General Motors Co. lost a key asset last week when Fritz Henderson left the automaker to take a job as senior vice president of oil giant Sunoco. He had been serving as a consultant during his final months at GM, following his firing last year as chief executive officer.
Don’t be surprised if Henderson’s career prospers at Sunoco. Over 26 years he rose to the top of GM on merit, having shown a willingness to cut costs and rare (within GM) courage to confront union opposition, notably in Europe. Before his European stint he had run GM’s Asian operations, shoring up alliances, especially in China, helping to create one of the automaker’s most reliable moneymakers.
"The firing of Fritz Henderson was a triumph of politics over common sense. Fritz combined the necessary experience and the ability to change that would have served General Motors well. But the political clamor for 'new leadership' gave him no chance," said Steve Miller, chairman of AIG, in an e-mail message. Miller had been CEO of Delphi, GM’s biggest parts supplier.
GM relied on Henderson’s expertise behind the scenes following his exit as CEO in the post-bankruptcy transition of overseas operations, especially in Asia. The company was caught short due to the transfer of top GM executive Nick Reilly, from Asia to Europe, according to a former GM colleague of Henderson’s who agreed to speak on condition of anonymity.
"A lot of people thought the $60,000 or so a month GM paid him from February to October was a way to get some money in his pocket because he didn’t get the severance he deserved when he was fired,” said the colleague. “He told me he worked very hard” in his final months.
Henderson, widely regarded by peers as one of GM’s brightest and most able executives, had been No. 2 to Rick Wagoner when the U.S. government fired Wagoner in April, 2009. For about six months, and during bankruptcy proceedings, Henderson served as GM’s CEO. But then the GM board, dominated by new government-appointed directors, fired him. Next came the short and ineffectual tenure of former AT&T CEO Ed Whitacre, a newcomer who by his own admission knew next to nothing about the automobile business.
Steve Rattner, who served as head of the government’s automotive task force, wrote in his new book Overhaul that Henderson was never intended as an interim replacement for Wagoner. GM’s board, without public explanation, decided Henderson wasn’t cutting it as CEO.
Henderson may have been blamed for championing the sale of GM’s troubled European operations, a strategy the board later reversed. A bigger issue may have been GM’s famously hidebound culture, which is slow, deliberate and arrogant at a time when the board wanted it to become nimble, feisty and humble. The board, according to one member, decided that Henderson ultimately wasn’t the right executive to lead a cultural change.
After Henderson’s firing, GM board chairman Whitacre declared that GM directors were looking outside GM for a new CEO. Whitacre and the board then discovered that attractive candidates weren’t exactly falling all over themselves to apply, so he took the job. In August, as GM was announcing its intention to file for an initial public offering of stock, Whitacre shocked the outside world by announcing his resignation as CEO in favor of Dan Akerson, another new GM director.
Akerson, like Whitacre, has little experience with the critical details of running a global automotive company. He’ll learn quickly, though perhaps not quickly enough to compensate for GM’s lost momentum during the past two years of bankruptcy and management upheaval.
A bit of local knowledge, furnished by someone with Fritz Henderson’s experience and ability, would certainly come in handy.