GM crisis so enormous it almost defies the usual management approaches to success


Mary T. Barra’s honeymoon ended fast.

The new and first woman CEO of General Motors enjoyed the initial accolades, but was probably just heading out the door to visit GM facilities around the world when the ignition switch disaster hit. A disaster is a crisis magnified.

Target’s credit card breach is a crisis. Russia’s invasion of Crimea is a disaster.

The headlines tell the sad story:

The Wall Street Journal: GM Now Says it Detected Ignition Switch Problem Dating Back to 2001

NBC: GM Chose Not to Implement Fix for Ignition Problem

This is a crisis that is difficult to manage. It’s a BP oil spill. A Ford Explorer/Firestone tire mess. That’s because it has all the worst elements of a crisis: Deaths; a long time period of apparent disregard, or at least ignorance; lawsuits; and an enormous, slow-moving organization that will struggle to keep up with the information flow.

Here’s why it’s so bad. The usual approach to a crisis includes getting all the facts, especially all the bad news, out as fast as possible. Not only has it been 13 years in the making, but the facts dripped out, and mostly from media reports and plaintiff lawyers.

GM itself may not even know what it’s done and not done. This likely involves hundreds of people, some of whom may no longer work at GM. It also involves hundreds of millions of dollars of potential liability, especially if negligence is proven. And, finally, it involves GM’s relationship with government regulators, another aspect that will take years to parse.

The next aspect that’s often effective in a crisis is taking responsibility and apologizing sincerely. That’s likely off the table because the time duration would make any apology late and thin. And the legal liabilities prevent GM from “owning” this until it can figure out who did what when and why.

In other words, the usual approaches for managing a crisis are like arrows against the castle walls in this case. This is such a complicated set of circumstances that while GM needs to act, it’s actions will have very limited effect, and could backfire.

The best approach right now would be for Barra to announce an immediate investigation to gather all the facts and a promise to release those facts as soon as possible and let the chips fall where they may. This could be a simple bureaucratic screwup, or, it could be a major coverup of negligence.

The content of this blog is about crisis management and mismanagement in a digital age. It originates with Steve Bell, who spent 30 years as a journalist for the Associated Press and in four top editor positions at The Buffalo News. He is now Partner/Director of Public Affairs at Eric Mower + Associates, one of the nation’s largest independent advertising, integrated marketing and public relations agencies, with seven offices in the Northeast and Southeast. Learn more about EMA at www.mowerpr.com/crisisready . Steve’s blog is based on his own opinions and does not represent the views or positions of Eric Mower + Associates.

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About steveoncrisis

The content is about crisis management and mismanagement in a digital age. It comes from Steve Bell, who spent 30 years as a journalist for the Associated Press and as managing editor and editorial page editor at The Buffalo News. He is now Partner/Director of Public Affairs at Eric Mower and Associates, one of the nation's largest independent advertising, integrated marketing and public relations agency with six offices in the Northeast and Southeast.
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