You are viewing this article in the AnnArbor.com archives. For the latest breaking news and updates in Ann Arbor and the surrounding area, see MLive.com/ann-arbor
Posted on Tue, Dec 1, 2009 : 5:12 p.m.

General Motors CEO Fritz Henderson's resignation driven by need for cultural changes

By Nathan Bomey

For General Motors, disruptive change offers the only plausible way forward.

Fritz Henderson.jpg

GM CEO Fritz Henderson, pictured here at a press conference discussing the Chevrolet Volt, resigned today.

Photo courtesy of GM

The company accelerated its changes today as GM announced CEO Fritz Henderson has resigned, and GM Chairman Edward Whitacre Jr. will become CEO effective immediately.

"Fritz has done a remarkable job leading the company through an unprecedented period of challenge and change, and momentum has been building in our company in the past few months," Whitacre said in a brief statement to reporters by phone conference and in person. "But we all agreed that some changes need to be made going forward."

Whitacre's intentionally disruptive management style surprised entrenched GM executives in the weeks after he assumed the chairmanship in the wake of GM's bankruptcy this summer.

His assumption of the day-to-day leadership role at GM means the automaker can expect faster cultural changes.

GM needs innovative products to survive the shifting complexion of the automotive industry.

But developing an innovative culture offers the only route to innovative products.

"Unless you have the leadership, unless you have an innovation culture, it's very difficult to be innovative at companies that have not had that historically," Larry Schmitt, co-founder of Ann Arbor-based consultancy Inovo Technologies, said recently.

Cultural change is sure to be Whitacre's chief objective.

Fritz Henderson, who shepherded the domestic automaker through the most tumultuous period in its history, understood the need for cultural change more than his predecessor, Rick Wagoner. But clearly GM's board was not satisfied with the pace of change after the company emerged from a brief bankruptcy this summer.

"I remain more convinced than ever that our company is on the right path and that we will continue to be a leader," Whitacre said. But "we now need to accelerate our progress toward that goal which means a return to profitability and repaying the American and Canadian taxpayers as soon as possible."

Whitacre told reporters today that GM's "business operations will continue as normal." GM's only manufacturing plant in Washtenaw County, the 5-million-square-foot Willow Run facility, was already scheduled to close by the end of 2010, displacing some 1,364 workers.

GM this summer survived an incredibly turbulent period due to intense cost-cutting and $50 billion in loans from the government, which now owns 60 percent of the company. In the bankruptcy, the automaker was split into two companies, General Motors Co., the new version of GM, and "Old GM," otherwise known as Motors Liquidation Co., which is shedding unwanted assets such as the Willow Run plant.

Contact AnnArbor.com's Nathan Bomey at (734) 623-2587 or nathanbomey@annarbor.com. You can also follow him on Twitter.

Comments

81wolverine

Wed, Dec 2, 2009 : 11:53 a.m.

It's too bad the GM Board of Directors in past years did not take the aggressive approach they are now to create change at the company. But that's a common problem at a lot of publicly-owned companies. Boards are often comprised of "rubber stampers" who approve everything the CEO recommends, or simply don't take the job that seriously. This has to change in this country to help avoid some of the poorly run companies from being run into the ground by management. Directors either need to be compensated better or selected using other criteria, or both.

mermaid72

Wed, Dec 2, 2009 : 8:47 a.m.

Wonder what color his parachute is? Platinum or gold?

stunhsif

Wed, Dec 2, 2009 : 8:19 a.m.

Heh John Gault and braggslaw, I do totally agree with you guys but I am a hypocrite because I knew that the gov't bailing out GM would help us here in Michigan with our home values etc so I was kinda for it. Basically I was willing to hurt all the taxpayers in the USA so that I, living here in Michigan could benefit. I also own an 08 Saab Turbo X which I love and that brand is apparently going to die. So there we go, I feel better by publicly admitting what a lousy hypocrite I am. Finally for once and to a certain degree, I was able to benefit from the gov't bailout by keeping Michigan residents employed that would otherwise have lost and that would have hurt the Michigan economy. I know guys, don't beat me up, I am a louse!

John Galt

Tue, Dec 1, 2009 : 11:44 p.m.

No self respecting business person would take a CEO job at Government Motors.

braggslaw

Tue, Dec 1, 2009 : 8:38 p.m.

Goodbye to "give it away for free" Fritz