April 5, 2006
CEO of GM Offers Advice by Example: Do
What You Love, Remain Optimistic
By Laura Griffin
Some have said that Richard Wagoner Jr. has the toughest job in America.
As CEO and chairman of General Motors, the world’s largest automaker, he
has had to make some unpopular decisions in the wake of GM’s financial
difficulties in recent years.
During a Q&A presentation March 30, moderated by McCombs School
management professor James Fredrickson, Wagoner—who has worked for GM
for 29 years—said the last six months have been more challenging than
the 28 and a half years before it, but he expressed an encouraging
outlook for the future of the company.
“We can’t change history in two months, but we’re going at it very
aggressively and very thoughtfully,” Wagoner said. “I think it’s
interesting that we are six months into these massive changes and our
people are still on our side.”
While GM is currently facing a lot of criticism, Wagoner discussed how
easy it is for critics to suggest fixes without intimately understanding
the company’s problems.
“When things are down, there is no end of people that can offer advice,”
he said. “Some of it is reasonable; some of it is from people who know a
lot less than we do.”
GM is known for its complicated but generally good relationship with the
United Auto Workers union. Despite this, Wagoner said that GM’s benefit
structure and large retiree base has definitely been a competitive
disadvantage—GM executives have said that the company spends more on
health care than it does on steel for its cars. But the union has a
clear view of those challenges.
“The fact is that if we are not successful, our union is not going to be
successful, and so we have a shared interest in our future,” he said.
Wagoner explained that GM’s problem is not the union, it’s the cost of
American health care.
Wagoner earned a degree in economics from Duke University and an MBA
from Harvard. He entered GM’s workforce almost immediately upon
graduation and has worked for the corporation ever since.
The CEO remains optimistic about GM’s future. While he said the company
will always proactively address difficult issues, Wagoner is looking
forward to advances in the auto industry. He anticipates a technological
revolution, including widespread use of hydrogen fuel cells and vehicles
with the ability to communicate with each other to create a safer
driving environment.
He advised students to enter a field they will enjoy rather than
focusing on a field that might be lucrative. “The car industry is
certainly not the easiest, but it is an exciting industry,” he said.
“When people ask where you work, you don’t have to explain; they know
what General Motors is.”
Wagoner also noted that within the auto industry, wherever GM plays, it
plays big. “We get to deal with a lot of government and regulatory
issues,” he said. “We have a very interesting distribution model, and we
get to deal with some of the most advanced technology of our time.”
There are also a few personal perks. “Every weekend I have an excuse to
test drive a brand new car.”
For information on specific programs at the McCombs School, consult our contacts page. For media information, contact the Communications Director by phone at 512-471-3314 or by email at CommunicationsDirector@mccombs.utexas.edu.
