The Tactics of Crisis Management

Context

Mary Barra’s life and career have long been intertwined with the history of General Motors even before her ascent as an executive. In Michigan, where Barra grew up, her parents experienced the devastating financial toll of the Great Depression on working-class Americans.

This family history paved the way for Barra to build a lifelong career at the carmaker. Her father, a factory worker at GM, instilled in his daughter the virtues of honesty, hard work and perseverance.

At age 18, Barra began working as a quality inspector on the assembly line at GM to augment her college tuition payments. Her early exposure on the shop floor gave her insights into the operations of GM and how these reflected decisions at the top. These lessons would later prove vital, especially in her first year as CEO surviving a major recall crisis.

What makes Mary Barra a remarkable WarTime CEO?

Real-Life Story

In a profession historically dominated by men – whether in the boardroom or the factory line – Mary Barra rose through the ranks managing different divisions. At various points in her career with GM, she was a plant manager; the executive vice president of global product development; the executive director of operations engineering; and the vice president of global human resources.

In 2014, Barra was named CEO of GM, becoming the first woman in history to stand at the helm of a global carmaker. And while her ride to the top has seen its share of bumps on the road, she maintains a clear vision of the path ahead.

Not long after Barra’s appointment as CEO, GM confronted one of its most critical production challenges to date: the discovery of a defective ignition switch that had purportedly led to over 100 deaths.

The crisis sparked a chain of events – from the recall of 2.6 million vehicles, to the termination of negligent employees, to the implementation of newer, more stringent safety measures.

An independent investigation into the scandal found a “pattern of incompetence and neglect” at GM. This prompted Barra and her team to fire at least 15 employees, including executives, who allegedly failed to uphold safety standards.

Barra conducted a daily crisis management check-in with key team members and sharpened the company’s focus on customer care and transparency.

More importantly, she issued a public apology over the scandal and followed through by setting up a compensation fund for all victims.

Barra put customer safety first and mobilised all divisions to work towards that goal in engineering better vehicles. “The most important thing [GM has] to drive into the business every day is that it all starts and ends with a great product,” Barra told the Los Angeles Times.

The crisis became a litmus test for Barra. Not only did she face the challenge of rectifying errors in GM’s operations. She also led an overhaul of the company culture, stressing the value of safety, transparency and innovation and steering away from a culture of bureaucracy and secrecy.

PostScript: Barra’s most remarkable trait as a WarTime CEO is her ability to survey the landscape that GM treads, from a strategic and tactical point of view. She knows the company and its inner workings well enough to see where gaps (and potential crises) might emerge, the way a good war strategist maintains oversight.

Yet, she has the intuition and sense of urgency to address issues decisively and head-on, the way a good tactician leads their troops on the battlefield.

Exemplifying leadership excellence in her industry, Barra was inducted into the Automotive Hall of Fame in 2023. She remains one of Corporate America’s most highly respected CEOs.

Key Lessons

1) Knowing your battlefield

Like Barra, who had deep insights into GM’s operations from her early years on the shop floor and as a plant manager, WarTime CEOs understand their company’s inner workings to anticipate challenges and identify potential crises before they escalate.

2) Leading with transparency and accountability 

Barra’s handling of the recall crisis, where she emphasised transparency and took decisive action against negligence, underscores the importance of confronting issues head-on and maintaining accountability at all levels.

3) Putting the mission first 

Barra’s unwavering focus on customer safety during GM’s crisis illustrates how WarTime CEOs prioritise the core mission above all, ensuring every decision aligns with the company’s most critical goals.

4) Balancing strategy with tactics 

Barra’s ability to navigate GM’s crisis involved both strategic oversight and tactical execution. WarTime CEOs see the big picture while also making quick, decisive moves to address immediate threats, much like a general commanding forces on the battlefield.

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Until next week, may the force be with you.

Kevin

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