My Years with General Motors
A major American corporation—one that has played a huge roll in the overall economy and our country's history, helping us win World War II and change the very way we traverse the earth—is being threatened with bankruptcy today. It's CEO has been ordered to resign by the most powerful man in the world—The President of the United States of America.
General Motors was built with the labor of millions of American, and the vision of one man. If it weren't for Alfred P. Sloan, Jr., GM would probably not have lasted through the First World War to help us win the Second. He took over the company in it's infancy, when it was in as deep trouble as it is today, and engineered it into the keystone of the American economic engine, literally driving us into the 21st century. Unfortunately, it has been very nearly driven into the ground by those who have come after Sloan (or, possibly, by circumstances beyond their control—if you are of that opinion).
Regardless of how you believe we came to this sad point in the company's history, GM has a very influential past, and Alfred Sloan is largely responsible for that. He arrived at GM when the company he had been running at the time (in 1916), was bought by General Motors for $13.5 million dollars. Mr. Sloan would be running all of GM by 1923, and would remain at it's helm until 1956. In that time, he would: help win a war; be instrumental in changing public transit by buying up most of America's streetcar companies and slowly replacing them with buses; form the blueprint for how American Corporations bargain with Labor Unions; and make his company the leader of the incredibly powerful auto industry. And when he retired, he wrote a book about it, My Years with General Motors.
The book is a very serious undertaking, and one of the most boringly fascinating books (more on that later) you'll ever read. It is so detailed that Sloan literally recounts meeting minutes, from the records kept of them, throughout the book. And, it is that detail that is so valuable to anyone interested in the discipline of management, that helped define management as a discipline, and that has helped countless managers—from its publication in 1963 to the present day—understand the role they are stepping into and thrive in it. It should be required reading for the new leadership team at GM.
"Confidence and caution formed my attitude in 1920. We could not control the environment, or predict its changes precisely, but we could seek the flexibility to survive fluctuations in business."
One of the first things Sloan did upon taking over the company was structure its divisions in a way that they were no longer directly competing with each other, but with other companies—Chevrolet competing with Ford at the bottom end and moving up in quality and price through Oakland (now Pontiac), Buick, Olds(mobile) and Cadillac, all competing with separate, individual companies in different luxury classes. By the time I was growing up in the '80s, GM products seemed indistinguishable from one another and, other than the Cadillac, my family owned numerous (used) models of all those brands.
Having three older brothers, I sat in the front seat of all of them, in between my parents, dangling my feet near the cup-holder, careful not to knock my Dad's Coke bottle over. I learned what the word "Regal" meant by reading it over and over again on the glove box of a blue Buick. GM dominated the Midwest then, manufacturing huge "boats" that sailed the blue highways of that region, full of screaming children on their way to visit Grandma or the grocery store, to Prange Way or a Little League game.
That was all I really knew about GM until I arrived here at 800-CEO-READ and was assigned Sloan's book while interviewing for my current position. And, not knowing anything about the auto industry beforehand, never having even owned a car, I now know as much about the history of the auto industry as Alfred Sloan has to teach in 500 pages, which is, as you can imagine, quite substantial. And that is power of books—especially The 100 Best Business Books of All Time.
I know, for instance, that in 1924, "The inertia-type transmission did appear to have great possibilities technically, but in actual performance it did not prove to be sufficiently smooth or long-lived to warrant production" (Page 110). (If you'd like to read the compartive essay I wrote of this book and A Business and Its Beliefs by IBM's Thomas J. Watson Jr., you can find it here.) And, though the book is very specifically about the auto industry, it's lessons don't limit themselves to that industry alone. Bill Gates believes it to be "the best book to read if you want to read only one book about business."
It's a good choice. Reading My Years with General Motors is the only time I've ever been kept up at night contemplating the minutes of a meeting I never attended or contemplating the production numbers and stock prices of a company during The Great Depression. It is this book that helped define management as a discipline, which we now take for granted. I would have thought it boring, and I guess it might have been, but it is also fascinating, and important, and entirely relevant. It's a page-turner, always leaving you wanting to know what decision was made or event happened next. The lessons and management acumen of Alfred P. Sloan are direly needed at GM today. I would even suggest that the future of that company, and maybe even our very economy as we know it, depend on it.
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