In a press briefing last week, Vice Chairman Robert Lutz and President of GM North America Gary Cowger said a team has been comparing GM's creative process to those used by competitors.
GM's goal is something like the fast-moving product machine Lutz helped build at Chrysler Corp. in the 1990s, where empowered designers and engineers cut costs and built a string of popular cars. Brand management will take a back seat, functioning more as a traditional marketing department.
Lutz spoke glowingly of GM's efforts to merge divisions into a unified company, saying it already "resembles what I remember from Chrysler, a very simple, easy-to-understand organization." But he said GM's product-development process has lagged, adding that he and Cowger expect to announce changes "fairly soon."
Their comments indicate the changes will include:
Fighting 'content creep'Vehicle line executives who report to Lutz will gain power over product content decisions as GM seeks to fight "content creep" that adds nonessential standard equipment - a longstanding Lutz target.
Lutz said the problem occurs at all automakers as marketers seek to add selling points to vehicles.
"You have a lot of so-called brand-marketing people who are helping to specify the next great new vehicle and they realize that at some point they're going to be responsible for selling the thing, so they want as high a feature count as they possibly can," Lutz said.
"It's just natural for one side of the organization to drive all of these features in, and the side of the organization that's in charge of making sure we have margins has to fight that."
Vehicle line executives will make the calls, Lutz said, because they will be responsible for the "contribution margin" - the difference between the cost of making the vehicle and the wholesale price.
"They'll be responsible for a percentage and an absolute amount, so that they have the power to say no," Lutz said. "They must have the power to say no."
Vehicle line executives now work in partnership with vehicle brand managers.
Divisions, not modelsBrand marketing will continue at GM, Cowger said.
"You'll tend to see us err on the side of product, but completely embracing and suppporting the brand structure," Cowger said. "The brand focus is key in this marketplace."
But Lutz and Cowger described a role of marketers that centers more on assessing competition and developing marketing plans than on product creation.
Lutz praised Zarrella, now CEO of Bausch & Lomb Inc., who brought the brand-management gospel to GM. But Lutz said, "We will be proposing some changes to make the whole system more effective," adding that brands will be defined as divisions, rather than models "that live under the umbrella of the brand."
Vehicle level brand managers will stay in place, he added. But the Zarrella-era title may be dropped. Said Lutz: "It might in the future be called a vehicle line marketing manager rather than a brand manager, but a lot of the function is still required."