DETROIT - GM Chairman Jack Smith took stock of GM's decade of cost cutting in a March speech to stock analysts. His comments on:
Just how bad was it, Jack?
"The place was a mess. We were the high-cost producer. We had unbelievable excess capacity. We had multiple vehicle and component divisions, all of them doing things differently. We had a huge central office. We had over 13,000 people with an elaborate maze of policy groups trying to coordinate the businesses, not to control them.
"In short, we did not look like any other manufacturer in the world. We were the tattered remnants of what (former president) Alfred Sloan had put together in the early 1920s."
"We moved from an old-boy system, a good-old-boy system, if you will, to a competitive bidding process where the focus was to have contracts that had prices declining year over year for the length of the contract. You have to compare that to what we did in those days, which was essentially to have price increases year over year for the life of the contract."
"We had to break down the culture of divisional autonomy and internal competition, with its incredible redundancy and duplication."
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