Lessons to be Learned from GM’s Fall

If one of the biggest and best companies in the world can fail, is anyone safe? The short answer is no. But, there are valuable lessons to be learned from the demise of General Motors.

David Schwinn is a full-time professor of management and worked at both GM and Ford. Professor Schwinn presented an insightful article for QualityDigest.com that explained what lessons could be learned from the GM experience and how those lessons can help other companies, even those not nearly as large as GM.

Ford revolutionized the auto industry in 1908 by listening to what the consumer wanted when they introduced the Model T – an inexpensive car in a time when many Americans couldn’t even consider buying a car. By the 1930s, consumers want more and GM listened. They offered styling, features, and choice. GM grabbed the industry lead and kept it for the next 70 years. As the leader, GM became complacent and not as quick to listen to consumer wants. In the 1970s, Japanese automakers challenged the industry leaders with superior quality. GM was slow to catch onto the quality game. When you’re the leader, it’s harder to learn.

So, what lessons can be learned from GM? GM was an example of learning at its best in their early years, but the quality of that learning waned over time. GM forgot to keep learning and it cost them dearly. I’m reminded of the quote about those who fail to learn from history are doomed to repeat it. Companies that fail to keep learning, that fail to keep innovating, run the risk of becoming irrelevant and losing whatever lead they may have once enjoyed.

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