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NYT's David Brooks takes a sober look at GM bankruptcy

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June 2, 2009 12:03 pm
By Peter C. T. Elsworth

Columnist David Brooks has a sober look at the General Motors bankruptcy in today's York Times and I think he brilliantly puts his finger on a couple of key potential problems: corporate inertia and the inevitable mixed signals involved when the government gets too involved in private sector.

Having worked for three corporations - Reuters, The New York Times and now A.H. Belo Corp.'s Providence Journal, I can attest to the important role that politics plays in such organizations.

Brooks refers to corporate "mind sets and relationship patterns" that determine so much of the internal structure of an organization and its consequent direction and policies.

The result is that clear, hard and new thinking all too often takes a back seat to the same cast of characters reinventing "the way we always do things."

And having grown up in Britain I can attest to the government's disastrous involvement in the auto industry there.

I just hope Brooks' analysis of the GM situation proves wrong. Here is the beginning and a link to the rest of his column:

The Quagmire Ahead

On Jan. 21, 1988, a General Motors executive named Elmer Johnson wrote a brave and prophetic memo. Its main point was contained in this sentence: "We have vastly underestimated how deeply ingrained are the organizational and cultural rigidities that hamper our ability to execute."

On Jan. 26, 2009, Rob Kleinbaum, a former G.M. employee and consultant, wrote his own memo. Kleinbaum's argument was eerily similar: "It is apparent that unless G.M.'s culture is fundamentally changed, especially in North America, its true heart, G.M. will likely be back at the public trough again and again."

These two memos, written by men devoted to the company, get to the heart of G.M.'s problems. Bureaucratic restructuring won't fix the company. Clever financing schemes won't fix the company. G.M.'s core problem is its corporate and workplace culture -- the unquantifiable but essential attitudes, mind-sets and relationship patterns that are passed down, year after year.

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