Racial justice, austerity and ventilators: GM CEO Mary Barra talks about her year of rapid change and accountability

When COVID-19 entered GM’s radar in early 2020, CEO Mary Barra knew she had to move. As the virus spread, she closed plants, instituted austerity measures — 20-30% temporary pay cuts; zero-based budgeting; massive ad spending reductions — and, incredibly, retooled a Kokomo, Ind., component plant into a ventilator production factory. I’d heard Barra refer to herself as an “action-oriented” leader, but this was a different level. 

And when the killing of George Floyd, Breonna Taylor and so many more Black Americans sparked a movement, Barra quickly set out to put her 164,000-person company at the forefront of it. In early June, she stood with Detroit’s mayor and declared a goal of making GM “the most inclusive company in the world.” She then committed to channeling $10 million to organizations promoting inclusion and racial justice, including an initial $1 million donation to the NAACP Legal Defense and Educational Fund.  

On this week's This is Working, I talked with Barra about the process of steering her 112-year-old company through this year of crises. From her book-lined home office in Michigan, she detailed the lessons that came from preparing GM, country by country, to make it through the pandemic — and to emerge even more competitive. We also talked about the Black Lives Matter movement and how she plans to keep the company focused on GM’s commitments even after the protests fade.

On that last topic, Barra drew a parallel that surprised me: GM’s 2014 recall scandal, in which the company concealed information about faulty ignition switches that were later linked to 124 deaths and 275 injuries. Inside GM today, talking about that dark period is part of the culture; there’s even an annual “safety week” born from the scandal. Barra insists on reexamining the wound to remind everyone of how things can go fatally wrong and how a safer company can emerge. She wants the same attention applied to inclusion.

“It's my responsibility as the CEO of this company to make sure it doesn't fall off the agenda,” she told me. “I think by setting goals for ourselves in the short, medium and long term, we can then hold ourselves accountable. And I expect the GM team to hold me accountable.”

Edited excerpts:

The cars-to-ventilator switch happened after Barra got a call from #StopTheSpread’s Ken Chenault, the former CEO of American Express, who connected her to medical-device maker Ventec:

“The team [met with Ventec and] said, we think we can do this, but we have to take an operation that's building about 200 to 300 ventilators a month and we want to get that up to 10,000.

"The speed was incredible. From when that first visit occurred, to being in Kokomo, Indiana, at the plant [with] the first ventilator rolling off the line, literally was a month. And that was a work of almost every function in General Motors: from quality to production, to manufacturing, to legal, to finance. Everyone had a role to play. And we leveraged all of our processes that we do when we launch a new vehicle.

"One of the really cool stories was there was a part in the ventilator that acts very similar to components in a transmission and our transmission engineers worked on helping improve a quality issue.”

The company is on pace to complete 30,000 ventilators by the end of August. Barra said she didn’t realize how deep the work had reached into GM until she visited. It taught her a management lesson:

“We had experts from every area and they knew they were empowered to do what needed to be done, to call whoever. There was no, “Can I call someone?” No, they made the call. When I went down to Kokomo to visit the team I didn't even realize how many resources from General Motors were working on the project, but it was just amazing to see. 

“And so one of the things that I'm personally taking away is to empower people and let them go. We were able to reduce a lot of the bureaucracy and now people in the company talk about it: ‘We want to do it ventilator fast.’ I love the fact that people felt empowered and are transferring that lesson to other parts of our business. 

“Because if we empower people, you know, occasionally we might have an issue, but 99% of the time, it's probably going to work out great. The team showed us what they could do.”

I asked her about how she makes sure inclusion goals aren’t just empty words. She said the key is treating this no different than she treats any other business goal.

“We want to move quickly and we want to act, but we want to make sure that we're acting in a way that is really going to address the problem and drive systemic change. So we'll listen. And through that, once we set our goals, we'll measure ourselves and hold ourselves accountable to those goals, no different than we are holding ourselves accountable to launch electric vehicles in a timely fashion across all segments.”

But goals don’t tell the full story. Barra said you also need culture change. She mentioned that every year at Global Safety Week, GM has a customer come in and tell their story of how a GM product saved their life — and why that applies here:

“Stories stay with you… that's what keeps people motivated and committed. So it's not always focusing on the negative. It's focusing on the positive and showing the work we do and how important it is to people's lives. And that's why I think there's a lot of parallels to what we're talking about of how we're going to create a truly inclusive environment.”

And one last note: Barra mentioned that even in the darkest days of the pandemic, GM refused to cut anything related to electric vehicles. Here’s why:

“We believe in an all electric future. So as we entered the pandemic, we looked at every single cost line-item in the company. We early on made a commitment that we didn't want to do anything that would stop our transformation and the development of electric vehicles… We didn't want to slow that down. In fact, we're looking for opportunities always to continue to accelerate that. 

“Engineers and cross functional teams found ways to get the work done in the development of these vehicles, even when they were working from home. And so we were able to do virtual builds with everybody using WebEx or different collaboration tools... It did surprise me though, how much we could still keep moving forward when everyone was working from home. That's something that was a lesson learned and we'll continue to build on.”

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