Bob Lutz: 'Tough, more authoritative approach' is critical in academics, business world
Bob Lutz has a lesson for educators and business leaders: Tough love and discipline are necessary to both train America’s youth and run a successful company.
That’s the message the former vice chairman of global product development for General Motors delivered at a Washtenaw Economic Club luncheon Monday afternoon.
Former General Motors Vice Chairman Bob Lutz speaks to reporters at the North American International Auto Show in Detroit a few years ago.
AnnArbor.com file photo
Lutz — who lives in the Ann Arbor area and recently wrote the book “Car Guys vs. Bean Counters: The Battle for the Soul of American Business” — outlined some of the issues with management styles in the United States.
“In the 1990s, consultants were telling us the authoritarian management style is wrong,” Lutz explained. “They said we should have a friendly management style and conference rooms had signs saying, ‘There’s no such thing as a bad idea.’”
Bob Lutz supports a 'tough love' management style.
John F. Martin | General Motors
“This has become the way we manage in the U.S., with the hands-off CEO,” he continued.
Lutz said this style of management, lacking in tension and conflict, rids of constructive dialogue. Lutz’s message Monday reflects that of his book, which derides the incompetent managers who drove the U.S. auto industry into the ground.
“At (General Motors) people said failure was circumstantial, or, ‘You did the best you could, it wasn’t your fault,’” he said.
He continued: “The two most successful car companies in the world right now — Volkswagen’s Audi…and Hyundai KIA — are run absolutely top down. Failure is not tolerated…If you screw up, you’re out.”
Lutz also credited the turnaround of Detroit’s “Big Three” auto manufacturers partly to “much tougher” executives — Dan Akerson of GM, Alan Mulally of Ford and Sergio Marchionne of Chrysler.
“A tougher, more authoritative approach is being taken by all three,” he said.
Aside from the automotive industry and business world, Lutz said this same lesson should be stressed in the education system, turning away from what he calls the “self-esteem movement.”
“We trained a generation of young Americans that they get the gold star whether their stuff is any good or not,” he said. “In doing that, we drastically lowered the standards and frankly, we’re turning out a bunch of functional illiterates.”
He said young people should be trained with “real world, necessary skills,” such as automotive maintenance and automotive repair, rather than earning degrees in the liberal arts sector.
“This type of education actually trains young Americans for careers that are in high demand,” he said. “It really bothers me that so much of formal education and so many politicians are saying, ‘Everybody has to have a four-year degree in film appreciation and environmental studies.’”
Lutz also said:
--The Obama administration had “absolutely nothing” to do with the Chevrolet Volt, despite claims by some conservative critics.
--He’s “very enthusiastic” about clean energy and believes there is a good chance the U.S. can be petroleum and gas independent by 2015 or 2016.
--Ford, GM and Chrysler are all producing the best products in the companies’ histories.
--The automotive company with the strongest global presence, particularly in China, is positioned to “be number one and well-off.”
Lizzy Alfs is a business reporter for AnnArbor.com. Reach her at 734-623-2584 or email her at lizzyalfs@annarbor.com. Follow her on Twitter at http://twitter.com/lizzyalfs.
Comments
Enso
Tue, Apr 24, 2012 : 12:37 p.m.
"Bob Lutz has a lesson for educators and business leaders: Tough love and discipline are necessary to both train America's youth and run a successful company." Tell that to Google, one of the most laid back and successful companies the world has ever seen. Also funny when you consider this guy is from a company that failed. Thanks Obama!
Bcar
Tue, Apr 24, 2012 : 5:15 p.m.
...And how hard do Google people work when they are working? I bet their efficiency numbers are quite high.
Bcar
Tue, Apr 24, 2012 : 10:41 a.m.
While I personally don't agree much with Lutz, other than with his passion for all things fast. And don't think he had much to do with GM turning around (That was **ALL** Tom Stephens, who just retired, unfortunately...). He's partially right, we're creating a generation of "we're all winners!" And we all get participation medals! That's not how it works in the real world and these kids will be at a disadvantage, competition and pay-for-performance are GOOD things. And I'm glad that many here in A2 don't agree with that, makes me stand out/rise that much more... ;) Sorry, but we dont need that many art history majors in the real world...(eyes rolling)
Bcar
Tue, Apr 24, 2012 : 5:20 p.m.
@Alan, I'm not saying those other majors aren't smart, or don't work hard, (some do work hard, but id still say not as hard as any tech major by a long shot!) but for them to expect to be paid what an engineer, accountant, physicist, etc. are paid is just plain stupid. I do think an engineer is worth more, does more, and should be paid more than an art history major. It amazes me when I see or hear these people expecting high salaries coming out of school in the business world with zero experience, zero real-world-useful knowledge thinking they're going to be supervisors with 30 days of paid vacation a year...ha ha ha!
alan
Tue, Apr 24, 2012 : 1:05 p.m.
While I certainly agree that the educational philosophy of "we're all winners" has been detrimental, I don't see how you equate that with one college major being more important than another. Those art majors are just as smart and worked just as hard as everyone else. Being a mathematician doesn't automatically make me smarter than the next guy. I know brilliant biologists who can't balance their own checkbook. I've been listening my whole life to physicists say that the engineers are dumb and mathematicians say that accountants couldn't hack it in math. It's all elitist and unproductive. Who should pick and choose which academic endeavor is more worthy?
JimB
Tue, Apr 24, 2012 : 1:32 a.m.
Lutz is trying to sell his lame book. His interviews over the last few months shows how much his views are outdated. The turn around in the industry is due mainly to a focus on quality. Not power.
alan
Tue, Apr 24, 2012 : 12:01 a.m.
'He said young people should be trained with "real world, necessary skills," such as automotive maintenance and automotive repair, rather than earning degrees in the liberal arts sector.' I think Mr. Lutz would have people study business, to be in charge, or a trade, to work for him. Does he realize that without the liberal arts we would have no mathematicians, physicists, chemists, historians, economists, etc. I cringe every time I hear someone say 'real world skills.'
Mike K
Tue, Apr 24, 2012 : 11:17 p.m.
Alan - the "modern" meaning of liberal arts does not include science and engineering. Look at any college ciriculum and you will verify this fact.
alan
Tue, Apr 24, 2012 : 12:48 p.m.
I have no idea what you're trying to say. Yes, math, physics, chem, biology, econ, history, poli sci, and the humanities are the liberal arts and have been since the conception of the modern university system. Non liberal arts include trade or career specific endeavors such as business, engineering, etc. I would suggest you not "LOL" at people for things that you apparently are not familiar with.
Bcar
Tue, Apr 24, 2012 : 10:36 a.m.
Since when are mathematics, physics and chemistry liberal arts?? LOL!!! Ha ha ha!!! Yay everyone get a medal and a $60k a year job with 30 vacation days! yay!
xmo
Mon, Apr 23, 2012 : 9:55 p.m.
Bob Lutz, was one of the rulers at GM that who helped them to become Obama Motors. I don't think we really need his advice. At least at Ford, Bill Ford Jr. knew he needed changed and got it, Lutz on the other hand thought that he was smart enough to save GM but he wasn't. Bob, enjoy your cigars, talk about electric cars and fade away!
Michigan Reader
Mon, Apr 23, 2012 : 9:13 p.m.
Bob Lutz is a great success---but, as John Lennon said, "Anybody can cook rice, but few can cook it well." Michigan Reader says that there are very limited Dan Akersons, Alan Mulallys, and Sergio Marchionnes. Not enough to go around. His (Lutz's) formula for turning around business and academia won't happen. This isn't the 1950's anymore.
Michigan Reader
Thu, Apr 26, 2012 : 12:12 a.m.
@Kara H--My point with the "rice" comment was to say that talented and skilled people are relatively rare. There ARE a limited number of people around who are outstanding in their fields. Whether John Lennon said it is irrelevent.
Kara H
Mon, Apr 23, 2012 : 11:50 p.m.
I'm going to call you on this one. John Lennon did NOT say that about cooking rice (anyone can, in fact, cook it well). And if he did (I remain dubious), it was not his finest or most cogent moment, I wouldn't toss it around as wisdom of the ages.
bhall
Mon, Apr 23, 2012 : 8:52 p.m.
Lutz has some gall. Remind me, was GM a successful company while Lutz was there? Didn't think so. His advice isn't worth the pennies of electricity it cost to transmit these bytes.
Kara H
Mon, Apr 23, 2012 : 8:48 p.m.
So glad he's now merely a footnote in business and automotive history. Why do guys like him still get any coverage at all? His "success" examples and conclusions are merely anecdotal with no apparent facts to back them up except his opinion. That said, I'm all for accountability in business (and life in general). I'll take a pass on the para-military approach Mr Lutz seems to favor though.
Mike
Mon, Apr 23, 2012 : 8:44 p.m.
This country is becoming soft and our overseas competition can smell blood in the water. We raise ours kids to all be nice and get along; "no fighting", "use your words", "be nice", "social and economic justice", etc. while the rest of the world laughs and eats our lunch. Everyone gets a medal, nobody competes anymore. Who would want employees like this? Is this what made America great? Or is this wht's going to break this country?
Mike K
Tue, Apr 24, 2012 : 11:14 p.m.
Peregrine - that would be union thuggary you describe, and may be the very reason jobs are going overseas to individuals that want to perform them. Mike is right. Terms like "social and economic justice" are high ideas. Look at what they've done in Europe.
ffej440
Mon, Apr 23, 2012 : 9:44 p.m.
your joking, right?
Peregrine
Mon, Apr 23, 2012 : 9:20 p.m.
So you think we need more black eyes, teeth marks, blood, and bullying?
cgerben
Mon, Apr 23, 2012 : 8:15 p.m.
Feel free to come into the classroom and try that out, Mr. Lutz. We'll see how your hard nose approach works out.
Steve in MI
Mon, Apr 23, 2012 : 7:59 p.m.
Shorter Bob Lutz: "guys like me need more power".
justwondering
Mon, Apr 23, 2012 : 7:52 p.m.
Mr. Lutz is no longer relevant in the business world or class room. His authoritative tough love top down style of management got Ford in trouble. He left and went to Chrysler and got Chrysler in trouble. Left and went to GM which isn't doing as well as it should. While it isn't right to pin the fortunes of a company on one person, he went to each company in the highest ranks of management where he made his mark and he contributed, in probably a large measure, to the outcome of those companies. Come on, enjoy your retirement and do some fishing.
A2K
Mon, Apr 23, 2012 : 7:19 p.m.
Say's the "bigger is always better" guy who consistently failed at Chrysler - a company that was so "Top Down/Top Heavy" that when Daimler came in , they were horrified at the excesses and waste perpetrated by management...a company culture that allowed Top Down decisions on everything, a culture that thrived on backstabbing, nastiness, and general lack of accountability...but only for managers. The LAST thing we need is more authoritarian management - it's EXACTLY what we've gotten the last 10-15 years (aka, where it's been draconian measures, squeezing employees until they drop/combining 2-3 positions into one (supposedly temporarily, but never hiring to fill vacancies despite record profits)...I could go on! Lutz also doesn't believe in Climate Change, despite incontrovertible evidence, which I find completely flummoxing and proof that the "kind of cars" isn't firing on all cylinders.
bhall
Mon, Apr 23, 2012 : 8:54 p.m.
I agree totally. The idea that someone who denies science should tell educators what to do is absolutely maddening.
Suzanne
Mon, Apr 23, 2012 : 7:16 p.m.
Gee...I wish he was in the Presidential race!