What does it take to inspire people and defeat a bean-counting corporate bureaucracy? An autocrat in the boardroom with an allergy to consensus, says former Chrysler and GM executive Bob Lutz. Here is an excerpt from an article of his published by the Wall Street Journal. To read the complete article, please click here.
* * *
One of my favorite anecdotes about the long postwar decline of General Motors came from a senior executive in the advertising agency that served Cadillac back in the 1950s and ’60s. At the time, Jim Roche was head of the division. It was time to design the annual Cadillac Christmas card, and Mr. Roche instructed the agency to find something “heartland”—down-home American, an original work from a good artist. One painting found Mr. Roche’s favor: a snowy scene with a small boy pulling a sled upon which was tied a Christmas tree. The lad’s destination was a modest cabin on a hill, with a winding road leading up to it.
Mr. Roche loved it—but wait! Where was the relevance to Cadillac? He ordered away the small boy with the sled, to be replaced by a Cadillac sedan, with the trussed tree tied to the roof. The artist was able to render the Cadillac accurately and duly pasted it over the boy with the sled. The modified card was again presented to Jim Roche, but he discovered a new flaw: The humble cabin on top of the hill was no longer a suitable destination. Why would an achiever live in a dump like that?
The agency was told to make the dwelling more appropriate for a Cadillac family, so the artist went to work again and rendered a substantial residence, which required a major expansion of the hill it sat on. A second garage was also added, since Mr. Roche felt that a single-car garage looked out of place next to a home of that size.
At the final Cadillac Annual Christmas Card Review, all were silent until Mr. Roche, staring at the now-crusty watercolor, asked in his usual soft monotone, “Are those tires approved by engineering?”
“How’s that, Mr. Roche?” came the response.
“The tire tracks in the snow. They’re very pronounced. Is that an approved snow tire?”
Mr. Roche was righteously indignant over this blatant lack of due diligence and ordered one each of the “approved” snow tires shipped to the artist, who would have the freedom to decide which snow-tire pattern would be immortalized in the Official Cadillac Christmas Card. After that modification, it was finally approved, sent to the printer and mailed out.
Can anyone begin to fathom what that card cost—the material and intellectual resources that were squandered in its tortured path to perfection? Did any recipient of the card bother to look at the tire tread imprints in the snow? Was the card with the large house, the multicar garage, the expanded hill and the Cadillac sedan more appropriate and artistically meritorious than the original boy-with-sled?
In a normal corporate culture, a senior executive would have looked the card over, checked the text (easy in those days, since “Merry Christmas” was still a politically correct wish), and said, “Sure, looks good, get ‘em printed.” But not in GM’s supposed “culture of excellence,” where management had to improve on every detail, no matter how trivial.
The unfortunate thing is that Jim Roche so embodied the charisma-challenged, nitpicking, detail-focused perfectionist that in 1967 he became the chairman and CEO of GM.
* * *
Bob Lutz held senior leadership positions at GM, BMW, Ford and Chrysler over the course of a 47-year career. From his book, Car Guys vs. Bean Counters: The Battle for the Soul of American Business, published Thursday by Portfolio, a member of the Penguin Group (USA) Inc. Copyright © 2011 by Bob Lutz.
Here is an excerpt from an article written by Nicholas G. Carr for strategy+business magazine (Summer, 2007, Issue 47). To read the complete article and check out the magazine’s other online resources, please click here.
* * *
The open source model can play an important role in innovation, but know its limitations.
Ten years ago, on May 22, 1997, a little-known software programmer from Pennsylvania named Eric Raymond presented a paper at a technology conference in Würzburg, Germany. Titled “The Cathedral and the Bazaar,” the paper caused an immediate stir, and its renown has only grown in the years since. It is now widely considered one of the seminal documents in the history of the software industry.
Raymond’s subject was the open source software movement, as exemplified by what was then — and still is — its most famous product, the Linux operating system. Open source projects, he pointed out, represented a radically new method of software development. Traditionally, sophisticated programs had always been “built like cathedrals, carefully crafted by individual wizards or small bands of mages working in splendid isolation.” An open source project, in contrast, was the product of a large and informal community of volunteers who in aggregate “seemed to resemble a great babbling bazaar of differing agendas and approaches.” What was amazing, Raymond wrote, was that “the Linux world not only didn’t fly apart in confusion but seemed to go from strength to strength at a speed barely imaginable to cathedral-builders.”
The bazaar model of “peer production” was unthinkable before the Internet came along. It was only when software programmers around the world gained access to a cheap, high-speed communication network that they could start sharing their code in a speedy and efficient manner. As Raymond observed, it was probably not a coincidence “that the gestation period of Linux coincided with the birth of the World Wide Web, and that Linux left its infancy during the same period in 1993–1994 that saw [an] explosion of mainstream interest in the Internet.” The Net formed the thoroughfare of the bazaar.
Of course, that thoroughfare wasn’t open only to software engineers. It was open to every person and to every company. The Net brought the bazaar, and its peer production model, right up to the doors of every business in the world. It’s hardly a surprise, then, that Raymond’s metaphor soon came to be applied far more broadly than he originally intended. Connected to the global masses through the Internet, companies no longer had to pursue innovation in splendid isolation. They had the option of replacing the traditional, closed cathedral model with the new, open bazaar model. Michael Schrage noted the importance of this phenomenon in the pages of this magazine back in 2000 (See “Open for Business,” s+b, Fourth Quarter 2000). Open source, he wrote, is “transforming how organizations of all kinds seek to create and manage value. [It] will be central to capturing more profits from innovation.” In their recent book Wikinomics (Portfolio, 2006), Don Tapscott and Anthony Williams similarly argued that peer production can help businesses “take innovation and wealth creation to new levels.”
But even as the corporate world has begun to embrace the idea of the bazaar as a forum for innovation, software programmers have continued to debate the strengths and weaknesses of peer production. The open source model has proven to be an extraordinarily powerful way to refine programs that already exist — Linux, for instance, is an elaboration of the venerable Unix operating system, and the open source Firefox browser builds on Netscape’s old Navigator — but it has proven less successful at creating exciting new programs from scratch. That fact has led some to conclude that peer production is best viewed as a means for refining the old rather than inventing the new; that it’s an optimization model more than an invention model.
Now that we’ve arrived at the 10th anniversary of the first appearance of “The Cathedral and the Bazaar,” it seems like an opportune moment to take a closer look at both the benefits and the limitations of peer production as a means of business innovation. What’s the bazaar good for, and what isn’t it good for?
* * *
Nicholas G. Carr (firstname.lastname@example.org), a contributing editor to strategy+business, is the author of Does IT Matter? Information Technology and the Corrosion of Competitive Advantage (Harvard Business School Press, 2004). His latest book, The Big Switch: Rewiring the World, from Edison to Google,was published by W.W. Norton (2008).