GM Update: It's official - Henderson out, Time Magazine's Alex Taylor III Explains Why

Alex Taylor III wrote a brief story for Time on GM’s surprise announcement that Fritz Henderson was out as GM’s CEO and Ed Whitacre, GM’s chairman would serve as interim CEO until replacement is found. Taylor was right on the mark in his explanation. IN the story he wrote,

Henderson will be remembered as being as smart and experienced as any GM CEO, but he appeared tone-deaf when it came to listening to Whitacre and the rest of his board of directors. Since he had no role in picking them and they owed him nothing, that proved to be a fatal mistake.

When the board made it clear that it wanted Henderson to replace chief financial officer Ray Young, Henderson dawdled. He could rightly complain that government curbs on executive pay made it difficult to recruit experienced financial executives, but it must have looked to the board as if he couldn’t make a decision or was simply stalling.

Check it out, it’s worth the read.

For a bit more read:

Slate

Not Official - Fritz Henderson, GM's CEO to Resign

The internet is abuzz with rumors that Frederick “Fritz” Henderson, GM’s CEO who took the reins after GM’s longtime CEO Rick Wagoner was forced out, is about to resign. The rumor is yet to be confirmed but appears quite plausible. According to CTV News Chairman Ed Whitacre, Jr. will serve as the interim CEO until a replacement is found for Henderson. Let’s hope GM selects someone innovative and ready to go. While Henderson was a vast improvement over Wagoner he has still not shown the kind of leadership necessary to take the new company out of the abyss.

GM's New Chairman Takes His Responsibilities Seriously

GM’s new chairman, Ed Whitacre the former AT&T chairman and CEO, appears to be taking his news responsibilities seriously. According to a story by David Welch in BusinessWeek,

General Motors’ recently installed CEO, Frederick A. “Fritz” Henderson, has had just one board meeting with his new slate of directors. And already they are giving him pressure to show better results.

… (Henderson’s) first board meeting shows a stark contrast from GM’s old board. With a few exceptions, the previous directors showed a lot of patience with ousted Chairman and CEO Rick Wagoner. He racked up some $80 billion in losses since 2005 but kept solid backing. The old board also had to focus mostly on costs since the automaker has been in nearly constant restructuring mode for years.

… At the meeting, new Chairman Ed Whitacre, who had previously been chairman and CEO of AT&T (T), and several other directors pressed Henderson on how the company would build revenue, strengthen its brands, and communicate the message that its new products are competitive. “All of their questions were on revenue,” Henderson said, adding that they asked, “What are your metrics? How will you hold yourself accountable?”

While the government has been constantly under criticism for getting involved in the auto industry’s affairs and bailing them out so far, it has demonstrated far more moxy in relation to management than previous shareholders. Let’s hope the new board can really get some results out of GM’s new CEO, Fritz Henderson and his management team. Stay tuned.