GM's Turnaround Now Fully in Akerson's Hands

Jan. 3, 2011
Akerson believes 'what's good for GM is good for America'

The future of General Motors is now firmly in the hands of Dan Akerson, who on Jan. 1 expanded his role to become both chairman and chief executive officer of the iconic American carmaker.

Akerson replaced Ed Whitacre as chief executive in September, but the straight-talking Texan who came out of retirement to lead GM through a government-backed bankruptcy and back to profitability remained chairman until the end of the year.

Akerson has built on Whitacre's success, leading GM through a $23.1 billion initial stock offering -- the largest in history.

He insists that the work of transforming GM is far from over, and gives every appearance of relishing the challenge.

"I expect GM to be a very different company in five years," Akerson said recently.

Akerson, who loves to reminisce about his days in the U.S. Navy, believes in the old adage that what's good for GM is good for America, and hopes it will lead a resurgence of the nation's manufacturing base.

He acknowledges that the company has a lot of work to do to win back the trust and excitement of consumers after years of shoddy, unattractive products and poor marketing.

Akerson, 62, is pushing the company to develop lighter, more fuel-efficient vehicles in anticipation of rising oil prices. He is also working to boost the automaker's environmental credentials through the recent high-profile launch of the plug-in electric Chevy Volt.

GM also has to reduce its reliance on debt and limiting increases in structural costs will be a key element of GM's operating strategy, he said.

"We need a robust balance sheet," he said.

Akerson is also working to change GM's corporate culture.

"GM is in a highly cyclical industry," Akerson noted during a recent appearance in Washington.

But it hasn't always acted that way. While sales climb and then drop steadily, the automaker did little in the past to link costs to revenue shifts.

Akerson said his ultimate goal is to manage GM for the long term, which requires contemplating what kind of impact a decision might have on the company's operations in the future. "That wasn't always done in the past," he said.

Akerson has faced some blowback from GM insiders who don't see him as a "car guy." He is a widely traveled corporate insider who earned high marks as a strategist.

Akerson graduated from the US Naval Academy in 1970 with a bachelor of science in engineering and later earned a masters in economics from the London School of Economics. He spent much of the 1980s and 1990s working in the telecom and tech industries.
During his 1996 to 1999 tenure as chief executive of Nextel Communications, he transformed the company from a regional walkie-talkie provider into one of the nation's leading cell phone companies. He then took the helm of XO Communications, where he led a successful restructuring, before moving into private equity work. Akerson was head of the Carlyle Group's global buyout activities when he volunteered to join GM's new board of directors when it emerged from bankruptcy in July 2009.

"I believe it was important to the country," Akerson said.

By his own account, Akerson became hooked on the business as he served as one of Whitacre's chief lieutenants.

Copyright Agence France-Presse, 2011

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