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GM shakes up corporate culture in wake of ignition switch issues

Barra has changed executives, split engineering operations since the scandal

So let’s see: A recall of 2.6 million cars, a PR nightmare, and governmental criticism waged at the company’s chief executive officer. Not much is going right for General Motors at the moment, but according to CEO Mary Barra, the company is looking to make creative positives out of negatives.

According to Barra, instability in the face of GM’s current ignition switch issues allows the company the perfect vehicle through which to change corporate culture. Barra said that she is looking to cut down on the company’s bureaucracy, much of which survived even GM’s government bailout of 2009.

“I see this as an opportunity to accelerate our culture change,” Barra said in late April. “We continue to face down every issue we have…and more aggressively pursue every opportunity in a way we haven't always done.”

Now, the company is beginning to put those words into action. According to The Wall Street Journal, Barra has tapped product development chief Mark Reuss to split the engineering operations into two groups: one that develops components and technology, and the other that focuses on “product integrity.” The latter group integrates the legal, engineering and design departments, and it is focused on making sure full compliance with federal regulatory standards is met.

The company’s executive structure could also be changing as well, a source said to the WSJ. New executives have already been named for engineering, safety and communications functions, and Barra may also look outside the company for new positions in corporate strategy, human resources and legal posts.

General Motors’ current company culture has been called into question from multiple sources, including even the U.S. Congress. Senator Claire McCaskill has called for criminal charges against the company for its failure to protect U.S. citizens, saying, “You know we had the Citizens United case where our Supreme Court said corporations are people ... but if in fact they are people, there needs to be some criminal accountability depending on what the facts of the investigation show. I know the Justice Department is taking a hard look at this.”


For more on our ongoing look at GM’s legal news, check out these stories:

Bankruptcy court may play a key role in GM class-action lawsuits

GM, plaintiffs turn to courts to help in ignition system lawsuits

New motions filed in GM class action over ignition system

Top automakers release new supply chain standards

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Zach Warren

Zach Warren is Assistant Editor of InsideCounsel magazine, where he oversees online content submissions and administers InsideCounsel's enewsletters. Zach specializes in new media and multimedia...

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