Analysis Of Car Guys Vs. Bean Counters
In Car Guys vs. Bean Counters, Bob Lutz outlines many challenges that General Motors (GM) faced. Fortunately, with Lutz’s experience and expertise, he was able to turn things around for GM. After reading chapters one through seven, I was able to take away two business insights. One business insight that I took away from chapters one through seven is that number-crunching is not the solution to making manufacturing companies successful.
Bob Lutz emphasized how over-analytical thinking was one of the main factors that led to their demise. GM was determined to maximize profitability, and they believed focusing on numbers and spreadsheets would achieve this goal. The “bean counters” were the leaders focused on the financial reward and manipulating variables to get that reward. This business philosophy was not successful because they did not focus on providing value to their customers. The company was so determined to reduce costs, increase market share, and reach earnings’ targets that they did not consider the consequences that this mindset could have on the company. Lutz highlights that the analytical thinkers were not using common sense when it came to product excellence and customer service. For this reason, he wanted to return product design back to the “product guys” and away from the accounting people. In my opinion, I agree with Lutz that the design engineers should be in charge. They have passion for creating products and enjoy the customer experience. In result, this gives a competitive advantage to manufacturers when they supply innovative and quality products.
GM’s creativity and drive for product excellence improved their performance and success. The bean counters, or accountants, should only be there to advise and support decisions made by the designers. It was intriguing to see that a simple change in philosophy could be the factor affecting the success of a business. Another key takeaway from these chapters is the importance of competition. Competition drives companies to be innovative and to constantly improve their business.
In Car Guys vs. Bean Counters, GM was constantly challenged by competitors such as Ford and Chrysler. In order to retain their customers and stay in business, GM had to provide quality products that would allow them to stand out among their competitors. Despite their many attempts and failures, GM constantly strove to improve their business and adapt to customer’s wants. In my opinion, GM’s failures are what led to their success. They were able to reassess and analyze what was not working for their business and what was working for their competitors. After refocusing their priorities on product excellence and customer satisfaction, GM was able to attract more customers and compete with the other companies. Without competitors in the market, GM would be complacent with their service and selling mediocre cars. Competition is what encourages companies to produce innovative products and create value for their customers.
In all businesses, competition is vital for a company to grow and succeed. After reading the first half of the book, I learned a lot about GM and their journey to become successful. By correcting their mindset and focus, GM was able to grow and improve their performance. Competition was also an important factor that drove their creativity and operations. I am looking forward to reading the rest of the book and finding new insights to take away.
