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Perot hopes Whitacre has better luck fixing GM

Perot hopes Whitacre has better luck fixing GM

Wed, Dec 2 2009

By Bernie Woodall

DETROIT (Reuters) – The last time General Motors had a plain-talking Texan on its board of directors who was critical of the way the automaker did business, GM sent Ross Perot packing.

Perot of Dallas said he hopes that Ed Whitacre of San Antonio won’t run into the institutional stonewalling the billionaire investor faced in the mid-1980s when, as a member of GM’s board, he challenged then-CEO and chairman Roger B. Smith.

"I disagreed with what they were doing," Perot told Reuters in a telephone interview on Wednesday. "Then suddenly, they just didn’t want anybody around to point out what we needed to do. They decided to get rid of the nuisance."

Whitacre, 68, became acting CEO of General Motors Co <GM.UL> when Fritz Henderson, 51, abruptly resigned on Tuesday. Whitacre has been serving as GM board chairman since July.

Perot, who became a household name in 1992 as a third-party presidential candidate, served on GM’s board from 1984 to 1986 after it acquired EDS, a data processing company he founded.

Perot, 79, said he did not know whether GM’s corporate culture was as insulated and aloof now as it was in the 1980s.

"The people at the working level wanted to change the culture and the people running the company at the time did not want to change it," Perot said.

Perot hoped Whitacre would have the wisdom not to make the same mistakes he spotted among GM executives two decades ago, when he observed that very few senior leaders of the company took the time to visit factories.

In his short tenure as GM, Whitacre has made surprise visits to plants where he has spoken with workers.

The first time Perot hosted GM executives at EDS in Texas after the acquisition, they were shocked, he said.

"We went to lunch and we got in line and they almost fainted," Perot said. "They couldn’t believe I ate in the cafeteria and that I had to go to the back of the line."

They were also surprised how good the food was, and that’s the point, Perot said. When company executives are treated the same way as the frontline workers, quality rises, he said.

"It’s very important in any company to have a very close relationship with the people who make your product, and those are the factory workers who make the cars," Perot said.

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