Team Concept Takes Back Seat at GM
Wall Street’s money manipulators, worried as usual only about short-range stock market fluctuations, had been demanding for months that executives of General Motors immediately do something dramatic about the firm’s massive losses in North America.
The few millionaires who control America’s largest corporation did come up with a dramatic response. But it was a clumsy one that could do long-range damage to stockholders and workers alike: The executives combined into one flashy package all of their tentative long-range ideas for possible action to deal with slumping car sales and excess production capacity.
With much headline-producing fanfare, they announced on Dec. 18 one sweeping answer for Wall Street: By 1995, GM would dump 74,000 jobs and close 21 plants.
That will obviously hurt the GM workers and their families and many others too because of the little-noted ripple effect from the layoffs: job losses of an estimated 350,000 other workers who are employed by companies that depend on business from the GM plants and employees targeted for elimination.
In their haste to show their determination to cut losses, the GM executives have also dealt a body blow to worker-management cooperation that is so crucial to GM’s future.
This cooperation--the so-called team concept--gives workers a meaningful voice in the way the company is operated. The system is based largely on trust between managers and workers who have to believe neither is using it to take advantage of the other.
When company officials either lie or conceal information from the workers, it destroys that essential element of trust, and worker morale tumbles, along with efficiency and productivity.
GM and the United Auto Workers, which represents production employees, have been able to improve both productivity and make major improvements in car quality in recent years--the best way to fight Japanese competition--by increasing the influence of workers. They were beginning to be more than mere order-takers obeying instructions from their “superiors.”
By unilaterally announcing their privately made decision in December to slash the work force, corporate executives badly undercut their effort to persuade workers they are really part of a team that is seriously involved in the company’s decision-making process.
However, that omission may not have been the fault of the GM executives alone. Some of the blame may also rest on a few key union leaders.
Several sources have told me that GM executives, worried about the impact their momentous decision would have on workers, wanted the union to share the responsibility for actions they believed had to be taken in response to the company’s losses and Wall Street’s demands.
So, I was told, a few of the executives quietly asked UAW President Owen Bieber and Vice President Stephen Yokich, head of the union’s GM department, to help find ways to reduce GM’s excessive production capacity and renegotiate the union’s contract.
The two men reportedly refused, apparently unwilling to give up contract gains and help the corporate executives plan a layoff their members might partially blame on the union leaders who are up for reelection next June.
There is already a candidate running against Bieber, Jerry Tucker, who heads a dissident UAW faction, New Directions. New Directions wants to renew traditional adversarial relations between management and labor.
Tucker, a bright, articulate leader, has been complaining loudly that the union is already too cooperative with an untrustworthy management. His campaign against pro-cooperation UAW leaders such as Bieber might have been strengthened if the incumbent leaders worked with management to help stem GM’s losses by agreeing, however reluctantly, to accept more layoffs.
Even so, the union officials should have accepted the reported offer if they believed that it was made in good faith. They may not have come up with any better ideas. But they might have prevented the corporate executives from whipsawing workers by pitting one plant against another in the struggle to avoid being among those laid off.
By failing to spell out which plants will be eliminated, the executives are tormenting almost all GM workers, who must now worry which of them will be eliminated by 1995, and, in the process, dividing the union.
Also, perhaps the union leaders could have resisted Wall Street demands for quick action and refused to go along with the decision to announce massive layoffs. Together, company and union leaders might have found other possibilities, such as long-range alternate uses of the GM plants.
Sharing that kind of heavy responsibility is an integral part of any true labor-management cooperation, but it isn’t easy to do with GM.
Bruce Lee, UAW regional director and a strong advocate of labor-management cooperation, said that problem was seen clearly when GM executives recently decided to close the company’s plant in Van Nuys.
“They did that even though they firmly promised me and other union officers that the Van Nuys plant would remain open if our members cooperated in the team plan there. That was done, but management . . . shut down the Van Nuys plant anyway. I felt betrayed,” Lee fumed.
Not all labor-management cooperation has ended at GM. There is still a very effective program run jointly by union and company representatives to improve the quality of the product.
And in time, the team system will be revived, because it makes so much sense. It’s unfortunate, though, that union leaders did not have a decisive voice in the latest major corporate decision.
That could have helped prove that GM really means it wants to share power with its employees and avoid the possibility of another GM betrayal such as the one suffered by Lee and the workers at the Van Nuys plant.
