John F. Smith Jr.

He makes sure GM keeps giving back to Detroit

    Been to the Renaissance Center lately? To paraphrase Yogi Berra, it’s a case of rebirth, all over again.

    “You should come over here at lunch time,” recommends General Motors Corp. Chairman John F. Smith Jr. “It’s really alive.”

    Indeed, Detroit’s 25-year-old landmark riverfront structure, purchased by GM in 1996, is being rapidly purged of the atmosphere of bankruptcy that haunted it for most of its existence.

    And for the first time since the century-old automobile firm’s performance began to deteriorate in the early 1980s, GM itself exudes an air of youth, energy and hope. Much of that is due to the leadership of “Jack” Smith, 62, who supervised one of the most thorough corporate renovations in the history of the auto industry.

    Detroit and Michigan have fared well as a result of the lengthy, complex and risky effort to give GM a modern, global operating structure.

    “I think we’ve been very fortunate,” Smith says. “We’ve had a terrific auto industry because car prices are at the lowest level we can measure from an affordability standpoint. And that has been good for Michigan and good for the city of Detroit.

    “And this is still the center of the automobile business,” he says. “I don’t think that will go away. The expertise for autos is here, and hopefully it will stay here.”

    Despite a top-to-bottom consolidation of operations, most of GM’s design, technical and marketing effort remains Michigan-based. Two new plants are being built in Lansing to replace aging facilities, and others in the state have been updated with key investments.

    “So many companies uproot out of the older downtowns and urban corridors — they go out to the green fields,” says Doug Rothwell, head of the Michigan Economic Development Corp. “GM kept its roots in Michigan, reinvested in those roots, and did it precisely in those urban areas that were the birthplace of the company.

    “I don’t think you could find a better corporate citizen, and this has happened under Jack Smith’s leadership,” he says.

    It didn’t have to be that way. The days when GM could command a large chunk of the market, simply because of who it was, are long gone.

    Competition is more fierce than ever and potentially deadly. Without adroit management, Michigan’s largest corporation could have stumbled badly.

    Smith pulled off the feat by a combination of personality and style, says David E. Cole, director of the Environmental Research Institute of Michigan’s Center for Automotive Research and a lifelong GM watcher. Rather than sitting on a high throne and trying to dictate change, he rallied a team to accomplish it.

    “Jack Smith didn’t want to be the quarterback, he wanted to be the coach on the sidelines,” Cole says. “That’s really been his role.

    “Jack is not an intimidating personality,” Cole says. “But one of the great attributes of a good coach is the ability to empower people, and Jack has that ability.”

    Smith says there is still room for improvement at GM, but the bulk of the change is completed.

    “It’s a continuous improvement process,” he says. “So long as we don’t kid ourselves about that and stay focused on where we need to go, we’ll be OK.”

   

— James V. Higgins