The big news today from General Motors concerns the results of an internal investigation into the company’s slow recall efforts. After firing 15 employees and establishing a compensation program for victims, is it enough?
In today’s AP story, GM says a pattern of incompetence and negligence, not a larger conspiracy or cover-up, is to blame for a long-delayed recall of defective ignition switches.
GM CEO Mary Barra, who released the results of an internal investigation into the company's missteps on Thursday, said 15 employees — many of them senior legal and engineering executives — have been forced out of the company for failing to disclose the defect, which the company links to 13 deaths. Five other employees have also been disciplined.
"Fifteen individuals, who we determined to have acted inappropriately, are no longer with the company. Some were removed because of what we consider misconduct or incompetence. Others have been relieved because they simply didn't do enough: They didn't take responsibility; didn't act with any sense of urgency," Barra said according to a CBS News story.
Barra said former federal prosecutor Anton Valukas interviewed 230 employees and reviewed 41 million documents to produce the report, which also makes recommendations to avoid future safety problems. What Valukas found was a pattern of management deficiencies and misjudgments — often based on incomplete data — that were passed off at the time as business as usual.
During tough questioning by a U.S. House committee on April 1, Barra said that she had hired Valukas to conduct a thorough and unimpeded investigation of the actions of General Motors. He had free rein to go where the facts took him, regardless of the outcome.
"What Valukas found was a pattern of management deficiencies and misjudgments — often based on incomplete data — that were passed off at the time as business as usual."
According to a USA TODAY article, Barra also said in those congressional hearings that failing to distinguish a revised part with a new part number is "unacceptable" and violates GM engineering rules. The use of old part numbers was one of the ways the defective ignition switches were kept secret.
GM is currently creating a program to compensate those injured or killed by the defective cars, although Barra did not announce a dollar amount that would be dedicated to it. The company will start accepting claims from the program on August 1. Compensation expert Kenneth Feinberg is working on a formula to set the level of compensation for victims.
To watch GM CEO Mary Barra’s full press conference, click here.
Needless to say, the corporate culture will be different going forward at GM. "While everybody who was engaged on the ignition switch issue had the responsibility to fix it, nobody took responsibility," Barra said. "Throughout the entire 11-year history, there was no demonstrated sense of urgency, right to the very end."
So what do you think about GM’s actions in light of its internal investigation? Was firing several employees and setting up a compensation program the best course of action for the auto giant? Should it be doing more? Is it doing too much? Leave your comments below.