Could OnStar Be the Key to Unlocking a New GM?

The big business news — whether you’re a green geek or not — in the last week has been the auto industry. GM dominated headlines, as it emerged from bankruptcy and brought back the brash Bob Lutz as “vice chairman responsible for all creative elements of products and customer relationships,” according to the Wall Street Journal. But perhaps GM would have done better to seek the help of the less well-known Chet Huber, president of the company’s successful OnStar division.

Over at Earth2Tech, my colleague Josie Garthwaite took a look at what to expect from the New GM and suggested that the company’s big challenge will be not its financial or technological hurdles; “changing the culture — one of the main goals mentioned in [CEO Fritz] Henderson’s statement this morning — to cultivate more innovation, swift action and cutting-edge technology, could be more difficult.”

The assessment, while apt, is (sadly) not a new one. Innovation has long been considered a weak point for U.S. car companies. But there’s one notable exception: OnStar, GM’s in-vehicle security, communications and diagnostics system, has been held up as a model of successful innovation for more than a decade, and in April this year, the division announced it had filed its 500th patent application. The technology, its quick time to market, and its rapid deployment as a standard feature in all U.S. and Canadian vehicles have earned it both praise and awards.

It’s not so far-fetched to imagine that OnStar will play a major role in the New GM, either. As Josie has written for GigaOM Pro this week, current vehicle intelligence systems — including GM’s OnStar and Ford/Microsoft’s Sync technology, among others — could be the training ground for creating an electric vehicle infrastructure. And while Josie describes some of the innovation Ford says is possible, GM has already been experimenting with some of the next-gen potentials.

Back in 2007, GM piloted OnStar@Home, which added the OnStar system to smart thermostats, electronic doors and smoke detectors to a handful of homes in Michigan. The goal of the project was simply “to see what happens when you put this stuff together,” Ron Bellow, the GM executive overseeing the project, told Fast Company in 2007. “For example, if you say ‘welcome home’ as you pull into your garage, OnStar could disarm your home-security system, unlock the door, turn on the lights, and even crank up the heat on a cold winter evening.”

That kind of focus on consumer demand, product ecosystem, and what’s-next potential could be just what the rest of GM needs to succeed with the kind of “culture change” it says is so important. And a major force in OnStar’s success has been, by all accounts, the masterful leadership shown by Huber, who created a nimble, independent organization inside the slow-moving, bureaucratic GM.

One key to Huber’s success has been his team (less than 40 percent of whom hailed from the auto industry). Huber has said before that building a team is one of a leader’s most critical responsibilities, and his approach — which includes putting OnStar engineers on the manufacturing floor, getting employees to leverage OnStar’s call centers for new ideas and customer needs, and cultivating trust (and accountability) from the corporate brass — has been a big success.

While the New GM says it’s committed to culture change, rehiring Lutz to head up brand and communications as a marquee move doesn’t signal the kind of commitment to actual change the company needs. Maybe it’s time for GM to take a lesson from its happy consumers and make a quick call that starts like this:

Hello, OnStar? I need some help.

Question of the week

What does GM need to do to achieve true culture change?
Relevant analyst in OnStar
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  1. Josie Garthwaite Tuesday, July 14, 2009

    Right on, Celeste. Great perspective on what GM can learn from its own history. ^^^As much sway as Lutz has in the company, I’m not convinced his presence will be anything close to the make-or-break factor for innovation there.^^^ You’re right that at some level, the fact that he’s staying at the company signals something less than a complete shakeout of top management. But his new role is a far cry from his former post as chief of product development.

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