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GM's 'Culture of Cover-up'

In a U.S. Senate hearing last week, GM CEO Mary Barra was asked a lot of questions about her company's years-long attempt to downplay its faulty ignition switches. Democratic Senator Claire McCaskill, who chairs the Senate subcommittee on consumer protection and product safety, accused Barra and GM in general of fostering a "culture of cover-up," that prevented anyone from taking action to recall the millions of vehicles affected by this product defect.

Unfortunately, Barra did not offer a whole lot in the way of answers. She basically deflected and deferred, saying she didn't know and was waiting for the results of GM's internal investigation. She said she was unaware of the problem, and when she did finally find out about it, the company acted swiftly to recall the vehicles in question.

This may very well be true. Barra has only been CEO since January, and the first recall occurred in February. That isn't a whole lot of lag time between when she stepped in and when the recall took place. What is disconcerting, though, is that Barra had been with the company for decades before she took the CEO post, most recently as the head of global product development. Did she really not know of the faulty ignition switches when she held this post? Hard to imagine someone in line for a CEO post pleads ignorance of an issue that had to permeate GM.

These are the types of questions the government is going to continue to ask of everyone involved in this scandal. Did they know or didn't they know? How far up the corporate ladder did this cover-up get before it resulted in the fatal accidents we're all so saddened and horrified by?

There's a lot of talk about the "old GM" and the "new GM," referring to the company before and after its bankruptcy and subsequent "restructuring," or bailout, rather, ending in 2009. Obviously, this scandal spans both of those eras. A story in the Wall Street Journal recently made the case that many companies discourage people from speaking out about this kind of thing because the corporate ladder is just that - a ladder. Employees are worried only about the next rung, their immediate superior. If they make their superior look bad, it could be their job on the line.

This is the kind of corporate culture that needs to change if we have a prayer of preventing this type of thing from happening in the future. Employees should be encouraged to speak up if they have something to say that could be in the best interest of the company as a whole, not to mention the consumer. Companies like GM need to foster more of a team-oriented mindset. In fact, they might even do well to take a page out of Silicon Valley's book, where companies like Facebook and Google often have collaborative atmospheres that encourage involvement and participation, even if it does sometimes result in a bunch of sleep-deprived employees.

Ultimately, for a little under $1 dollar per car, GM could have avoided this entire thing and saved a bunch of lives in the process. Now there are more than six million cars that have been recalled, people have died and GM is worse off than it has ever been. GM still needs a drastic restructuring, to be sure, but of a different kind. When will automakers like GM and Toyota learn that a culture of cover-up doesn't serve anyone involved?

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