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Gm Finally Faces Up To The Dangers Of Inbreeding


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GM FINALLY FACES UP TO THE DANGERS OF INBREEDING

It's the marketing challenge of the decade. Or the job from hell. When General Motors Corp.'s top brass in late June took the unprecedented step of throwing open to outsiders its search for a new North American marketing honcho, they offered up a post that could be both. The job "requires guts as much as brains," says Oldsmobile Div. General Manager John D. Rock. "The guy will need a tin badge and a bulletproof vest."

Why such gnashing of teeth over a search for, well, a car salesman? GM isn't looking for just any marketer. The hope is that a high-powered outsider can bring enough clout and savvy to the post to make major changes in the way the company does business. "We're not just looking for a marketing guru. It's much grander than that," insists James C. Carpenter, the headhunter for New York-based Russell Reynolds Associates Inc., who is scouring the nation for candidates. One measure of how seriously GM is taking the search: It started in June, and the company doesn't expect a winner to be announced for at least another month or two.

The driving force behind the talent hunt is Chairman John G. Smale, retired head of master marketer Procter & Gamble Co. So, not surprisingly, speculation about likely candidates frequently centers on P&G alumni. One star marketer rumored to be on GM's list is William B. Connell, former vice-president for beauty care, who recently left Whittle Communications LP to become a venture capitalist. "I can't talk about that," he says. Some scuttlebutt, though, such as the frequent mention of former P&G Vice-President Charles A. Lieppe, seems to be off target. "Nobody's ever been in touch with me about it," says Lieppe.

Even with Smale backing the search, however, there is some question as to whether GM will actually follow through with its plan to bring in an outsider. J. Michael Losh, who in June vacated the marketing post to become GM's chief financial officer, insists that insiders are still being considered. Given GM's inbred culture, analysts worry that he and other top brass may prefer to elevate one of their own. Rumored candidates include the general managers of three of GM's car divisions: Buick's Edward H. Mertz, Pontiac's John G. Middlebrook, and Saturn's Richard G. "Skip" LeFauve.

And even if GM does opt for an outsider, it may have trouble finding anyone who will accept the job. It's a huge position to fill: GM's car and truck divisions, with $100 billion in sales, report to the marketing chief. So do advertising, service parts, Canadian sales, and a raft of support operations. The company needs to refocus its fuzzy marketing strategies and the images of six tangled nameplates that often compete with one another. Also needed are lots more creative ideas like Chevy's current "Discover America Tour," which lends new Lumina sedans to 70 families to drive on their vacations. But any newcomer will have to make such campaigns work in a company that's notoriously hostile to outsiders, rife with brutal politics, and deeply resistant to change.

Given the challenge, there are some indications that the company is trying to nab a real hotshot. For instance, GM may have approached Michael A. Miles, the former CEO of Philip Morris Cos.--but analysts speculate that Miles would balk at the idea of taking less than a CEO's job. Asked if he's a candidate, Miles says: "That is strictly a rumor."

"ABYSMAL." Still, whoever is chosen, it's clearly a good sign that GM finally seems to realize that it needs new oomph in marketing. Because its top jobs have been dominated for decades by a succession of "car guys" and "bean counters," marketing has gotten short shrift. That's a major reason why, despite improvements in quality and styling, the company's market share continues to languish (charts). "GM's marketing has been abysmal," declares Furman Selz Inc. analyst Maryann N. Keller.

But for an outsider to have a chance at forging real change, Smale may have to throw his weight behind the winner--and keep it there. "Anybody they hire is going to understand that he will be about as welcome as the flu in winter," says Keller. Hardly a dream assignment, but one that could pay big dividends for General Motors if it makes the right choice.Kathleen Kerwin in Detroit, with Zachary Schiller in Cleveland


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