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General Motors Shakes Up HR Leadership

July 30, 2009
General Motors head of human resources and longtime executive Katy Barclay is stepping down, the automaker said Thursday, July 30. She will be replaced by Mary Barra, a top executive with an engineering background who worked closely with former GM chief executive Rick Wagoner.

The leadership change comes just weeks after the new GM emerged from a structured Chapter 11 bankruptcy with the goal of overhauling the company’s bureaucratic and bloated corporate culture, especially within its executive ranks. The shift completes GM’s executive restructuring, though the company has yet to bring in executives from outside the corporation.

The HR change will officially take place October 1, which is GM’s deadline to reduce its salaried workforce by 4,000 people. Saturday, August 1, is the deadline for reducing the company’s union workforce. The company said it wants to trim the number of union workers to 40,500 from 61,000 a year ago.

The retirement of Barclay, 53, who has been vice president of global human resources since 1998, was seen as long overdue. According to a 2005 article published in Automotive News (a sister publication of Workforce Management), Barclay said her first automotive job was as a human resources professional at GM in 1978.

“She is one of the same senior leaders who is responsible for the destruction of the company,” said Rob Kleinbaum, managing director of auto industry consulting firm Rak & Co. “She is responsible for it and should be accountable for it.”

Barra, 47, is vice president for global manufacturing engineering and has been with GM since 1980. She has served in a number of engineering, manufacturing, management and communications positions and was plant manager for the Detroit Hamtramck assembly center. Barra was appointed executive director of vehicle manufacturing engineering in 2004 and was named to her current position in 2008, the company said in a release.

Appointing an engineer with no HR experience as the department’s head suggests the company is looking to infuse it with a greater sense of the manufacturing principles of continual improvement and operational efficiency.

“It’s a positive sign they want to make deep changes in HR and don’t want to draw from the HR community,” Kleinbaum said.

Before her current position, Barclay was general director of human resource management for GM North American operations. Other positions include director of human resources for GM vehicle sales, service and marketing, and director of compensation for GM.

CEO Fritz Henderson, who has made changing the company’s culture a top priority for the new GM, announced the changes to employees Thursday, July 30, as part of an overall reduction in the company’s executive ranks.

“Our goal was to streamline our leadership team and put some of our best executives in positions where they can use their diverse perspectives and extensive global experience to create the new GM,” Henderson said in a statement.

The company appointed Mark Reuss as head of global engineering, replacing two executives, Jim Queen and Ed Koerner, who have been with GM a combined 72 years.

In a post on the company’s blog in June just after the company declared bankruptcy, Henderson wrote, “It’s important to remember that the reinvention of GM must start within GM, and we all need to be part of the process.”

Henderson then formed a team to look at the company’s cultural issues, “like how the new priorities of customer/product focus, speed, risk-taking and accountability become a natural part of our behavior,” according to a memo to employees.

Henderson has since appointed Chris Oster, head of organizational change management, to lead the company’s overhaul of its corporate culture.

The changes come a week after GM announced that the human resources seat at the proverbial leadership table would be eliminated. The company replaced its Automotive Product Board and Automotive Strategy Board, on which Barclay sat, with a new nine-person executive leadership committee.

The smaller committee is instead composed of executives from marketing, manufacturing, finance, labor relations, corporate planning, sales, and supply chain units. The new Executive Committee was created in hopes of speeding up day-to-day decision making.

Barra will report directly to CEO Fritz Henderson, a spokesman said.

—Jeremy Smerd

Read General Motor president and CEO Frederick A. Henderson's response to this story.

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