Executive Briefings

Will Hasty Supply Chain Decisions Hurt GM's Chances for Success?

The speed with which General Motors emerged from bankruptcy may be what Wall Street wants to see but it does not bode well for the company's long-term viability, according to Jeffrey Karrenbauer, a 40-year supply chain veteran and president of Insight Inc, which provides applications and consulting services for supply chain network design. Karrenbauer tells us that he believes GM is acting too hastily and being too heavily guided by a single issue -- manufacturing labor costs -- when making decisions about international outsourcing, supplier contacts and plant closures. A proper analysis of these issues would look at all relevant factors, Karrenbauer says, including total logistics and import costs as well as issues of flexibility, responsiveness, risk, and profitability of brands, markets and channels. While acknowledging that this type of in-depth analysis takes time to do properly, he insists that it is essential. "I have no use for analysis paralysis," he says. "However, I passionately believe that we owe the country, its taxpayers, and the various stakeholders of General Motors no less than the best possible effort, accomplished as expeditiously as possible -- not some sophomoric rush to judgment that we will come to regret."

Do you agree with this assessment? Is GM shooting itself in the foot with its supply chain decisions?

Comment on this story

The speed with which General Motors emerged from bankruptcy may be what Wall Street wants to see but it does not bode well for the company's long-term viability, according to Jeffrey Karrenbauer, a 40-year supply chain veteran and president of Insight Inc, which provides applications and consulting services for supply chain network design. Karrenbauer tells us that he believes GM is acting too hastily and being too heavily guided by a single issue -- manufacturing labor costs -- when making decisions about international outsourcing, supplier contacts and plant closures. A proper analysis of these issues would look at all relevant factors, Karrenbauer says, including total logistics and import costs as well as issues of flexibility, responsiveness, risk, and profitability of brands, markets and channels. While acknowledging that this type of in-depth analysis takes time to do properly, he insists that it is essential. "I have no use for analysis paralysis," he says. "However, I passionately believe that we owe the country, its taxpayers, and the various stakeholders of General Motors no less than the best possible effort, accomplished as expeditiously as possible -- not some sophomoric rush to judgment that we will come to regret."

Do you agree with this assessment? Is GM shooting itself in the foot with its supply chain decisions?

Comment on this story