Arun Sudhaman 25 Jan 2015 // 7:45PM GMT
Tony Cervone rejoined GM in May of last year, as the company struggled to deal with revelations about a 2001 ignition switch defect that ultimately led to the recall of millions of cars.
Named as one of the Holmes Report's 15 People to Watch this year, Cervone had previously spent 10 years at GM, before departing to lead communications at United Airlines and then Volkswagen America. He returned to serve as SVP of global communications under new CEO (and former colleague) Mary Barra.
Speaking to the Holmes Report at the World Economic Forum in Davos, Cervone explains how he helped GM weather such a severe storm, his focus on rebuilding GM's global brand in 2015 and beyond, and whether he plans to review the automaker's internal and external communications strategy, including agency support.
Why take the job at GM?
I knew Mary extremely well. I had a high degree of faith and trust in her. Not only on this issue but to drive the company to a level of performance and pre-eminence. If I could be part of that and help her, that was a pretty compelling proposition in spite of the craziness at that time. Her integrity was never in doubt. So when you come into the kind of crisis we were in - at the CCO level, if you presume you have the right level of skill to be considered for those jobs, then it largely comes down to chemistry with the CEO.
What did you feel you needed to do straight away?
This might sound too simplified but it’s true. It was articulating what Mary and her senior management team were doing. And how they were viewing the situation. Up until that point there was a large degree of reactive communications. If it’s completely reactive then you’re put in a position of letting others define for you your message. Once the Valukas Report was issued, we felt very strongly that what it pointed out were things we needed to address transparently, largely to our workforce. Mary was very honest about what it said. She selected some of the worst themes anybody could pull out of it, and said this is what I see and this is what we cannot tolerate. She’s been able to articulate that new centre for the company, if you follow the actions we’ve taken since then, both process and behavioural-related.
"The brand isn’t as strong as it used to be" How do you think GM strayed so far off course?
Without minimising the true impact of what happened, if you really look at the Valukas Report, the central cause of what happened was at the moment of time that those issues were being evaluated, people didn’t equate the issue with a safety issue, it was a customer convenience issue. If you take a step back now and say, this probably wasn’t a 60-year-old driving the car, there would be re-analysis, and it’s a safety issue for sure. Another component is an individual made a part change and didn’t let anyone know, and continually claimed there wasn’t a part change. No one can change that.
Do you feel the crisis has been resolved to a point where you can start to focus on GM’s brand building?
Certainly it’s to a point that we can begin to articulate the direction of the company. It’s never going to be resolved. Mary has said many times that she never wants to forget it, but she doesn’t want it to define us either. It’s a healthy dose of keeping it front and centre and having the ability to articulate where we want to take the company. We’re strengthening the global brand for the first time in 25 years. We’ve grown market share in Europe for two years in a row for the first time in 25 years. The brand isn’t as strong as it used to be.
How do you feel about the automotive industry reputation, in general?
As a global industry, you look at many markets, including China, it’s a really valued industry. In the US, it has been gaining credibility. The nature of the industry seemed to be at odds with a number of stakeholders for decades. The industry is not taking that position anymore. We’re not fighting regulators anymore, we’re not fighting customers. It’s helping us earn the right to have those relationships with stakeholders at the right level. It’s no longer about transacting a purchase, its more about do you have a relationship with those stakeholders, whether its policymakers, customers, resellers, distributors.
Do you see any changes in crisis management? We seem to live in an age of permanent crisis.
It’s an age of permanent volatility. Peeople are getting used to more volatility. But there are thresholds, beyond which it becomes a crisis. If it passes that threshold, the communications aspect actually becomes clearer, because you have senior management's attention and you have the ability to communicate decisively and clearly. It’s actually fundamentally easier. When you’re at a level that’s below that threshold, that to me is the challenging environment, you almost need to have that same mentality to keep that agility which is relevant in today’s world.
"If I can build advocates, they are more likely to not only support you but also desire your products" Is it harder to get the truth out today, when there are so many sources of information?
No I don’t think so. There are different tools. But, in many ways I’d argue it’s easier to go direct to the consumer, if you have the ability to already have that relationship. The intensity of the traditional media is still there. There’s an intensity to drive headlines today because of the economic conditions that exist in traditional media today, especially print.
You mean more negative news is better for sales?
It’s the economics of what we’re doing. It’s unfortunate, because there is a level of entertainment that’s going on with this.
GM has been defined by the crisis since you’ve joined, what do you want it to be defined by going forward?
That’s true, but also defined by the way the issue has been handled. If you look at any objective measure of reputation, the company is actually at the same level now compared to when it started. Mary Barra's reputation is actually stronger than when it started. More people know her, more people have become supportive because of her genuine nature. It’s given us a window to say here’s where we’re taking the company. That genuine nature and that level of decisiveness is going to continue. What I’d like to see us measured by is our performance and being accountable.
There’s no question that the cars and trucks we produce today are the best they’ve ever been. Now the next step is to make the affinity of the brands equal to the quality and integrity of the vehicles. You can keep loyalty in our business in a lot of ways — by continuing to discount, for example. That was the propensity. It’s about shared desire now. For communications, that’s about building advocacy. If I can build advocates, they are more likely to not only support you but also desire your products.
Are you happy with your agency support?
We need to do a much better job of utilising them appropriately and pointing them in a right direction. In an industry that tends to use them more as arms and legs than anything else, that’s not the appropriate direction.
Are there plans to restructure your PR support, because it seems to be organised geographically right now.
It’s more of a smorgasbord, is what it is. Yes, but I don’t know what the answer to that is so I don’t want to scare anybody. It’s deeper than that. It’s also about how we’re utilising our own staff.