November 12, 2008

Coming home to roost

Here’s Tom Freidman’s take on why receivership, not a blank check, is needed for the US auto industry.

Since the early 1980’s I’ve had opportunities to work with the US and Japanese car builder’s senior execs. The contrast was – and still is – amazing. The Americans have been on a non-sustainable path for many years - they actively fought-off the constraints that could have guided them toward profitable growth. Business strategies are doomed to fail when they are shielded from reality.

Bigger Isn’t Always Better includes a chapter on facing reality and why this is seldom a natural act.

The issue now is not so much to assign blame for Detroit’s woes (there’s plenty to go around), but sort out what to do. Freidman offers a useful way to start thinking about this.


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