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Friday, December 26, 2008

Too BIG to Succeed?

Some people say that GM, Chrysler and Ford are too big to fail.  I say they are too big to succeed.  These giants are bound by the inherent inertia of large organizations and so cling to flawed models in both business and car design.  Break them up!  And don't just break them up by line. Making and independent Jeep company, or Pontiac company, or even Hummer company won't save the American auto industry.  Take a hammer to them and find the natural cleavages upon which they will shatter.
Declare these vestigial beasts bankrupt and extinct and sell off the assets.  

Do away with vertical integration!

Let small design companies make innovative designs to sell to the highest bidder.  Let small, nimble and innovative manufacturers build better parts more efficiently through competition. Vertical integration allows any aspect of the design, manufacturing, distributing and sales process to bind the hands of all the others.  When each component has to compete to work with the best producers in all the other fields, the producers and consumers win.

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