The Auto Bailout--A Service or Disservice?

The big three American automakers — GM, Ford, and Chrysler — are getting a multi-billion dollar bailout. Granted, they have had to come up with a plan in order to get this money—a plan which includes cutting jobs, shedding brand names, slashing CEO pay, reducing some benefits for workers, making more hybrids, and selling corporate jets. But is the bailout really a service? Or is it a disservice at the highest level? Did the American automakers really learn their lesson (besides the one that goes “Don’t fly to Washington, D.C. in a private jet when you are asking for billions”)?

I say “no.” I say that the failure of the American auto industry was a long time coming and that it began going downhill because some basic tenants of good service were ignored. First, the American auto industry did not listen to their consumers. They haven’t been paying attention to their target markets. When the country began showing signs of a recession and petroleum costs skyrocketed, they increased prices. When the demand for green automobiles surfaced, they mass produced large SUVs. They were always ‘a day late and a dollar short’ because they weren’t listening to their customers—a key to providing good service. Secondly, when things went from bad to worse, they did not take responsibility for their failures. Accepting responsibility for mistakes is another measure of a good service provider. They flew (and, after being chastised, drove) to D.C. to ask for help without any sense of self-responsibility.

So, what can we learn from their situation? All organizations should be listening to consumers. It’s like an inside track to the next wave of market demand because for every person that speaks up there are probably 10, or 100, or 1,000 that don’t. Next, all organizations should take responsibility for their mistakes. Pride only takes you so far; respect for people has to come before the worship of profits. Be smart, be responsible; after all, Uncle Sam probably isn’t going to bail anyone else out anytime soon. And I think that’s a good thing.


We want to hear from you! Respond to one, all or none of the questions below. We just want to hear your thoughts!

Do you agree? Do you think the bailout sends the wrong message to corporations?

Do you remember a time as a consumer when you weren’t listened to?

Are there any organizations that you feel listen to their customers and take responsibility for failings exceptionally well?