Mary Barra’s Leadership Style: What Entrepreneurs Can Learn

GM CEO Mary Barra addressing an audience Maddie Maffia / The Climate Centre

This article is part of our Leadership Studies series, an insight and analysis into the makeup and model of some of the world's most successful leaders.

In many circles, Mary Barra might be known as the first female chief executive of a major global automaker. However, her effective, independent and reliable leadership and management style prove that gender is irrelevant; to sell it more accurately, she is one of the most effective CEOs currently operating in the United States, period.

Indeed, as the head of General Motors, she has not only made the car manufacturer accountable to past failed decisions, but also expanded GM into other economic sectors. An expert in managing risk, leading by example and taking advantage of conflict for the benefit of her organisation, there is plenty to learn from Mary Barra's leadership style. Here, we will break down what exactly you, as a small business owner, can take away from this hugely successful trailblazer.

Curriculum Vitae

Age: 58

Born: Waterford, MI, USA

Education: General Motors Institute (now Kettering University), BSc Electrical Engineering (1980-85) | Stanford University, MBA (1988-90)

Work: Senior Plant Engineer (1985-88) | Senior Staff Engineer (1990-93) | Manager, Manufacturing (Midsize Car Division) (1993-96) | Executive Assistant to the Chairman (1996-99) | General Director, Internal Communications (1999-01) | Executive Director, Competitive Operations (2001-03) | Plant Manager, Detroit Hamtramck Assembly (2003-04) | Executive Director, Vehicle Manufacturing (2004-08) | Vice President, Global Manufacturing (2008-09) | Vice President, Global HR (2009-11) | Senior Vice President, Global Product Development (2011-13) | Executive Vice President, Global Product Development (2013-14) | CEO (2014-16) | CEO & Chairwoman (2016-Present)

Leadership and Management Style

Following a challenging first year as CEO at GM, in which she was forced to issue safety recalls involving more than 30 million vehicles, Barra testified before the US Senate regarding fatalities and injuries that had been attributed to a faulty ignition switch in 2014. During this deposition, Barra repeatedly apologised, remained humble, and promised to change the fundamentals of GM's culture.

"Today's GM will do the right thing," she announced in her opening remarks. "That begins with my sincere apologies to everyone who has been affected by this recall, especially the families and friends (of those) who lost their lives or were injured. I am deeply sorry".

Indeed, despite this rocky start Barra was able to keep her – and GM's – reputation intact, even to the point where a subsequent Fortune article deemed Barra "crisis manager of the year". But how did she accomplish this impressive feat? Ultimately, she did not just pay lip service in Washington; she followed through on her promises.

She crafted new policies that fostered responsibility, cooperation, and inclusiveness in the workplace. One of the new mechanisms in place was encouraging employees to report problems when confronted with issues that may seem incorrect, contradictory to manufacturing specifications, or inferior. Another critical step was to initiate an out-of-court compensation fund to pay claims on behalf of individuals who may have been wounded, or whose family members had died because of the defect, with Barra giving the man in charge of paying claimants, Ken Feinberg, full autonomy to compensate without any challenges. This was unprecedented.

Rather than tapping into the corporate trope of putting the scandal behind the company, Barra has always desired to keep the incident at the forefront of operational thinking, too. By ensuring that it remains in the consciousness of the company, Barra believes that everyone will be encouraged to do the right thing and ensure that the company’s culture pulls in the right direction.

Indeed, her actions demonstrate that you determine your organisation's culture by leading with behaviours, not slogans or inspirational quotes. She personifies the adage that actions speak louder than words.

That said, Barra continues to change the way GM operates – at least internally. She hosts town halls to seek input from the workforce, fosters an environment of open communication and holds meetings to discuss rather than delegate and disseminate. In an era that rewards inclusion, these have been integral adjustments. Moving forward, Barra's objective is to ensure the entire workforce, from the top of the food chain all the way down to entry-level interns, aligns on values.

She has overseen drastic strategic changes, too. Since the crisis, Barra has sold GM's European interests (Opel and Vauxhall) to French automaker Groupe PSA, introduced all-electric vehicles, unveiled a new range of Corvettes and Stingrays and steered the company into autonomous cars. This proves that she is not adverse to making bold decisions with the company’s longer-term future in mind.

Unfortunately for Barra, it’s not all positive, though. She has also had to endure one of the biggest headaches of any corporate executive: 48,000 workers going on strike for 40 days. 

This disruption, which has been commonplace throughout GM's history, hit the company's bottom line to the tune of about $3bn in 2019. Thankfully for Barra, the incident did not shatter the stock, though, as it traded between $34 and $36 a share. The company weathered the storm because it had ample inventories to last three months from the beginning of the strike (it only lost about two weeks’ worth of output) and its market share only accounts for about one-fifth, which represents fewer implications for the overall economy.

Once again, Barra somehow managed to leave her reputation intact and the company unscathed, illustrating how proactive measures, effective crisis management and the ability to switch between management styles has seen her thrive as a leader.

Achievements

In an age of increased scrutiny over gender in the C-suite, some commentators believe that Barra becoming a CEO is an achievement in itself. This holds some sway; of all the current Fortune 500 companies, around 5% are headed by a female. However, the woman herself sees her achievements differently.

"[My] job is to keep up with the technology advancement so that consumers are able to choose," she told Stanford Magazine in 2011. "So, if we as a company have the right technology that allows us to deliver fuel economy, yet still offer a range of size and products to meet people's needs and wants, that's how we win".

According to Barra, benefits should always be greater than the effort, so what has this achieved? Here are just some of GM's honours and awards under her tenure:

  • Top-ranked manufacturer in the 23rd annual Automotive Loyalty Awards
  • Best Gorgeous Costume Design 2018 at the 2018 Motor Show in Thailand
  • North American Chevrolet Colorado with Thai-Built DURAMAX Engine Wins MOTOR TREND 2016 Truck of the Year
  • Listening to Customers wins Chevrolet three 'Car of the Year 2015' awards
  • All GM brands in the top 10 in the Benchmark Dependability Study
  • GM named one of the 2015 'Top Companies for Executive Women' by the National Association for Female Executives (NAFE)

Key Numbers

Considering Barra's ascent, you would expect GM's finances to be among the best they have ever been. Like her tenure in her first five years, though, the company's accounts have been a roller coaster ride during this time.

Here are some of the numbers to examine her success:

GM Financials

2014

2019

Stock

$34.91

$37.25

Dividends

$1.07

$1.52

Market Capitalisation

$63.5bn

$53.2bn

Revenue Growth

$156.8bn

$144.8bn

Net Income

$2.7bn

$8.9bn

Number of Employees

215,000

173,000

Sales

10.4m

8.4m (2018 numbers)


Based on numbers, Barra's record as head of GM has been mixed. However, if you are an investor holding GM stock, then you would have enjoyed modest gains in terms of share price and dividend yield since 2014.

Influences

When asked about the start of her career in a February 2018 interview, Barra tellingly quoted Eleanor Roosevelt: "Do one thing every day that scares you". She noted that she would tell her younger self to start "embracing new and different opportunities," which "would be a good place to start".

Alongside her father, who was a factory worker at GM, Barra started her career at the auto manufacturer when she was 18. Her job, which was meant to pay for her college tuition, was to inspect hoods and fender panels of the Pontiac Grand Prix. As she climbed the ranks, eventually serving as Vice President of Global Human Resources in 2009, it is safe to say that the company's employees heavily influenced her.

"I loved that time because you're dealing with people," she told Wharton professor Adam Grant in a 2018 interview. "Sometimes, people do the craziest things. You see everything in HR. But you also see the goodness of people and how to really help them achieve their goals". 

This focus on people is a crucial component of Barra's leadership style, and something she has taken with her from the shop floor into executive management. "I think it's [about] recognising that people are the most important asset in the company. I just wouldn't subscribe to not being valued — I mean, you're driving value every day".

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Whether you are the owner of a startup that has a handful of staff, or the head of a multinational corporation that employs thousands of workers worldwide, there are plenty of core leadership lessons to take from Mary Barra. Whether it's how to handle a corporate crisis, instil confidence in your brand, or ensure that your business is prepared for the future, Barra offers a case study for business leaders everywhere on how you never let a crisis go to waste – and why your people should always be your number one asset.

In the meantime, find out how to hone your own leadership skills and abilities with our handy guides, and don’t forget to check out our recommendations on the best leadership books, films and podcasts to enlighten your development.

What aspect of Mary Barra's leadership style would you implement in your business? Let us know your thoughts in the comment section below.