e view of senior management, who understood too well what needed to be done, the lower management just did not believe change was required. After all, GM was GM. In the 1990s, true disaster hit General Motors. When Roger Smith retired, a new management team was installed. However, serious cash flow problems arose, and the GM board which had become more assertive in the late 1980s, took charge and forced the early retirement of CEO Robert Stempel and president Lloyd Ruess. The now more active board placed Jack Smith in charge, with the simple assignment of stopping the cash problems and turning the company around (Maynard, 1995, pp. 8-9).
As the 1980s were drawing to a close, GM's share of the U.S. passenger-car market slumped to 33 percent, a loss of 11 points in only five years. At the same time, Japanese car makers had a 7-point gain in market share, to 26 percent. Consumer surveys were even bleaker: A study by J.D. Powers & Associates found that 42 percent of all new-car shoppers would not even consider a GM car (Treece, 1990, April 9, pp. 87-89). At that time, Saturn began to assume a position of greater importance to GM. Its new fundamental goal was to sell 80 percent of its cars to drivers who otherwise would not have bought a GM car.
The beginnings of Saturn, its very inception, go back to 1982. Originally, it represented an ambitious effort by General Motors to make small cars in the United States as cheaply and as well as they could be made overseas. Roger Smith, the CEO of GM at the time, called the $5 billion undertaking "the key to GM's long-term competitiveness" (Hampton, 1987, March 16, p. 107). The project represented GM's attempt to rethink every aspect of auto making. GM's management hoped that production innovations would save $2,000 from the cost of building a subcompact car. Initial plans called for selling 400,000 cars yearly. So important was the project deemed to be in the total GM scheme t...