Miser Mooney tackles Holden bureaucracy
BY BRUCE NEWTON | 13th Feb 2004
After a little over three months in the country and officially less than one month in the top job, Mr Mooney has seen enough to be convinced there is bureaucracy to be slashed and dollars to be saved.
But he emphasised that a cost-cutting strategy would be restricted to fixed costs and not damage product development and marketing programs.
"You’re not talking about the cars or the trucks, you’re talking about the process and the organisation structure," he said.
The good news for consumers is Mr Mooney’s intention that savings be driven straight to the showroom to keep the price of new cars down.
Mr Mooney’s strategy was revealed at Holden’s annual ‘year ahead’ dinner, hisfirst opportunity to present his views since taking over as chairman and managing director from Peter Hanenberger on January 1.
Mr Mooney’s concern about pricing is understandable as Holden has just slashed the recommended retail price of Barina and Vectra to get them back in the game against Japanese competition.
"The strength of the dollar, relative to the yen, has given the Japanese imports a pretty good advantage on the price side of the business," Mr Mooney said.
"I’m not complaining, but it’s a fact that it’s putting pressure on the price side of the business.
"So we’ve got to deal with that and one of the ways we’re going to is an unrelenting focus on structural costs and nobody likes to talk about structural costs. But, at the end of the day, it’s important for us to have the right cost, for us to have the right price out there."Holden is in the process of figuring just what can be cut and how, but Mr Mooney was able to produce one example of waste straight up – paper.
"There’s a lot more paper (at Holden) than where I come from, Mr Mooney said. "Everything I used to do was electronic. I rarely if ever signed paper.
"I have signed a lot of paper since I have been here, which is surprising, but some of that is getting our IT systems up to date, which we are working on.
"Some of this stuff is done elsewhere within GM, we can just pick it up off the shelf."Mr Mooney confirmed a cut of fixed costs "can mean jobs," but he backed away from saying that would necessarily be the case.
"What I am saying is you have to look at every dollar you spend and you’ve got to make sure it’s going towards something meaningful," he said.
Mr Mooney said he had previously been involved in similar programs in the US, where his most recent role was executive director of vehicle integration for GM North America Engineering.
"In engineering over in North America, we took a billion dollars out of our engineering costs in three years," he said.
"That is some serious structural cost going right to the bottom line, and we’re doing more products than we ever were not only in North America, but globally.
"And the reality is, you don’t like to make those kinds of cuts. I had fun working on the product programs, but driving that side of the business was not fun it was not fun."