CEO Talks Trade-Offs to HBS Grads

CEO and chair of General Motors (GM) G. Richard Wagoner offered encouragement and advice to the graduating class of the Harvard Business School (HBS) yesterday afternoon in a Class Day speech on the lawn of Baker Library.

Wagoner received an undergraduate degree in economics at Duke University in 1975 and a master in business administration from HBS in 1977. After 29 years at GM, Wagoner stepped up as CEO and chair slightly over a year ago. He has become known for managing his employees more like a coach than a boss, and for streamlining production at the company.

In his speech, Wagoner outlined five difficulties that every business person will encounter in a career.

The first is data analysis versus people motivation. While Wagoner said that data crunching is extremely important, the “soft side” of motivating workers sometimes will mean the success or failure of a company.

“You have to be able to walk and chew gum at the same time,” he said. “There are no false trade-offs.”

He also stressed the precarious balance between a “hands on” attitude and delegation of duty.

“You must know when to dive into details, and when to let other people take over,” he said.

According to Wagoner, a good rule of thumb is to take on the “toughest, nastiest job” yourself, and focus on doing your own job.

And throughout his speech, Wagoner lauded the value of simplicity in his third suggestion. Citing a Mark Twain quote, “I would have written you a short letter, but I only had time to write you a long one,” Wagoner said that “99 percent of the time, a simple answer is better than a sophisticated one.”

Finally, focusing on the overall leadership of a business, Wagoner made two more suggestions.

In trying to decide between “me versus we,” he said that a true leader should give credit to “we” and push the blame onto “me.”

But above all else, Wagoner said that one’s values should come above everything else, and so one should always seek a win-win situation.

“The question should not be who gets the biggest slice of the pie,” he said, “but rather how can we grow the pie.”

Students found Wagoner’s speech helpful and relevant.

“I think it was a great speech,” said Mark Okerstrom, who will be working at the Bain and Company consulting firm. “He touched on various trade-offs of being a business leader, and combined it with a family life, putting things in perspective.”

Luis Rodriguez, class co-president, also said he enjoyed hearing life lessons from an experienced professional.

“As we’re stepping into the next step of our journey, it’s useful to have these type of lessons taught to us,” said Rodriguez, who will be working at Citigroup.

—Staff writer Risheng Xu can be reached at xu4@fas.harvard.edu.