Daniel Akerson, the man charged with taking General Motors public and freeing it of government ownership, may be an auto industry outsider but he is used to being in the driver’s seat.
When he was named CEO of General Instrument in 1993, Akerson replaced Donald Rumsfeld in the corner office — with the former, and future, Defense Secretary moving to occupy just a board seat.
But Akerson, under pressure from ownership, then quickly moved to boot Rumsfeld from the board and, despite resistance from the government veteran, succeeded in pushing Rumsfeld from the company, according to sources close to the situation.
The ouster showed clearly that Akerson could carry out difficult tasks.
GM said that the 61-year-old Akerson, a GM board member and a managing director of private-equity firm Carlyle Group, would become the automaker’s fourth CEO in less than two years.
Akerson will succeed Ed Whitacre, who will step down as CEO on Sept. 1. Whitacre will stay on as chairman until the end of the year, when Akerson will assume that role as well. Like Whitacre, Akerson is a veteran of the telecom industry after running companies including Nextel, General Instrument and XO Communications.
While Whitacre has shaken up GM’s senior ranks since taking the helm in January, Akerson said yesterday that he would steer clear of big management changes.
“At this stage, the biggest management transition is me,” he said.
Still, Akerson is no stranger to driving tough management decisions. The Rumsfeld matter is a case in point.
In 1990, Ted Forstmann’s private-equity firm bought New York set-top box maker General Instrument, and tapped Rumsfeld to be CEO, in part because he believed Rumsfeld’s high profile would help him market an IPO, sources said.
Forstmann grew frustrated with Rumsfeld after he failed to invest as much as rivals in making new digital set-top boxes.
When a big client threatened to pull its business, Forstmann pushed Rumsfeld aside and brought in Akerson, who had just been passed over for the top job at MCI.
Akerson’s latest challenge is keeping GM on track, which finally returned to profitability after its emergence from a government-sponsored bankruptcy last year.
Yesterday, GM reported a second-quarter profit of $1.3 billion, compared to a loss of $13 billion in the year-ago quarter.
Although GM is on more solid footing, Akerson will have his work cut out for him negotiating GM’s way through a public offering and restoring investor confidence.
“There is still some way to go for it to become a world-class car company,” said Kim Korth, president of auto consultant IRN. “The biggest danger GM has is its history of being very close to death and then saving itself and becoming arrogant.”