Why attacking your company can make it strongerJuly 6, 2011: 1:04 PM ET
GM CEO Dan Akerson recently asked his top execs to think like the competition and exploit GM's Achilles' heels. More companies should be following suit.
By Shelley DuBois, writer-reporter
FORTUNE -- One of the best things you can do for your company is turn against it.
It sounds odd, especially when corporate culture is often consumed with deflating negative news. But companies can learn valuable information about their own weaknesses not just by talking about what moves competitors might make, but by actually stepping into the shoes of the competition, and going for the throat.
This past year, General Motors (GM) executives participated in an exercise that did just that. At the automaker's annual shareholders meeting in early June, CEO Daniel Akerson explained how some of GM's leadership broke into six groups, each with a packet of information about a rival company. Then, group members were asked to devise a strategy to attack GM. Participants had to consider which areas of GM they would target: Given the specific strengths of those other companies, how were they best suited to take GM down?
The results were "enlightening and a little bit frightening," Akerson told shareholders: "God forbid someone will leave that exercise and go to work for some of our competitors."
The last comment may have been tongue-in-cheek, but the takeaway thought, he said, was that GM knew its weaknesses as well as anyone else. Having taken the time to discuss the company's flaws, GM could then take action before rivals could discover and capitalize on them.
More companies should follow GM's example, even if it is temporarily painful, says Michael Useem, a professor of management at Wharton. That's not always easy, especially during an activity when your own executives talk about other companies' cutthroat strategies in the first person. "It does take a thicker skin to get those kind of darts thrown in your back without flinching when they hit," Useem says.
But creating a dart-friendly environment is important because a crucial cognitive switch happens when you start thinking like the enemy.
"If you say, 'Look, this is what Ford would say about us,' that's going to still be in polite language and some of the punches are pulled. But if you really are asked to play a role, you have to play it to the hilt," Useem says.
While harsh internal criticism may be brutal to hear, the ability to have that kind of dialogue is often a sign of a healthy company. For one, it shows that leaders want to be in touch with reality at the corporation, not just the most flattering news.
A company that can use its employees as resources in this way can not only patch problem spots, but also create a culture of open internal communication. In the future, employees could feel comfortable bringing potential problems to the C-suite's attention. That's good in the long-run, since it is often much better to address difficult management situations in a preventative setting rather than a reactive one.
This particular trick is simple: don't think what the competition would do, think like competitors. Companies that are wiling to take risks and try counter-intuitive leadership tactics often gain an edge over those competitors, Useem says. "It really is a matter of creating a few devices like that to overcome this tendency to sugar-coat the news," with the ultimate goal of nipping that news in the bud before anyone else catches on.