On the B2B issue, GM's supplier-oriented initiatives are more crucialprecisely because of the dire need for a refresh of its auto lineup."The reason their U.S. market share dropped was because they weren'tbringing out cars people really wanted to buy," says Keller. It's anopen question whether GM's upcoming designs will reverse the trend,although Lutz helped overcome similar criticisms when he took the helmat Chrysler in 1986, and author Keller says Lutz has already startedto make an impact by accelerating certain promising forthcoming modelswhile nixing others. GM's internal revamp and collaboration withsuppliers have put GM back into the race.

Still more significant is the change of GM's mind-set. "You need adifferent attitude than when you're developing a car and you have tomeet safety standards, where you can't afford not to be right," saysWagoner, when asked what GM has learned from its e-business ventures."[In e-business] we'd like to be right every time, but the cost wouldbe that we'd be slow, expensive and probably last-to-market in a lotof areas."

By running limited pilot versions of e-business projects, GMexperiments in a cost-effective manner. Asked about how his groupdetermines the right amount of resources to allocate to each project,Szygenda says his team holds sometimes-heated priority-settingdiscussions, but he ultimately boils it down to "gambling." Ask GMexecutives about the goals they set prior to launching variousinitiatives, and the answers are uniformly nonspecific. That's trueeven in a clear success like the Celta, of which GM's Hogan will onlysay, "I guess we might have hoped for 50 percent of those sales tohappen online, so we've been pleasantly surprised." That attitudereflects a significant shift of mind-set for a traditionally slowindustrial giant in a traditionally slow industry.

Expect GM to continue to invest in e-business. The IS group hasdelivered the lineup of e-business initiatives without breaking thebank, partly because of the small-pilot approach and partly becausethe IS budget prior to 1996 was so bloated that Szygenda's group hasbeen able to pay for all the company's e-business plans while stillcutting the yearly IS budget by $600 million to $700 million, to justover $3 billion today. Furthermore, GM holds equity stakes in 38Internet-based and software businesses - stakes gained without spendinga dime, by providing those vendors with product development guidanceand one of the world's biggest customers. (That contrasts with Ford,which bought its way into Internet equity via a $50 million purchaseof Internet Capital Group stock in 1999 - stock Ford later dumped forless than $1 million.) In all, GM's e-business work benefits greatlyfrom continuity of leadership. Szygenda has been the CIO of GM for sixyears. Ford, on the other hand, has had three CIOs during the sameperiod.

By paying for initiatives without crippling company finances, GM istaking a smart approach to e-business. The company takes acceptablerisk, runs pilots, learns and pulls the plug when necessary. Criticssay GM is too ponderous to act quickly, but regardless of the fate ofAutoCentric or eGM itself, GM has entirely defied those critics withits e-business efforts.