Detroit Muscle

Devising a strategy, brilliant or otherwise, was left to Huber, a midlevel executive who had no experience with high-tech gadgetry. "I was just a locomotive salesman," he says. What Huber did have was the right mix of skills and connections to make something happen. He was steeped in GM's Byzantine culture, but he was not a captive of it. Plus, he'd just finished studying at a place that trained admirals and generals to tackle the world's toughest problems. Wagoner puts it this way: "Chet was wired to think different."

As president, Huber made some unconventional moves from the start. First, he assembled a core team that embraced the insider-outsider dynamic. Fred Cooke, who recently retired as OnStar's vice president of commercial development, had started at the Allison engine division in the 1960s. Dave Acton, now executive director of global telematics, was a senior electrical engineer who had worked on Project Beacon. Meanwhile, Huber poached a key engineer, Walt Dorfstatter, from Ford's nascent program, code-named RESCU. To this core GM team, Huber added expertise from outside the company. (Nearly 60% of OnStar's employees aren't from the auto industry.) Bruce Radloff, OnStar's CTO, came on board from IBM in 1997. In 2000, Huber hired Rod Egdorff, who started out with Craig McCaw's pioneering cellular service before moving on to Sprint PCS, to take over OnStar's wireless business.

Next, Huber insisted that his project be an independent venture inside GM, free to operate with its own strategy, metrics, and culture. The initial plans had called for Project Beacon to be controlled by a three-way partnership between EDS, Hughes, and GM. But Huber thought that such a structure would make the project virtually impossible to manage. Over the years, many of Huber's key players have worried about their unit's elbow room inside GM. "Would we be given the freedom to pursue our dream?" wondered Radloff, who knew from his IBM days what it was like to innovate inside a huge company. "But Chet was true to his word. He went to battle for us and got tremendous support."

There was one last big organizing principle behind OnStar: Huber felt that the unit had to be free to operate at its own pace -- one that embraced the short product cycles of the consumer-electronics world, as opposed to the five-year product cycles of the auto business. "I needed to persuade a company that doesn't like risk or change to accept that we would be risking and changing a lot," Huber says. "I told them that if they made me conform to car cycles, we'd be selling eight-track tapes when our competitors would be selling CDs."

GM's brass signed up for the ride, including the fast pace. Huber then focused on the shop floor. He knew that full-fledged backing from headquarters didn't mean a thing if he didn't have support from the factories. The essence of OnStar, Huber believed, was that it had to operate like an extension of the car -- it had to be a seamless part of the driving experience. That meant working closely with engineers and assemblers to build a simple user interface and limit production costs.

Huber encouraged his outside recruits to work on the technologies behind the new service. But he relied on GM veteran Acton to manage the factory-installation project. Acton had grown up in GM's car divisions, and he was passionate about OnStar. But he knew how difficult it was going to be to get OnStar's technology (cost: $800 in 1996 but just over $100 today) into cars. "At GM, you often got mandates from the boss telling you that you had to add something new to the car," Acton says. "The problem was that there was rarely any money or extra people in the budget to make it happen."

Acton's solution? Put frontline champions (called OnStar resident engineers) in the 15 assembly plants that would install the system. These resident engineers would make the case for the technology on the shop floor -- and respond to the tactical concerns of the assembly lines. For example, just one year after Acton started working with the teams, the engineers had the idea to use the rearview mirror in certain car models as the OnStar delivery device. The idea reduced costs and maximized flexibility. "I knew that the plants wouldn't want any extra parts," Acton says. "And I couldn't affect quality on the line." Winning over GM's factories means winning a big victory in the marketplace. Today, thanks to its factory-installed status, OnStar adds close to 5,000 new subscribers a day.

Connecting With Customers

Huber's wins inside GM set the stage for a fight on the real battleground: the market. From the start, his goal was to create a mainstream service, which meant putting customers first and technology second. OnStar had never been the most cutting-edge or feature-rich wireless service on the market. "We didn't always go with the prevailing wisdom," he says. "We knew that if we were going to be mass market, we had to be simple and easy to use. OnStar had to feel like it was part of the car."