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John Taylor never meant to make his colleague cry. But when Taylor, director of design strategies for General Motors's forward-thinking Advanced Portfolio Exploration Group (APEx), told one of Chevrolet's brand managers that it was time to rethink and redesign the Camaro -- a relic of an extinct consumer group that Taylor describes as "medallion men," with their unbuttoned shirts and exposed gold chains -- the manager literally broke down in tears.

Change is never easy -- especially in a vast, global organization like GM, which has been struggling with a change agenda for years. But having weathered an 18% dip in its U.S. market share over the last decade, a dip that's been partly due to the fact that many of the company's new vehicles don't seem to appeal to young buyers, GM finally understands that keeping its leadership position in the worldwide auto business demands deep-seated change.

"Change takes guts. It takes imagination. It takes commitment. This place has had so many life-threatening shocks over the years that the thought of even taking a risk has been considered too risky," says Taylor, 60, a sharp-witted Aussie who came to GM headquarters five years ago from Ruesselsheim, Germany, where he served as assistant director of design at Adam Opel AG. "But the upside is that when you finally do get a supertanker to turn around, shit happens."

APEx, a team of 40 designers, analysts, and engineers temporarily housed in the basement of GM's sprawling Technical Center in Warren, Michigan, is charged with imagining and developing bold new concept cars -- future vehicles that will, ideally, create the type of buzz and cultlike following that the Volkswagen Beetle and the slick Audi TT Roadster have generated. APEx is part of an idea-generating triumvirate inside GM that includes the Corporate Brand Character Center, a creative think tank that sharpens the images of GM's nine different vehicle divisions, and the Innovation Zone, a 12-person team that focuses on how to make gm's best new ideas an engineering reality.

Already, APEx's hand can be seen in gm's 2000 concept-car lineup, as well as in several on-the-market vehicles such as the new "funkstalgic" Chevrolet SSR, which is half-pickup, half-roadster, and which debuted to much fanfare during this year's auto show in Detroit.

How has APEx changed how GM generates ideas? First, it convinced the company that it had to break out of what APEx manager Bill Ochalek calls GM's "16-mile-road mentality."

"There's this idea that the world runs right around our technical center, that Warren is at the center of the universe," says Ochalek, a 23-year veteran of GM. "But being alone is not a good thing in our environment. It's too easy to talk yourself into the brilliance of your ideas."

The basic insight: You learn the most by interacting with people who are the least like you. But the reality of life inside GM -- and, to be fair, inside virtually all big companies -- is that you spend most of your time with people who are exactly like you. To counter this insularity, Ochalek, 43, lobbied to get his team out into the real world. Members of APEx went to work inside various car dealerships and visited with companies in different industries. They stopped attending auto shows and started going to Internet conferences, consumer-electronics trade shows, and toy fairs.