New Yorkers might not know it, but Detroit giant General Motors has an office in midtown Manhattan.
It’s not in the actual GM building, a mid-1960s skyscraper that the company effectively sold in the 1990s and that was later partly owned by Donald Trump. GM’s views of Gotham are now found at the nearby AllianceBernstein Building, once known as Burlington House, another mid-’60s monument to American capitalism.
From there, Dhivya Suryadevara, GM’s chief financial officer, oversees the economic well-being of the largest US car company, often flying up to GM headquarters in Motown to connect with CEO Mary Barra and other members of the management team.
It’s an arrangement that emphasizes Suryadevara’s critical role as the face of GM for Wall Street, more than her historic job as the first female CFO of a company that in 2014 hired its first female CEO in Barra. Suryadevara, 40, joined GM in 2004 and rapidly distinguished herself after the car maker’s 2009 bankruptcy and subsequent 2010 relisting on the New York Stock Exchange as an executive to watch at the company.
Following the retirement of GM veteran Chuck Stevens as CFO, Suryadevara got the job. She had worked closely with Dan Ammann, who served as CFO before Stevens and had become GM’s president, overseeing deals such as a $1 billion all-in purchase of San Francisco self-driving startup Cruise Automation in 2016 and GM’s sale of its Opel-Vauxhall European division to Peugeot in 2018. (Last year, Ammann gave up the president’s title to become CEO of Cruise, now valued at nearly $20 billion after investments from Japan’s SoftBank and Honda.)
India to Harvard to GM: a long road traveled in a short time
Suryadevara had come a long way. She was born in Chennai, India, and lost her father when she was a child. Raised by her mother, along with her two siblings, she studied business in college at the University of Madras and did a stint at PricewaterhouseCoopers, then came to the US to attend Harvard Business School, earning her MBA and laying the groundwork for a top-flight career in finance.
She worked at UBS before joining GM when she was 25. Responsibilities came quickly, and by 2013, in the aftermath of GM’s 2009 federal bailout, bankruptcy and subsequent stock-exchange relisting, she was CIO of GM Asset Management, taking care of the company’s $85 billion pension fund.
That New York-based role, and her performance in it, captured the attention of Ammann, who singled it out when I asked his opinion of Suryadevara in 2018 for a profile of GM’s C-suite. GM’s leadership was already impressed by her talents when the opportunity arrived to name a new CFO, which in the process created the first all-female team in the auto industry. Suryadevara joined Mary Barra as the executive duo that would argue the 111-year-old car maker’s case to Wall Street every quarter.
“It’s been awesome,” Suryadevara told Business Insider in an interview on the 20th floor of the AllianceBernstein Building, in a conference room named for GM’s legendary mid-20th-century president, Alfred Sloan, the father the modern American corporation. “The role is incredibly rewarding and challenging. I’ve been fortunate.”
Getting down to first principles
Suryadevara alternates between youthful enthusiasm, steely management pronouncements, and expressing a broad but detailed perspective on GM’s past and future. Smartly attired in white jeans and a short black jacket, she projects a modern image of Detroit, bent through the lens of New York fashion. She spends half her time in Manhattan, living with her husband and daughter on the Upper West Side. (She drives a Cadillac XT4 in the Big Apple and a Chevy Camaro in Motown.)
“I like the amazing restaurants with authentic food in New York,” she said, confessing to being a serious gastronome. She’s also a fitness fanatic who counterbalances her dining-out enthusiasms by taking advantage of New York’s “million different workout classes” and the city’s never-sleep energy. But she’s also a Detroiter who says the revitalization of the city, its arts and music, and its automotive DNA all inspire her.
She might lean a bit more toward the Big Apple, though. Suryadevara’s manner combines poise with more than a dose of New York moxie. More than once during our conversation, she thumps the table to stress a point. She takes not a minute to gaze out the windows at the midtown vistas to collect her thoughts. They’re already collected and ready to go.
Stevens was a steady hand on GM’s post-bankruptcy business; it was impossible, even futile, to discombobulate the man, as investment-bank analysts discovered at financial events and on quarterly earnings calls. Suryadevara hadn’t been tested by the media before her ascent to CFO, but she knew Wall Street. Her first interaction with analysts, at the end of October 2018, served notice: Suryadevara was going to perpetuate Stevens’ focus and discipline — and intensify it.
Barra has already indicated that this was what was in store for the financial community. She told me last year that Suryadevara never does anything without comprehensive preparation. She’s one of those executives you don’t have to worry about getting up to speed because she’s already setting the pace. Or exceeding it.
GM’s finances aren’t just complicated — they’re sprawling, encompassing huge international markets and featuring eye-watering credit operations and oceans of cash. In a single quarter, the company typically notches over $30 billion in revenue and posts a profit of more than $2 billion. But do that math: In the US alone, GM sells nearly 3 million vehicles every year, and in China it’s 3.6 million. In one year, $150 billion in revenue flows through the balance sheet.
Faced with cash flows of that magnitude, some managers would blanch; instead, Suryadevara zeroes in on what matters to the business.
“I like getting down to first principles with everything, challenging assumptions and getting down to the basics,” she said. “If you don’t have a fundamental understanding if what you’re doing, it’s not a good place to be.”
Fundamental No. 1: Return on invested capital
Fundamental No. 1 for GM under Barra has been to maximize its return on invested capital. Barra has been unwavering in her commitment to that goal since she negotiated the difficult ignition-switch recall that intensified after she became CEO. With ROIC as its North Star, GM has shed its underperforming divisions, streamlined its South Korean operations, invested in self-driving technology, and announced a thoroughgoing rework of its vehicle portfolio to shift the company to electrification.
Barra has also made tough calls on GM’s North American manufacturing footprint. The car maker began the process of shutting down two factories, in Michigan and Ohio, drawing the ire of the United Auto Workers and President Donald Trump before retreating in its plans as it hammered out a new four-year contract with its 49,000 UAW-represented hourly workers and endured a 40-day strike that ended right before the automaker reported third-quarter earnings. (GM beat expectations with a solid profit, but Suryadevara was left to contend with a $1 billion loss for the period and a trimming-back of GM’s overall expectations for 2019’s margins.)
The industrial logic of Barra’s move was simple: GM has enough US capacity to build a million more vehicles than it can sell in that market, a market that’s been running at peak levels for the past five years.
That’s a serious business challenge, one that encourages Barra to limit difficulties elsewhere in GM’s operations. Fortunately, in Suryadevara, Barra has a financial-complexity assassin.
“I’ve spent a lot of time at GM slaying complexity,” she said. “There’s good complexity and there’s not-good complexity.”
The latter has to go, or at least be correctly managed. She cited as an example the nearly $30 billion in pension liabilities GM offloaded under her supervision. (The deal, completed in 2012 when she was managing director of investment strategy, involved swapping future pension payments to retirees for Prudential annuities, effectively de-risking GM’s balance sheet and reducing the type of legacy costs that had sent the company into insolvency in 2009.)
Making big and important decisions, and not realizing how big and important they were
Direct, relentless questioning is how Suryadevara eliminates as much intricacy as possible. “Why are we doing X?” she asked. The common answer, especially at a gigantic conglomerate, is “because of Y and Z” — a familiar, entrenched sequence of received thinking.
Suryadevara’s reaction is to ask, “Why is Y Y and Z Z?” Once this issue has been raised, Suryadevara and her team can decide if the process actually still makes sense.
“We talk through what’s really important,” she said. “We distill and then we make recommendations.”
This can be an uncomfortable experience for people who’ve been cranking out PowerPoints since freshman year.
“You don’t have to put anything together for me. Let’s just chat. If we have to get some data, we’ll obviously get it.”
If one mistakenly assumes that attitude means Suryadevara is conducting chill seminars in first principles, she’s ready to dispel misconceptions with a little table pounding.
“There needs to be a path to making a reasonable return on capital,” she says, punctuating the message with three or four thumps. “It all comes back to this simple concept, at the end of the day.”
Pulling herself back again and again to this fundamental notion, Suryadevara even uses it to frame her memorable moments in her 15 years at GM. “It’s been a series of important decisions we’ve made,” she adds. “When we made the decisions, we knew they were big and important. But looking back we didn’t realize how big and important.”
Keep putting proof points on the board
GM has been steadily profitable since its 2010 IPO, but the company’s stock has been off its trading highs of about $45 for more than a year. Before the UAW strike, shares appeared to be setting a floor at $37, but despite five years and a gain of around 15%, the stock’s 10-year performance, at 6%, has lagged behind the broader markets by a notable margin.
The company has compensated investors with a multibillion-dollar stock-buyback program, now winding down to a final $3.5 billion tranche, and a 4% dividend yield. Several analysts are bullish on GM and have praised its efforts with Cruise, creating a $20 billion company that’s tied to a $50 billion one. But Wall Street has been anticipating a US sales downturn for four years, and though the market has instead set records or near-records, skepticism has been difficult to overcome.
Suryadevara summarizes GM’s position, one that has been articulated most forcefully by Mark Reuss, GM’s president and main product guy.
“We’ve been putting proof points on the board,” she said. “And we want to keep posting proof points.”
Additionally, Suryadevara believes GM has to tell two compelling stories.
“We want to be great at our core business and great at the future,” she said. “It’s not an or — it’s an and.” (The table was spared her fury for that insight.)
Given that, it might be a good thing that she lives in the city that never sleeps and brings that relentless ethos to Detroit. Reflecting on her time at the largest US automaker and the No. 4 worldwide (behind the VW Group, Nissan-Renault-Mitsubishi, and Toyota), Suryadevara says she doesn’t always have restful nights, in either metropolis.
“I lie awake at night thinking about how we’re going to set this company up to be successful for decades to come.”