Outsiders Take Big 3's Keys

"Insiders have a dominant logic that is based on an environment that may not be relevant to (imposing) change," he says. "Normally, insiders also have social relationships within the business that may make them less willing to take the actions necessary to change the company."

In the third case of an automaker turning outside for help, Chrysler in 2007 chose as its CEO Robert Nardelli, who had spent three decades at General Electric(GE) and six years as CEO of Home Depot(HD).

Tom Libby, an independent auto industry analyst, says Nardelli "was put in a very difficult situation. A lot of people were resentful of his huge severance package at Home Depot, and then he wasn't given enough time." In the end, a deeply troubled economy forced Chrysler into bankruptcy, where it reached a deal with Fiat that may enable it to survive.

In general, "The auto industry has tended to be very insular, almost as if it is in a cocoon," Libby says. "Because of that, it tends to benefit from outsiders, (even if) they have to go through a learning curve."

In at least one case, however, going outside was a major mistake for GM.

In 1992, GM's financial performance was troubled, and the company sought a turnaround. For its new chairman, it chose board member John Smale, CEO of Procter & Gamble(PG). And in 1994, it hired Ron Zarrella, president of Bausch & Lomb, as vice president for North America: he was later named president.

"What they brought to GM was the concept of brand management, which crashed and burned in a spectacular way," says John Wolkonowicz, senior auto analyst at IHS Global Insight, "They were insistent that you didn't have to have any knowledge of the product, you manage a brand. They even brought in someone from Keebler Cookies to be brand manager for the Buick Regal." In all, GM hired 34 brand managers in 1995 and 1996.