[GTO]

Nikkei.com has an interesting series called 'My Personal History', where eminent leaders share their story - first hand.

Carlos Ghosn shares his story. It's an awesome read!

Link to article index

12 parts are already up, with new ones coming everyday.

I'm somewhere over the Atlantic Ocean now, cruising at an altitude of about 14,000 meters. As I fly toward Brazil, my thoughts are in Japan. While it is a tradition for me to spend the New Year holiday with my family in Brazil, a part of me wishes I could also be in Japan, on the most celebrated day of the year. I extend my Happy New Year's wishes to all.

As the CEO of both Nissan Motor and Renault, and the chairman of the Renault-Nissan Alliance, I split my time each month between Japan, France and other markets where the companies operate, such as the U.S., Brazil, China and the Middle East. People often ask me what I do from day to day. It's a difficult question to answer: No one day is like another. It depends on the region where I am working and what decisions need to be made. But while every day is different, it is also the same in the sense that I am focused on the performance and success of these businesses.

How & why Renault picked Nissan

My journey to Nissan Motor began with the "merger of equals" between Daimler-Benz and Chrysler. This historic partnership was announced in May 1998, and it challenged the entire automotive industry.

A few days after the announcement, Renault's executive committee held a meeting. Chairman Louis Schweitzer mentioned that Renault should also start thinking about potential mergers and partnerships. At the time, the company was showing some revenue growth, but it didn't compare to the growth of the new company formed by Daimler and Chrysler, which became as large as General Motors and Ford Motor virtually overnight. We understood the strategic challenge: Could Renault stay relevant among such mammoths?

The question then became not whether we should form a partnership, but with whom. We knew that automakers who delivered sales of fewer than 4 million units wouldn't be around much longer, so that disqualified any smaller candidates. On the other hand, the then-largest automakers, such as GM and Ford, were out of reach.

Saving Nissan

The first order of business when I joined Nissan Motor was to build a plan for its recovery. At the time, Nissan was in a desperate situation. The company's share of the Japanese market had been steadily falling for 26 years. Financially, it had been in the red for seven of the eight years through 1999. Interest-bearing debt was more than 2 trillion yen ($17 billion at current rates). Because of this, the release of new models had slowed almost to a stop.

How did Nissan find itself in such a hole? One reason was that the company had simply not valued profits. Back in 1999, Nissan offered 43 models, but saw profits for only four of them, and small ones at that. I remember one executive meeting early on in my tenure in which I rejected the development plan for a new model called the X-Trail.

To me, the reason was clear: The proposed business plan would result in a loss. But other executives and staff were shocked. It was the first time that a plan for a new model had been rejected by the executives. The team argued that without the plan, dealers would have nothing to sell. I responded to their pleas by saying, "no profit, no program." Discipline was critically important. (The X-Trail we have produced since 2001 is an improved, and profitable, version of that plan.)

[VKumar]

Thanks a lot for sharing, GTO. That link is indeed a trunk filled with gems.

I remember reading in 'American Icon' book, Carlos was approached by Bill Ford too for the position of CEO. Bill was unsure if anyone other than Carlos can turn his company around. That time Carlos asked for the position of both president and CEO; which Bill wasn't ready for. Later they brought in Alan Mullaly from Boeing, how Ford turned around after that, is known to all.

[vvnagan]

GTO - Thanks a million for this!!! I once saw a documentary abt the development of the Nissan GTR which showed Ghosn's personal involvement in the project. Have been a fan of his ever since.

[MSAneesh]

Thanks GTO !! Carlos Ghosn is such an inspiration. During my short association with Nissan and opportunities to visit their US Head Office and plants, I had read about him before and the great turnaround he brought at Nissan. This is a delightful series from the man himself....thanks!

[Fraz33r]

Originally Posted by VKumar

I remember reading in 'American Icon' book, Carlos was approached by Bill Ford...

What a coincidence, I am currently reading this book and I am at the same page where this happens. Carlos needed the entire reign in his hands and that is what Bill wouldn't agree on and hence they went to Mullaly. Need to keep reading on..

[ajmat]

Having met him in person, this guy is impressive. He speaks without notes, his energy never flags. I spoke to some of his staff and they mentioned that timezones never bother him, he is ready to go everyday

[The Brutailer]

Great read. Sometimes you gotta take tough decisions without attaching emotions to it to succeed. First get the basics right, then expand!

Love reading such articles. Thanks GTO.

[kiku007]

Good article. Thanks for sharing. I've read about how Alan Mulally turned around Ford as well.

Both Carlos and Alan have been tough in bringing about change and discipline, especially with respect to cost cutting.

In this light, I wonder how they were indifferent to their respective Indian operations. I mean, we read about how Carlos didn't approve the X-Trail program because it wasn't profitable or how Alan let go Jaguar Land Rover. Alan used to have weekly reviews which is based on real numbers and not BS. But Ford or Nissan in India come nowhere close to the expectations these CEOs seem to expect. And its even surprising on how the heads approved some of the decisions like the below,

1. A new Ford plant (At Sanand) which is far from the current plant (Chennai) when their current plant itself isn't really running in full capacity. Hyundai next door has multiplied their marketshare several fold since inception and has expanded its capacity within Chennai.

2. Three brands for India - Renault Nissan Datsun. Enough said.

What could be the reason? Is a notional presence in India a compensation for their underwhelming performance?

[deetjohn]

Nice share! Will go through it and update the thread.

After reading about Ghosn for so long and his impressive turnaround stories at Nissan, I bought Shift some years back and found the book to be surprisingly boring. Though I am not much of a book reader, I didn't think an automotive story could drive me away. I don't think I read it completely. It was not at all in the same league as Lee Iacocca' autobiography which I finished in one go at college.

So definitely want to try this out. And seeing other posts on this thread, I am hopeful its not like 'Shift'.

[VKumar]

Originally Posted by Fraz33r

What a coincidence, I am currently reading this book and I am at the same page where this happens. Carlos needed the entire reign in his hands and that is what Bill wouldn't agree on and hence they went to Mullaly. Need to keep reading on..

Same page? That means, 'The Man on White Horse', must have arrived as of now. What an interesting read that book is. You read it once, and it's not possible not to pick it again after sometime. I have read it thrice, the most interesting IMO is the section where Mr. Mullaly visits Washington as well as how they decided not to take the tax-payer's money.

Originally Posted by kiku007

But Ford or Nissan in India come nowhere close to the expectations these CEOs seem to expect.

Maybe because the volume here is a bit too low go grab their eyeballs.

1. A new Ford plant (At Sanand) which is far from the current plant (Chennai) when their current plant itself isn't really running in full capacity. Hyundai next door has multiplied their marketshare several fold since inception and has expanded its capacity within Chennai.

Can be several reasons. Taxation benefits and maybe transportation costs too. I believe that the shipping cost of sending the cars from Sanand to Europe, will be considerably lesser than that to be incurred for shipping the cars from Chennai to Europe.

Originally Posted by deetjohn

So definitely want to try this out. And seeing other posts on this thread, I am hopeful its not like 'Shift'.

Try 'American Icon - Alan Mullaly and a Fight To Save Ford Motor Co.'. You won't be bored I am sure. I too ended up buying 'The Toyota Way' and within a week, I donated it

[deetjohn]

This was going very well until I hit the paywall on the 6th chapter. Damn! I am hooked and want to complete this.

Originally Posted by VKumar

Try 'American Icon - Alan Mullaly and a Fight To Save Ford Motor Co.'. You won't be bored I am sure.

Will do that certainly. Thanks for the suggestion.

[GTO]

Originally Posted by VKumar

I remember reading in 'American Icon' book

Excellent book, that is! For more recommendations, please read this thread.

Originally Posted by vvnagan

I once saw a documentary abt the development of the Nissan GTR which showed Ghosn's personal involvement in the project.

This one?

https://www.youtube.com/watch?v=irjdE9uGQMQ

Originally Posted by kiku007

But Ford or Nissan in India come nowhere close to the expectations these CEOs seem to expect.

When you are a global CEO sitting in USA or Japan, India isn't a top priority, especially when your Indian operations have minuscule market-share after years of trying. I don't think Ghosn or Mulally had any bandwidth for India (other than lip service).

Originally Posted by deetjohn

After reading about Ghosn for so long and his impressive turnaround stories at Nissan, I bought Shift some years back and found the book to be surprisingly boring.

Horrible book! Here's my review from the other thread (linked above):

Originally Posted by GTO

Please avoid Shift (Nissan).

I'm a huge fan of Carlos Ghosn and bought the book with high expectations; well, it's hardly a book for a petrolhead (unlike the books I've listed earlier). I was yawning through most of it. Sure, it's got some solid management stuff, but there are books that do it better.

For petrolheads looking at some solid insider car stuff, it's a thumbs down. Nowhere as captivating as Iacocca's biography (for instance).

Originally Posted by deetjohn

This was going very well until I hit the paywall on the 6th chapter. Damn! I am hooked and want to complete this.

Ctrl + Shift + N = Open your Chrome browser in incognito mode and access the website.

[vinit.merchant]

Originally Posted by GTO

Ctrl + Shift + N = Open your Chrome browser in incognito mode and access the website.

Unfortunately, this trick isn't working. I managed to read through the first 9 articles before it prompted me to pay.

[AbhisheKulkarni]

Originally Posted by vinit.merchant

Unfortunately, this trick isn't working. I managed to read through the first 9 articles before it prompted me to pay.

Switching browsers does the trick. I used Internet Explorer for the remainder of the articles after it showed me the payment page in Chrome.

[GTO]

Originally Posted by vinit.merchant

Unfortunately, this trick isn't working. I managed to read through the first 9 articles before it prompted me to pay.

I just tried and it did. Be sure to close the incognito browser window (entirely) and start a fresh one for the next batch of articles.

*Sorry for going off-topic*