| BUSINESSWEEK ONLINE : OCTOBER 11, 1999 ISSUE | ||||||||
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| INTERNATIONAL BUSINESS
'There Needs to Be a Sense of Urgency' Carlos Ghosn, Nissan's new French COO, outlines his revival plan When Carlos Ghosn became Nissan Motor's chief operating officer on June 25, he set ambitious targets for Japan's No. 2 auto maker. Ghosn wants Nissan to get back into the black by 2001, after its $261 million loss last year. That means that Nissan must overhaul its products, marketing, and manufacturing worldwide. On Oct. 18, Ghosn will announce a comprehensive revival plan intended to achieve all that. But his toughest challenge could be in nurturing a new culture inside the Japanese icon that will ensure that is new plan is implemented well. Ghosn recently shared his plans with Business Week Tokyo Correspondent Emily Thornton. Here are edited excerpts from their conversation: Q: How do you hope to bring about a cultural revolution at Nissan? A: People are not focused enough on profitability. Nissan will be more performance-oriented. It will be building market share instead of buying it. Second, Nissan will be much more customer-oriented. Nissan is much more competitor-driven than customer-driven. This is going to change. We want to know what are the segments of the markets we are addressing, what are the buying trends of the customers, and why. The questioning and decisions on investment will be mainly made starting from the customers and not from what Toyota is doing or what Ford is doing. Third, there needs to be a sense of urgency. You should come to the headquarters and the walls should be on fire. Time is of the essence. Every day counts. This is a very important element in the change of Nissan. Fourth element. The company has been in turmoil. All companies in turmoil, with a lack of profit, a high level of debt, and lots of autonomy, tend to look only at the short-term. They forget the mid-term and long-term. This is something that is true at Nissan, probably because top management was mainly preoccupied with how we are going to get the money for the end of the month. There was no attention given to the mid-term and long-term plans. If there is no clear vision, no clear identity, and no long-term plan, then there is no motivation. People just tend to do what they have done in the past. This is something that's going to change. Fifth. I am going to manage the company in a more cross-functional way. This company has been full of sectionalism and territorialism. Nissan appears to be more of a multiregional company than a really global company. To be competitive, you have to be global. And global means one strategy. Q: What has been one of your biggest surprises so far at Nissan? A: One of the biggest surprises is that Nissan didn't care about its brand. There is nobody who is really responsible for the strategy of the brand. This is one of the surprises. Q: Have you seen any signs that your cultural revolution has started to take root? A: On July 7, I made a speech that was communicated across Japan, Europe, and the U.S. It would be fair to say my first message was received well. People know that some of these decisions will jeopardize their jobs and the way they are doing their jobs. So they don't always like it. There is a high level of expectation, but at the same time they are saying maybe it will not be good for me. Everything will be good for Nissan, but it may not be good for me. When I read the feedback, I was expecting more anxiety and less positive reaction. Which leads me to think that people are ready [for change]. Q: I hear you are planning to hold board meetings at the test track.... A: You think it's a joke? I want the executive committee to test competitors' cars and Nissan cars. It's not a joke. We need to be familiar not only with our products, but also with our competitors' products. It allows us to see how our cars fare. It also allows us to see what our experts think vs. what our customers think. Q: About the revival plan... A: I'm not going to say anything about the revival plan. It's not a cost-reduction plan. It's a revival plan. It's going to be a complete plan. How much time is it going to take to come up with a more attractive lineup? What is your target market share, the profits you're going to make? That will all be addressed. Q: I understand you're starting your days at 7 a.m... A: It's considered a little bit rude in Japan to call somebody at 7 a.m. But I'm telling people, look, if you want to see me, it will have to be very early in the morning or late in the afternoon. People are responding favorably. I'm not trying to provoke them. I'm just doing it because I need to meet people, and I need to solve problems. And there are only so many hours in a day. Q: How would you describe your relationship with Nissan Motor CEO Yoshikazu Hanawa. How is this partnership working out? A: We have common objectives. This is the best way I would describe it. Q: I hear you're emphasizing responsibility. How are you doing that? A: Each time we put money in subsidiaries, we are asking management for a special commitment. It means you have to deliver. The first reason for lack of accountability is unclarified processes. We have a lot of subsidiaries, and we are going to be asking them to deliver on target. But if the targets are not met, it doesn't mean it's not important . We're going to try another year. We will analyze why the targets have not been met and make conclusions. People must feel there is nothing guaranteed when you don't deliver, which is not the traditional way. Then when someone delivers more, they will say what's in it for me? That's why we are looking into measures like stock options. Q: And when will we see the first car from this alliance? A: You mean the first baby on the line? It will be a little bit more than two years. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP |
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RELATED ITEMS A New Order at Nissan PHOTO: Nissan's Xterra SUV ONLINE ORIGINAL: ``There Needs to Be a Sense of Urgency'' INTERACT E-Mail to Business Week Online | |||
