Nissan Motor Corp. Chief Executive Officer Carlos Ghosn enjoys something akin to rock star status across the auto industry. He mastered the art of turnaround during stints running Michelin's U.S. tire operations and with Renault in Europe during the 1990s. His most remarkable feat, though, has been his salvage job at Nissan (NSANY), which looked like road kill five years ago when he arrived.
In 1999, few thought Nissan would survive -- and the decision by Renault to pump in $5.4 billion in capital to gain effective management control and to try revive Nissan, which was bleeding cash and losing market share in Japan and the U.S, looked like a chump's game. Ghosn, however, changed all that. Nissan is a profit machine, and its product lineup -- which includes the Altima sedan, Titan pickup trucks, and Infiniti luxury offerings -- has caught the imagination of consumers.
In April, Ghosn will assume the CEO title at Renault while keeping the top job at Nissan. This dual-CEO gambit is an industry first, and will test the wits of even a proven player like Ghosn. BusinessWeek Asia Regional Manager Brian Bremner met with Ghosn to discuss his managerial philosophy, his unique international background, and his love of cars -- that is, as long as they make a truckload of yen for his company. Edited excerpts follow:
Q: You have a reputation around the industry as a cost killer. But at this point in Nissan's revival, the focus is much more on expansion and growth. How exactly would you define your managerial style and philosophy?
A: It's a little bit difficult to define it, because it's very difficult to describe yourself in a very objective way. It's a little impossible. But if there are some strong beliefs in terms of management that I have, they are these: The basic objective of management is to create value. It's very important never to forget why we're here. And the higher you are in management, the more obvious it has to be. And in order to create value, obviously you have many methods, etc.
But the heart of all this is how you get the attention of people and how you get people motivated to what you are doing. How do you get people thrilled in a certain way about what's going on in the company?
There's a lot of cynicism. There's a lot of doubt. There's a lot of skepticism. There are a lot of second thoughts. But you know it's a competition. And if you do better than your competition, you're going to get better results.
Motivation is the ultimate weapon. My management style is inspired by this. That's why I'm very demanding about performance. I'm very demanding on myself, and I'm very demanding of the people around me. But I know that to be able to be demanding, you have to empower people. You can't be demanding of someone who isn't empowered, it isn't fair. If you have to put two words around the management style, I would say value and motivation.
Q: Despite being a foreign CEO in Japan, you have managed to gain the trust of Nissan's largely Japanese workforce. How did you bridge the cultural barrier?
A: It's interesting to see how human beings handle difference. People have always had problems about what is different from them. Different religion, different race, different color, different sex, different age, different training -- human beings have always had a challenge confronting what is different.
Now, we come to the basic acknowledgement that you feel more secure with somebody who is like you. You feel more comfortable, you feel more secure. You feel insecure with someone who is different from you. You feel more insecure with a woman, or someone who is younger than you, or older than you, or a foreigner.
But I recognize that even if someone is different, I'm going to learn a lot. We have a tendency to reject what is different. And at the same time, we need what is different. Because what is different is the only way we can grow by confronting ourselves.
As you know, I was born in Brazil, I spent some time in schools in Lebanon, and I went back to France for my graduation. But I have been confronted by change all my life. I changed friends, I changed schools. You start to understand that [while] it's unpleasant, it's also enriching. That's what I want to tell you. Going to another country and confronting another culture, I don't feel any anxiety about that. I feel curiosity, I feel interest.
Why? Because I have already spent a lot of time in my life worrying about anxiety and I have overcome it. But I still understand people who are confronting difference for the first time. When my kids change schools, they don't like it. But at the same time, I understand that this will make them stronger.
You know, people usually ask me, "Who is the business leader that you respect or that you read about?" In fact, I don't think about so many of them. But I'm impacted from time to time by employees who make very simple remarks about some specific events. [They] have more impact on me than books written about management, because they are so expressive. And it can be a worker on a shop floor, [or] it can be a technician doing something extraordinary.
For me, in management you learn independently of ranking, independently of IQ, and independently of age. You witness different situations. Whenever you understand how much difficulty is behind the situation, then you appreciate people and what they do independently of who they are.
Q: Tell me about your interest in cars.
A: I like cars. Even if I have throw myself into the role of a businessman who looks very coldly at a decision, I'm always reminded by my sisters, or my parents, that I used to recognize cars by their horn at the age of five. Now am I a car lover? Yes. Am I car fanatic? No. Which means I will never make a wrong business decision just because I love a car.
You have to resist your feelings, particularly in some important decision you have to make. In the car industry, there's this image that there are CEOs who are car fans and CEOs who aren't. There are CEOs who like cars and understand cars and CEOs who don't. But I don't know who's more dangerous. If you have a car fan, and he's going to substitute himself for the customer, you're in trouble.
Q: You talk a lot about Nissan's need for segment-defining cars. What image are you actually seeking for the brand?
A: We don't want to be something for everybody, we want to be everything for some people. By that definition, we're going to distinguish ourselves. Our objective isn't to be the unanimous brand that everybody recognizes and everybody likes a little bit but not too much. We want to present products that are going to be attractive. And when they're attractive to some people, they will be repulsive in some way to others.
We're trying to build character. We're trying to build authenticity, spice, something that makes our cars different. We understand that some people won't like it. That's O.K. That's fine. A powerful brand is engaged whenever you have clear attributes recognized by the public, and clear attributes mean no complacency, a good, strong character, a strong personality.