This is the story of Carlos Ghosn and how he became the CEO that led Nissan’s revival. The book is easy and quick to read – taking you from his childhood to the near present. He shares many management insights but all are guided by his strong desire to be in charge and lead aggressively – preferring to be a big fish in a small pond vs. a small fish in a big ocean. Here are some of the management techniques he shares in his book:
Make a significant contribution straightaway – do something so those around you can recognize and measure what you have done; Contribute quickly, set a fast pace, taking action, assigning responsibilities and setting deadlines; Prepare the ground for change by presenting all the facts and getting them out in the open; Establish cross functional and/or cross company teams with co-leaders from different functions to encourage managers to look beyond their functions and to break down inter-organizational barriers; Articulate the plan and state goals clearly and set timetables and deadlines and assign groups to do the work.
Here’s a good quote: ‘if you’re focusing on speed, it’s not how quickly a decision is made that’s improtant, it’s how quickly the decision is carried out. Similar to innovation equaling the application of creativity, what becomes important is the result. Ideas, like decisions, are nothing unless they get applied. Regarding Mr. Ghosn’s leadership style, it can best be described as determined. He does listen to others but only when they can offer constructive alternatives. He supports active consensus building and doesn’t shy away from conflict – when it’s constructive and there are valid arguments to be heard.
He boils Nissan’s problems down to failure to concentrate on profit, neglect of customers, weakness in cross functional work, absence of urgency, and the lack of a common long term vision. He then starts to re-evaluate every part for of the business – especially Nissan’s ownership in many of it’s suppliers. Purchasing costs (60% of expenditures for Nissan) are slashed. platforms, powertrains, and administrative expenses are reduced. And finally, if goals were not achieved, he and his executives would resign. He clearly wanted to make public his commitments and goals.
His advice to other car companies considering mergers or alliances is to focus on performance advantages of the alliance by playing up each company’s strengths and not just focusing on scale economics. For example, supplier development times are much shorter in Japan vs. North America and Europe.
Although Nissan did eliminate it’s debt and generated healthy profits, there were some problems that surfaced shortly after this book was written. Poor quality plagued a U.S. plant during startup, the Titan Pickup truck never met sales expectations, and the Quest minivan was also a disappointment in terms of styling and sales. As a result, Nissan remains in my opinion a solidly 2nd tier Japanese OEM behind Toyota and Honda.
But if you want to buy an interesting car book and learn about a very dynamic leader, I recommend Shift as a quick and fast read. But remember, this book is more about the man and his management style and less about Nissan and their cars.