Week­ender

Ghosn: rise and fall of the ‘cost killer’.

Business Daily (Kenya) - - FRONT PAGE -

It's hard to over­state the stature of Car­los Ghosn — and not just in the car-mak­ing world. His po­si­tion atop an em­pire com­pris­ing three of the world's big­gest man­u­fac­tur­ers — Nis­san, Re­nault and Mit­subishi — made him the leader of a trail­blaz­ing global al­liance. He was one of the most in uen­tial and pow­er­ful busi­ness lead­ers any­where in the world. His down­fall comes as a big shock. He was well known and widely liked by jour­nal­ists mainly thanks to his gen­eros­ity with his time and his habit of mak­ing head­line-grab­bing com­ments — like a Jose Mour­inho of busi­ness lead­ers. Car­los Ghosn was both a busi­ness vi­sion­ary and — it now seems — a tra­di­tional char­ac­ter in a very fa­mil­iar busi­ness fable. An al­liance between three global man­u­fac­tur­ers was some­thing not seen be­fore in the car in­dus­try and was his per­sonal cre­ation. Sav­ing a be­lea­guered Nis­san and team­ing it up with a Euro­pean gi­ant like Re­nault was ar­guably some­thing only he — a French cit­i­zen (Brazil­ian birth and Le­banese de­scent) who saved Ja­pan's trea­sured Nis­san could have done.

ELEC­TRIC CAR PARTY

Al­though known as "le cost killer" his easy cross-cul­tural charm was able to build a bridge between two man­u­fac­tur­ers who were (and many will tell you still are) nat­u­rally sus­pi­cious of each other. Af­ter ad­ding Mis­tubishi as the third leg of the stool, the al­liance he built pro­duced 10 mil­lion cars last year putting it be­hind only Volk­swa­gen as a vol­ume man­u­fac­turer. With his su­per­star sta­tus as­sured he had the li­cence to make bold moves. He was very early to the elec­tric car party — evan­ge­lis­ing about their im­mi­nent surge and putting his money where his mouth was by in­vest­ing heav­ily in the tech­nolo y de­spite a scep­ti­cal mo­tor­ing press. Ex­cept it wasn't his money. It was Nis­san's money. The same money that re­port­edly bought him four houses dot­ted around the world for his per­sonal use at a cost of £15 mil­lion (Sh1.98 bil­lion).

BOSS TURNED EM­PEROR

It is in that re­gard he also em­bod­ies an­other im­por­tant busi­ness phe­nom­e­non — the clas­sic tale of the boss-turned-em­peror. "L'etat c'est moi" said Louis XIV. In their own ways, and to greatly vary­ing ex­tents, so have other long serv­ing chief ex­ec­u­tives. Lord Browne who led BP for 12 years and mas­ter­minded the mega-merger with US gi­ant Amoco was called "the Sun King" by em­ploy­ees. His reign ended af­ter con­tro­versy sur­round­ing his pri­vate life. Sir Martin Sor­rell who turned a shop­ping bas­ket com­pany into a £20 bil­lion (Sh2.6 tril­lion) me­dia gi­ant stood down af­ter 33 years amid claims, which he de­nies, that he spent com­pany money on per­sonal ac­tiv­i­ties. These lead­ers are not nearly as das­tardly as Mir­ror Group's Sir Robert Maxwell or Polly Peck's Asil Nadir — both of whom stole millions from the com­pa­nies they founded. But they tell a fa­mil­iar story of the feted, long-serv­ing boss for whom the board meant to con­trol them be­came tooth­less and ir­rel­e­vant as the lines between the com­pany and the in­di­vid­ual be­came blurred. So what's the an­swer? The US po­lit­i­cal sys­tem has de­cided that term lim­its are the an­swer to stop the pres­i­dent be­com­ing im­pe­rial. Al­though some or­gan­i­sa­tions, like Deloitte, do im­pose time lim­its on their chief ex­ec­u­tive and chair roles (at Deloitte's, those roles are lim­ited to two con­sec­u­tive four-year terms) — these are gen­er­ally used in part­ner­ships where the chief ex­ec­u­tive role is very di er­ent from that in a pub­licly listed com­pany. Maybe there is no way to al­ter this age old tra­jec­tory. Suc­cess breeds con dence as the boss think that the suc­cess is en­tirely down to them, which breeds in­tol­er­ance of other views, that breeds re­sent­ment which prompts frus­trated sub­or­di­nates and whis­tle-blow­ers to look for mis­con­duct, which cre­ates a scan­dal, which ru­ins lega­cies — as this one threat­ens to do to Car­los Ghosn. As he once said him­self. "If you have not been a vil­lain at a cer­tain point in time, you will never be a hero. And the day you are a hero, you may be­come a vil­lain the next day." In his 40 years in the auto in­dus­try, the praise Car­los Ghosn has won for turn­ing around busi­nesses has reg­u­larly been matched by crit­i­cism over the amount he has been paid to do it. Brazil­ian-born, of Le­banese de­scent and a French cit­i­zen, Ghosn be­gan his ca­reer in 1978 at tire­maker Miche­lin, be­fore mov­ing to Re­nault in 1996, where he over­saw a turn­around at the French au­tomaker that won him the nick­name “Le Cost Killer.” Af­ter Re­nault sealed an al­liance with Nis­san in 1999, Ghosn used sim­i­lar meth­ods to re­vive the ail­ing Ja­panese brand, lead­ing to “busi­ness su­per­star” sta­tus in Ja­pan, blan­ket me­dia cov­er­age and even a manga comic book on his life. As auto mar­kets in west­ern Europe and Ja­pan strug­gled, Ghosn cham­pi­oned a cheap car for the masses in emerg­ing mar­kets and em­braced the elec­tric ve­hi­cle be­fore many oth­ers. He also never made it a se­cret that he be­lieved there were too many car­mak­ers in the world and consolidation would con­tinue — in 2016 he added Ja­pan’s Mit­subishi Mo­tors Corp to the al­liance.

Brazil­ian-born, of Le­banese de­scent and a French cit­i­zen, Ghosn be­gan his ca­reer in 1978 at tire­maker Miche­lin be­fore mov­ing to Re­nault in 1996

Newspapers in English

Newspapers from Kenya

© PressReader. All rights reserved.