building emotional capital for strategic renewal...ghosn understood that the success of corporate...

Building Emotional Capital for Strategic Renewal: Nissan (1999-2002)

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This case was written by Quy Nguyen Huy, Associate Professor of Strategy at INSEAD. It is intended to be used as a basis for class discussion rather than to illustrate either effective or ineffective handling of an administrative situation.

It draws extensively on INSEAD case “Nissan’s U-Turn: 1999-2001 - Condensed Version of Redesigning Nissan (A & B)” written by Kathryn Hughes, Jean-Louis Barsoux, and Jean-François Manzoni, as well as other publicly available information.

Additional material about INSEAD case studies (e.g., videos, spreadsheets, links) can be accessed at cases.insead.edu.

Copyright © 2004 INSEAD

COPIES MAY NOT BE MADE WITHOUT PERMISSION. NO PART OF THIS PUBLICATION MAY BE COPIED, STORED, TRANSMITTED, REPRODUCED OR DISTRIBUTED IN ANY FORM OR MEDIUM WHATSOEVER WITHOUT THE PERMISSION OF THE COPYRIGHT OWNER.

This document is authorised for use only in Executive Education - Advanced Leaders Programme - Cohort 4 - Module 2 at INSEAD - Oct 2016 -Mar 2017 – by Loïc Sadoulet (Programme Director(s)). Copying, printing or posting is a copyright infringement.

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Taking on the Challenge

In March 1999, when Renault and Nissan announced their alliance, the press releases from both sides stressed how well the companies complemented each other. Renault’s cash injection of $5.4 billion for an equity stake of over 36% in Nissan would reduce the Japanese automaker’s crushing debt. It would also provide Renault with access to two huge markets – North America and Asia – where it was virtually absent. Conversely, Renault’s market strengths were in Europe and Latin America where Nissan was weak. Likewise in terms of capabilities, Renault would gain access to Nissan’s engineering and manufacturing expertise while Nissan would benefit from Renault’s marketing and design flair. In theory it looked like a perfect match, but industry analysts had serious reservations about the deal.

The first hitch was Nissan’s desperate financial situation: it had posted global losses in six of the previous seven years. In its home market, only 4 out of 43 models were profitable. And its debts were such that in 1998 it had spent $1 billion on interest payments alone, money that should have been reinvested in its aging and rather bland product line. For months, Nissan’s chairman, Yoshikazu Hanawa, had tried to secure a relationship with a foreign investor, yet other carmakers were afraid to touch it. Bigger companies, with deeper pockets and better partnership records than Renault, had already walked away from talks with Nissan. For example, DaimlerChrysler was put off by the figures and anticipation of Japanese resistance to change.1 Indeed, one Chrysler insider compared bailing out Nissan to “putting $5 billion into a steel container and throwing it into the ocean.”2

Then there was Renault’s credibility as a rescuer. Renault’s botched merger with Volvo in the early 1990s – fuelled by cultural problems – was still fresh in many minds. Also Renault had been a French government-controlled enterprise until only five years before, and remained 44% state-owned. Cultural incompatibility seemed likely, leading one industry analyst to comment, “Much has been made of the culture clash between Daimler and Chrysler, [but] it will be nothing compared to Nissan and Renault…At their core, they are both nationalistic and patriotic, and each believes its way is the right way to do things. We will have quite a teething period for the first year or two as they feel each other out. It’s a complex thing to work through.”3 “Two mules don’t make a race horse,” was how the CEO of one European automotive company summed it up.4 Another observer commented that it was “like relying on the French civil service to revive the Japanese economy.”

This pessimism was widely shared. News of the negotiations provoked a fall in Renault’s share price, and when the French company disclosed its offer for a stake in Nissan three separate rating agencies issued reviews of Renault’s debt “with negative implications”.5 Many of Nissan’s problems were evident. It had too many plants (some running at 50% of their nominal capacity), too many car platforms (25 expensive chassis, compared with Volkswagen’s four), too many suppliers (at 3,000, nearly 10 times more than Ford), and too many dealers in Japan.6 Radical surgery seemed the obvious solution. Yet this ran counter to deeply anchored Japanese business practices such as lifetime employment and close ties with suppliers in interlocking industrial groupings, known as keiretsu. Renault’s stake in Nissan only gave it power of veto, raising the difficulty of pushing through fundamental changes.

The unenviable challenge of trying to make the alliance work fell to Carlos Ghosn, already seen as Louis Schweitzer’s number two at Renault, and the main driving force behind

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Renault’s on-going cost-cutting program. In fact, Schweitzer privately admitted that he would not have signed the deal without Ghosn’s agreement to run the alliance.7

Building Up the Expeditionary Team

Born in Brazil of French and Lebanese parents, and trained as an engineer in France, Carlos Ghosn was no stranger to cross-cultural challenges. He had held major jobs on four continents and had made his reputation overseeing the restructuring of Michelin’s North American operations, including the acquisition and integration of Uniroyal Goodrich. Ghosn was then recruited by Louis Schweitzer to restructure Renault and quickly turned the carmaker’s fortunes around by implementing an aggressive cost-cutting plan. The plan included the politically explosive closure of the Vilvoorde plant (2,700 jobs) in Belgium and a big reduction in the number of parts suppliers, earning him the nickname “le cost-killer”.

Ghosn agreed on condition that he would have full control, and that he would not constantly have to seek approval from France. He also insisted on handpicking the 20 or so executives who would accompany him on this mission. Commenting on the modest size of the team he proposed to take to Nissan, Ghosn said: “To make deep changes inside a company you don’t need loads of people, but rather the right catalysts in the right places.”8 He chose people who were mostly around 40, “experts in their field, very open minded, not solo players.”9 They would serve as facilitators and coaches. There would be no external consultants. Ghosn did not want to waste energy on the merger issues that had plagued Daimler and Chrysler. By adopting the alliance route the two companies could work together as distinct partners without having to worry about creating a common culture and combining their businesses.

In mid-May, the team members gathered on a three-day crash course aimed at familiarizing them with the host country – only one of them spoke Japanese. Besides giving them a chance to discuss some basic dos and don’ts in Japan, the seminar also allowed Ghosn to pass on some key messages. “We are not missionaries,” he told them. “We are not going there to teach the Japanese [about] the role of women in Japanese business. We are going there to help fix Nissan, that’s all. Any issue that does not contribute to that is of no concern to us.”10

In the two months preceding his formal appointment, Ghosn first went to places where the actual work was done and talked to people who dealt with customers every day such as sales people and service technicians. He also visited research facilities and production plants, gathering input from section managers, engineers and dealers. He solicited their views earnestly and got candid feedback. In meetings with Nissan section chiefs he asked questions like: “What are the problems in your department? What needs to be done to improve the situation? What does your department contribute to Nissan?”11 He was astonished to find that Nissan factory managers could tell him how many minutes it took to build a car but not how much it cost.

There were other troubling signs. As Ghosn commented: “The biggest sign is when everybody tells you he is achieving his objective, yet the company is in bad shape. Why? Because when you are in a situation where everybody feels good about what he is doing personally…who is blind about how much trouble he is creating….nobody feels really responsible for the situation of the company, and that’s why there was no sense of urgency.”12



Ghosn understood that the success of corporate turnarounds was not simply about making fundamental changes to the company’s organization and operations. He also had to preserve the company’s identity and the self-esteem of people affected by the change. Trying to reconcile making changes and preserving identity required a difficult balancing act. As he noted: “I was, after all, an outsider: non-Nissan and non-Japanese. I knew that if I had tried simply to impose the changes from the top, I would have failed.” Dictating changes from the top risked backfiring and undermining employee morale and productivity.

Ghosn thus assured the Nissan workers he met that the company would remain Japanese. He wanted to show them respect by keeping the strengths of the Japanese culture but to modify elements that offered an opportunity for progress by adopting best practices worldwide. He recognized that the Japanese way of doing things was very different from that of the French or the Americans, illustrating his perception of the cultural differences as follows: “Japanese people want and need to spend a lot of time on a concept at the beginning. They need to understand the concept. What do you want to do? Why do you want to do it? How do you want to do it? It takes much, much, more time. [But when the Japanese] understand, they buy in, they execute. And you don’t have to spend a lot of time checking afterwards – the results will be there. In a Latin American country, or even an Anglo-Saxon country, it’s different to a certain degree. People are very quick at the beginning. ‘We understand. We understand. You don’t have to continue. We understand.’ So the concept part and the decision part are very fast. The problem is that when [Westerners] execute, you’re going to have to intervene many times to make sure everybody is moving in the direction that you want the company to move in.” 13

Ghosn was named Chief Operating Officer on 25 June 1999 and was appointed to the Nissan board, along with two Renault colleagues who were to oversee product development and finance. At the same time, the board was downsized from 37 members to 10.14 As president, Yoshikazu Hanawa assumed a more ambassadorial role, but it was he who selected the Japanese members of the executive committee. When he had approached Ghosn to see who he wanted on the executive committee, Ghosn had answered: “I don’t know. You choose. You know me so please, you pick them – knowing what you know of me.”15

For the first time, the board meeting was held in English. Ghosn’s message was simple but blunt: “Gentleman, we’ve had 10 years of decline. That’s enough,” he said. “There is a place for every single person in this company who wants to give the company a chance for recovery, no matter what age, what gender, what citizenship.”16

In the annual shareholder meeting that immediately followed the board meeting, Ghosn told the audience: “I have not come to Japan for Renault, but for Nissan. I will do everything in my power to bring Nissan back to profitability at the earliest date possible and revive it as a highly attractive company.”17 He weathered the criticisms of disappointed shareholders and pledged change for the coming year. He alluded to likely changes to the supplier network aimed at reducing high procurement costs, as well as changes to the inefficient dealership network. He also conveyed confidence that Nissan employees would embrace internal company reform: “Given their strong enthusiasm and pride, I am very hopeful that we can put Nissan on the road to recovery and growth.”18

During his first week in charge, Ghosn introduced a number of changes. He announced a quasi-stock option incentive plan for its 30 executive officers, including the three new board



members from Renault. He also immediately introduced a new language policy – decreeing that all top-level meetings be conducted in English and that reports be produced in English. Ghosn backed up the decision with intensive language courses for all Nissan employees. But beyond those efforts he realized that “some key words were not understood in the same way by different Japanese people or even different French people,”19 so he asked a mixed Renault-Nissan team to establish a dictionary of essential terms. The 100 or so entries included clear definitions of terms like “commitment”, “authority”, “objectives”, “transparency”, and “targets”. An open discussion of these notions would help to avoid mixed messages. Ghosn told his top management team: “What we think, what we say, and what we do must be the same. We have to be impeccable in ensuring that our words correspond to our actions. If there are discrepancies between what we profess and how we behave, that will spell disaster.”20

Mobilizing Middle Managers

Shortly after accepting the Nissan job, Ghosn had stated, “I am not going in with any preconceived ideas.”21 In line with that promise, he quickly set up nine cross-functional teams (CFTs) to generate ideas and recommendations for change. Contrary to convention, these would not be made up exclusively of senior managers, but rather would draw on line middle managers in their 30s and 40s from different departments and divisions – both Japanese and international.

Cross-functional teams of middle managers also ensured that the revival plan was the work of the whole company, not only of top management. From his preliminary contacts with Nissan employees, Ghosn had been amazed at the lack of communication across functions, borders, and hierarchical lines: “Country (organizations) were not talking to each other, people were not talking to each other,” he noted. “I want to destroy this spirit.”22

The CFTs focused on different critical areas like purchasing, engineering and R&D. To staff those teams, Ghosn requested that 1,500 profiles of Nissan employees be posted in the corporate headquarters for consideration in the CFT formation process.23 He wanted to take a close look at the next generation of Nissan leaders. He also wanted to ensure that selection was based upon talent and demonstrated commitment to Nissan – and it quickly became obvious to Nissan executives what type of people Ghosn was seeking. As one Nissan veteran put it: “Ghosn [brought] a lot of mavericks with him… He has shown those are the kind of people he likes.”24 In particular, he took a close personal interest in the selection of the pilots, those who would drive each team’s agenda and discussions – since the reforms proposed by the CFTs would form the backbone of Nissan’s recovery plan (see Appendix 1 for a description of the CFTs).

Each CFT was piloted by a middle or upper-middle manager chosen for his extensive frontline experience and strong personal credibility. Two senior executives representing different functional areas, whose roles were to remove organizational barriers and facilitate the team’s work, sponsored each CFT. Having two senior voices (e.g., from R&D and purchasing) ensured that no single perspective function could dominate and the team would not focus its efforts too narrowly.

The CFTs were peppered with former Renault managers familiar with the process, and team size was limited to 10 members in order to avoid endless debating. It was clear, however, that



10 people would not be able to review all the operations in their domain, so sub-teams of 10 people were created to investigate particular issues. Through this cascading effect, the total exercise drew on the efforts of 500 or so people. The teams received three simple guidelines: “One goal: to make proposals in order to develop the business and reduce costs. One deadline: three months for final official decision-making. One rule: no sacred cows, no taboos, no constraints.”25 Ghosn kept repeating, “Only one issue is non-negotiable: the return to profit.”26

He tried to be clear at all times, noting: “If people don’t know the priority, don’t understand the strategy, don’t know where they’re going, don’t know what is the critical objective, you’re heading for trouble. Confusion is the first sign of trouble. It’s [the leader’s] duty to clarify the environment, to make sure there is the maximum light in the company.”27

As the CFTs started working, the team members generated a lot of ideas, many of which had never been implemented due to lack of resources. They felt energized as they realized it was up to them to revive Nissan, and that this might very well be their last chance. Never before in Nissan’s history had a small group of middle managers been engaged to perform a drastic re-examination of company practices without spending a lot of time building consensus. As a result, past proposals tended to be conservative when they finally reached top management. As the teams made their initial recommendations to the executive committee, Ghosn rejected many of them outright and sent them back for more work, telling them that their recommendations were not aggressive enough.

Understandably, the teams felt strong pressure from the people with whom they worked in their regular jobs. They expected to return to these groups when the project was over. Major changes required a fundamental change in the way of organizing and many recipient groups found the target savings desired by the CFT teams unrealistic and did not endorse them. But second time around, members of the CFT teams were bolder as they concluded that there would be no place to return to anyway if they failed. They solicited the help of the two executive sponsors to negotiate with the recalcitrant departments. After much hard work and tough negotiations, they finally came up with recommendations that met Ghosn’s expectations.

This work provided useful learning to middle managers. They realized that each individual tended to look at the issue from his own functional perspective. As they had to debate the pros and cons of each idea, they became aware of their own functional blinkers and discovered what was wrong with the organization from the larger corporate viewpoint. The exchange process also helped the team members to bond more closely.28

Straight Talking

While the middle managers’ CFT teams worked on their respective assignments, Ghosn toured the company telling employees that Nissan “had its back to the wall”; reminding them it had just lost its position as the country’s second largest carmaker to Honda; stressing that world sales of the brand in the last seven years had fallen by 800,000 units amounting to “nearly the equivalent of Mercedes’ or Mazda’s worldwide sales, and more than BMW”; and telling the press that the forthcoming plan represented Nissan’s last hope. Ghosn was resolute: “If you want to mobilize 130,000 people in different cultures and different countries you have



to be precise, you have to be factual, and you have to base everything you say on hard evidence that people can measure.”29

He also reiterated that success at Nissan would come from its employees: “If the Nissan Revival Plan succeeds, it will have many fathers. If it fails, it will have only one.”30 But Ghosn did not just speak, he also listened. He surprised workers by strolling up and down the assembly lines and asking questions, not just of senior engineers and managers but also of workers themselves. And he encouraged the use of email, previously little used at Nissan. He also found time, in July, to test-drive 25 models at the company’s purpose-built course.

Ghosn quickly found out that the sense of decline was widely shared inside the company: “From the inside, the burning platform was even more visible. Managers knew how much they were restricted in their budgets, how many resources they needed that were not given to them, and how much they had to accept short-term oriented decisions that hurt the company long term in terms of delayed development of certain products.”31 His outsider status gave him an advantage when questioning certain practices: “It allows you to challenge in a very decent way what has been done without anybody having a second thought about, ‘Hey, where were you when we were doing this?’”32

Ghosn also became aware of the psychological damage wrought by so many years of underperformance: “The biggest challenge when the company has been depressed for a long time is self-confidence. [I had] to help Nissan people believe that they are capable of doing a great job in this industry, that they are capable of rivalling Honda and Toyota in terms of profitability and in terms of growth.”33

A week before the announcement of the revival plan, Ghosn met with and solicited support from the union leaders. He assured them that employees who were willing to relocate would be guaranteed a job. Those who were unable or unwilling to move could take a compensation package offered by the company.

Announcing the Plan

The CFTs made more than 400 recommendations that were aggregated into a comprehensive plan by the executive committee and its staff. On 18 October 1999, Ghosn unveiled Nissan’s restructuring plan to a packed audience of journalists and analysts – the speech was to be simultaneously broadcast to company employees worldwide. The extended quotes that follow are excerpts from a transcript of the speech.34

Ghosn got straight to the point. “Nissan is in bad shape,” he asserted, highlighting the extent of the decline by adding “Nissan has been losing global market share continuously since 1991… Our production has dropped by more than 600,000 cars in [that] period. This drop, for example, represents 25% more than the total annual car sales of the Volvo brand.”

Ghosn went on to outline his diagnosis of the company’s performance problems: 1) Lack of clear profit orientation; 2) Insufficient focus on customers and too much focus on chasing competitors; 3) Lack of cross-functional, cross-border, intra-hierarchical lines, work in the company; 4) Lack of a sense of urgency; and 5) No shared vision or common long-term plan.



After explaining in some detail how the Nissan Revival Plan (NRP) had been elaborated through broad-based and intensive debate in cross-functional teams generating over 2,000 ideas, he outlined the key contents of the plan.

“As you know,” he started, “there is no problem at a car company that good products can’t solve.” He went on to describe some of the new product opportunities they had identified which would give rise to several revamps and four new models, including the reincarnation of the celebrated “Z” which had first established Nissan’s US reputation, and the March/Micra subcompact to come out of a new common platform with Renault. “Product development,” he asserted, “will be at the heart of Nissan’s revival.”

Ghosn continued: “Our styling has not always been an asset. It has to be more attractive and consistent.” He then caused quite a stir in the audience by revealing that he had lured from rival automaker, Isuzu Motors, its 25-year veteran design chief, Shiro Nakamura. Starting today as Nissan’s head of design, Ghosn explained, “He will be fully empowered, along with a re-enhanced styling team, with the mission to bring back to Nissan’s car design the attractiveness and consistency it urgently needs.”

Now came the moment to deliver the proposed treatment. Even for the foreign analysts and journalists who had been advocating radical surgery, the measures came as a shock.

First, there would be a two-pronged attack to cut purchasing costs by 20% over three years. Ghosn explained: “Today, Nissan buys parts and materials on a regional basis or even on a country basis. This will stop immediately. Purchasing will be centralized and globalized.” The other, more controversial measure, involved Nissan halving the number of its suppliers “which means that our chosen suppliers, existing or new ones, will significantly increase their business with us.”

The second target had to do with Nissan’s excess capacity. The company’s actual capacity was “a minimum of 2.4 million vehicles.” On that basis, plants were currently “operating at a 53% level of capacity utilization.” Ghosn went on: “Taking into account our long-term forecasts, we have decided to reduce by 30% the current capacity.” A gasp went through the audience as the corresponding plant closures were announced: three of the company’s seven auto assembly plants in Japan plus two engine-transmission factories in Japan. “The plant closures, however painful they are – and they really are – will guarantee the future [of the remaining plants] by allowing them to be industry leaders.” Ghosn continued: “At the same time, we will take this opportunity to rationalize…the number of Nissan platforms” – going from 24 platforms spread between seven plants to 15 platforms divided by four plants in 2002, and down to 12 by 2004.

The third target had to do with Nissan’s shareholdings in close to 1,400 companies. In more than half of them, Nissan’s stake exceeded 20%. Ghosn explained: “With the exception of four companies, none is considered to be indispensable for the future. This means we will be unwinding most of our shareholdings strictly on the basis of a cost/benefit analysis… Our objective is to free all capital resources from non-strategic, non-core assets and to invest more in our core business, while at the same time significantly reducing our debt.” 10% of domestic dealerships would also be cut and the dealership organization revamped.



“Our target is to develop and optimize our R&D capability and capacity,” asserted Ghosn. “We will move to a globally integrated organization… in terms of [R&D] strategy, processes, standards and benchmarks… We will empower [the regional R&D centres] to take more responsibility for the entire product line offered in their region, whether they developed it or not.” Investment in R&D would be increased from 3.7% of sales in 1998 to 5%.

Ghosn then revealed extensive changes to Nissan’s traditional HR practices: “A performance-oriented compensation will be established for management starting in 2000. Bonuses and stock options will be part of the incentives offered to boost Nissan profitability and growth. Performance-based career advancement will be established at the latest by the end of [April] 2000 to make sure we act in a coherent manner across the company.” But he added: “Concretely, some of the changes will not be implemented before ensuring that the people in charge have changed their attitude, and that the clear performance indicators for which they are accountable exist.”

21,000 people (14%) would be cut from Nissan’s consolidated workforce of 148,000 employees– with domestic employment bearing more than three-quarters of the cut – through attrition, the increased use of part-time employees, spin-offs, and early retirement programs. Ghosn reassured employees that there would be no outright layoffs: “Transfers will be offered to all direct and semi-direct employees. In order to facilitate the transfers, hiring will be strictly limited and monitored by HR.” R&D, however, would increase its headcount by 500.

Ghosn admitted: “Establishing the plan represents at most 5% of the challenge; 95% of the challenge now lies in its execution.” He rounded off his speech by specifying the commitments of the top management team. First, a return to profit by FY 2000; second, an operating profit of at least 4.5% of sales for FY 2002; and third, to cut the debt in half to $6.3 billion by FY 2002. “The top management,” he declared, “will be accountable for delivering the committed performance – all of it.”

“I know and I measure how much effort, how much sacrifice, and how much pain we will have to endure for the success of the NRP. But believe me, we don’t have a choice and it will be worth it. We all share a dream. A dream of a reconstructed and revived company. A dream of a thoughtful and bold Nissan on track to perform profitable growth in a balanced alliance with Renault to create a major global player in the world car industry. This dream today becomes a vision with the NRP. This vision will become a reality as long as every single Nissan employee will share it with us.”35

In the question and answer session Ghosn added, “I understand that a lot of people will feel like orphans in this plan. But we have no choice, and the fact that we have no choice is the strength of our plan.”36 Hanawa concurred: “The plan is tough, perhaps even severe, but then our situation is severe.”37 He added, “This plan marks a new era for our proud company and we will implement it with indomitable resolve.”38

Immediate reactions to the radical renewal plan were mitigated. Predictably, suppliers and dealers denounced Nissan’s demands as extreme. Competitors like Toyota chairman Okuda Hiroshi, as head of the employers’ federation, Nikkeiren, condemned the large-scale layoffs. And Prime Minister Obushi Keizo warned Nissan to “give full consideration to the employment problem and impact on subcontractors.”39 The powerful labour unions, frequently vocal in their response to organizational change proposed by foreigners, requested



only that no employees be laid off. The union leaders focused instead on negotiating better packages for those who would accept early retirement or transfers. According to one insider: “He painted a picture so bleak that suppliers and unions felt compelled to accept change.”40

Some investment analysts doubted Ghosn’s ability to deliver on intangibles, such as designing products that people wanted to buy and creating a powerful and consistent brand image. Nissan had tried many restructurings before but never followed through.41 As one Japanese auto analyst observed: “Raising a target is one thing. Hitting it is another.”42

Ghosn was very aware that until he had some results to show, his credibility rested entirely on “telling it like it is”. As he observed: “Credibility has two legs: the first leg of credibility is performance, but [we have nothing to show at the start]; the second leg of credibility is transparency – what I think, what I say, what I do is the same thing. So we have to be extremely transparent.”43

Focusing on Action

Less than two weeks after the NRP announcement, Nissan’s stock had fallen 5%.44 Within days, Ghosn promised to quit along with the executive committee if Nissan failed to post a profit for the year ending March 2001.45 He reiterated that pledge on a number of occasions, explaining: “The big risk is that if you announce ambitious results, people will not believe you. They’ll say, ‘He said 100% but if he gets 50% he’ll be happy.’… Well, we want 100 and we’re going to get 100. If we don’t get it next year, that’s it: we will resign…”46 As Ghosn explained: “It was very important for the credibility of the plan, both internally and externally, to make this kind of commitment so people know that you are going to be 100% behind the Nissan revival plan. The ultimate sacrifice for the top manager is to say “I’m putting my job on the line if I don’t achieve these targets.”47

Ghosn also approved the project to build a new $930 million assembly plant in Mississippi intended to supply the US market which accounted for over a third of Nissan’s sales. The plant was scheduled to start production in mid-2003 with models – new pickup trucks, minivans and sport utility vehicles – squarely targeted at the American market. Ghosn’s swift decision heralded greater responsiveness to US needs.48 Though this investment decision was regarded by some executives as premature, Ghosn told them: “People need to know what the prize is, what are they aiming for, what are the benefits or the advantage to them of changing some established tradition. When this is clearly spelled out, people will be motivated to follow… You cannot over communicate about why we’re doing certain things or how we’re going to do it and what is the advantage we’re going to get from this.” 49

While Ghosn praised the loyalty and enthusiasm inside Nissan, he simultaneously pressed employees for top results. When two managers presented their ideas for a new information system at Nissan, Ghosn challenged them to prove that their solution could not be bettered by outside consultants. He sent them away, demanding a response to his queries within three weeks.50 Ghosn also required that every number had to be checked and reports should be. totally clear and verifiable. Basing his decisions on facts, with profits usually coming first as the motive, allowed Ghosn to send a strong message to Nissan employees that political behaviour would not be accepted.



He encouraged open debate of major issues and expression of open disagreement, in contrast to the old Nissan way in which proposals were worked out prior to the meetings and no one was supposed to raise questions or objections in the formal executive meetings. Japanese managers were initially not used to it, but eventually found the new approach more productive and substantive.

But Ghosn also told Nissan managers to use 5% of their time planning and 95% on implementation, contrary to their habit of planning much of the time. The CEO saw continuous insistence on implementation as the key difference between turnaround success and failure. He stressed action, speed, results, and close follow-up. He was concerned that managers would spend more time on planning if top management was not clear in its directives and if it did not insist on getting the job done on the spot. He said: “First, you have to give employees the opportunity to create change by discussing and listening at all levels of the company; then you have to decide and implement. It can be easy and useless to spend too much time listening and planning without effective implementation.”51

The obsession with implementation came from his multicultural experience:

“What people see is what we execute. Part of my Latin surroundings is an ability to talk too much and not implement. I’ve seen it in many places - Brazil, France, and Italy - where people tend to think about a problem and talk about it without doing anything about it. The temptation to talk is so big. I consider it pleasant on a personal level; extremely unpleasant in business.”52

On the marketing front, Ghosn left Patrick Pelata to look at brand identity. The 25-strong group included all the leaders of marketing and advertising for Japan, Europe and the US, plus one person each from Nissan’s three agencies in those regions. Their objective was to tackle the “patchwork of images in Europe, the United States, and Japan.”53 The design team in Japan was removed from the engineering group and placed under the responsibility of Pelata.

On the finance front, Ghosn was ably supported by Thierry Moulonguet, the deputy chief financial officer seconded from Renault. Moulonguet’s first priority was to clean up the accounts, which included making sure there were no surprises left on the books. In particular, he fixed Nissan’s heavily underfunded pension plan and made provisions for the three-year restructuring plan to cover plant closures and golden handshakes for workers taking early retirement. The net result, announced in late November 1999, was a record half-year loss of just over $3 billion – and predictions of full-year losses around double that figure.

Though expected to disband after building the NRP, Ghosn kept the CFTs as an integral part of the management structure to serve as watchdogs for the implementation of the plan and to look for new ways to improve performance – indeed, a tenth team was added to cover investment costs and efficiency.54 The CFT pilots continued to meet with Ghosn at least once a month, serving as relays to the rest of the workforce but also keeping him informed of progress. Two months after the NRP announcement, Ghosn commented: “There is a group in the company who still think this will blow over, though their number grows smaller by the day.” 55 Internal resistance was further reduced by an agreement under which employees with home loans and dependents would be paid up to 3 million yen (about half the average annual wage for union workers). “Management has accepted almost 100% of our demands,”56 said the president of the All Nissan Motor Workers’ Union.



Plant closures took place as planned and in close cooperation with the union leaders. Japanese middle managers and first line supervisors, many of them 30-year veterans, spent a lot of their time meeting with the workers, often in small groups, as they devoted their attention to a massive amount of detail since each person’s situation was different and required customized solutions. As they had to relocate most of the workers along with the production lines, plant managers had to coordinate closely with the engineering and manufacturing groups who underwent a lot of changes themselves. Managers ensured that workers who agreed to move would be integrated into the work groups at the new locations.57

Despite all these actions, market confidence in the company remained shaky. An initial wave of euphoria had greeted the NRP and pushed the stock past the ¥700 mark. But by the end of 1999, Nissan’s share price had slumped by more than 40% to ¥402, as the market signalled “doubts over the practicality of the plan”.58

2000: Making Headway

During the 1990s, Nissan managers received bonuses based on production levels rather than profits – which meant there was little incentive to minimize overproduction. Ghosn insisted that bonus structures be explicitly linked to the operating profit of the company or the subsidiary, with up to 35% of salary to be performance-related. At internal meetings with managers, he emphasized that without a demonstrated contribution to cost cuts, no one in purchasing, administration or engineering would receive a pay increase.59 He also established and personally headed a team called the Nomination Advisory Committee to review promotion recommendations. No promotions were to be made at Nissan without a prior performance review by this board. Ghosn mandated that within one year of his arrival all promotions were to be based upon performance rather than seniority – and the power and prestige of many senior managers began to evaporate as longstanding supplier relationships were severed. These HR changes were crowned in March 2000 by the extension of the stock option plan to managers worldwide, benefiting about 500 employees.

Ghosn introduced the notions of target (that is, stretched goals) and commitment that were new to most Nissan managers. Commitment referred to an annual set of objectives to which compensation and promotion were tied. Actual performance was monitored monthly to ensure immediate response to shortfalls from budget. Managers who met their targets could receive cash incentives equal to about a third of their total compensation. Typically, commitment and target comprised two or three specific, and mostly quantitative, goals. Ghosn explained, “The Japanese people are very pragmatic. They are always a bit suspicious of big ideas, but they believe in results and statistics, and they measure everything. So we said that the quality of management is not a fuzzy concept. It can be measured, and we’re going to base that measurement on performance.”60

Ghosn demanded total commitment from all departments within Nissan – and by now had earned the nickname “Seven-eleven” because of his long office hours. On whistle-stop tours of factories, he probed managers for explanations of sluggish performance improvements or limited cost cuts. He reprimanded one tongue-tied manager whose results were insufficiently promising, with, “This is your responsibility. Brainstorm. Discuss. You will be held accountable for this.”61 He was direct in his dealings with employees, enthusiastically shaking hands with all those who came to his office, regardless of rank.62 He monitored reactions to



his proposed plans by having Nissan intranet messages – from affiliates, dealers and employees – posted in corporate headquarters.63

Internally, Ghosn’s efforts were producing divergent reactions. “There is a schism,” said Akira Kaetsu, a senior manager in human resources. “We’ve told those who are resisting the changes that they have one year to change their attitude.”64 Some were disoriented by the changes and worried that their lifelong career and retirement plans would be upset – or else disagreed with Ghosn’s demanding work expectations. “We attend meetings late into the night, and the next morning we are requested to come in at 6 a.m. If this goes on for days and days, it just won’t work unless we get paid more,” complained one employee.65 Contrasting with the complaints and confusion of some of the more established executives, many of the younger executives, especially those who spoke English, saw unexpected new responsibilities and career opportunities coming their way.

According to Thierry Moulonguet, VP Finance: “With Carlos Ghosn the rules of the game are simple and clear. That was perfectly understood by the young generation of Japanese managers. He is very approachable. Anyone can send him an email; he looks at all of them. He reacts in an open and straightforward way.”66

In late March 2000, Ghosn and Moulonguet were designated president and chief financial officer respectively. The incumbent president, Yoshikazu Hanawa, would assume the largely symbolic role of chairman, serving as a liaison with the Japanese business community. More significant was the decision to eliminate the divisional presidencies in Europe and North America – putting in place instead four management teams including representatives from the major functions who would meet once a month. Ghosn asserted that regional presidencies were conducive to crossed communication and unclear leadership. “Each time you have a regional president, you start to have problems of communication and retention of information, either from headquarters to the region or from the region to the headquarters. We don’t want that. This is a killer for the global performance of the company.”67 According to Ghosn, “This reorganization was one of the few changes I made unilaterally.”68

Ghosn also announced the high profile promotion of two senior VPs, Toshiyuki Shiga and Shiro Tomii, both still in their 40s. With purchasing, finance, manufacturing, and R&D already under global management, Ghosn named Shozo Kurihara as chief information officer with global responsibility. Likewise, the CEO established a global marketing team to provide him with better marketing intelligence as he lacked a clear picture of how Nissan’s models were faring against the competition. “You laugh,” Ghosn told journalists, “but it’s real. We had no substantial analysis, segment by segment, [of] what was going on.”69 Ghosn also wanted qualitative data: “Is the brand stronger? More attractive? Do people like [the products]? How are they characterized? Is there grace in our design? All of these concerns impact our image, and image is crucial to our overall success.”70

In mid-May 2000, Nissan announced plans to revamp its product line with 22 new models over the next three years. Ghosn insisted that these would be “all-new products, not derivatives”, 10 of them destined for the North American market.71 After less than a year in office, there was the imminent introduction of a full-size truck in the US, a model that dealers had been requesting for 10 years prior to Ghosn’s arrival.72 Ghosn told journalists: “The Nissan Revival Plan is on track and it is now time to grow.”73 Later, he compared the interplay of investment and cost-cutting strategies to car racing: “A Formula One pilot, he’s



constantly using the accelerator and the brakes. He uses them at the same time...to go to the max. We are at the same time accelerating and braking.”74

Barely a week after announcing the new product drive, Ghosn had to announce one of the worst full-year losses ever recorded by a non-financial company, posting a net loss of $6.4 billion. Though massive, this figure was very much expected and there were even some bright spots as Nissan had erased outstanding pension liabilities, adopted new accounting practices and progressed on its plant closures and employee cuts. Also, 11 of its 40 models were now profitable in Japan. Industry analysts were reassured by the better-than-expected operating results and Ghosn’s promise that the group would return to a net profit by the following year. The results did not significantly alter the company’s stock price, which had risen some 25% since the start of the year.

At the end of the following October, Ghosn announced Nissan’s best half-year results in a decade, with a consolidated net profit of over $1.5 billion contrasting with a $3 billion loss for the corresponding period the previous year. The workforce had been cut by 9,000 by September 2000 and purchasing costs had been cut by 10% – with suppliers noting that formerly risk-averse Nissan managers were suddenly more willing to consider suppliers’ ideas for cost-cutting design changes.75 “The revival plan is going further, moving faster and reaching deeper than we previously forecast,”76 said Ghosn, as the company quadrupled its earlier projections for full-year profits, made in May. Ghosn also told workers: “This is only a step, but a very important step, because it will enable you to regain your confidence.”77

Though clearly delighted with the speed of improvement, Ghosn was careful to protect the reputation of his predecessors, telling journalists: “The previous management [was] struggling with survival problems, and therefore it did not have enough time to think about long-term vision.”78 As an outsider, he explained, he was much freer to make drastic reforms: “To make radical changes in a company, it is very difficult to do it from the inside because you have been with the company for years. [The changes] will have to come from the outsider who has some kind of credibility from the beginning, so people will listen to you… Japanese or non-Japanese, I think it is not a question of origin.”79

Creativity and Innovation

Ghosn believed that new, exciting models delivered rapidly would save Nissan. Despite the company’s low cash and cost-cutting situation, he approved the upscale remodelling of Nissan’s technical centre in Tokyo where chief designer Nakamura and his team worked. Nakamura, a graduate of the Art Center College of Design in Pasadena, California, felt that Japanese designers were more concerned with group consensus than individuality, and was determined to include more foreigners in the Japanese design teams. “I want to break through Japanese design,” explained Nakamura. “This is a very rare chance to break the Japanese culture of consensus, consensus, consensus.”80 Expecting to hire many non-Japanese to join Nissan’s 600 vehicle stylists worldwide, Nakamura said: “A lot of times it takes an outsider to rediscover the great styling tradition you’re holding in the midst of you.”81

Nakamura challenged his team to create innovative styling and led two-and-a-half years of creativity at levels he had never seen before. Japanese designers worked closely with their US counterparts at Nissan Design America (NDA) based in San Diego. The US design centre



itself was located in a secluded hillside retreat that intentionally fostered unorganized and unorthodox ways of working. Designers enjoyed relative freedom in how they spent their work time and did not follow traditional office routines. To help spur creativity, they could play volleyball games, tennis, or watch movies during work hours. Some NDA designers stimulated their creativity by working on non-automotive products ranging from a 150-foot yacht to pre-school furniture and golf clubs.82

As part of the global teamwork instituted under Ghosn, designers started to be involved in models throughout the life of the car, since engineering changes and marketing demands directly affect design. Designers communicated daily with other team members in Japan, Europe and North America and frequently met with people from engineering and sales and marketing. As Nakamura explained: “Before I arrived, design was under engineering. Nissan has eight design studios around the world – 600 people – and not all of them reported to the head of design. Engineers are responsible for manufacturing problems, cost and so on, so if there’s friction between the two, that can lead to design that is not market-oriented. Now all the studios report to me. It’s much stronger.”83

The increased involvement and cross team coordination meant more work, but most designers, who were strongly stimulated by Ghosn’s stretched goals, welcomed the additional work in exchange for the freedom to create all-new vehicles that displayed original styling. The global design team worked on a large number of projects within a short schedule. The results: a new Z-car, the full-size truck, a new sports utility, the new Altima, a new minivan, the Murano cross-over vehicle – more than two dozen new or radically changed models.84

On the back of the company’s encouraging first half-year profits, Ghosn also announced that Nissan would spend $790 million in conjunction with Renault to develop a viable fuel-cell car. The partnership made a lot of sense given the risks involved and the lack of consensus over what type of fuel cell was most promising. A large number of the 1,000 new engineers that Nissan was set to hire would be channelled towards the five-year fuel-cell program.

2001: Nissan is Back!

When Ghosn first came in, he had kept the existing executives in place yet made them “very aware” that there would be consequences if they did not meet their targets. In March 2001, there were several senior casualties including one member of the executive committee – the EVP of domestic sales and marketing was proposed as a company auditor – and 20 subsidiary presidents were axed from the domestic dealership network. As Ghosn put it: “Accountability has to start from the top. If there is no… felt and clearly mentioned accountability at the top, it is very difficult then to push a company at all levels of the company and to make sure that everybody is committed to the subject.”85

On the other hand, there were also many promotions. Among the most notable was the promotion of Shiro Nakamura, now fronting TV ads for the newly redesigned Skyline sedan, from VP of design to SVP (with no change of duties). There was also the rapid promotion of Mamoru Yoshida, who had piloted one of the CFTs, to head the group’s Canadian operations. One of the recently promoted Japanese managers commented: “In the old system everyone could be promoted, so there was no pressure… For many employees it was a good system but for those with good skills it was no good. If I [had] been replaced by a younger man in the



past I would have been shocked. But now I don’t think I would care, because clearly the person has better skills than mine.”86

In the same week, Ghosn announced plans to resume dividend payments for the first time since 1998. He also granted a generous 6% salary increase for all employees in recognition that the change in Nissan’s fortunes had been the result of a collective effort. After a two-year freeze, the unions had put their demands to Ghosn expecting some negotiation but instead received immediate approval. The decision was so fast and unexpected that it drew widespread attention from the national press.87 Indeed, Ghosn hit the headlines again the following month when he hired Shuri Fukunaga as general manager of Nissan’s communications department, making her the first woman to head a section at Nissan.88 The move was particularly significant since she had previously been the public relations chief at J. P. Morgan Securities, and Japanese career women tended to switch from domestic to foreign-owned companies, rather than the other way around. 89

In May 2001, when announcing Nissan’s full year results at a news conference in Tokyo, Ghosn raised his voice and declared, “Nissan is back!”90 Sales were up 1.9% to nearly $50 billion; cash generated by the disposal of non-core assets and the sale of securities and real estate had shrunk debt by nearly half (to $7.7 billion), which also contributed to profit by reducing interest repayments; purchasing costs had been cut by 11%; and the closure of three assembly plants had pushed up the domestic capacity utilization rate to 74%. As a result, operating margins had more than tripled from 1.4% to 4.75% exceeding the stated goal of the NRP a year ahead of schedule.91

Building on this financial recovery, Ghosn touched on Nissan plans to introduce 22 new models in the following three years and to boost global sales by one million units over the same period. He cautioned, however, that Nissan’s turnaround remained fragile and warned against complacency. “Fiscal year 2000 is only the first step in the right direction,” he said. “We have moved from the emergency room to the recovery room.”92

Shortly after the Tokyo Motor Show, Ghosn announced record half-year figures for the third period in a row, up 39% to $3 million. Eighteen of its 38 models were now profitable and the operating margin had reached 6.2%. Just past the mid-point of the three-year NRP, Nissan had met or exceeded its self-imposed targets. For example, as of September 2001, procurement costs were down by 18%. Similarly, the global headcount had been reduced from 148,000 to 128,100 employees. According to Hisayoshi Kojima, the EVP in charge of plant closures, “Everything has proceeded more smoothly than I expected. So the question now is not why we closed so many plants but why we didn’t do it earlier.”93

With all the NRP targets easily within reach, Ghosn evoked his chief concern for continued progress: “My biggest worry is complacency inside Nissan. And it comes very quickly. I’m not talking about people who are consciously complacent. I’m talking about people who are unconsciously complacent. But we are still in the mindset of an underdog and I would look to maintain that as long as I can.”94 Ghosn was adamant: “No system can replace people. A system makes sure there is discipline, productivity. But if people change their perception of the situation, no system can change your company.”95

At the start of February 2002, Nissan confirmed that it would meet all of the NRP targets one year ahead of schedule.96 Jed Connelly, Nissan North America’s senior VP of sales and



marketing, commented: “One thing that Ghosn brought to the party was a clear focus on our priorities and a clear plan by which to execute those priorities. He has not wavered from day one.”97 Another executive VP and board member, Norio Matsumura, saw Ghosn’s key contribution elsewhere: “His greatest performance is that he was able to restructure people’s mindsets.”98 One shareholder drew attention to Ghosn’s outsider status: “Japanese managers couldn’t have done what he has done. They’d have felt too many obligations. They wouldn’t have been able to take bold measures.”99 A Japanese manager commented: “He is not Japanese, clearly, but he is not Brazilian or French either. He is a leader. If his personality had reflected a strong nationality, he might not have been very successful.”100 And a French manager commented: “Ghosn knew how to make people feel that what they faced was not insurmountable. He got people involved by convincing them that facing the challenge would develop them personally, even if they did not agree initially with him. In the end, the objective appeared so clear and transparent that it was difficult to argue against it.”101

The question, with the crisis now over, was whether the employees would maintain the same energy and focus. Ghosn remained vigilant: “What I’m focused on now is mainly making sure that full execution of the Nissan Revival Plan continues to take place as we’re planning 180 [Nissan’s second phase growth strategy]. I don’t want people to be serious about Plan 180 and reduce the intensity in executing the NRP. It requires doing both at the same time.”102

In conjunction with Plan 180, Ghosn sought to push the change deeper within Nissan by empowering lower levels of middle management than those involved in the CFTs. Mobilizing middle managers stemmed from his belief that answers could be found within the organization if people were given the freedom to actively find problems and recommend solutions. Known within the company as V-up, the program utilized more than 400 “V-pilots” in a manner similar to that of CFT pilots, with the exception that V-pilots would typically have smaller teams and more specific areas of focus. V-pilots began training in 2002. Their challenge was to offer continuous process improvement and field-level problem solutions. By doing so, Ghosn sought to relieve the boredom and frustrations that typically strike middle managers in Japan and encouraged them to lead the changes and fix the company by providing solutions to everyday problems.103

The Road Ahead: 2002 and Beyond

While Nissan seemed to be staging a remarkable recovery under Ghosn’s leadership, not everyone foresaw unhindered progress. Some questioned the real extent of the turnaround. One informed observer suggested that the plan amounted to “little more than kitchen-sink accounting”.104 His view was that the combination of massive provisions against one year’s figures and selling off non-core assets was bound to move results in the right direction: “Add in favourable currency benefits on Nissan’s US sales and strong demand for new models – all developed before Renault’s share acquisition – and the basis of the turnaround is clear.”105

Others were sceptical about Nissan’s capacity to make the transition from bottom-line improvements to top-line growth. According to one Tokyo-based analyst: “Nissan can’t rely on restructuring forever.”106 Ghosn’s own future could also influence the sustainability of the turnaround: some observers were mindful of the way Renault’s revitalization efforts had run out of steam when Ghosn had left for Nissan.



Reflecting on the reasons for the success achieved thus far, Ghosn said:

“No matter how promising your resources, you will never be able to turn them into gold unless you get the corporate culture right. A good corporate culture taps into the productive aspects of a country’s culture, and in Nissan’s case we have been able to exploit the uniquely Japanese combination of keen competitiveness and sense of community that has driven the likes of Sony and Toyota – and Nissan itself in earlier times…For a turnaround process of this kind to work, people have to believe both that they can speak the truth and that they can trust what they hear from others. Building trust, however, is a long-term project; those in charge have to demonstrate that they do what they say they’ll do, and that takes time. But you have to start somewhere. Right from the beginning, I made it clear that every number had to be thoroughly checked. I did not accept any report that was less than totally clear and verifiable, and I expected people to personally commit to every observation or claim they made. I set the example myself: when I announced the revival plan, I also declared that I would resign if we failed to accomplish any of the commitments we set for ourselves.” 107



Appendix 1 Nissan’s Cross-Functional Teams

This table shows the areas of responsibility of the nine-cross-functional teams and the main changes they instigated.

Cross-Functional Team

Team Review Focus Objectives Based on Review

1 Business Development

profitable growth new product

opportunities brand identity product development

lead time

launch 22 new models by 2002 introduce a minicar model by 2002 in

Japan

2 Purchasing supplier relationships product specifications

& standards

cut number of suppliers in half reduce costs by 20% over three years

3 Manufacturing & Logistics

manufacturing efficiency & cost effectiveness

close three assembly plants in Japan close two power-train plants in Japan improve capacity utilization in Japan

from 53% in 1999 to 82% in 2002 4 Research &

Development R&D capacity move to a globally integrated

organization increase output efficiency by 20% per

project 5 Sales & Marketing advertising structure

distribution structure dealer organization incentives

move to a single global advertising agency

reduce SG&A costs by 20% reduce distribution subsidiaries by 20%

in Japan close 10% of retail outlets in Japan create prefecture business centres or

common back offices 6 General &

Administrative fixed overhead costs reduce SG&A costs by 20%

reduce global headcount by 21,000 7 Finance & Cost shareholdings & other

noncore assets financial planning

structure working capital

dispose of noncore assets cut automotive debt in half to

$5.8 billion net reduce inventories

8 Phaseout of Products & Parts Complexity Management

manufacturing efficiency & cost effectiveness

reduce number of plants in Japan from seven to four by 2002

reduce number of platforms in Japan from 24 to 15 by 2002

reduce by 50% the variation in parts (e.g. due to differences in engines or destination) for each model

9 Organization organizational structure

employee incentive & pay packages

create regional management committees

empower program directors implement performance-oriented

compensation & bonus packages including stock options

Source: Ghosn, C. (2002) “Saving the business without losing the company,” Harvard Business Review, January: 37-45.



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Entreprises, July 2: 28-29. 88 Kageyama, Y. (2001) “Dynamic Brazilian leader turning Nissan around,” Bell+Howell, June 25. 89 Suzuki, Y. (2001) “Female managers filling corporate Japan’s top spots,” Nikkei Weekly, April 23. 90 O’Dell, J. (2001) “Nissan proves comeback with soaring earnings,” Los Angeles Times, May 18: 1. 91 Nissan Annual Report, 2000. 92 Anon. (2001) “Nissan posts $4.1 billion profit on year,” The Toronto Star, May 18. 93 Dawson, C. (2001) “Saying Sayonara,” Business Week, September 24: 108. 94 Anon. (2001) “Ghosn wants Nissan to keep underdog mentality,” Auto Asia, November 10. 95 Brooke, L. (2002) “From here to infiniti,” Automotive Industries, March: 22. 96 Zaun, T. (2002) “Nissan nears its restructuring targets,” Asian Wall Street Journal, February 11: 3. 97 Mayershohn, N. (2002) “Nissan’s U-turn to profits,” Chief Executive, January: 12-16. 98 Taylor, A. (2002) “Nissan’s turnaround artist,” Fortune, February 18: 47-51. 99 Williams, I. (2001) “Japan’s new superstar,” Sunday Telegraph, July 1: 29. 100 Taylor, A. (2002) “Nissan’s turnaround artist,” Fortune, February 18: 47-51. 101 “Carlos Ghosn a l’epreuve,” Le Monde, 19 October 1999. 102 Burt, T., and Ibison, D. (2001) Interview: Carlos Ghosn, Financial Times (ft.com), October 25. 103 Magee, D. Turnaround: How Carlos Ghosn rescued Nissan (pp. 106). 2003. Harper Business. 104 Burt, T. (2001) “The ice-breaker sees open waters,” Financial Times, March 21: 16. 105 Burt, T., and Ibison, D. (2002) “ Renault and Nissan going Dutch,” Financial Times, March 29: 15. 106 Dawson, C. (2002) “Nissan bets big on small,” Business Week, March 4: 28-29. 107 Reprinted by permission of Harvard Business Review. From “Saving the business without losing the

company,” Carlos Ghosn, Vol. 80 Issue 1, January 2002. Copyright © 2002 by the Harvard Business School Publishing Corporation; all rights reserved.



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