The Remarkable Story of Carlos Ghosn

Regular followers of business news are well aware of the daunting challenges faced by the Chief Executive Officers of Fortune Global 500 companies. There are some who have taken the reigns of a failing company and led a successful turnaround; but many fail.

In the business history of the modern world there is but a single individual who has taken not one, but two Fortune Global 500 companies from rags to riches. That individual is Carlos Ghosn, the CEO of both France’s Renault and Japan’s Nissan. Who is this guy and how did he do this?

Carlos Ghosn was born in Brazil of Lebanese parents. His family later returned to Lebanon where he received his secondary education before moving on to Paris to earn multiple university engineering degrees. He entered the Automotive Industry with Michelin Tire Company and after only seven years, and at the ripe old age of 30, he returned to South America as Michelin’s COO (Chief Operating Officer) for South American operations. That is where his impressive record of turnarounds began. After his success in South America he moved on to fix the company’s North American operations and was elevated to CEO of Michelin’s North American Operations after only one year.

In 1996 France’s automaker Renault was In deep trouble and brought Ghosn in as Executive Vice President to work his magic, which he did, returning the company to profitability within one year. Renault formed an alliance with Nissan of Japan at a time when Nissan was nearing bankruptcy. Ghosn immediately assumed the role of COO at Nissan, followed by elevation to President in 2000 and CEO in 2001.

DeZir is a compact coupé that embodies Renault’s essential values. Ghosn changed the game in Renault

DeZir is a compact coupé that embodies Renault’s essential values, which Carlos Ghosn was able to change

When Ghosn arrived at Nissan he announced a revival plan, promising a return to profitability in one year; an increase in profit margins and a 50% reduction in debt by 2002. What is truly amazing here is that unlike far too many current CEO’s who step into companies on the brink of oblivion, Ghosn pledged that he would resign if he did not achieve the goals of the revival plan. At the time he announced his plan, business analysts at Business Week, CNN Money, and The Economist expressed serious concerns about the state of Nissan.

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Ghosn’s plan succeeded, leading to his becoming the boss at both companies. His turnaround success has earned him numerous business awards and laudatory monikers like “le cost killer”, “ice-breaker”, and “Mr. Fix-it”.

Perhaps the greatest measure of his astounding success is the fact both US Auto Manufacturers General Motors and Ford Motors tried to recruit him. So how did he do all this?

Ghosn brings to the table a multi-cultural background that led to his appreciating the value of diversity. There are substantial differences between the Western culture of Renault’s French operations and the Japanese culture surrounding Nissan. Ghosn embraced that diversity and brought with him like-minded personnel.

He is also willing to listen, a key attribute of many of history’s great leaders. Ghosn had his plans but he remained open to having others in the companies contribute to his vision.

Although Ghosn knew the companies in trouble needed to make changes and was not afraid to do what needed to be done, he also believes in collaborative efforts. Some CEO’s will step in and run roughshod over existing personnel but Ghosn chooses to work with others, not against them.

Although his work at Michelin and Renault was exemplary, it is the Nissan resurrection which best shows his substantial leadership capabilities. At the time there were many who doubted a Westerner could enter the Japanese business culture and be successful. Ghosn’s qualities of valuing diversity, listening to the opinions of others and collaborating with them appear to have made his success possible.

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Ghosn himself has said his experience of living and working in different cultures was key to his success. It gave him a sense of empathy for transcultural practices. In a 2012 interview with consulting firm McKinsey & Company, here is what Ghosn had to say about leadership in the 21st century.

“Leaders of the future will also need to have a lot more empathy and sensitivity—not just for people from their own countries, but also for people from different countries and cultures. They are going to need global empathy, which is a lot more difficult.”

The world is waiting to see more leaders like Carlos Ghosn.


by Robert Kohut

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Categories:   Leadership, Management