Carlos Ghosn is a businessperson who presently acts as the Chairman and Chief Executive Officer of the Paris-founded Renault. Additionally, Carlos acts in the same capacity at the Japan-founded Nissan (Millikin & Fu 2005). These companies jointly generate more than 10 per cent of cars sold internationally.
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Carlos is as well the Chairman and Chief Executive Officer of the Renault-Nissan coalition, the tactical affiliation administering both companies via distinctive cross-shareholding accord.
For coordinating one of the most violent downscaling movements and leading the turnabout of Nissan Company at the verge of bankruptcy, Carlos attained his celebrity standing. Currently, Carlos ranks amongst the 50 most renowned individuals in international business and politics.
In 1996, Carlos was employed as the administrative vice president accountable for sophisticated research, purchasing, car improvement and engineering, and management of Renault Company (Yoshino & Fagan 2003). Renault acquired around 37% stake of the Nissan Corporation in 1999.
While continuing with his capacity at Renault, Carlos was hired as the CEO of the Nissan Company in mid 2001. Carlos met a debt of 20 billion dollars that the Nissan Company had not cleared.
Additionally, just three of the forty-eight models of the Nissan Company were making a profit and undoing the falling fate of the company was deemed unattainable. Carlos promised his resignation if the company failed to attain a profitability status by the close of that year.
He also affirmed that Nissan could have cleared all it debts by 2005. He disregarded business etiquette in Japan and went ahead to cut off 14 per cent of the entire workforce, closed up five plants, and sold off assets like the aerospace entity of the company.
Owing to his radical schemes, the net profit of Nissan rose to around 3 billion dollars in one year from a loss of 6 billion dollars in the previous year. Within twelve months of his 3-year turnabout scheme, Carlos managed to take Nissan back on the right course.
By the end of the 3-year period, Nissan was among the moneymaking companies in the automotive industry. Moreover, the operating profit margin (prior to taxes and interests) of Nissan rose from 1.4% in 2000 to 9.2% in 2006.
Carlos initiated major structural modifications at Nissan, considerably adjusting the culture of the company (Pisapia 2011).
He stopped dependence of Nissan on an intertwined web of suppliers (keiretsu), modified the official language of the company from Japanese to English, and encompassed officials from Europe and the US in major international policy for the first time.
In early 2005, Carlos was promoted by the Renault Company to be its CEO. With his assumption of the responsibility of CEO in both Nissan and Renault, he became the first individual to head more than one company simultaneously to the extent of their being among the Fortune 500 companies.
He has maintained his dedication of establishing over a million trucks and cars every year in Japan. He has fully rebuilt every one of the earlier damaged plants making all plants attain full production. These efforts have placed Nissan past its rivals like Toyota in some markets.
While heading the Renault Company, Carlos has ensured that it remained top on the sales charts by overpowering its rivals like Peugeot and to ensure that Renault evades losing in poor performance period of 2008, Carlos cut off 4800 workforce.
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In conclusion, dedication by Carlos improved both Renault and Nissan companies by making organizational change and development. The tactical partnership involving Nissan and Renault is not a unification or acquirement. Both companies are connected through cross-shareholdings accords (Segrestin 2005).
This alliance has continued to widen its scope noticeably by establishing further partnerships.
Millikin, J & Fu, D 2005, ‘The global leadership of Carlos Ghosn at Nissan’, Thunderbird International Business Review, vol. 47 no. 1, pp. 121-137.
Pisapia, J 2011, ‘Finding the Future and Making It Happen’, Towards the Next Orbit: Corporate Odyssey, vol. 1 no. 1, pp. 55-7.
Segrestin, B 2005, ‘Partnering to explore: The Renault–Nissan Alliance as a forerunner of new cooperative patterns’, Research Policy, vol. 34 no. 5, pp. 657-672.
Yoshino, M & Fagan, P 2003, ‘The Renault-Nissan Alliance’, Harvard Business School, pp. 303-023.