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by Peter M. DeLorenzo
The Madness of King Carlos.
Detroit. Now that the real picture of Nissan's move to Tennessee is emerging, Carlos Ghosn's "vision" for its U.S. operations to be part of a globally competitive Nissan seems to be unraveling. As much as the apologists still associated with the company are going out of their way to defend the move and the potential savings (which official estimates peg at around $50 million), the reality of the situation is something altogether different - for any number of reasons.
Ghosn's original boast that "most" of the people at Nissan headquarters in Gardena, CA, would make the move to Tennessee is proving to be a complete bust. Not only are fewer than half of the employees making the move to Nashville, it's the number of essential, high-caliber people leaving the company that have the more realistic insiders left at Nissan gravely concerned. Not only is Jed Connely, Nissan North America's sales chief, leaving, Jack Collins, NNA's highly-regarded product development VP is exiting the company too. These two led a team that was single-handedly responsible for Nissan's resurgence. Carlos Ghosn may have gotten the credit, but even he was smart enough not to mess with the well-oiled machine that NNA had become under Connely and Collins. But these two executives are only two of the most visible of the key players leaving. It's the exodus of the key people at levels just below Connely and Collins - in a broad spectrum of critical areas - that is decimating NNA and ripping the heart out of an organization that at one point was considered to be one of the hottest car companies in the world.
It's amazing to me that this is the one blind spot that Ghosn and his loyalists not only fail to acknowledge, but they almost derisively refer to it as a non-issue. Anyone with at least a modicum of perspective who can actually sit there and think that you can just "plug and play" a new organization (in any field - not just the automobile business) with only slight hiccups and be able to perform at previous levels in short order is either pathologically delusional or so arrogant that they're blinded by their own brilliance.
NNA is on the verge of several key launches of vehicles that must hit the U.S. market with no mistakes and no excuses. That's the price of entry in the automobile business in this country these days - the toughest market in history. Nothing can fall through the cracks, nothing can be left to chance, and an organization has to be functioning on all cylinders and on all levels.
And Ghosn picks this exact moment in time to uproot NNA's entire organization and send it across the country in the interest of financial savings that are already proving to be a pipe dream? Even conservative alternative financial estimates say that the move won't save Nissan a penny in the short term - and that in fact it may cost Nissan dearly, what with bonus payouts to employees who choose to stay for an agreed upon amount of time mounting.
But the very essence of the problem here is that while Ghosn and his cronies are calculating the incentive package from the state of Tennessee and predicting the savings they'll ultimately garner, the one cost they're blissfully leaving out of their equations is the human capital that will be squandered in the process - and the devastating effect it will have on the ability of NNA to function as before.
Even under a best-case scenario, I estimate that there will be a painful gap of as much as 18 months, if not more, before this new organization is up to speed. And that's only a best case. This will be an organization that will be expected to gel overnight, largely stocked with refugees from the Detroit-based car companies (something we predicted on this site the moment we first heard of the news). That's just notgonnahappen.com. It doesn't happen in major league sports even when a team is stocked with "all stars" - team chemistry is never a given - so why should we expect it to happen in Tennessee for Nissan when more than half the organization is new to the task at hand and new to each other?
This move is shaping up to be nothing short of Carlos Ghosn's Waterloo. Ghosn has made all of his calculations based on the idea of cutting costs and expenses and preparing Nissan for its role in the global automobile business - where cost and expense are, of course, paramount. But in focusing on just one dimension to this move, he is underestimating the daunting challenges and equipping his former well-oiled organization with a series of built-in handicaps that will prove to be devastating.
What it comes down to is that Ghosn has achieved legendary status around the world - and he is too arrogant to retreat or admit failure. He would never admit that the idea was flawed or that he is setting up his North American organization for a disastrous undertaking - it's just not in his makeup.
As I've said many times before, Ghosn is a proven corporate turnaround artist, but his ability to lead organizations after the turnaround plateau is reached and then take it through the crucial next phase has always been suspect in my book. And by orchestrating the move of Nissan's U.S. headquarters to Nashville, Ghosn is demonstrating to me that my gut feelings about him are indeed correct. He is willing to trash the current NNA organization - destroying the culture and the chemistry of the team that did all of the heavy lifting and delivered the goods in the process - as long as it conforms to his "vision" for the company's future. In other words, his "vision" is more important than the reality of the situation - or the welfare of the company itself.
Carlos Ghosn may be the King of all he surveys, but this move is pure madness.
And it will prove to be the undoing of what once was a pretty damn good car company.
 

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Please enlighten me

Who is Peter M. DeLorenzo?

And why should I believe he knows more as an outsider than Ghosn?

The tone of the article says Jealous at every sentence. The use of the words: Boasts, pathologically delusional, arrogant t, blinded, retreat, admit failure.

Wow talk about sour grapes this guy needs some grapfruit juce to sweeten up a bit.

:eek:
 

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Who is Peter M. DeLorenzo?

He founded and writes an Internet magazine called Autoextremist.com, a small weekly rag that he uses to rant and rave about anything that rankles his feathers.

Although he never worked directly for any auto manufacturer or supplier, he claims to have worked for ad agencies in the automotive arena.

-njjoe
 

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hfelknor said:
by Peter M. DeLorenzo
....Ghosn's original boast that "most" of the people at Nissan headquarters in Gardena, CA, would make the move to Tennessee is proving to be a complete bust. Not only are fewer than half of the employees making the move to Nashville, it's the number of essential, high-caliber people leaving the company that have the more realistic insiders left at Nissan gravely concerned. Not only is Jed Connely, Nissan North America's sales chief, leaving, Jack Collins, NNA's highly-regarded product development VP is exiting the company too. .....
Heck! even I will leave my current job for the same amount of pay for a job in California: 80+ degree the whole yr, rare (almost no) snow, a lot of good foods, closer to hollywood/hawaii/las vegas, beautiful people, beaches, highway 1 for top down driving...:rolleyes: It is all about quality of life!
 

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Re: Re: NNA/Ghosin criticism by Peter Delorenzo

SugarRushMurano said:


Heck! even I will leave my current job for the same amount of pay for a job in California: 80+ degree the whole yr, rare (almost no) snow, a lot of good foods, closer to hollywood/hawaii/las vegas, beautiful people, beaches, highway 1 for top down driving...:rolleyes: It is all about quality of life!
SugarRushMurano-

You got it the wrong way around... He was asking his employees to move from California to Tennessee.

No offense to our Tennessee members, buy I would say it is a safe bet Gardena, California has a slightly different lifestyle than Nashville, Tennessee. I can see why some employees would be reluctant to relocate.

-njjoe
 

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The corporate offices will be moving from California to Tennessee, but will the design team move with them as well? I can understand cost savings from the relocation, but I think its pretty important to consider the trendy climate of SoCal as well, and the influence it will have for leading car design.
 

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There is only one king in today’s world - $$$ and Wall Street with its short term goals and "share holders ( I call them "share takers") first" attitude.

Sadly, it justifies everything……and we cannot do anything about it....
 

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Mr. 3 K, 3/3/5. 5K,10/5/7
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I have lived in

Detroit
Tarpon Springs Fla
Key West
Miami
Gainesville
Long Boat Key
Hampton Va
Houston Texas
Cocoa Beach Fla
Marina Del Rey CA
Valencia
Phoenix
Birmingham Mi
Knoxville Tn
San Franscisco
Los Gatos Ca
Hunington Beach
Laguna Beach
Scottsdale

To tell the truth Calif is Full, overpriced, crowded roads,hetic, poor high schools and was a general pain in the ass to have a nice life style. Remember this is all IMO to eachhis own.
I would take tennessee in a minute.
 

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Discussion Starter #9
"I would take Tennessee in a minute."

Gripper, you were a vagabond. A gypsy.
Me too.
I would also take Tennessee.
In fact I took a transfer to Dallas from Silicon Valley in 1980.
Precisely to get away from California and it's phony atmosphere.
People there didn't own anything.
They rented their house, their cars.......and I would swear, their wives.

But having said that, a true Californian loves it.
We transferred 22 people.
We all signed 1 year agreements.
18 months after we transferred, there were 2 of us left.
The other guy was a native Texan who had taken the opportunity to "go home".
Me? I wasn't cut out for California.
I loved Texas.

So NNA will face another crisis IMO in about a year after they make the move.

Homer
 

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I say Yeah to Don and Homer.
Imagine what you could buy on a nice uncrowded mountainside around Nashville for the money you made in Cali. Jeeeeze.
I would also take Nashville in a minute, just for the room to breathe, and, I'm from the south so I'm kinda prejudiced.
:D

Don, you lived on Longboat Key?

Cool. I got to Siesta Key for vacations. Been on longboat many times.
 

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Don, Homer

You guys have definitely “moved”. And I thought I move around a bit. Guess I got corrected :)

Back to NNA. Moving an office and moving a company is a significant difference. I work for a major corporation and know a little bit about it as I was “bought” or “acquired” many years ago. Since then I have seen many acquisitions. What people do not realize is how hard it is to change company culture. And many do not know what does it even mean. As an example, my corporation built a brand new plant in Florida and relocated production from an Ohio Plant. It did not work out very well. In a relatively short period of time the plant in Florida was closed and everything moved back to Ohio…..again bean counters forgot to understand the culture. And wanted short term results.

California – I love this place. I know I would be happy there because of climate. Work ethics, culture? This is a different story. A few months ago I audited a bay area plant, a very well known brand. It is the worst performing plant in USA! So many problems……management and culture related. Anyway, it is great to live in such a diverse country. I am still getting over over Boston rudeness, New York “deals”. Then I love the southern hospitality and kindness, great straightforwardness of Maine, good old American honesty of mid west.

NNA – they will be OK. They have good products now and most likely processes in place. If the top management give Tennessee time and prepare a good relocation plan, in the end everything will be OK. Just do not let bean counters run the company. Profit is important and this is what business is all about, but to get the profit company has to have THE RIGHT PEOPLE, THE RIGHT MANAGEMENT AND THE RIGHT PRODUCT. Profit is a result of these. Not the opposite…..
 

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Re: Re: Re: NNA/Ghosin criticism by Peter Delorenzo

njjoe said:


SugarRushMurano-

You got it the wrong way around... He was asking his employees to move from California to Tennessee.

No offense to our Tennessee members, buy I would say it is a safe bet Gardena, California has a slightly different lifestyle than Nashville, Tennessee. I can see why some employees would be reluctant to relocate.

-njjoe
What i meant form my post is that I understand why so many of NNA employees do not want to move to Tenesse. They do not want to leave California. Using my self as example: I will move to California in a heart beat from where I am now.....;)
 
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