Nissan Essay Example | Topics and Well Written Essays - 1250 words

Nissan - Essay Example It seemed like no one would be able to revive the company. In 1999 Renault has bought a 37% share of Nissan and announced the merger between two companies. Investing $5,4 billion in Japanese manufacturer falling quickly into the abyss was taken as more than just unwise by skeptics. Nevertheless, executives of Renault were optimistic about the deal. Carlos Ghosn was sent to head the restructuring of Nissan by Renault in June 1999. "Ghosn slashed costs and laid off employees, but also instituted a sweeping reorganization of the entire company, announced an ambitious slate of new vehicles and promised that if Nissan was not profitable in 2000, he and his entire managerial staff would quit"2. Eventually Ghosn has kept his promise and became a CEO of Nissan in 2000. Nissan had lost Japanese market share for 27 years in a row, and was operating at 50% capacity, with far too many suppliers, constant goal changes, poor accounting data regarding product line profitability (later found only 4 of 43 models were making a profit), and goals generally lacked quantitative specificity on amount (eg. "Build a quality product"), timing, or priority.3 The company was dying under the traditional Japanese management. ... innovative and motivating technique; statistical quality control as the key to productive effectiveness; a long planning horizon; and consensus decision making, as a form of participative management4. The Japanese style of management is all about quality. Due to the fact that a lot of American and European companies have successfully implemented Japanese strategies it should be noted that quality is really important when it comes to competitive advantage. Nevertheless, the mistake of Nissan was behind the belief that quality is the only important factor. This mistake was uncovered by Carlos Ghosn. Traditional Japanese management is based on the collective mentality. Individualism is valued less in Japanese companies than in European. Nissan needed drastic changes and cost reduction above all, however the Japanese mentality interdicted the implementation of extreme methods used by Ghosn. Additionally, overlapping net of distributors, which is also a typical feature of the Japanese management strategies, has played a mean joke to Nissan, forcing its distributors to compete with each other. Resuming the subsection, it can be concluded that traditional style of management was ineffective in Nissan. It was like dozens of feuding board members were not able to make an agreement. Changes made by Ghosn The impact made by Carlos Ghosn on the performance of Nissan was great. This Brazilian manager of Lebanese origin used a simple philosophy: "Be transparent and explain yourself in clear, lucid terms. Do as you say you are going to do. Listen first; then think".5 It may seem really simple, however it helped Ghosn to perform greatly in South and North American divisions of Michelin, and then in Renault and Nissan. According to Magee, he "may be the only person to have four

Strategic HR Essay Example | Topics and Well Written Essays - 250 words

Strategic HR - Essay Example R systems are the most critical in HR architecture since they are the source of value creation and have greater inimitability depending on how they are aligned with the overall corporate strategy. According to the Resource based View (RBV) of the firm, human resources are the most strategic assets for the firm and should be recognized in order to attain competitive strengths. In implementing SHRM strategy, the firm should focus on the key strengths and capabilities. According to Porter, the firm should emphasize on cost leadership and differentiation in the competitive strategy (Becker and Mark 902). Current trends in focus on differentiation in the SHRM since business processes should create value for the organization (Becker and Mark 903).unique and firm specific HR architectures will create and sustain competitive strength for the firm. Modern SHRM literature focuses on the holistic view of human resources since all employees have unique talents and contribute differently in the value creation process. Effective human resource management strategy includes both HR core architecture that creates equal value to all business processes and HR differentiated architecture that provides specific skills and attributes for the effectively performance of certain strategic jobs in the organization. According to five national surveys conducted between 1991 and 2000 and data from 3200 firms, the standard deviation from HR systems change is 10-20 percent in value of the firm. Increase of one standard deviation leads TO 4.6 percent increase in return on assets (ROA) (Becker and Mark 907). SHRM should focus on intermediate outcomes since financial performance should not be the only dependent variable and outcome of SHRM. Focus should be on strategic business processes that involve a high level of human resources. New focus should be on contingencies and fit since HR architectures should also be differentiated. HR managers face challenges of measuring employee performance