Michelin had recently acquired the Uniroyal Goodrich Tire Company and Ghosn was tasked with restructuring the merged companies. said, return to profitability within the year. The doubt and the judgment is before. If you get carried away by success, it may prepare big deceptions for the future. "I've always felt and had hit its production peak ten years before, in 1989. Qwest minivan, ran into trouble due to its inexperienced workforce and an American automaker, and it was still an open question as to where the When Renault entered into an alliance with Nissan Motor Co. in 1999, Ghosn was tapped to become chief operating officer of Nissan in Japan. On the other side, successes can be — even though they are pleasant — they can be dangerous, because in a certain way you may forget what made the success. The way I see myself as a child is that I was probably a very focused person. You’ve had such an international career. But this is not sufficient, because if you have a good vision and you explain what are the action plans, people will not believe you unless you come with very strong commitments, and we made commitments. But I ended up staying two years and a half, because all of a sudden this alliance came, and the prospect to work in Tokyo and heading a Japanese company was not something that I had ever dreamed of, or planned for it, or plotted for. They will be willing to face many challenges which would appear to other people as daunting, and they will be able to make commitments that for other people would be foolish. I still think that as long as you deliver a strong performance, your management is considered as attractive and meaningful. He earned an engineering degree at the Ecole Polytechnique and a graduate degree from the Ecole des Mines. As much as failure is unpleasant, it can be extremely helpful, because, if you learn from failure, you’re preparing for future success. If young people come to you for advice, is there anything you would add to that? Ghosn stepped down as CEO of Nissan in 2017, while continuing to serve as chairman of Nissan and Mitsubishi, and as chairman, president and chief executive officer of Groupe Renault. Carlos Ghosn was born in Porto Velho, Brazil, on March 9, 1954. discussions in meetings. "cost killer" sobriquet. You can’t get anything valuable done. And coming to Japan as a foreigner, I was probably very well prepared — having faced different cultures and different countries — to approach Japanese culture with enough attention, curiosity and respect. There are opportunities that come, you take them or not, and this defines the course of your life. It can go to support or it can go to resistance and negative attitude. I accept all this advice and I have to pack my luggage and go back to Paris and just let somebody else get a shot at it, or I’m going to have to transgress many of these advices. In fact, I went to Michelin because Michelin had a big project in Brazil, and they were looking for students who had ties with Brazil, spoke Portuguese, knew Brazil, and had a French education. mastered the traditional bow common in Japanese business circles. But despite his record, there was an But with time, with experience, you learn how to make these things — you position them, in a way, where they’re not as important as they appear to you when you’re younger. married to his wife, Rita, and with a growing family that would eventually 1 of 3 A security official checks people's IDs before the third hearing in the trial of Carlos Ghosn, former Nissan Motor Co. chairman, in Istanbul, Wednesday, Jan. 20, 2021. Fortune That’s the difference. But as you know, I ended up graduating doing these things versus what I was interested in. I’ve been always a difficult student, you know. In 2003 Ghosn announced a second and equally ambitious three-year plan, "Nissan CEO: The Making of a Superstar," Nissan was saddled with So you have to come with amazing results that people believe were not possible, and you have to come with them as soon as possible. schedule in meeting Ghosn's goal of cutting costs by 20 percent, And the second important point is the motivation. They convey the image of the company, so either they are happy, they are hopeful — if they are more confident, if they trust, if they work hard, people around you are going to look at you and say, “Well, there is something right that you’re doing.”. If, on the contrary, they are skeptical, they are critical, they are anxious, they are nervous, then you’re not going to be given any other chance. Carlos Ghosn: I was fascinated by education, because at school I was able to make a difference between the poor teachers and the excellent teachers. 90-day review, negotiations between the two firms fell apart in the summer be recruited by General Motors or Ford, the Big Two of the American auto How you can boost these aspirations? organizational structure of Michelin's South American operations, nothing," and held the noncompetitive collective belief that Ghosn, shuttling between Paris and ", Ghosn's accomplishments were all the more noteworthy because they How could you be focused and be a rebel at the same time? Prior to joining Thunderbird, he was vice president of human resources at Motorola. through the Michelin organization, rising to become head of research for had immigrated from Lebanon, and when Carlos was six he and his mother Ghosn himself This put a lot of pressure to deliver results quickly, and that’s why we were able to come with a plan three months after I assumed my responsibility, and committing on results already on the first year of the plan. The electric Nissan Leaf debuted in 2010, and soon became the world’s bestselling zero-emissions vehicle. 1992, but by the mid-2000s the government's share had declined to We want to make a difference, and we make a difference where value is going to be recognized. So I gave myself a 50 percent chance, but I was very excited. You can’t close a plant. the language. And little by little I tried to observe why some teachers were interesting and why some others were boring. The same day, the CEO of Nissan announced that Ghosn would be removed as Chairman of the Board for acts of financial misconduct, including the diversion of company assets to his personal use. I headed for Tokyo, where I took the responsibility of Nissan as president and chief executive officer, and that’s what I’ve been doing for the last five years. , July 21, 2003; March 7, 2005; April 4, 2005; December 11, 2006. I found more lessons of courage and wisdom in ordinary people around me than in more renowned people. He started business there and was involved in various industries … Ghosn's skills lay more in effective sharp gains at the same time. and he later began working on several others, including Japanese. Ghosn believed only drastic action could save the company. The difference is how much can you transform the reality into something better. The operating margin is at 11 percent, which positions Nissan in the top level of the industry. foreigner to hold that symbolically significant post in Japan's union representatives that flexible work rules were in the best interest Rising from plant manager to head of research and development, he was thrilled when an opportunity arose to transfer to the land of his birth. I found it very true in a certain way, and I found it even more true today than when I read it 15 years ago. "Having to speak English is very helpful, as it is I was very happy to have skepticism and not significant animosity against me. It’s like reading a story which is not your story. Ghosn became a hero in Japan; his managerial exploits were even portrayed in a comic book. I was looking for an opportunity after I graduated as an engineer. What’s your direction? agreed to talk to Louis Schweitzer, CEO of the money-losing French After a having fallen behind those of rivals Toyota and Honda technologically. What about success? Polytechnique in 1974 (a school that spawned an unusually large number of resulting in improvements that had been missed when each department had With the record he had amassed, it was perhaps inevitable that Ghosn would The return on invested capital is more than 20 percent, again at the top level of the whole industry. In 2020, Ghosn fled Japan for Lebanon, alleging “injustice and political persecution” by the Japanese authorities. And probably one of the coolest product lineups on the market today. pressure from prominent shareholder Kirk Kerkorian, was exploring a series We have 130,000 people worldwide, half of them being in Japan. Under his leadership, the company returned to profitability in only two years. You can’t reduce head count. The plan had been for Ghosn to take over the CEO position at Renault after Carlos Ghosn was born in Brazil and earned his engineering degrees in Paris. It’s not so much the amount of knowledge, it’s the intensity of the knowledge and how embedded is the knowledge. I liked the strong identity of Japan. Carlos Ghosn has used his freedom to blast Japan's legal system and denounce his arrest as part of a plot to topple him as head of the world's most powerful auto alliance. From time to time you take them but you fail in them, which means when they repeat, you just are not courageous enough to take them again. first year, Ghosn had to develop a restructuring plan that took continuing Former Renault-Nissan boss Carlos Ghosn said in an interview aired Monday that French investigators are coming to question him in Lebanon over some legal … and other world markets, barely broke his stride. working groups consisting of people from different sections of the It’s also about the fact that you’re offered a lot of opportunities in life, but from time to time you don’t see them. So failure is, in a certain way, a kind of condition for important successes. occupying Japan after World War II. Then, for family circumstances, I went to Lebanon, where I spent the following ten years going to a French school in Lebanon, and then after this went to Paris. While Ghosn was free on bail, Japanese prosecutors filed additional charges and arrested him again. positions of president and CEO at Renault. The punctuality, the technology, the dedication, the loyalty, the simplicity, the modesty of the Japanese, all of this attracted me a lot. In 1999, Nissan was a heavily indebted company, more than $20 billion in net automotive debt. With nearly $20 billion in debt, and annual losses of over $6 billion, Nissan was near bankruptcy. The day after he was given that post, Ghosn faced a tense meeting of What haven’t you done in your life that you’d like to do? He formed That’s what led me to appreciate and understand the skills necessary to be a good teacher, or to be a good educator, and this is something which helped me a lot even being in the business world. operation. So I knew it from the beginning, but I took it, because I thought that if anybody has been prepared in his career to take this kind of challenge, it was me. So it doesn’t matter if you fail or if you win, but you just have to dare, be audacious, be bold, look at the direction and don’t be afraid to fail. In 1996, therefore, he include four children, he added the position of chairman in 1990. So the two most important words that I believe in — and I practice it under different angles in my family life, my professional life, and my personal life — is aspiration and motivation. This is probably the only book I’ve read many times and I recommended it to my children. known as Nissan 180. , Doubleday, 2005. Mines de Paris in 1978. The saga began with his arrest on suspicion of financial misconduct, then he … I was born in Brazil, spent there the first six years of my life. Some people create value by being politicians, others by being in a nonprofit association, others in business, but we are all looking for the same thing. I hated mathematics, physics, and all the other things. He dealt with unionized I’ve learned a lot in the five years, and that’s what makes me extremely excited about my job. At age 17, after completing his secondary education in Lebanon, he traveled to Paris for university study, engineering degrees at the École Polytechnique and the École des Mines de Paris. After two failed partnerships in India, Renault-Nissan’s CEO has learnt the hard way that he cannot look at all emerging markets through the same lens In 2005, Ghosn was chosen to serve as CEO of Groupe Renault, making him the first person to run two Fortune 500 companies simultaneously. Finally, you have to deliver results, because the vision is good, motivation of people is good, your commitment is important, but if you don’t have results no leadership will ever last or be accepted. problem making decisions quickly and decisively.". But Ghosn succeeded brilliantly by overhauling the In November 2018, Carlos Ghosn and an associate were arrested in Tokyo. At the beginning, you’re scared because you don’t have the experience. ruthless economizer. TOPSHOT - Former Nissan chairman Carlos Ghosn leaves his lawyers' offices after he was released earlier in the day from a detention centre after posting bail in Tokyo on March 6, 2019. You have to guarantee lifetime employment.” You know, a list probably of about 80 or 90 things not to do in Japan. Ghosn's popularity in Japan skyrocketed after his rocky start. Carlos Ghosn: When I was a child the thing I was most interested in was history, geography and languages. This put a lot of pressure on me to deliver results quickly, because skepticism is an unstable situation. As an adult Finally, he infused new So I had to put the two companies together and run them up to 1996. It was a company with a weakening brand, a bland product lineup, and an average operating margin of one percent — which is very low for the automotive industry — and most of the years were unprofitable. His career started unremarkably enough, as a Carlos Ghosn holds French, Brazilian and Lebanese citizenship. In Paris I graduated from two engineering schools and started my career with a company, which name is Michelin, thinking about going back to Brazil because they were developing a big project in Brazil. , May 22, 2006. Ghosn would attribute the ease with which he moved among different Until 2018, he served concurrently as Chairman, President and CEO of Renault, and as Chairman of the Board of both Nissan and Mitsubishi Motors. Technology is here. What characteristics or traits do you think are important to achievement? If you can have both of them in a project, 95 percent is going to be successful. It’s not only in your mind, it’s in your body, I would say, everywhere. using a method that would become something of a trademark. © 1996 - 2021 American Academy of Achievement. At the same time, with enough focus on reviving Nissan to be able to pull it off. He recounted his experience in a bestselling book, Shift: Inside Nissan’s Historic Revival. In 2007 he committed $5 billion to the development of an affordable zero-emissions vehicle. That September, he settled with the United States Securities Commission (SEC) for failing to disclose $140 million in compensation from Nissan. Going through different countries, working in different continents, facing different challenges, different people, I’ve been through this. You start from the result. What was that like, as an outsider, taking over this established Japanese company? Listen to your anxiety because it can be the best guide for you. FILE - In this Sept. 29, 2020 file photo, former Nissan Motor Co. Chairman Carlos Ghosn holds a press conference at the Maronite Christian Holy … unofficial contract-for-life arrangement that existed between Japanese The biggest challenge for the 21st century is how can you bring people together at the same time and respect their identity. Nissan's debt by selling off the company's shares in about markets were chaotic during those years, and Brazil in particular suffered FILE - In this Sept. 29, 2020 file photo, former Nissan Motor Co. Chairman Carlos Ghosn holds a press conference at the Maronite Christian Holy … Carlos Ghosn has tales to tell and scores to settle | Analysis Jan. 1, 2020 at 8:44 am Updated Jan. 1, 2020 at 3:32 pm The home of former Nissan chairman Carlos Ghosn on Dec. 31 in Beirut, Lebanon. I received a lot of advice when I arrived from outside people — Japanese and non-Japanese — saying, “You know, there are a lot of things in Japan that you can’t do. Many, many books. A security official checks people's IDs before the third hearing in the trial of Carlos Ghosn, former Nissan Motor Co. chairman, in Istanbul, Wednesday, Jan. 20, 2021. Everybody is afraid to fail, but at the same time this is a remedy to success also, because if you’re not afraid to fail you’re not going to be successful. It was written in a very simple way, very lively way, very human way, and it struck a chord in me. disciplined man I've ever worked with," U.S. Nissan That’s with experience. division had turned a profit. He became chairman of Japan’s Mitsubishi Motors in 2016, and relinquished the chairmanship of AVTOVAZ, which remains a Groupe Renault subsidiary. $20 billion in debt, had lost money for seven of the previous eight years, There are more important things in life, and with experience you can position them in a much better way. Ghosn won plaudits in the automotive press after accepting responsibility came at deeply troubled companies—Renault in France and Nissan in, Carlos Ghosn was born in Porto Velho, Brazil, on March 9, 1954. I spent a lot of time observing people and learning from them. So I was the perfect profile for this, and as this project was in the State of Rio de Janeiro, and not very far from the City of Rio de Janeiro, I decided to go for it. Nearly bankrupt before he came, Nissan would, he But I was grateful that I was at least given the benefit of the doubt, and I could not expect more than this. Japanese women named him the country's most desirable husband in But I think what made the public, in general, wait and see or give us the benefit of the doubt is there were some commitments behind it. HIs reign ended in November 2018, when he was arrested on charges of underreporting his income to Japanese tax authorities. At the outset, he cut 21,000 jobs — roughly one in seven — closed five plants, eliminated seniority-based promotions and dismantled the keiretsu system, buying out suppliers who held long-term sales agreements as well as stock in the company. The four companies he headed over the course of 2016 sold 9.96 million vehicles that year. Born in Brazil of Lebanese descent, Carlos Ghosn was educated in Paris. He has been the subject of numerous business school studies and popular books such as Turnaround and The Ghosn Factor. , Collins, 2003. , http://www.detnews.com/2005/autosinsider/0502/27/A01-101491.htm Former auto executive Ghosn, who is a Lebanese, Brazilian and French national, fled Japan in a dramatic escape that drew headlines last year, arriving in Lebanon on Dec. 30, 2019. So far, I had been a member of an executive committee, a member of a team. I respect Japan for being a country with no resources, very small, not a very significant population, and still being the second largest economy in the world. Ghosn repeated this early success after becoming president and chief was family-owned, and its longtime head, François Michelin, had They have stretched. The task facing Ghosn was daunting. French engineers met with But you don’t know why you’re doing this, you don’t know why you’re studying this, you don’t know why these rules are being implemented. Schweitzer made a bold move: he injected $7 billion into the Japanese estimated his chances of success at no better than even money. I continued to read a lot of books and tried to read in many languages — in Portuguese, French and English — and I can spend a lot of time reading a thriller, as much as I like books about religion or philosophy or history. Seeing the company, a better company, much more respected. We said also that if the debt was not cut by half in three years we would also be resigning. industry and each beset with many of the same problems Ghosn had solved at And what is planned is, next year, in April 2005, after the shareholder meeting, I will become president and CEO of Renault at the same time that I will be keeping my responsibility as president and CEO of Nissan. I was going to learn about Japan, about Asia. At the same time, I was a rebel. And then when the results started to pour in, and people started to see transformation of the company — and transformation of the company shows first in the employees of the company, because they speak about the company more than anything else. Don’t be afraid to fail, but listen. That’s what I think is going to be the major challenge of the 21st century. That’s it.” And if there was another plan for Nissan, it would not be carried by us. And today, Nissan is a hot story in Japan, as you know. The arrest is a remarkable fall … I found it a very interesting book and a book that I recommend to many people. Carlos Ghosn: The most difficult thing when you grow up is you feel you have a lot of energy in you. You can’t unwind cross shareholding. automaker Renault. Ghosn’s strategy worked, and by the end of the year, the company, which had reported billions in losses, was showing billions in profit. knowledge," wasted time on "discussions about everything and Under Ghosn’s leadership, the firm’s production has more than doubled and its debt has been eliminated. Ghosn resigned as Chairman and CEO of Renault in January 2019. Carlos Ghosn: Oh, yeah. I’m not sure they read it. Lebanon Ghosn attended topflight schools run by the Jesuit Catholic order, the variety of languages spoken, he instituted English as the official Carlos Ghosn: Oh, yes. I wanted to make sure that I will have the attention of the public, and hopefully get the public to judge on the results and not on intention, or not on origin, and not on gender, or not on culture, and as you know, that’s what ended up happening. not our native tongue; so we have to simplify our thoughts down to core You have to respect the seniority system. Mississippi to address the problems. You get more wisdom. From Beirut, Ghosn denounced the Japanese criminal justice system as indifferent to the rights of defendants and prejudiced against foreigners. Or it means that you’re going to have to pass it on to somebody else who is going to feel this huge anxiety and this fear before the big events, and if something goes wrong, what’s going to happen. So failure and success, at the same time, are mixed blessings. They are better. United States, Ghosn engineered a merger with domestic tiremaker Uniroyal Dubbed "le cost killer" and "the It’s also the growth of people. acted in isolation. last two goals and been met and the third was well on the way. I can’t give you the names of these role models because probably they don’t mean anything to you or to the people watching us. Ghosn undertook a radical restructuring of the company that earned him the unwelcome nickname “Le Cost Cutter.” Nicknames notwithstanding, Ghosn restored Renault to profitability, setting the stage for the company’s further expansion. You were challenging a lot of the ways Japanese companies traditionally operate. I don’t know if you know this book. By 2005, again ahead of schedule, the When I say growth, it’s not only the growth of the company. These commitments involved top management more than anybody else in the company. Is it possible to plot a course or, I mean, does one find a career or a calling, or does it find you? Automotive News I didn’t want more than this. network of relationships between auto companies and their suppliers, Ghosn pared unproductive fat from Renault, closing Traditionalists were scandalized at the thought of a foreigner taking charge of this icon of Japanese industry, but the situation at Nissan was bleak, and a new approach was plainly called for. Carlos Ghosn: The Great Escape Mr Ghosn’s disappearing act might actually harm further chances of reform. Ghosn was criticized for not having Were there any books in particular that influenced you when you were growing up? Part of Nissan's problem was excess capacity, brought on by an That’s what gave us a little bit of a benefit of the doubt. . It is how many successes you’re going to have in your life, even though you have some failures also. Just over 30 percent level of operating profit. They are different. , September 20, 2004; January 31, 2005; July 17, 2006; September 25, 2006. Carlos Ghosn: I don’t know if it’s a problem or it’s opportunity. Carlos Ghosn at Nissan John P. Millikin Dean Fu Dr. John P. Millikin is the academic director for the Global Strategic Human Resources program in Thunderbird Executive Education and a visiting professor of management. So I would say putting them in relative order — putting them in priorities, looking back at the past, and trying to see what happens in similar experiences — alleviate the anxiety and alleviate the pressure. As part of the settlement, Ghosn agreed not to serve as an officer or director of any publicly traded company for a period of ten years. The terms of Ghosn’s bail required him to remain in Japan under constant surveillance, and barred him from contact with his wife Carole, who made a series of public appeals to world leaders to pressure the Japanese government to drop the charges against her husband. automaker (and world's largest corporation of any kind). Fortune Ghosn's parents In December 2019, Carlos Ghosn escaped from Japan and rejoined his wife in Beirut, Lebanon, forfeiting $13.8 million in bail. I made a personal commitment, saying that if the company was not profitable — the first year of the plan — I would be resigning, and with me all the members of the executive committee. patriarch Bill Ford Jr., news emerged in 2006 that General Motors, under Benjamin Fulford of As you know, we had to make a lot of changes in Nissan. That means there is nothing you can get from anybody, including yourself, if you’re not motivated, if in a certain way you don’t sense ownership, if you don’t share in something, if you don’t embrace something. I spent seven years in the United States, but then a headhunter approached me and asked me if I’m willing to join the car industry, which obviously is something that anybody working as a supplier would like to do, because then you are at the top of the food chain. I liked Japan for very subjective ways or things. Ghosn faced an unusually difficult situation as the first foreigner to head a major Japanese company. "He's just the most It was not easy, but it was very important to explain why we had to do this and where we were going. , who noted that "Once [Ghosn] has digested a problem, he is like Forbes