Case Study on "Leading Change Carlos Ghosn at Renault and Nissan"

Case Study 6 pages (1565 words) Sources: 6 Style: APA

[EXCERPT] . . . .

Change leadership by Carlos Ghosn at Renault and Nissan.

The causes of organization culture change

The beliefs of Ghosn in regard to leadership and change

Organizational change management which refers to the framework used in the management of the various effects of business process, cultural change as well as any cultural changes within a given business enterprise is an important element of every organization. When implementing a perfect change management, it is worth noting that the process should be systematic as people are taught new skills as well as new behaviors. It is important to appropriately set formal settings that involve the use of tools that are necessary for improving communication while at the same time seeking ways to effectively reduce the level of misinformation within the organization. A successful organizational change management is noted to include a combination of factors. The first one being that there must be an agreement within the organization on a common vision for organizational change. This implies that there must be no form of competing initiatives. The second one is that there has to be a strong leadership presence to help in communicating the organizational vision as well as sell the specific business case that is necessary for change. The third factor is that there has to be a strategy that is aimed at educating the employees on their actions after the change. The fourth factor is that there has to be a concrete plan necessary for measuring the success rate of the change process. Finally, there has to be a reward system, monetary and otherwise for encouraging individuals as well as groups to take appropriate leadership of the newly created roles as well as responsibilities. In this paper however we analyze the concept of organizational change management and change leadership in regard to the leadership of Carlos Ghosn at Renault and Nissan.

Change leadership by Carlos Ghosn at Renault and Nissan.

Change leadership is an important element of every organization (Cloud,2010,p.74). Despite its successes, it comes with its challenges (Trybus,2011,p.34) as is evident in the case of Carlos Ghosn's leadership in Renault and Nissan as a dual CEO. Ghosn made a strategic alliance between Renault and Nissan, a relationship which was mutually rewarding to both companies. An analysis of Carlos Ghosn's leadership indicates that he made several leadership change management moves to the strategic alliance.

As result of his leadership at Nissan he exhibited several core leadership tasks. These included;

His effective leadership skills that allowed for behavioral change within the organization in an effort of improving the organizational performance. While he was at Nissan, he wanted to bring the company back to profitability within the shortest time possible. Ghosn made several fundamental changes to the organization of Nissan as well as the operations within the company by focusing on several specific business aims and objectives. His main focus was on improving performance at all cost. He is however criticized by achieving this through drastic cost cutting measures. He wanted to achieve the organizational objectives at all costs by surpassing the existing cultural differences.

He used the concept of performance management to remove executives who were not able to meet the set performance targets (Baggaley,2006,p.37).He set extremely high standards within very short time limit. His team therefore had to work extra hard to achieve the set standards or risk being fired.

While at Nissan, Ghosn developed and communicated his purpose. He achieved this by making several level communications as well as giving his team as much valuable information as possible to help him and the teams diagnose the organization as well as implement the prescribed organizational changes effectively. Communication is therefore an important component of change management. Ghosn communicated with his teams directly in case he had key issues and decisions that were bound to change organizational processes and culture. The demanding nature of organizational performance must be effectively communicated. Elving (2005) noted that organizational communication performs two major roles. The first role is to inform all the employees on the tasks that they should perform as well as the policy and major issues that affect a given organization. The second role is to create a sense of community within a given organization. Ghosn used communication for both purposes. As a result of these goals it is important to note that information that is given as a result of organizational change must be given in order to instill a sense of community prior to, during as well as after the change. Elving (2005,p.131) indicated that the information which is provided regarding a given organizational change must effectively address the specific reasons for the organizational change. The information must also address the worries that the employees may harbor. This aspect was however conspicuously The information that is provided by the organization must come from the management as the body sending the information while the employees as the recipients. It is important for the common communication theories like the sender, information (message), recipient and noise to be noted as part of the communication. It is therefore worth noting that change communication is crucial in informing the organizational members of the impending change as well as its progress. The purpose is to influence the readiness of the members of the organization to the impending change.

The other element of Ghosn's leadership at Nissan is leadership development via a cross function team work. This is crucial since it helps in the making of important decisions which affects the operations of a given company. A review of the case indicates that Carlos Ghosn's leadership at Renault and Nissan had strengths and weaknesses. The strengths indicated above and they helped the company realize profitability within the shortest time possible. The weaknesses of his change leadership style are that he was authoritative and never allowed a smooth dialogue between him and his team. We also notice that Ghosn was obsessed with cost cutting measures which in a manner could have affected the later recorded poor performance of the organizations which he led.

The causes of organization culture change

According to Salinas (2010,p.24), organizational culture change involves transitions within an organization as its members in order to change the status quo. These changes could be motivated by the market dynamics via a deliberate effort by the management to institute changes to key processes, leadership as well as the partial or complete change to the organizational structure. Salinas (2010) further indicates that the process of organizational change is a complex one that involves individual as well as group learning.

The Ghosn's case indicates that organizations may at time require an external stimulus for them to perform and well by overcoming the inertia as well as any cultural barriers that may be active within its ranks. A review of the Japanese organizational landscape reveals that there are very few cases in which an outsider was consulted to come and successfully managed the organizational culture.Ghosn is therefore one of the outsiders who came to change the performance of a troubled Japanese company. The manner in which Ghosn was dispatched from Renault (A French automaker) to go and tackle the problems that were facing Nissan indicates how a change in organizational culture steered Nissan to corporate success. Ghosn implemented key reforms while also revolutionizing the way Nissan did business.

The beliefs of Ghosn in regard to leadership and change

A review of the Ghosn's leadership at Nissan indicates that he is a true believer of leadership change management. This is exemplified in the manner in which he initiated changes and then subsequently secured a significant level of change. He was almost obsessed with the concept of change leadership. Just as Kotter (1996,p.25) pointed out "Leadership defines what the future should look like, aligns people with that vision, and inspires them to make it happen despite… READ MORE

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