Mr. Lee Iacocca was born to Italian parents who had settled in Pennsylvania, USA. Mr. Iacocca graduated with a degree in industrial engineering. After graduating he went to Princeton University for his post graduate studies. He then began a career at Ford Motor Company as an engineer. Unhappy with the job, he switched career paths at Ford, entering the company's sales force. He was very successful in sales and moved up through the ranks of Ford to product development.
Iacocca was involved with the design of several successful Ford automobiles, most notably the Ford Mustang. This successful model was made with the existing platforms and engines and hence the term 'Bricoleur' is used for such people. He was also the "moving force," as one court put it, behind Ford Pinto. Please see my article titled 'Business Ethics - Cost Benefit Analysis' available in this domain. He promoted other ideas which did not reach the marketplace as Ford products. Eventually, he became the president of the Ford Motor Company, but he clashed with Henry Ford II and in 1979, was fired despite FMC posting a $2 billion dollar profit for the year.
After being fired at Ford, Mr. Iacocca was aggressively courted by the Chrysler Corporation, which was on the verge of going out of business and in bankruptcy. Iacocca started as Chrysler's chairman, and began a heavy restructuring of Chrysler. By the time Iacocca took over, Chrysler was focusing most of its money on large, fuel thirsty cars that the public did not want due to a fuel crisis at that time. Iacocca began rebuilding the entire company from the ground up. He built a new TMT and fired 35 former VPs of Chrysler and brought in a number of former Ford colleagues. He laid off 65,000 employees. He communicated with the union, suppliers and all other stakeholders. He sold Chrysler's loss-making European division to Peugeot. His next move was cutting several large models, which were heavily unprofitable, and put the subcompact Dodge Omni and Plymouth Horizon into production. The Omni and Horizon became instant hits, selling over 300,000 units each in their debut year, showing what was to come for Chrysler.
Realizing that the company would go out of business if it did not receive a significant amount of money to turn the company around, Iacocca approached the United States Congress in 1979 and asked for a loan guarantee. While it is sometimes said that Congress lent Chrysler the money, it, in fact, only guaranteed the loans. Most thought this was an unprecedented move, but Iacocca pointed to the government bail-outs of the airline and railroad industries, arguing that more jobs were at stake in Chrysler's possible demise. In the end, though the decision was controversial, Iacocca received the loan guarantee from the government. This was similar to the Lockheed bailout.
After receiving this reprieve, Chrysler released the first of the K-Car line, the Dodge Aries and Plymouth Reliant in 1981, compact automobiles based on design proposals that Ford had rejected during Iacocca's tenure there. Coming right after the oil crisis of the 1970s, these small, efficient and inexpensive, front-wheel drive cars sold rapidly. In addition, two years later Chrysler released the minivan, based on a proposal of a key subordinate (Hal Sperlich) hired away from Ford; to this day, Chrysler leads the automobile industry in minivan sales. Because of these three cars, and the reforms Iacocca implemented, the company turned around quickly and was actually able to repay the government-backed loans, seven years earlier than expected.
Iacocca was also responsible for Chrysler's acquisition of AMC in 1987, which brought the profitable Jeep division under Chrysler's corporate umbrella. It also created the short-lived Eagle division, formed from the remnants of AMC. By this time, AMC had already finished most of the work with the Jeep Grand Cherokee, which Iacocca desperately wanted. The success of the Grand Cherokee and The Eagle Premier under Chrysler badges had the press and industry analysts convinced that AMC could have turned around, just like Chrysler did, if Chrysler hadn't bought them out. I would like to add here that everything appears easy once the task is achieved but everything is difficult, till it is made to appear easy. You need people like Mr. Iacocca to do that.
Summary & Conclusion:
Talented and skilled people will always face opposition from mediocre minds, but like Mr. Iacocca, will prove that success for them is no flash in the pan, again and again and again. People like Mr. Iacocca have the amazing ability to put life in dead organizations. Anybody can nurture a healthy but a fat child and make it grow. But to save a sick and undernourished child and to make it healthy needs a lot more talent and skills. This is where his greatness lies. People like him cannot sit quietly doing nothing. Mr. Iacocca left Chrysler in 1992 and was last known to be working with a company making electric bicycles.
We have referred to various articles on the net and our grateful acknowledgement to all of them
Copyright. November 06, 2007. www.madgopes.com . All rights reserved.
Mr Lee Iacocca The Transformational Leader - To learn more about this author, visit Madhavan T Gopalachary's Website.
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Madhavan T Gopalachary
(Visit Madhavan's Website)
Madhavan Gopalachary, nick name "madgopes"
(g pronounced as in go) given by IIT
classmates, is a Mechanical Engineer and
an alumnus of Indian Institute of
Technology, Madras having passed out
specializing in IC Engines &
Thermodynamics.
He has nearly 35 years of experience in
the Corporate World. He started off as a
trainee and handled sales, marketing,
manufacturing, product management, profit
center management, strategic planning and
corporate development including R & D in
various organizations and at various
levels before becoming a CEO. His last two
professional assignments were at CEO level
before embarking to start management
consultancy business on January 01, 1998.
He has worked for British, Swedish MNCs as
well as very large Indian business houses.
He has spent a large portion of his time
from June 1998 till date in East African
Countries practicing as an independent
Management Consultant.
More details can be obtained at the
following web sites:
mmg.name/
mtg.html
mmgconsu
lting.biz/
Madhavan's articles can be accessed at www.madgopes.com
.
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