When we chose Renault Chairman Louis Schweitzer as our Executive of the Year, we found it almost impossible to avoid a comparison with his German rival, Juergen Schrempp. As of November, Schweitzer was basking in praise for the energetic recovery of his partner, Nissan Motor Co. Meanwhile, DaimlerChrysler's chief executive was working frantically to revive his ailing American subsidiary.
Both executives are very smart fellows. How could one do so well while the other failed? I think the answer lies in the emotional makeup of the two executives. When Renault and Nissan formed an alliance, Schweitzer worked hard to ensure that it was a partnership. Although Carlos Ghosn formed a task force of 20 Renault executives to guide Nissan's turnaround, Schweitzer's deputy did not neutralize Japanese managers. Senior Nissan executives retained power, and they worked loyally to carry out very tough cost-cutting measures.
Moreover, Schweitzer proved willing to draw upon Nissan's best technology and platforms for future Renault vehicles. The message: Renault is a partner, not a conqueror.
Now let's consider Schrempp's handling of the Chrysler merger. First, the German executive neutralized any Chrysler executives who retained power after the merger. Thus, former Chrysler President Tom Stallkamp was forced to resign after clashing with Schrempp. Then Schrempp vetoed a proposal to let Chrysler produce the Java, a low-priced vehicle for the European market.
Schrempp did not want Chrysler's executives, its car models, its lean production system or its famed purchasing system. Why, one might ask, did he bother to arrange the merger? In a recent interview, Schrempp explained why. His long-term goal, he said, was to absorb Chrysler as a stand-alone subsidiary. All that talk about a 'merger of equals' was just a smoke screen.
Schrempp later apologized to Chrysler employees, but the damage was done. It was stunning to hear such a smart executive make such a stupid, needless blunder. I believe his ego led him to do it. Schrempp is convinced that for him to win, someone else has to lose. He cannot stand to share the spotlight. The contrast with Schweitzer is instructive.
You can e-mail David Sedgwick at [email protected]