Auto industry leaders cannot let fear dictate decisions made in the industry's turbulent climate, Continental AG's NAFTA-region CEO Samir Salman says.
Executives must take decisive action to preserve their companies while being mindful of employees' struggles and treating them with dignity, he said.
This is not the first period of turmoil that the auto industry has faced, Salman said, citing the Great Depression and the oil shocks of the 1970s and '80s.
"Yet these were times when the most creative and prepared people ... grabbed the technology and innovation," Salman said yesterday at the Management Briefing Seminars.
Salman talked about growing up in Iraq and seeing students and adults disappear and return as "broken people" at the hands of the country's regime. Yet by focusing on the future, he said, he was able to transcend that painful experience.
"What my experiences taught me was that however tough and turbulent our industry is now, this is only a temporary period which we will go through, and our industry will survive," he said. "It's our task as leaders of this industry to believe that and engrain or implant this into our people."
Industry leaders must make tough decisions, such as downsizing operations to fit the environment; be ethical, open and honest with employees about the state of the company and industry; and find creative solutions to problems.
Said Salman: "If we use these three concepts and apply a creative approach it has to be a creative approach to manage through these times we stand a better chance of getting out of this trauma in the long term."
Another key for the industry is to protect r&d spending as much as possible to ensure success when the market rebounds.
"It is imperative that companies like Continental protect our r&d," he said. "It is essential that we keep spending on r&d in these difficult times because that will lead to innovation." c