In light of the developments around the
Renault-Nissan-Mitsubishi Alliance – including the controversies and
allegations around its iconic leadership – several relevant observations
emerge for other strategic alliances.
Readdressing mutual strategic dependency
In Renault-Nissan’s case, the strategic goals of
the two partners were divergent from the start. Nissan required emergency surgery,
which it received with Carlos Ghosn’s Nissan Revival Plan, while Renault wanted
access to the Asian growth markets where Nissan was already well entrenched.
These goals do not add up to a recipe for long-term harmony. Indeed, Renault’s
response to a strengthen Nissan becoming the larger of the two companies was
to reinforce its own power position within the alliance.
Transitioning to alliance leadership
In the early days of the alliance, Carlos Ghosn
clearly understood how to translate the differences and gaps between Renault
and Nissan into highly successful management practices. His boundary spanning approach
was a textbook example of how inspirational leadership can create common goals
and lift the parties over and beyond the mere sum of the parts. The strategic,
operational and management challenges for all layers in both organisations
generated cohesion and commitment.
Yet once an alliance has achieved its “obvious”
goals leadership legitimacy
tends to be challenged. After all, the success of the alliance proves it has
served its purpose. The implicit expectation of both parties is often a return
to a more classical management model, including a self-effacing, humble role
for alliance leadership. Further, the shift from visionary to collaborative
leadership is a prerequisite for strategic re-adjustment, enabling senior
executives on both sides to redefine the governance equilibrium.
It is a strong possibility, then, that
Renault-Nissan has long outgrown Ghosn’s autocratic leadership style.
Trust and cultural awareness
Cultural fit is instrumental to the success of
strategic alliances. It is probably the most complicated dimension in the
overall relationship as it tends to surface in unexpected places at unexpected
moments. Company culture and national culture are inevitably intertwined and
tend to reinforce one another in dire times.
Japanese culture is sensitive to honor and its
opposite, shame. This is especially true with affairs that are highly public,
such as the fortunes of a prominent (and emphatically Japanese) firm like
Nissan. In 1999, Renault had offered a cooperation model by which the two
companies would retain their own identities, have their own corporate
strategies whilst cooperating with each other as global partners. After seven
consecutive years of losses and two failed internal turnaround attempts,
Nissan’s alliance with Renault brought renewed success and, consequently, a
restored sense of national-corporate pride. However, frustration has been
building up among Nissan’s management in recent years, because of Renault’s
refusal to equalize power relationships within the alliance.
Any unilateral attempt to alter the core
philosophy of the alliance can be seen and exploited as a token of disrespect
and create a trust breakdown. Ironically, the same abhorrence of dishonor that
initially cemented Nissan’s compact with Renault now threatens to hamper relations between the pair.
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