Analyzing the Change Management Case of Nissan

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TURNAROUND AT NISSAN
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TURNAROUND AT NISSAN
1. What was done to improve efficiency, adaptation, and human relations, and how
were the potential trade-offs among the performance determinants handled?
To stop the downward spiral at Nissan, Ghosn reduced the number of stages in operations
while cutting down on force requirements. The relations with human resources are significantly
impacted during the reduction of the labor force. Ghosn practiced some conventional whittling
down while at the same time offering a more friendly working environment and shuffling staff to
other organization’s offices to negate any impact of the survivor's disorder. Such re-shuffling,
layoffs and drastic changes in working environments reduced employee productivity, and Ghosn
had to find new ways to motivate the staff and recover on productivity (Nakae, 2005).
Ghosn reduced the cost of supplies and acquisition of resources by an estimated 20%. He
accomplished this by reducing the number of suppliers and doing larger orders. Ghosn was very
keen to notice that the procure meant at Nissan was faulty, and the procurement specialist was
making excessively constrained orders, and this pushed the expenses unnecessarily upwards,
causing increment in operating costs. This move had a severe negative impact on customer-
supplier relationships, but Ghosn dealt with it by increasing the request sizes from the remaining
suppliers (Ghosn, 2002).
Ghosn had superior human relations and resourceful skills that he used to shift the focus
of auto production at Nissan. Nissan had a set of advisors who had no responsibility at all, Ghosn
reshuffled them and put them in positions with direct operational responsibility in an attempt to
ensure that they were directly useful to productivity (Ghosn, 2002). The firm had come to a point
whereby it only focused on execution. This practice went a long way to reduce customer

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satisfaction and to further push the company on a downward spiral of losses. Ghosn changed the
focus to the clients. He ensured that autos were manufactured in the light of client needs. The
shift would see more stakeholder and client satisfaction and change how things are done in
product development and on the production lines. The repercussion for this move presented in
the form of demoralized employees, but Ghosn dealt with it through the provision of more
friendly working environments and schedules. Ghosn also eliminated all of the vague job
positions that were giving the company a capacity far above what it could use, given the
prevailing sales volumes (Ghosn, 2002). This reduced unnecessary expenditure and enhanced
individual productivity and responsibility.
Ghosn, being an experienced manager, noticed that Nissan was failing due to powerless
dissemination. To counteract this negative energy, Ghosn reduced dealerships. To strengthen the
brand, Ghosn made sure that dealerships that remained had enhanced administration and made
them more business-centered (entrepreneurial). He also incorporated cross-functional groups to
make each team more engaged and probed to disrupt existing norms and see the realization of a
change that would be much more productive (Ghosn, 2002). Ghosn made sure that these
dealerships would cease to be social connections to the company and become vital business
forces in the company because he had an open mind that appreciated the value that the Japanese
and their clients attached to brand devotions (Zentner, 2016). The trade-off came in the form of
reduced brand devotion. Still, Ghosn recovered this by improving the administration in the
remaining dealerships in a way that they became more business-minded.
Ghosn moved the responsibility of configurations from the fashioners to the engineers
(architects). Ghosn had the critical thinking skills that helped him realize that most of the models
in production at the time he went to Nissan were not profitable. To address the issue of non-