12 Success Lead Change Append 2 Nissan
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Nissan Motor Co., Ltd
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Share of Sales by the World Car Market 2001
Daimler-Chrysler(US&GER)
7.8%
Toyota(J A)10.3%
Ford(US)12.0%
Volckswagen(GER)8.9%
GM(US)14.1%
Peugeot(F)5.5%Honda(J A)
4.6%
Hyundai(KR)4.6%
Nissan(J A)4.5%
Renault(FRA)4.2%
Other23.3%
215,370 billion yen
197,330 billion yen
134,244 billion yen39,549 billion yen
64,638 billion yen
56,209 billion yen
165,327 billion yen
96,331 billion yen
60,896 billion yen
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Net Sales (1990-2002)
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002
Toyota Honda Nissan
単位:億
(Billions of yen)
(Year)
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Ordinary Income (1990-2002)
-4,000
-2,000
0
2,000
4,000
6,000
8,000
10,000
12,000
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002
Toyota Honda Nissan
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Introduction
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Company Name : Nissan Motor
Company Highlights
Paid in Capital :604.6 (billions of Yen)
Employees : 125,099
Establishment : Dec, 1933
Representative : Carlos GHOSN
Global Retail Sales : 2,596,530 (units)
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Financial Highlights (2001)
Operating Margin : 7.9%
Net Sales $ 51.6b
Ordinary Income $3.5
Operating Income $ 3.1
Net Income $3.1R&D Investments $2.2
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Capital alliance of Japanese makers
GM ( US ) Isuzu12.0 %
Suzuki20.0 %
Fuji HeavyIndustries20.0 %
Ford ( US) Mazda33.3 %
Renault ( FRA )
Nissan Motor44.4 %
DC ( US&GER )
Mitsubishi Motors37.3 %
Opel ( GER )
Fiat ( ITA )
Land Rover ( UK )
Jaguar ( UK )
Volvo ( SWE )
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Nissan Motor Co.Net sales & ordinary income
5,000,000
5,200,000
5,400,000
5,600,000
5,800,000
6,000,000
6,200,000
6,400,000
6,600,000
6,800,000
1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001-300,000
-200,000
-100,000
0
100,000
200,000
300,000
400,000
Net sales Ordinary income
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0
500
1000
1500
2000
2500
3000
3500
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
(Billions of Yen)
Net Debt (Automotive Business)
(Year)
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Vision / MissionVision
Mission
Nissan : Enriching People’s lives
Nissan provides unique and innovative automotive products and services that deliver superior measurable values to all stakeholders* in alliance with Renault.* Our stakeholders include customers, shareholders, employees, dealers, suppliers, as well as the communities where we work and operate.
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History
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Major Events in Nissan’s History -1
• (1933) Jidosha Seizo Co., Ltd., predecessor of Nissan Motor Co., Ltd., is established in Yokohama.
• (1935)The first car manufactured by a fully integrated assembly system rolls off the line at the Yokohama Plant.
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Major Events in Nissan’s History -2
• (1960)Nissan wins the 10th Annual Deming Prize for excellence in industrial engineering.
• (1972)Cumulative domestic production surpasses 10 million units.
• (1980)Cumulative exports surpasses 10 million units.
• (1980)Nissan Motor Manufacturing Corporation U.S.A. (NMMC) is established.
• (1984)Nissan Motor Manufacturing (UK) Ltd. is established.
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Major Events in Nissan’s History -3
• (1988)Nissan European Technology Centre Ltd. is established in UK.
• (1990)Cumulative production surpasses 50 million units.
• (1994)Nissan Middle East FZE is established in Dubai, UAE.
• (1995)Vehicle production at the Zama Plant ceases.
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Major Events in Nissan’s History -4
• (1999)Nissan and Renault signs an agreement for global alliance, including equity participation.
• (1999)The company announces the Nissan Revival Plan (NRP).
• (2002)The company announces new three-year business plan NISSAN 180.
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Renault
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Renault Financial Highlights (2001)
Operating Margin E 473
Revenues (euro million) E 36,351 Operating Income E 704
Renault net Income E 1,051Investment E 3,314Total workforce (number of persons) :140,417
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0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
1997 1998 1999 2000 2001Revenues
Renault’s revenues (1997-2001)
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Nissan Revival Plan
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Carlos, GHOSN・ Born in Brazil (March,9,1954)
<Education>・ Graduated from E´cole Polytechnique ・ Graduated from E´cole des Mines
<Experience>・ (1978) Ghosn is hired Michelin・ (1985) became COO of Michelin Brazil・ (1989) became COO of Michelin North America・ (1996) became Executive Vice President of Renault ・ (1999) became Chief Operating Officer of Nissan motor・ (2000) became chairman and COO of Nissan Motor・ (2001) became chairman and CEO of Nissan Motor
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Nissan Revival Plan• First announced in October of 1999,
Nissan Revival Plan (NRP) went into action in April, 2000.
• When the NRP was first announced, Nissan’s executive committee announced three bold commitments.
• If any of these were not met, the executive committee members promised to resign.
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NRP’s Objective• The objective is to free resources from
non-strategic, non-core assets and investment more in our core business -cars - while at the same significantly reducing Nissan’s debt.
“The aim is to grow the company, not shrink it.” said Ghosn.
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Goal of Nissan Revival Plan
1. Return Nissan to profitability for 20022. Achieve a consolidated operating profit of 4.5%
of sales by 20023. Reduce costs by 1 trillion Yen and net debt
from 1.4 trillion Yen to less than 700billion Yen by 2002
As ResultsReduce headcount :21,000 (14%) for worldwidePurchase strategy :Appropriate 200billion Yen for Reserve FundThe effect of cost redact :1 trillion Yen
Substance of Nissan Revival Plan
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Major Contents of NRP
Enterprise development : Profitable growthPurchase strategy : It is 20% of cost reduction in three years. suppliers Reduction (1,145⇒600)Production : Achievement of optimal production efficiency / the optimal cost. 30% curtailment of productive capacity Sales, General and : To be reduced 20% administrative costs Slimming of a operating network (Number 20% curtailment of direct management dealers, 10% curtailment of offices, etc.) financial cost : Strengthening financial management reduction of financial cost. Cancellation of strategic stock possession
( Stock sale of an affiliated company, etc) R&D : Effective development of R&D capabilityOrganization : The change to the global organization from
the organization according to area
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Results : Attaining the NRP Goals• Purchasing costs : reduced 20 %.• Plant capacity utilization : risen from
51%→75%.• A revamping of the domestic sales
system has reduced sales and administrative costs.
• Worldwide stuffing has been brought in accordance with needs.
• Non-core assets have been sold.• A rededication to R&D has been
matched by 25% increase in efficiency.
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Essence of NRP
達成方法
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What is ‘Commitment’ ?・ A return to net profitability in 2000.
・ A minimum operating income to sales margin of 4.5% by 2002.
・ Consolidated net automotive debt reduced to less than \700 billion ( $58 b) by 2002.
Nissan announces NRP conclusion one year earlier than planned(2002→2001).
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CEO (Hanawa chairman)
COO (Ghosn President)
Executive committee
Planning Domesticsales
Overseasales R&D Produc
-tion Purchase Admin. Europe OthersNorth America
1. Growth of business ( 50 )
2.Purchase ( 12 )
3.Production ( 10 )
4.R&D ( 13 )
5.Marketing ( 10 )
6.General admin. ( 10 )
7.Finance & cost ( 12 )
8.Cut of the model ( 13 )
9.Org. & decision ( 12 )
The name of CFT (members)
Structure of Cross Functional Team
* ○(2) ○(3)
○(1)
○(2)
○(2)
○(3)
○(1)
◎(4)
○(1)
○(1)
○(1)
○(1)
○(1)
◎(6)
○(1)
○(1)
◎(9)
○(1)
○(1)
○(1)
○(4) ◎(1)
○(1)
○(2)
○(2)
○(1) ○(1)
○(1)
◎(5)
○(1)
○(1)
○(3) ◎(4)
○(3)
○(2)
◎(2)
○(2) ○(5)
○(2)
○(1)
○(1)
○(1) ○(1)
○(2)
○(1)
○(1)
◎(4)
○(1)
○(1)
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Investment for the Future• With an additional 1,000 engineers
being added to Nissan’s technical team.
• Massive investments in R&D ( to 4.5% of revenues).
• Investments in capital expenditures ( to 5.5% revenues).
Building Competitive Advantages
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New Cars after NRPMarket launching model Sales’ market
2001, Jan. CIMAJapan & North America
Feb. PRIMERA Japan & Europe
Mar. XVLJapan & North America
Oct. STAGEA Japan
2002, Apr. March Japan & Europe
Larel Japan
FAIRLADY- ZJapan & North America
CefiroJapan, Europe& North America
SKYLINE Japan & Europe
TeranoJapan & North America
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New Strategy (NISSAN180)
Nissan will sell one million additional units worldwide by fiscal year 2004.
Nissan will realize an eight % operating margin under constant accounting standards.
Nissan will achieve Zero net automotive debt by the end of 2004.
180
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Renewal <March>
March New-MARCH
Driving Wheel Front Front
Seating Capacity 5-persons 5-persons
Engine Displacement 1.3 Litter 1.4 Litter
Length 3,720 mm 3,695 mm
Width 1,585 mm 1,660 mm
Height 1,425 mm 1,525 mm
Price (in Japanese Market,$000)
$11 $10
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Renewal< >
Z New-Z
Driving Wheel Rear Rear
Seating Capacity 2-persons 2-persons
Engine Displacement 3.0 Litter 3.5 Litter
Length 4,520 mm 4,310 mm
Width 1,800 mm 1,815 mm
Height 1,255 mm 1,315 mm
Price (in Japanese Market,$000)
$38 $30
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Four Pillars of N 180• Generating more revenue.• Reducing costs.• Increasing both quality and
speed.• Maximizing the Alliance with
Renault.NISSAN 180
Ready and Positioned for Growth
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The NISSAN180 goal
• One million additional units will be sold by the fiscal year 2004 (October 2004 to September 2005).
Japan : +300,000 unit
US : +300,000
Europe:+300,000
Other markets+300,000
Global Total Market Share Targets: 5.1%
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Building the Brand• 28 all-new products will be launched in
all segments, all over the world.• Company executives set the goal of
placing at least three Nissan cars in Japan’s top-ten monthly best-selling lists.
• Nissan’s new brand identity : based on the traditions of technology, imagination and passion.
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Strengthen Designing Power• Nissan Design Europe will play a strategically
important role in Nissan’s creative network.• Nissan Design Europe will be home to around
50 international designers, modellers and support staff.
• Nissan Design Europe has increased its staff by 25%, a further indication of the importance of the studio to Nissan’s global design operations.
“Design is fundamental at Nissan. Most importantly it is a key driver behind NISSAN
180, our global growth plan.” said Carlos Ghosn.
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Summary Nissan New Business Structure and Model
1) Cross Functional team
2) Restructuring
3) Cut costs + reinvestment1) New Engineers2) Massive R & D investment
4) Restructure to permit Quality and Speed
5) Alliance with Renault
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Summary Nissan New Business Structure and Model
1) The New Model of Nissan….Nissan 180
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New Strategy (NISSAN180)
Nissan will sell one million additional units worldwide by fiscal year 2004.
Nissan will realize an eight % operating margin under constant accounting standards.
Nissan will achieve Zero net automotive debt by the end of 2004.
180
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Understanding the degree of change required
1.1b
Gerry J Gannon
Institute for International Research
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