Carlos Ghosn, Chairman and CEO of Renault-Nissan alliance at IIT Madras
Frontiers of Green and Electric Vehicles with Sustainability and Innovation in Auto Industry
Stalwart, trans-cultural leader, the icebreaker were words used to welcome Mr. Carlos Ghosn, Chairman and CEO of Renault-Nissan alliance to the most keenly anticipated EML session of the academic year organized in association with NDTV Profit. It was indeed a privilege to listen to someone who is rated no less than among the world’s “25 Most Influential Global Business Executives” by Time and CNN, “World’s Most Respected Leaders” by Financial Times and CNBC European “Business Leader of the Year 2006”. This special lecture with its central theme based upon “Frontiers of Green and Electric Vehicles with Sustainability and Innovation in Auto Industry” was anchored by Siddharth Patankar from NDTV . The event was conducted in form of an interview followed by a Q&A session where eager students put forth inquisitive questions to Mr. Ghosn. Managing the Human Capital On being quizzed about India’s famed human resource advantage, Mr. Ghosn opined that apart from demographic advantage that our country has, it was necessary to also consider the quality of human capital and from an organizational perspective it was important to align this human capital to organizational strategy. Bringing a new dimension to the question he further explained that as the globalization required companies to move into practically all corners of the world it was essential for organizations like Renault-Nissan to have cross-cultural, multi-cultural workforces which can be aligned with each other. Management decision making “Management in the times of crisis is the most essential part of management. When the times are good things work on their own and it is only when there is a crisis the real decision making ability of the management comes to fore. The decisions involve not only deciding how to get out of the crisis but also about what needs to be done once we are out the crisis” Mr. Ghosn held this view, also emphasising that one needs to take of long term consequences of short term decisions. One task of a manger is also to get people do things which they naturally wouldn’t like to do and crisis situations demand that we need to do many of such things.
On Mr.Ghosn’s own multicultural background.
He explained that to be successful in business one must be able to connect with people who are not from a similar background as yours. This involves establishing working connections with different people and communicating with them. People exposed to high level of diversity will definitely be in a good stead and this will also facilitate their management skills
How green and sustainable is the process of manufacturing a component that goes into making a car?
Mr Ghosn replied that they are not ignoring the other areas where a lot of consumption of fossil fuels takes place, but even still major consumption of fossil fuel is due to recurring usage of gasoline to drive cars and it is because of this reason that a significant amount of our efforts to go green is directed in this regard. Hydrogen as an alternate source of fuel is also being looked at. Also by 2020 ten percent of cars manufactured worldwide will be powered using electricity, he said.
Mr. Ghosn also explained that as technology students numerous opportunities awaited them in the fields of energy management and that even today we don’t have the appropriate technology which can efficiently store energy. Hence, it is also a promising area for business as well as technology R&D. He also stressed that in such initiatives the government’s support to promote green fuels is vital and further explained his point by giving example of how 60 % cars in Europe run on diesel while it is practically zero in US, all this because of the kind of incentives and fiscal policy which the government comes up with to promote or dissuade people from using a particular fuel.
Shipping production to developing countries from developed economies.
He was of the view that this shift is not encouraged just due to free trade agreements and WTO regulations but because it makes economic sense to manufacture products locally. The main friction comes when we manufacture cars in India, China etc and ship them back to Europe especially in a situation where carbon tax is levied on manufacturing in Europe but not on products manufactured outside and these products are then imported into Europe.
He also explained that Renault prefers having many joint ventures and alliances and each of their alliance is for a specific purpose. Mr. Ghosn also informed that they into collaborative research into green tech and in other areas with many universities including IIT Madras.