Good Example Of Case Study On The Renault-Nissan Alliance In 2008
Renault–Nissan Alliance is a Franco-Japanese strategic partnership founded in 1999 between two famous automobile manufacturers Renault (France) and Nissan (Japan).
The following 4 steps are considered to be crucial in the history of the Alliance:
- Renault helped Nissan in the field of financial recourses and management;
- the Alliance identified and exploit synergies and economics of scale;
- in 2008 the Alliance pursued opportunities for joint projects (building electric cars, constructing plants in India and Morocco);
- expansion of the Alliance with other major partners to indentify and exploit further opportunities (this was consistent with Gosh's vision for the Alliance: to become one of the three automotive companies in terms of quality, technology and profitability in the industry).
Ghosh’s vision for fourth stage is to create greater value through further expansion.
Preparing for the fourth stage, Nissan and Renault took into consideration experience of Chrysler and Mitsubishi and the ideas about what not to do. Renault and Nissan decided to create a new, unique management philosophy. Ghosh saw Renault-Nissan growing through financial performance.
The key to success is based on human relationships, which consists of mutual respect, trust and equal-footing attitude. Gosh made changes to management process, underlying the importance of personal responsibility for all employees. He gave greater priority to hiring talented managers who could succeed in any country he placed him.
Further recommendations supervene the situation the Alliance faces nowadays. They are:
1. To focus on and to review long-term vision (to capture the maximum amount of potential synergy).
2. To build the alliance mechanism, but to maintain own production style and healthy partnership between Nissan and Renault.
3. To enter new markets (herewith Gosh wanted to make companies as much freedom as possible).
3. To continue the culture of mutual respect, trust and loyalty (all leaders must understand the values that are important to both companies and subscribe to shared systems and processes; a good suggestion is to make one formal language for employees to deal with diversity of spoken languages).
4. To reaffirm the win-win principle (win-win outcomes occur when each side feels they have won; in this method of doing business all the participants can profit from the Alliance).
5. To achieve greater integration and to give ABM (Alliance Board Management) more control.
More than 10 years of existence, the Alliance did not use all its potential. Nowadays two companies still benefit from the collaboration and still get synergy. In particular, the Alliance is able to meet new global requirements. For example, two main strategies are of their mutual interest:
Implementing fuel-efficient technologies (as well as electric cars production);
Introduction on emerging markets (Russia, China and India are of the greatest interest).
Nevertheless, two companies are still independent. The “divide and concur approach” helps them not to compete but prosper. Moreover, working in partnership enabled the companies to split development costs and mitigate the risks associated with pursuing one technology over another.
In conclusion I would like to say, that the Alliance is the best way for both companies to compete with world greatest automobile producers preserving its own characteristics.
1. "Another Clean Tech Startup Goes Down: Better Place Is Bankrupt". The Atlantic. 26 May 2013. Retrieved 13 January 2014.
2. "How the Alliance generates synergies from shared logistics" (Press release). alliance-renault-nissan.com. 20 July 2012. Retrieved 13 January 2014.