Thinking Managers

Robert Heller of looks at the challenges facing the automobile industry and their need to find visionary leaders.

Driving Success

Have you heard of any of these: Aptera 2e, BYD F3DM, or The Volt? How about Ener1 or A123 Systems? And also Quantum Technologies, Altair Nanotechnologies, Tesla Motors, Ener Del and Acta Cellconsolation?

All these technological-sounding names are pioneers and would-be leaders in the burgeoning electric car industry and, more specifically, in the electric battery technologies. Here, the successes and failures will determine the ownership and wealth that will inevitably grow as the infant industry becomes a giant.

There’s no doubt about this: ‘It now appears that nearly every car on the planet will eventually be electrified’. Paul Keegan, the writer, goes on to advise readers of Fortune that ‘Investors could hardly ask for a bigger incentive’.

The issues surrounding the new auto industry begin and, for now, end with battery technology. Optimists will see the electric car race as an opportunity for the US car companies to build or regain power, success and reputation. However, Keegan believes that: ‘For America the ultimate irony is also the ultimate humiliation, and worse. Just as the electric car is finally arriving to save Detroit, the US is poised to swap our dependence on foreign oil for a dependence on foreign batteries.’ The one ray of hope comes from ‘tiny precocious firms’ which are betting on a miraculous comeback.

The hunt is on for a viable way of building and then running an all-electric car. And new types of car require new styles of manager. The likes of Henry Ford I would not have understood government intervention. However, they would have clearly seen the need for management innovation right across the board.

The big names like Bill Gates, Andy Grove and Steve Jobs have led revolutions in technology and management practice that have changed the world – everybody’s world. Surely there is an American out there who can achieve the same result in a second automotive revolution?

The late Peter Drucker said: ‘The CEO is the link between the inside that is “the organisation” and the outside of society, economy, technology, markets and customers. Inside there are only costs. Results are only on the outside.’

Procter & Gamble chief executive A.G. Lafley, writing for Harvard Business Review, explained how he turned this definition of the CEO’s work into a dynamic tool. Anybody can do the same if they get the correct answers to four questions, all many times repeated:

• What is our meaningful outside?
• What business are we in/not in?
• Where is our balance between sufficient yield now and necessary investment in the future?
• What are my standards and values for the business?

Using these four questions, Lafley took P&G from serving two billion world customers in 2000 to an amazing 3.5 billion (over half the market) in 2009. That surge offers better understanding of the coming job of leading the best company through the auto revolution.

The driver and the driven is the meaningful outside of the industry, together with their servants in the auto services. The business is the electrification of every motor vehicle in the world. Investment in the future is of greater importance than present returns. The essential value is customer satisfaction and the standard is proof that this is actually being obtained. Whether it’s the Americans, Chinese or Japanese, the veterans or the new kids on the block, that’s how the winning CEOs will achieve victory.

About the author
Robert Heller is one of the world’s best selling authors on business management.

  Robert Heller