Top Management

Fabio Pederneschi – Pederneschi

One of the most difficult and complex Top Management operations is undoubtedly constituted by the management/integration of a taken over company.

If said operation, then, concerns a company headquartered in another Country, speaking another language and, unavoidably, coming from different habits and traditions, we can certainly state that it is difficult to imagine a more demanding “challenge”.

I should precise now that I have decided to put this reflection in writing after reading an editorial by Dave Guilford (October 2014) entitled “Sergio has been the glue that kept Fiat Chrysler intact”.

In that editorial, he argued (and I tell you at once that I completely agree with him) what I shortly summarize as follows:

“Unlike what done by the management of the German Daimler from the beginning to the end of the management of Daimler Chrysler, Marchionne faced the operation of managing the taken over Chrysler taking care of minimizing/preventing any possible internal quarrel, both at Chrysler and at Fiat. Mainly deciding that he in person was the “Chief Executive Officer” (CEO) of Chrysler as well as of Fiat, through the smart invention of the “Dual CEO Role”. Very tiring and committing role, but unequivocally conceived just to avoid that, instead of starting a constructive integration, the two big companies undertook an unmanageable and permanent war/insurgency. Conflict that would have certainly led Chrysler (probably involving Fiat, too) to another disastrous end”.

The excellent results of this management are nowadays visible for all observers and even the most doubtful (or even pessimist) are obliged to express more or less corrective admissions about their verbal and written forecasts, on a world scale.

Certainly, it was not easy (on the contrary, we should admit that it was at least risky!) to forecast that, in the lapse of less than ten years, the same Manager would save first Fiat Group and then Chrysler, resurrecting it from the ruins to which Daimler had brought it.

Nevertheless, since I know the German mentality by direct experience, I can immodestly state, also in these lines, that the “Chrysler miracle” made by Marchionne has not surprised me so much.

As just said, I know well the German mental approach, especially concerning mutual confidence, respect, solidarity and loyalty with “not German” colleagues, but I also know a fact – unknown for most people – that I am revealing now; certainly true fact reported to me by an absolutely reliable witness some time ago.

Just after the takeover of Chrysler by Daimler, the German Top Management called the first operating meeting of Daimler Chrysler, at executive level, in Detroit. A real strategic “summit” that lasted several hours (days).

Obviously, it was a very important, crucial and determinant event, highly expected by American managers.

Well, all speeches (written and oral) were delivered strictly and only in German language.

We all know that almost no American speaks a foreign language.

Therefore, we can easily guess the frustration, the sense of helplessness, humiliation and … the enthusiasm that pervaded – immediately – Chrysler managers’ souls and minds. And, consequently, of all their collaborators’.

Now, can someone be still surprised that the evaluation of Chrysler Group for the sale to Fiat was only one tenth of what Daimler paid?