Marchionne Is The Man In North America, As Fiat And Chrysler Align Management
[UPDATE: Fiat press release outlining the complete new management structure added]
The awaited consolidation of Fiat and Chrysler operations is complete, reports Bloomberg, and CEO Sergio Marchionne is taking the North American job for himself. Joining Marchionne at the top of the company’s new regionally-based divisions, are Gianni Coda, former head of purchasing at Fiat and now the boss of European, African and Middle East operation; Cledorvino Belini, erstwhile head of Fiat in Brazil is now in charge of all of South America; Michael Manley, previously boss of the Jeep brand, will be leading the firm’s effort Asia. These four regional bosses will be part of a 22-member “group executive council” which will manage all of Fiat and Chrysler’s operations. The details of the council’s makeup still haven’t been released, but the big news is well encapsulated by a quote from Gianluca Spina, chairman of the business school at Polytechnic University of Milan.
Marchionne’s decision to keep the role of overseeing the business in North America shows that the center of gravity of the combined entity will be in the U.S… The integration process is going extremely fast, as is Marchionne’s style.
Given all the questions about the national character of the new Fiat-Chrysler, Marchionne’s personal emphasis on the US market is a heartening sign. Meanwhile, another point that Marchionne seems to deserve credit for is keeping his team intact. Where GM has been shuffling and reshuffling its management since the bailout, Marchionne seems to be keeping a steady hand on Fiat-Chrysler’s human resources situation. Which is all the more surprising for the other bit of management news coming out of Chrysler this week…
The AP [via BusinessWeek] reveals what may have been the most interesting tidbit from Chrysler’s Q2 financial results analyst call earlier this week: the revelation that Chrysler’s new freedom from government pay restrictions (a condition of the bailout) does not mean there are plans to alter compensation.
QUESTION: Will your executives get across-the-board raises when you put the new management team in place?
MARCHIONNE: “No. I think that … you’re assuming that once we’re out of jail, that we’re going to start distributing cash indiscriminately to return to the old ways of sin,” he said. “We’re not going to do that. Obviously we want to remain competitive, but I think the industry itself has learned how to be much more cautious and judicious. I think we tend to follow that trend.”
[UPDATE: Fiat press release, detailing the full management structure follows]
FIAT PRESS RELEASE
Fiat Announces Key Appointments
Fiat S.p.A. is pleased to announce significant organizational changes effective September 1, 2011. As a result of the acquisition of majority ownership of Chrysler Group and consistent with the objective of enhancing the operational integration of Fiat S.p.A. and Chrysler Group, Fiat S.p.A. is today announcing the formation of a Group Executive Council, similar to the one that managed Fiat S.p.A. until the demerger of the Fiat Industrial activities.
The Group Executive Council (GEC) is the highest executive decision making body within Fiat outside of its Board of Directors1. It is responsible for reviewing the operating performance of the businesses, setting performance targets, making key strategic decisions and investments for the Group and sharing best practices, including the development and deployment of key human resources.
The GEC will have 4 main groupings.
The first is composed of 4 Regional Operations Groups for car manufacturing and sales, plus Parts and Service (MOPAR), Automotive Components (mainly Magneti Marelli) and Systems and Castings (Teksid and Comau). Each will be the responsibility of a Chief Operating Officer (COO) who will drive the organization via a regional Management Team (subject of a separate announcement prior to September 1, 2011). The COO’s are accountable for Profit and Loss of their region/business, the management of regional resources, including manufacturing and commercial activities.
The COO’s appointed to the GEC are as follows:
NAFTA (including Chrysler): Sergio Marchionne
Europe, Africa and Middle East: Gianni Coda
Latin America: Cledorvino Belini
Asia: Michael Manley
Parts and Service (MOPAR): Pietro Gorlier
Components (Magneti Marelli): Eugenio Razelli
Teksid/Comau: Riccardo Tarantini
The second grouping is reflective of the Group’s focus and emphasis on its brands. Each of the global or potentially global brands is represented in the GEC, and their responsibility will be to improve and develop an appropriate brand portfolio and to assist in the development of adequate commercial and marketing strategies in each of the Group’s operating regions.
The Brand Heads appointed to the GEC are as follows:
Fiat: Olivier Francois
Commercial Vehicles: Lorenzo Sistino
Alfa/Abarth/Maserati: Harald Wester
Lancia/Chrysler: Saad Chehab
Jeep: Michael Manley
Dodge: Reid Bigland
They will be supported by a Chief Creative Officer, Olivier Francois.
The third group is composed of industrial process leaders, who will drive consistency and rigor across the operating regions, and optimize the capital allocation choices the Group will face in the years to come.
Chief Technology Officer: Harald Wester
Design: Lorenzo Ramaciotti
Manufacturing Technology and Coordination: Stefan Ketter
Group Purchasing: Vilmar Fistarol
Quality: Doug Betts
Powertrain Coordinator: Bob Lee
Product Portfolio Management: Mark Chernoby
The final group is composed of support / corporate functions.
Business Development: Alfredo Altavilla
Fiat Services & Holdings: Alessandro Baldi
Chief Financial Officer: Richard Palmer
Chief Human Resource Officer: Linda Knoll
The GEC will utilize Alessandro Baldi as the Executive Coordinator.
“We have now reached the right moment to step on the accelerator of the Fiat-Chrysler integration” said Sergio Marchionne, Chief Executive of Fiat and Chrysler. “These appointments are the result of an extensive process of evaluation of the technical and leadership skills of the individuals who have been appointed to the GEC. But equally important is the fact that they reflect the multi-cultural geographically diverse nature of our businesses. We recognize in these leaders the future of Fiat-Chrysler as an efficient, multi-national competitor in a global automotive marketplace. It is a privilege for me to have the opportunity to lead this group of people and see them grow, to watch them as they transform challenge into success and into faith in themselves and what they can achieve.”
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I like what Sergio is up to here. In many ways the Chrysler / Fiat alliance reminds me of the Nissan / Renault alliance that formed after Nissan's near death experience in the late '90s. There seems to be far more synergy between Chrysler and Fiat than there ever was between Chrysler and Daimler. Sergio has taken a basket case company and made it viable, where the incompetent Daimler management took a wildly successful company and made it into a basket case. While it is too early for Sergio to declare victory, there are some encouraging signs. Here in Canada Chrysler group sales were up 27% in June over 2010, and the company is in a tight race for number two overall by sales. It looks like Mother Mopar has gone off her meds, and is in her manic phase... http://www.curbsideclassic.com/automotive-histories/chryslers-bi-polar-history-part-1/ http://www.curbsideclassic.com/automotive-histories/chryslers-bi-polar-history-crashes-6-9/ Edit: Wordpress wouldn't let me post this earlier for some reason - perhaps my bi@s is showing :p Just cleared my cache and tried again...
I suspect Sergio has had enough of squabbling Italians and plans to build his global car company from Auburn Hills. Watch for the name change. Instead of Chrysler as a wholly owned subsidiary of Fiat, It will be Fiat as a wholly owned, er, "integrated" subsidiary of Chrysler-Fiat.