Sweeping From The Top Down…

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At some time or another most companies struggle. They face challenges related to a changed competitive environment, or they face the daunting task of re-engineering business processes. We’ve all been there, we’ve all seen it. Years of success seem to culminate in seemingly insurmountable threats to the organization’s very survival. These are decisive situations, and they require sound, considered leadership… but leadership not afraid to commit, to make decisions, and to act with an urgency that has at its core the future of the enterprise.

Such was the reality that Porsche found itself in a little less than 15 years ago. They were in serious trouble. Despite the storied history they had lost sight of their audience, of their relevance, and were watching worldwide sales numbers dip dangerously close to 10,000 vehicles (from a high of 53,000 in 1986). In 1992 an engineer named Wendelin Weideking was brought on at Porsche to head their materials and production group. He immediately traveled to Japan to survey the Japanese automotive industry, and what he saw both inspired and terrified him. He realized that Porsche could never survive with current processes and methodologies. He returned from Japan determined to pull the Porsche manufacturing mindset into modernity. He promised a 30% reduction in production costs and brought in a team of Japanese consultants from Toyota to dissect the Porsche process. He then cut the number of managers by 35% and fired 95% of the sales and marketing managers. He knew that change needed to start at the top, and that Porsche as a company needed to change its culture, its leadership and its vision. The traditional Porsche way was incorrect. That meant those who had managed Porsche into the present challenges had to get out of the way for new ways of thinking, of executing. I’ll let you read the full story through the link below, but suffice it to say that Porsche asked Weideking to take over as CEO in 1993 at the age of 39. He immediately went to work setting in motion a plan that not only turned Porsche around, but reclaimed their position as a high performance engineering company AND recast the company as the most profitable automotive manufacturer, per vehicle, in the world. A fascinating story.

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