Can Chrysler Survive Fiat. The Challenge of Bureacratic Transformation


Program Description:

When Sergio Marchionne became CEO of Fiat in 2004, he inherited a company on the brink of failure. It was a company with a lackluster product line, one that had suffered more than $12 billion in losses over the previous five years. To transform the company, he fired senior management, upended a bloated bureaucracy, brought a team of young aggressive managers on board, hired new designers, and killed lackluster projects. In less than three years he succeeded in one of the most impressive turnarounds in automotive history. Now, as part of his plan to grow Fiat into a major automotive force, he is about to acquire a 20 percent stake in Chrysler. Can he perform his magic again? Can he save another company whose circumstances, in many ways, are strikingly similar to those faced by Fiat five years ago? Can his leadership style as well as the Fiat 500 be successfully exported to this side of the Atlantic? As George Santayana said, “Those who ignore history are doomed to repeat it.” In this situation if Marchionne ignores Chrysler’s struggle over the last 10 years, he may be doomed to repeat history and the merger will fail.


Barry Shore

Barry Shore, Ph.D., U. of Wisconsin, Madison, is a professor of business administration at the University of New Hampshire. His research interests are in the area of global information systems, and he has published in numerous journals.

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