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Lee Iacocca – A Leader for Our Times

Abstract

             Lee Iacocca, the man who snatched Chrysler from the brink of bankruptcy, is a leader with vision fueled by passion. His career, which began at Ford Motor Company, spans decades, and has made him almost an icon of business leadership. He is the man at the top of the company with the means to develop his company into a profitable business’ but he is also “everyman,” feeling for and helping the workers who have made his successes possible. His almost miraculous rescue of Chrysler Corporation has assured him a top spot in the annals of the business world. He is admired by most, criticized by many, but will always be known as a leader with passion.

Lee Iacocca –A Leader for Our Times

            Lee Iacocca is the son of Italian immigrants whose passion to succeed was evident even as a young boy when he stood outside a neighborhood grocery store with a wagon, ready to deliver customer’s groceries to them for a tip. (Lee Iacocca, 2005). This enthusiasm for work soon translated into success with his first employer after college – Ford Motor Company. Although Iacocca began his career as an engineer, he quickly showed his skills as a salesman

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and so “ushered in monumental achievements for Ford.” (Lee Iacocca, 2005).

            When he began to clash with Henry Ford II, his career at Ford came to an abrupt end – he was fired. But he was soon to build an even more outstanding legacy at the faltering Chrysler Motors. The methods he used to bring Chrysler from red ink into black are legendary in the world of management and leadership.

            Kurt Anderson, who wrote an in-depth article on Iacocca in Time magazine touts him as “an industrial folk hero in a supposedly postindustrial age and, more improbably still, a corporate capitalist with populist appeal, an eminence terrible admired by working class and ruling class alike. Not since William Randolph Hearst has there been a tycoon who has occupied the national imagination as vividly as Iacocca.” (2001). And therein lies the heart of Iacocca’s leadership – his prominence in industry developed in the public eye where perceptions of the man are almost as important as what he has done.

            Lee Iacocca’s leadership abilities were fueled by his passion for success, his visionary plan and his honest and frank recognition of the problems and strengths of the company. He exhibited these usual leadership qualities along with some uncommon strategies to make his name and reputation not only at Chrysler, but also in the world of business leadership.

Iacocca and Ford Motor Company

            Fresh from college, Lee Iacocca stepped into the automobile business, first in engineering, then, more comfortably, in sales, and ultimately as president of Ford Motor Company. At first he sold trucks in Chester, PA, racking up so many sales over his nine year sales career that he was brought back to headquarters as a marketing manager. (Anderson, 2001).  In that capacity he displayed a remarkable knack for coming up with advertising “hooks.” His “$56 for ‘56” credit plan was an effective means of selling 1956 Fords financed for $56 per month for three years. He took the revolutionary Mustang to record sales numbers that contributed to his becoming head of the Ford car division. (Anderson, 2001). Iacocca demonstrated leadership qualities whether he was selling trucks in a remote market or running the company itself. It didn’t matter what the challenge, Iacocca had vision, passion and integrity in facing and conquering all of them. And it is these successes that established his reputation as a leader. According to Lord and Maher (1993) in their book, Leadership and Information Processing, these were “crucial factor[s] in his ability to marshal the resources needed to ‘rescue’ Chrysler after he became CEO of that corporation.” (p. 9).

            According to Anderson, Lee Iacocca’ style came off as “feisty and anti-Establishment, but his patriotism makes that posture seem safe and red-blooded.” (2001). He led Ford in the right direction and even though his successor, Philip Caldwell, took Ford to a dramatic turnaround after Iacocca was fired, he is not as well-remembered as Iacocca. Lord and Maher (1993) attribute this to Caldwell’s focus on “teamwork” rather than on the individual leadership approach of Iacocca. (p. 59). No one can refute the fact that Iacocca was a powerful leadership presence at Ford, even those who might denigrate his performance for one reason or another. In fact, his leadership stance at Ford may have contributed to his firing by the “other leader” of Ford, Henry Ford II. In Iacocca’s eyes, Ford was “paranoid, vulgar, personally extravagant at company expense, cruel and sexist.” (Anderson, 2001). And he was not shy about letting everyone know how he felt.

            Even after this unceremonious firing, Iacocca was undaunted (angry maybe, but undaunted); he packed up his vision, passion and integrity and carried them over to Chrysler Corporation where he was to leave an even more impressive mark on the business world.

Iacocca and Chrysler Corporation

            In Bennis’s (1994) analysis of leadership, Iacocca hits every mark. Bennis sees the most important components of leadership to be a guiding vision, a particular passion for a course of action, and integrity (including self-knowledge, candor, and maturity). (p. 39-40). Iacocca employed these attributes to save Chrysler from disaster.

            In taking on the job of CEO of Chrysler, Iacocca had to chart a map of where he wanted to take Chrysler. The company could never reach the goal of profitability without having a roadmap to lead it there. Iacocca had a vision of where Chrysler should be. He followed through on that vision in a number of ways. Chrysler’s products were poor when he took over and they had limited financial resources. (Lord and Maher, 1993, p. 59). Iacocca was “resolute” and “tough,” standing firm in the face of enormous pressures. He used his prior successes at Ford to lobby Congress for federal loan guarantees; he shut down plants and laid off employees; and he did all this under media scrutiny for three years. (Anderson, 2001). Lee Iacocca liked to use a wartime analogy to help people to understand his methods. (Lord and Maher, 1993, p. 59). He justified the plant closings and layoffs by saying, “It’s like a war – we won, but my son didn’t come back.”

            Part of his leadership plan at Chrysler was to make himself known to the general public through a blitz of television ads in which he appeared personally. According to Lord and Maher (2001, p. 59) this enhanced the public’s perception of his leadership, attributing Chrysler’s turnaround to Iacocca alone. Iacocca was perceived as a person whom the public could trust. He used this sincerity and popularity to lead Chrysler to record profits of more than $2.4 billion in 1984. (Lee Iacocca, 2005). He also made himself prominent by testifying at Congressional hearings to make his voice and the plight of the auto industry known to the legislators and the general public. (Lord and Maher, 1993, p. 59).

            Although Iacocca’s actions at Chrysler were not entirely different from what any other executive of a struggling company would take, his leadership and reputation were key to getting the help needed to turn the company around. Without Iacocca’s passion and vision, without his powers of persuasion, Chrysler would probably not have fared as well. Lord and Maher credit Iacocca with achieving the “most widely discussed ‘resuscitation’ of a dying company.” (p.218). They go on to identify his actions as indirect and internally focused, much like those made in any other turnaround, but Iacocca got the lion’s share of credit at Chrysler and with the public. (p. 218).

            Iacocca embodied all of Bennis’s qualities of leadership. He is the type of leader who “embraces errors,” learning from them and using curiosity and daring to experiment with new things. (Bennis, 1994, p. 42). He “loves what he does and he loves doing it.” (p. 40) and this is what gave hope to the ordinary worker.

Conclusion

            Because of the type of leader Iacocca was and still is – spirited and enthusiastic, honorable and trusted, sometimes blunt to the point of antagonism – he stands out above others who have been in similar situations and effected similar results. The very fact that he is remembered over and above the others like him is a testament to the fact that he is indeed a leader. This is what leadership is all about. A leader must make his mark. That is the means by which the leader can direct others so effectively. If someone thinks of himself as a leader, has accomplishments as a leader, but is not perceived by others to be a leader, his leadership will be ineffective. Lee Iacocca knows this. He promoted himself; let others know that he was a leader and he backed that up with an amazing list of accomplishments.

            Not long after his success at bringing Chrysler around, President Reagan asked Iacocca to take on a private sector fund-raising initiative to restore the Statue of Liberty and Ellis Island. His acumen as a business leader resulted in great success for the Statue of Liberty – Ellis Island Foundation, making it the largest restoration project in American history. (Lee Iacocca, 2005).

            He continues his role as leader today, writing books such as Where Have All the Leaders Gone? (2007) challenging the establishment to produce real leaders. He makes an analogy to the auto industry where leaders are held “brutally accountable” for their performance. The mantra of accountability was the phrase “show me where it’s working.” (Iacocca, 2007, p. 25). Iacocca maintains that leaders today (if one can call them leaders) are not held accountable and cannot make obvious “where it is working.”

            It is established from the outset of the book the Iacocca is mad; he is outraged at the state of leadership. In a typical “in your face” passage he calls government leaders “clueless bozos steering our ship of state right over a cliff.” What is his solution? “Throw the bums out!” (p. 3).

            He has come up with his own leadership qualities that he calls his “Nine C’s of Leadership:” curiosity, creativity, communication, character, courage, conviction, charisma, competency and common sense. (p. 6 – 10). He opines the fact that these characteristics are lacking in most leaders of today.

            Lee Iacocca is a born leader, embodying all of the traits of leadership. He has vision, a sense of urgency and passion, and integrity that engenders the trust of his followers. He stands above the rest because he has placed himself there through his accomplishments and the public’s perception of them. As a true leader, he challenges other leaders to do the same. He is not content with mediocrity. Iacocca demands more, as any good leader would.

References

Anderson, Kurt. (2001, June 24). A Spunky Tycoon Turned Superstar. Time. Retrieved December 6, 2008, from              http://www.time.com/time/magazine/article/0,9171,1101850401-141447,00.html

Bennis, Warren. (1994). On Becoming A Leader. Cambridge, MA: Perseus Books. Retrieved     December 6, 2008 from Questia.com database.

Iacocca, Lee A. (2007). Where Have All the Leaders Gone? New York: Scribner.

Lee Iacocca. (2005). The Iacocca Foundation. Retrieved December 6, 2008 from

            http://www.iacoccafoundation.org/lee_iacocca.html

Lord, Robert G. & Maher, Karen J. (1993). Leadership and Information Processing: Linking      Perceptions and Performance. New York: Routledge. Retrieved December 6, 2008           from Questia.com database.

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