Saturday, November 01, 2008

Cerberus' hubris - not so easy to turn around Chrysler

So many people think it is easy to turn around a company, change culture, cut costs without hurting effectiveness. Many Private Equity executives have never run a manufacturing company or consumer services company. Yet, they think it is easy to be done. Any thinking and experienced executive has known for years that the US automobile companies have been dying and will be almost impossible to save. So why did Cerberus buy Chrysler? Why did Mullaly move to Ford - a consumer products company, completely unlike Boeing?

The answer is partly hubris, partly lack of understanding of what it will take, and also partly lack of objective and deep thought.

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