Power of organizations Essay
Power of organizations
Lee Iacocca was born Lido A. Iacocca, on October 25, 1924 to Nicola and Antoinette, who were both Italian immigrants. His parents were hardworking people and his father Nicola believed that America was a land of opportunities. As long as people were willing to work hard, it America, it was possible to achieve anything. Lee followed his father’s work ethic and when he just a boy of ten years, he would take his wagon to the grocery store and wait outside. He volunteered to take the groceries of the shoppers to their respective houses for a tip.
When he turned 16, he worked 16 hours a day in a fruit market. Lee confesses that the depression of the 1930s resulted in a transformation to his personality and he became a materialist. He graduated from college with the goal of earning $10,000 a year till he was 25 and then, he planned to work towards becoming a millionaire (Iacocca, 1984). The depression also made Lee a less intolerant person towards waste in any form: food, clothing or business and a conservative person in his investments. He always knew that disaster can strike any time.
During his school days, Lee also faced racial discrimination due to the fact that he was Italian. Moreover, he was pained by the fact that his two Jewish friends were treated worse than he was. When Lee was in Chrysler, he named Gerald Greenwald as the Vice President of Chrysler. He would be the first Jew to enter the top ranks of any of the top three automakers (Iacocca, 1984). After his graduation at Lehigh, he got a job with Ford. But he could not pursue that job at that point in time, because he won the Wallace Memorial Fellowship at Princeton.
He Graduated from Princeton and started working for Ford in 1946. Lee married Mary McCleary in 1956 (Iacocca, 1984). Lee considered his family life very important and reserved weekends to spend time with family. Lee’s success in business was not only due to his hard work and education, but also due to his ability to adapt to any situation (Swinfin, 2006). He was also a decisive man and had the ability to take innovative decisions. In 1956, when his district was the last in sales, he introduced a new program called “56 for 56”. This program made it possible to purchase a new 1956 Ford for 20 % down and $56.
00 a month for 3 years. The program was a huge success and more than 75,000,000 cars were sold and his district secured the first place in sales. Lee also undertook the challenge of the Fairlane Committee, which was responsible for producing a new type of car. Lee analyzed the research data on demographics and buying capacity of Americans and concluded that the car must be small, but needed to hold 4 passengers. There would be a 2500 LB limit, and the cost could not exceed $2,500. 00 with equipment. The end product was the 1964 Mustang (Iacocca, 1984).
Iacocca Lee was a good leader who used good marketing research data, surrounded himself with good people, and was open to new ideas. Lee became President of Ford on December 10, 1970. He initiated a program called “Shuck the Losers”. This program gave managers 3 years to make their departments profitable or sell them off (Iacocca, 1984). This shows that Lee was also highly competitive in approach and stern when he had to be. Though there were many successful projects while he was at Ford, by the end of 1975, Lee started having personal conflicts with Henry Ford II.
Lee was fired in July of 1978 and thereafter he joined Chrysler on November 2, 1978. Lee found that Chrysler had a problem in its communication style and team work. He reduced his salary to $1 per year and bargained with the union for cuts in salary and benefits. First, Iacocca announced plant closures, job layoffs, and his plans for the company. His next move was cutting several large models, which were heavily unprofitable, and put the subcompact Dodge Omni and Plymouth Horizon into production. The Omni and Horizon became instant hits, selling over 300,000 units each their debut year (Iacocca, 1988).
By 1983 Lee turned around the fortunes of Chrysler and repaid all government loans. Lee made a public statement, “We at Chrysler borrow money the old fashioned way. We pay it back. ” At Chrysler, Iacocca not only overcame a $3. 3 billion deficit but capped it with another $3. 3 billion profit between 1982 and 1984. That represents a net gain of $6. 6 billion, or an average increase in earnings of $6 million per day over the previous period (Harmon and Jacobs, 2006). The administrative style of Lee Iacocca is based on tapping the hidden power of organizations.
He peeled “the encrusting layers of dead habits, vested interests, outmoded strategies and inertia and removed the lid on an enormous reservoir of productive energies. He did it by firing 33 of the company’s 35 vice-presidents and allowing long-suppressed ideas, energies, and talents to rise to the surface” (Harmon and Jacobs, 2006). Thus Lee was responsible for discovering the potential of organizational power. This discovery not only brought into use hidden potentials but also created new possibilities.
The administrative style of Lee Iacocca enabled organizational power to maximize the productive and efficient utilization of ideas, resources, energies, and opportunities. He combined the organization power with his personal talents at communication, decision-making, motivating, time management, flexible approach in leading, and innovation to achieve great success as a leader. Lee Iococca, after his successful career at The Ford Motor Company and Chrysler, said, “I seized the opportunity, but I was no ninety-day wonder. It took me almost forty years of hard work. ” This then, was the main reason behind his success.
Subject: Social Organization,
University/College: University of Chicago
Type of paper: Thesis/Dissertation Chapter
Date: 20 April 2017
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