Nissan and Honda announced integration late. The Renault-Nissan Alliance, which had existed since 1999, is often described as having come to an end by the adjacent of 2023. Popular structures, such as the simultaneously created purchasing organization, are dissolved. But, the relationship between the two companies continues ( along with the third mate, Mitsubishi ) in the form of creative projects.
How does we comprehend the alliance’s collapse while maintaining a relationship that is sustained through jobs? To explain this phenomenon, it is necessary to examine the entire dynamics of the partnership, from its roots to the problems it has undergone.
The Renault-Nissan proper empire, forged in 1999, has been a subject of extensive research, especially as it faced a big issue in 2018. The partnership’s base was shaken by the arrests of Alliance CEO Carlos Ghosn and Nissan committee member Greg Kelly on charges of tax fraud and misuse of commercial property.
However, the alliance endured, with Mitsubishi joining as a second mate. Understanding its direction – its operations pre-crisis, the tumult of the problems, and its survival – required a new lens. Through conducting extensive interviews with key partners in France and Japan, which led to the publication of our study in the journal M@n@gement.
The bases of the Renault-Nissan empire
First dubbed” The Alliance” by its members, the Renault-Nissan relationship can be assessed through proper alliance concept, which emphasises three core rules:
- Complementarity: Alliances thrive when colleagues possess comparable features.
- Interpersonal investment: Trust and cooperation deepen over period, fostering a smooth working relationship.
- Learning interactions: As companies learn from each other, their mutual dependence diminishes, usually limiting the group’s duration.
Yet, the Renault-Nissan ally defied these standards. There were geographic complementarities when Renault first came out, with Nissan’s reputation in America and Asia competing favorably with Renault’s power in Europe. Operatically, Renault demonstrated exceptional project supervision but lagged in terms of quality control, while Nissan excelled in quality output but struggled with charge and project management.
However, these synergies were overshadowed by the reality that Nissan was on the brink of bankruptcy, burdened with$ 20 , billion in debt. It was Renault, no Nissan’s preferred companion Daimler-Benz, that took the risk. Complementarity is an exaggerated notion because the two businesses had little in common at the beginning.
The companies had plenty of time to learn from one another as the empire approached its 20-year milestone. However, the 2018 problems revealed a remarkable fragility. Decades of cooperation virtually instantly vanished, posing questions about the quality of their interpersonal funds. One top professional reflected:” It remains a problem for me: why are these companies but delicate”?
The Renault-Nissan strong
To fully realize the Renault-Nissan strong, we turned to other philosophical systems. We covered topics ranging from project management and personal connection theory.
While business alliances differ from individual associations, both are, ostensibly, forms of relations. Interpersonal theories show two important conclusions:
- Relationships are ongoing, inherently “unfinished business” ( Duck, 1990 ).
- Yet long-standing relationships can become ineffective when ahead momentum stops, so the prospect takes precedence over the past.
Current companies operate within a framework of “projectification”, in which jobs are defined by distinct priorities and fixed timeframes. Unlike connections, projects are “finished company”. The Renault-Nissan agreement was analyzed by this duality between fixed assignments and open-ended relationships.
The Alliance is seen as a “project of assignments.”
Carlos Ghos n’s framing of” the Alliance” as a new management model offers critical insight. He envisioned it as a tactical empire without a predetermined goal, neither a momentary collaboration nor a merger. Through shared jobs, this vision came to life. As a Renault manager said:” Ghos n had this genius. He focused whatever on tasks. As soon as we got out of there, stuff went wrong”.
Soon after the name, the Alliance launched a joint effort in Mexico. Interconnections were created within the construction of the job itself. ” At the beginning, we focused on determining how to work properly. Jobs were matched, with a head and a co-leader assigned to each area”, said the Renault boss.
” We were informed that Nissan had a strong emphasis on quality and strict obedience to schedule”, the manager continued. ” Their technique was known to be unforgiving. When we began working together, we assigned a Renault co-leader in acknowledgment of this. In terms of price management, Renault was more organized and drove its jobs with revenue goals. Thus, cost control was managed by Renault”.
The Renault-Nissan relationship operates as an overall, endless task sustained by fixed, goal-oriented cooperation. Its construction reflects the broader pattern of projectification but with a special bend: an “unfinished task” supported by finite, finished projects.
The 2018 problems, but, tested this concept. Conflicts arose from different objectives. The French authorities, a Renault investor, pushed for a consolidation – an ultimate finish to the empire. Nissan resisted. Compounding the burden, Renault and Nissan pursued electric car growth differently, undermining combined development.
As a Nissan director said,” Now, markets only occur on jobs. We not longer have the goal, the cause for exchanges has fully changed”.
To return, the empire returned to its basic model, emphasising collaboration on electronic vehicle projects. The emphasis on shared efforts restored speed to the larger, open-ended marriage.
The Renault-Nissan event enriches our understanding of strategic alliances and job control:
- Complementarities can come over time: More than existing from the outset, they may grow through shared projects.
- Relational capital is focused on the future: The strength of an alliance lies more in its shared goals than in its historical ties.
- Projectification’s dual nature, the interplay between infinite and finite projects, can sustain complex relationships.
Interestingly, this framework may extend beyond corporate alliances to interpersonal dynamics. Couples, for example, could be seen as “projects of projects”, with their longevity dependent on shared goals and mutual perceptions of fairness.
Going back to Renault-Nissan, the Alliance has ended in its institutional form, but the relationship between Renault and Nissan continues through time-limited ( finished ) projects. The dynamics of this relationship will be fascinating to keep an eye on. Will it eventually fall apart as the two partners become more and more involved in joint projects with other automakers and their joint initiatives start to decline? Or will the two partners be able to maintain some form of collaboration through joint, concrete projects without an unfinished perspective?
Magali Ayache is the maître de conférences en sciences de gestion at CY Cergy Paris Université and Hervé Dumez is vice-président rechervhed’euram, professeur and directeur of the Centre de recherche en gestion et del’Institut interdisciplinaire del’innovation, École polytechnique, European Academy of Management ( EURAM )
This article was republished from The Conversation under a Creative Commons license. Read the original article.