Book review on Iacocca An Autobiography

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The title of the book is “Iacocca: An Autobiography” is completely in accordance with its content in it, as the author describes his whole life story by himself.

Author

The author of the book is ‘Lee Iacocca’ who was the former president of Ford Motor Corporation and the former chairman and CEO of Chrysler Corporation. His major contributions in history of auto business is that of giving a new life to chrysler by saving it from near bankruptcy and putting it back on track of success.

Starting Pages

The book also has ‘Acknowledgements’ page, accompanied by ‘ Introduction to the paperback Edition’. Then it is followed by ‘An Opening Word’ and before the author starts his story there is ‘Prologue’.

Special Features

This book specifically does not have any special features, but it does got pictures, and caricatures in it. All of the pictures are in black and white.

Number of Pages

The book has a total of three hundred and sixty five pages. This much amount of pages makes it a decent, light weight handy book and the reader comfortably can carry it easily.

Number of Chapters

This book has twenty eight long chapters and one epilogue in it.

Size of Paragraphs

About the size of paragraphs is concerned, it has a mixture of short as well as long paragraphs.

Price

About the price of this book, if we rate it on international level or for readers of United States it is $7.99 and for Canadians it is $ 10.99 which is a good price tag. On the other, if one would see its price for Pakistani readers though it is Rs. 400 but to me it is still very expensive.

Publisher

This book is published by Bantam Books, a division of Random House, Inc. Its trademark, consisting of the words “Bantam Books” and the Portrayal of a rooster, is registered in US. Patent and Trademark office and in other countries. Marca Registrada. Bantam Books, New York, New York.

ISBN

The ISBN of this book is 0-553-25147-3. By using this very number one can easily get this book from anywhere in the globe.

Genre of Book

The genre of this book is non-fiction and based on true story of the writer’s life. Here, all the events and happenings were revealed as it is by a single person.

First Book or Second

This Autobiography is writer’s first book, which tells us about his fabulous career and life. His second book is “Where Have all the Leaders Gone”. Therefore, till now the author has penned down a total of two amazing books.

Target Audience

This book is written for people from all walks of life, from business students to business managers. Yet, the book focuses to cars, because the writer’s profession and passion was auto industry business. But still as this book has no scientific formulas, technical works, and methods, so one can easily read it and enjoy what this book is all about.

Edition

This is the second edition of this book “Iacocca: An autobiography”. It is called the paperback edition and it was out in the market for readers in July of 1986, where as, the first one was called the hardcover edition and it came out for the readers in November 1984.

PURPOSE OF WRITING:-

The author’s purpose behind writing this book is not to get royalty money from the publishers or to show off his achievements at Ford, how he had rescued Chrysler from bankruptcy and run the affairs successfully. Instead of this above all, Iacocca’s purpose to help out all the present and future business graduates in various types of problems and difficulties they have to face when they start their jobs. The writer firmly believes that when this book will assist those young brains in solving their matters, only then it would satisfy my conscience of doing something positive, productive and worth to read.

AUTHOR’S STYLE:-

The writing style of author in this book is formal. If one assess the quality of writing used here is of worth mentioning. The speaker has beautifully maintained the linkages of all the way from sentence to sentence and paragraphs to paragraphs and then chapters at larger level. The vocabulary of the book is easily comprehendible and has used no jargons in it. As far as the description is concerned, here too the writer carefully revealed everything in a step by step form so the reader while going through it cannot be detracted. Especially, in autobiographies such things ought to be given a fair amount of importance. Where upon, the details given in this book is completely a self-narration and does not contain any incorrect information which did not happened in writer’s whole life.

AT FORD:-

Before moving towards the book review it is important to recall the summary and what happened in the first part of this autobiography, this covers the writer’s life at Ford.

So in the summary part one already read that author started his journey of career at Ford as a salesman and passed through a stage when he was a novice and had to learn all about his job. He learned various types of selling tactics and practiced them. During this initial span of his career he came across many good mentors and Lee was influenced by them a lot. Moving a head in his career and became an expert in sales field he decided to give himself a break and tied the knot. When the writer was part of company’s top management and became General Manager of the Ford Division he was a stranger to everybody. At this point in life, he planned to do something big; with this thought and ambition Iacocca used his skills, knowledge and gave the world Mustang. This first jewel to his name made Lee a known from the unknown. The narrator, also gave two very fine cars to Ford namely as Fiesta and Mark III.

Here at Ford when Lee was president and giving an annual turnover of $ 2 Billion to the company. On the other, such a profit though was coming to the organization, and making Iacocca famous and boosting its image among its competitors. But this thing and repute of Lee made Henry Ford to think exactly the opposite. Henry took this as a direct threat to his throne because everybody eyed Iacocca as their real leader and started disliking Lee. All hatred ends up in firing Iacocca from president ship. Therefore the story of writer at Ford lasts to this day. Now we will be looking at the second part of the book, which tells us about the writer’s story at Chrysler.

AT CHRYSLER:-

To reveal the Chrysler days it is better to go and explore first what events took place in writer’s life when he was eventually picked up by the Chrysler people. When Lee left Ford, he got a job in a warehouse, where he only stayed for few hours. In fact, these couple of hours forced him not to give up at any cost. Leave all the negatives aside and picked up only the positives and move ahead. The humiliation of being at an ordinary office right after serving as a president of a great company for so many years. There, he decided to fight back with his life and that results into reaching at the top in Chrysler Motor Corporation. Here I would like to quote Lee’s words as it is from the book which goes as “there are times in every one’s life when something constructive is born out of adversity. There are times when things seem so bad that you have got to grab your fate by the shoulders and shake it. I am convinced it was that morning at the warehouse that pushed me to take on the presidency of Chrysler only couple of weeks later”.

The writer before becoming boss of Chrysler was offered many jobs from other companies but none of them was from the auto industry. These were all the way from international paper, Lockheed, Charles Tandy and business school of NYU. (New York University). But lee wasn’t satisfied upon these offerings, because cars were his only world, and he can’t think of joining to any other profession. He is of the view that “all business skills are not interchangeable at any level. The reason behind his this philosophy should only pursue that line or profession in which he/she had and has a grasp over it. Where one is a pro and not somebody who is alienated to the field and job”. That’s why when he declined these non-autos industry jobs a renowned French car maker Renault, offered Iacocca the post of their “Global Head of Automotive Consultant”. Where upon, Lee rejected their offer, because though the job was from an auto industry, but it was not that one in which he got expertise. He refused them solely of the fact that in this consultant job he never be able to give his best.

Iacocca later wanted to form a consortium of car companies which he named as Global Motors. His intention was to build a fabulous consortium, would be based in Europe other in Japan and lastly in the US. This was all planned to break the monopoly of GM, which they have maintained from several years. Yet, this project won’t work because of American Antitrust Laws. After that event, Lee learned that in the circles of auto industry there might be a possibility that Chrysler will pick him up for its very important post. And they are in need of someone who has great potential to lead and cope with any kind of difficulty. Thereby, after some time Lee was approached by the board members of Chrysler, who held couple of unofficial meetings with him which ended up in offering a job at their company. Iacocca in his heart decided that this time he would only accept the number one man position in Chrysler. So, he informed the Chryslers top management about his this plan where upon they told Iacocca that his route of becoming the boss will be a bit different. At first he was made the president and afterwards became the chairman CEO of Chrysler on January 1st 1980.

Till now we have learned that writer’s journey at Chrysler has just started. What is ahead of him will be revealed in the next heading.

BEGINNING OF ANOTHER JOURNEY:-

When the author officially joined his office at Chrysler, the same day his organization declared its losses of about $160 million. This was surely a bad coincidence with a human and the company itself. So, the beginning of narrators of another journey wasn’t a good one.

Problems Ahead

The narrator here will discuss what were those problems regarding organization which he had faced during his tenure at Chrysler. These are enlisted below.

A, Discipline. B, Functionality. C, Lack of Cohesion & interaction between departments.

D, No Meeting System. E, Management Structure (Planning & Projecting). F, Financial matters. G, No team. H, Lousy and vehicle for an older guy’s car and considered boring too. I, Bad morale and deteriorating factories. J, Inappropriate placements of the work force. K, Security leaks. L, Manufacturing & Quality. M, Purchasing. N, Sales and Marketing.

Now we’ll move to the next chapter and see what the speaker had for us to share and learn.

THE DAY THE SHAH LEFT TOWN:-

The title of this chapter reveals the same as its name goes, because the narrator here meant “Shah Left Town” to Mohammad Reza Pahlavi the Shah of Iran who was thrown out from his throne on January 1979 in an Islamic Revolution lead by Ayatollah Ruhollah Khomeini.

Here the question popped up in one’s mind that what this exit of Shah had to do with America, its economy and specifically with Chrysler. Why the writer dedicated a full chapter depicting the aftermath of his departure. The reason behind all this was that, till 1979 Iran was under heavy American influence and Shah with their help made Iran quite liberal and develops its infrastructure. Along with that, Iran before the revolution was one of the greatest oil suppliers to US. Therefore, when Shah left and Khomeini took over he stopped not only providing them oil but also the diplomatic relations with the US. Thereby, in this chapter writer describes the effects of extra organizational stressors on Chrysler’s business which is as follows:

Iran’s 1979 revolution ousting Shah of Iran.

Prices of gas were doubled.

Energy crisis.

Chrysler’s market share gone down to 8 percent.

Recession.

Owner’s loyalty.

Rumors of Chrysler’s demise.

Out of these above problems, the main were gas price and recession. The reason was simple that cars run on oil. People therefore stopped buying their big cars with low fuel efficiency. The Recreational vehicles (RVs) and vans were two models of Chrysler cars which got affected from the gas fare. Even the parts of the cars like “chassis” and “engines” too were affecters of such a crisis. The thing which further harmed and destroyed US auto industry was that people started buying Japanese small cars instead of the Americans. Here, GM (General Motors) survived by selling their new car model called “X-body”. They were also successful in selling another model which was Chevrolet Citation.

So, the story of boom in small cars business continues on when an analysis was done between the market share of small versus big cars. They found that in year 1979 in a period of merely five months the small cars took 58 percent of market share and the sales of vans was gone down to 42 percent. Here, when Chrysler wants to build small vehicles and try their luck in this category unfortunately the recession broke out in the country. The writer mentioned that “the annual” rate of sales was dropped to nearly half”.

After reading the above figures the narrator decided to go for an overhaul of the company in order to bring it in a stable position. For that, Chrysler initially closed its few plants and by doing this they also seek help from their suppliers and informed them from our every move. In fact if one keep on closing production units then for what good reason the suppliers will give Chrysler parts to manufacture their current and future products. To lower the cost more and avoid keeping the parts at the factory’s inventory (a shop where all goods are stocked) Lee devised a new system called “just in time” meaning all those parts which are required to assemble car arrived from supplier when they have to manufacture and will be off from the production line when it is built, so no need of putting the parts in an inventory.

Iacocca kept on cutting cost from where ever he could so he can run the company. He did this even when they sent the annual report of 1979 to the shareholders of the company. Instead of printing it on a thick good paper, Lee ordered to print it on a plain white paper written in black ink. This decision was to show the shareholders that in times of crisis, Chrysler remained within its resources and didn’t opt for any wasteful step. Later on, when the company is in a desperate need of money Lee sold out the business which was expanded in overseas. He kept their operations to the US, Canada and Mexico. After this measure the money they got wasn’t sufficient at all, there Iacocca decided to sell Chrysler’s tank division to General Dynamics.

In the end of this chapter the writer said that, all those above decisions he took was necessary to brought Chrysler out of the ditch. Whereupon, to him he believed that the most unimaginable and painful deed was to lay off thousands of employees. But this act gave him a lesson that, if one has to run a large company and has limited number of employees then this would be very easy to do so than with lots of people in the company. The writer while finishing wishes that, competitors of Chrysler would never learn this lesson otherwise their profit will be lessened.

DRASTIC MEASURES : GOING TO THE GOVERNMENT:-

To save Chrysler from bankruptcy Lee asked government to help them in this matter. He approached the rich Arabs to do the same, but of no use. Later, Volkswagen the German giant car maker agreed on a merges with Chrysler. Unfortunately when they read our balance sheet, so they refused for the merger. The reason behind this failure of merger was that Chrysler had made no money and in severe debt. Eventually, Iacocca went for proper government assistance for giving them “Loan Guarantees”. They plan not to plead for such a guarantee. Here, this initiative was taken up by the outgoing Chairman John Ricardo. He explained the government about Chrysler’s current sick condition and asked to give a two year freeze on government regulations (meaning by law to control any business activity or a process) but none gave a kind ear to it. For government’s bad safety and emission controls system he suggested a combined research and development program. He stressed that our aim is not to steal any company’s good and cheap way of controlling emissions instead they should sell it to the needy. In this statement of Lee the government listened them and realized that our antitrust laws are never be competitive with Japanese, till someone would reform those laws. Instead of doing anything regarding formation of new competitive laws government signed collaboration between Toyota & General Motors. According to the antitrust laws all the motor companies namely General Motors, Ford, American Motors and Chrysler ought to work in chunks in order to fix the same problems. On the other, Ricardo once again seeks government help for a “freeze on regulations” but the result came out in a NO. After seeing this behavior he asked them to give a “refundable tax credit”. Meaning the money Chrysler spends on qualifying for government’s safety and pollution standards will be refunded to the company. The writer says that our company wasn’t the first who asked for such a relief. In the past car makers like American Motors, Volkswagen, Renault, and General Motors already benefited by the taxes. Over there Ricardo, in wake of getting any support for “loan guarantee” one more time returned to government, whereupon his efforts weren’t of any use. The writer here explains that though Ricardo was a nice human being, yet he was a short tempered and not good at communication skills and Congressmen never liked such traits in any human.

Later, on one fine day the writer learned that G. William Miller who previously holds the post of chairman of the Federal Reserve Board. In fact in America the State Bank of the country is called the Federal Reserve. So, now Miller becomes the treasury secretary here, Iacocca shares a strange aspect of Miller’s personality. When he was serving as chairman at Federal Reserve Board. He told to Ricardo that Chrysler would go for bankruptcy instead of government help. On the other, when he moved to his new post, he declared that government must help Chrysler. Afterwards he accept the proposal of “Tax Credit” but informed Chrysler people that to seek such type of assistance they have to rolled out a complete plan of survival to the government.

The writer got no choice except going to government. In this regard he learned that a British Car Company Leyland took government support but after that the company never recovered. But still Lee filed an application for government loan guarantee. Before appearing in front of Congress Iacocca did his homework. This homework was about to know that in past how many companies are there which had been benefited from such a loan. There, speaker found that organizations that already got this loan were all the way from aircraft to City of New York and from housing to subway of Washington DC. In this research Lee found one very shocking thing that, till now government had given $409 billion in loans and loan guarantees were outstanding. While ending this chapter Iacocca describes that when Chrysler put up their case to government, it gave him a feeling that in government there was no person who remember those previously given loan guarantees to the above mentioned companies.

SHOULD CHRYSLER BE SAVED?

Yes, this question has become the question of town. This chapter revolves around the inappropriate attitude of senators, congressmen, businessmen, business leaders and other stake holders against the Federal Loan to Chrysler. In fact to save the company Lee requested the government to give them $1 Billion loan guarantee. The first refusal came from General Motor’s Tom Murphy and Citi Corporation’s (Citibank) Walter Wriston. Then National Association of manufacturers, policy committee of the business Round table too spoke bitter words for our company. Iacocca blamed the government for Chrysler’s current bad condition, especially government regulations and its unequal effects. But along with governments role Lee believed that previous management’s inability to rectify various problems too brought them in this position. These problems were like, producing cars on basis of speculation, their decision of taking Chrysler to foreign markets, and lastly doing business of used cars. Instead of such doing things they ought to focus on quality of Chrysler cars.

When Lee started appearing before Congress, he straight away informed them that “Regulations” was the first and last element which made Chrysler to beg for loan. In the end of this chapter Lee shares that American people is of the view that “Chrysler had received

$1 billion in cash which they never had to pay it back”.

CHRYSLER GOES TO CONGRESS:-

In this chapter Iacocca talks about lot of things including passing of $1 billion loan, repaying it, and series of appearances before Congress and Senate committee etc. The speaker describes that this whole process of hearing was a gigantic task. In fact the layout of those hearing rooms forced the witness to first look up and then answers the questioner, because members of the committee sit at a semicircular table which was few feet above the floor. Before moving on to Chrysler’s hearing in Senate and Congress, here it is important to learn the so called allegations and scolding done by committee members. These were as below:

A, Sins of management. B, Lack of foresightness for not building 30 miles per gallon as Japanese did. C, Not prepared for the aftermath of Shah of Iran. D, Not prepared for the screwed up fuel allocation, result in riots at gas stations. E, Chrysler missed the market and deserved punishment.

Punishments:-

They were held up in front of the whole world for asking government help.

Disgraced on editorial pages, by cartoonists who painted Chrysler into the grave.

In public places their wives and children became the target of jokes.

Now one would see the relation about the passing of loan guarantee from writer’s eye. Iacocca, made his first appearance before the House Subcommittee on Economic Stabilization of the Committee of Banking, Finance and Urban affairs on October 18th, 1979. The writer explains the committee about Chrysler’s present condition and the exact words from book are ” I began my testimony by stating our case very simply. I am sure you know that I do not speak alone here” today. I speak for the hundreds of thousands of people whose livelihood depends on Chrysler remaining in business. It is that simple. Our one hundred forty thousand employees and their dependents, our forty seven hundred dealers and their one hundred fifty thousand employees who sell and service our products, our nineteen thousand suppliers, and the two hundred fifty thousand people on their payrolls, and of course, the families and dependents of all those constituents.” Lee made it clear to the committee that guarantees loan is not to receive an official gift from the Carter’s government (Jimmy Carter was the 39th President of the United States from January 20, 1977 – January 20, 1981). Instead, Chrysler will pay back each cent and dollar of this loan including its interest. When the Loan Guarantee Act was passed, after few weeks the Republicans (name of political party in America) came to power. On the other hand, in this whole event Democrats (name of another political party in America) were in the government. But these Republicans talked very negative about giving loan to Chrysler. And that was the point where Lee realized that he should now start favoring the Democrats. The speaker describes that at the time of their company’s bad condition if Democrats wasn’t in government then Chrysler wouldn’t have any existence today. The $ 1.2 billion dollar of loan was passed exactly before the Christmas and surely this Christmas had really given a priceless gift to all those people who were associated with Chrysler. In the end the narrator reveals that Chrysler paid back their loan seven years early from the given time. Along with that they paid taxes of millions of dollars and fee of the Loan Guarantee Board. Last but not the least the opponents of their company too said that government loan given to Chrysler was a very noble idea.

EQUALITY OF SACRIFICE:-

From the title of this chapter the writer meant everyone has to sacrifice on basis of equality whether you are a Head of the company or a Worker. He further explained that though they need the loan desperately. But what really worked and brought Chrysler back on its feet was a team effort and cooperation. In fact the real story of Chrysler’s survival started now, because that loan Guarantee Act requires them to provide various concessions. Thereby, Lee reveals that our existence based on cutting cost from wherever one can. So, Iacocca decided that he should start this process of cost cutting by deducting $1.00 a year from his salary. This move of withdrawing one dollar was necessary to make others do the same. He says that as a leader of the company he should be the first one to show sacrifice in any form. Because for a leader its mandatory to come up with such examples, otherwise his followers would never follow on his footsteps. Lee describes that reducing his pay, never meant that he won’t take his meals. What he is of the view that such a giving up, is to display a team work, family’s job and togetherness. Here, for the first time he came to know that people can do anything if they knew that others are experiencing the same pain as they are feeling. Iacocca, repeat his words that all this collective and oneness took Chrysler out of the trouble and not those dollars, which they definitely required just like blood. Moreover, the speaker sadly discussed the worst part of the cost cutting which though lifted the company but finished people’s lives and that was about firing many workers. This act of ours destroyed the social fabric of masses which results in, that they got divorced and had to stop sending children to college etc. Later, he explained that when public and celebrities came to know about our goal to save Chrysler, by any way or means. They showed fabulous support by writing letters to the writer. Then all the way big celebrities of that time joined us including Bob Hope, Bill Cosby, Pearl Bailey, and Frank Sinatra were the people who performed at our premises, encouraged the workers to show collectiveness in this hour of struggle but they never charged us a single dollar.

At the end of this chapter, writer wants to tells us about one major helper without whom this saving of Chrysler never be executed. This was Doug Fraser, president of workers union. Then Lee made him part of Chrysler’s board of directors. Who was extremely good at negotiation, got good know how about politics and would speak out the same what goes through his head.

THE BANKS: TRIAL BY FIRE:-

When the Congress passed Chrysler’s loan of $ 1.5 Billion dollars, it was time to collect the money from the designated banks. These banks were based in the whole country as well in other parts of the world. But these banks made Lee and associates to be on toes in order to receive their loan. The writer said that the banking sector started showing bad attitude to them, even before when Chrysler’s hearings initiated in Congress and Senate. When giving the amount in chunks the bank representatives never bothered about Chrysler and after how long it’s going to rise. What they always concerned was about their banks money, meaning when Lee’s Chrysler will pay back loan’s money to them. Eventually, after lot of hassle and hard time with bank people, they received Chrysler’s first installment. Thus, it will result into a rebirth of a motor company.

THE K-CAR AND A CLOSE CALL:-

The moment, day, month, and year was there for Chrysler to stand on its feet. In fact Lee and his very brilliant ex-Ford colleague and current coworker Hal Sperlich had dreamt to launch small American built cars, from the days when they were at Ford. Unfortunately, Henry Ford, chairman and CEO of Ford motor company never permitted them to do so. But now they had the time, resource to fulfill that dream but no need of seeking permission, because Iacocca was in charge at the company. So they built, researched its name, advertised and launch “K-Car”. This model of Chrysler was rock solid, got a decent style, and has four cylinders engine with a fuel efficiency of 25 miles per gallon in intra city. Whereupon it’s consumption on the highway (motorway) it has mileage of 41 miles per gallon. Apart from its features the best thing of K-Car, that it was the first vehicle that can fit in six Americans but remain light in weight and gives amazing fuel efficiency.

PUBLIC MAN, PUBLIC OFFICE:-

The writer describes here that when Chrysler was back on track in market and started doing well. He learned the news that he too is campaigning for President of US but truly it wasn’t correct at all. Iacocca believed that people made such rumors on the basis, because he did lot of advertisements for Chrysler’s promotion. He further explained that people write many letters to him saying that he should run for president. Another well-wisher of Lee wrote to him: I will write exact words of book here and they are “why don’t you turn this country around? Why are you wasting your time selling cars?” Iacocca, analyzed and observe that why people of America wants him to be their next President because from the day Eisenhower (34th President of United States from January 20, 1953 – January 20, 1961) left Oval office (the office of US President is called Oval Office) America started going down. And all the way after Eisenhower, none would turned up to be a great President and stayed long to flourish the country’s economy. In the end he said that he is very grateful to all those people who think that he would be the next President of America. But he believes that these priceless statements of people made my day and gave lot of contentment, which can’t be expressed.

A BITTERSWEET VICTORY:-

Chrysler right after producing K-Car, then manufacturing fantastic line of cars all the way from

Le Baron, Chrysler E Class, Dodge 600, the New Yorker, in sports car category it was called Dodge Daytona and lastly Chrysler Laser. So, now Iacocca’s great company was back in business and started making good profit. Whereupon, writer decided to do a press conference in which he wants to brief the media on their success. The primary purpose of this conference was to abandon those titles which media gave them when Chrysler was on the edge of bankruptcy. While talking to the press Lee said as: “Effective immediately, Chrysler is no longer ‘cash starved’ or ‘struggling’ or ‘financially troubled’. If you insist you may continue to call us “the nation’s number three auto maker”. But those other phrases are now banished forever!” Afterwards, the profit they made in next year surpassed Chrysler’s previous history of profit earnings. Further, writer talks about the promises they made to lift Chrysler. These promises includes, modernization of plants on basis of latest technology, converting the fleet of cars to front wheel drive technology, to become leaders in fuel economy, promised to maintain employment for half a million workers. Last but not the least promised to produce “exciting” products. The writer called this bittersweet victory to two things. He refe

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