Bob Eaton Is No Lee Iacocca But He Doesn't Need To BeJohn Templeman
The whispering went on for days in Detroit early last March. Chrysler Corp. Chairman Lee A. Iacocca's imperial reign was nearly over, and he had announced his successor: a low-key engineer named Robert J. Eaton, president of General Motors Europe. Word spread through the Chrysler Building that Bob Eaton likes to consult widely before making a decision. The in-house translation: Eaton is a wimp.
Within days, however, any notion that the incoming chief executive was indecisive was quickly put to rest. By the time Iacocca introduced him to Chrysler staffers on Mar. 16, Eaton had already penned a memo telling them he believed in "participatory management, not consensus management." The message was clear: Eaton will be calling the shots when he takes over from Iacocca at the end of 1992. But the memo was also a sure sign that Chrysler's executive suite will see some big changes in management style.
Eaton's low-key approach is a far cry from Iacocca's high-profile flash. While Chrysler's current chief enjoys his celebrity as the savior of the nation's No. 3 auto maker, Eaton shuns the limelight. Indeed, he says he won't play pitchman on TV commercials as Iacocca has.
SHIRTSLEEVES. Where Iacocca relished the perks of high corporate office, Eaton, 52, prefers no frills. At his Zurich headquarters, he invariably worked in shirtsleeves and thought nothing of collecting his own mail if his secretary was away. And while Eaton can be "abrupt," says one former subordinate, he's not given to sudden fits of temper. He is unlikely to reduce subordinates to jelly, as Iacocca was known to do.
As a manager, Eaton sees himself as a team leader. "He laid out broad objectives," says the former colleague. "But he left it up to you how to achieve them." That was key to attracting and keeping top-notch staff in Europe, and it'll be equally important in working with Chrysler President Robert A. Lutz, who was passed over for the top job.
Eaton's experience offers another promise for Chrysler: He knows how to turn an auto company already on the mend into a profit-gusher. After he inherited the top job at GM Europe from John F. Smith Jr.--who's now in line for the top job at GM--Eaton racked up $5.5 billion in profits over three years as the U.S. parent slipped deeper into the red.
Colleagues say the stocky executive, who is married and the father of two sons, is "a car guy to the tips of his toes." Born in Buena Vista, Colo., he was tuning up his first car--a '32 Chevy--at age 11. A graduate of the University of Kansas with a degree in mechanical engineering, Eaton confesses he still misses the chance to speed new cars around the test track as he did as a GM engineer in the mid-'70s.
So far, Eaton has avoided airing his plans for Chrysler, waiting to assert himself after Iacocca steps down. But judging from his tenure at GM, high on the list of his priorities is efficient production, an area where Chrysler still needs to make a lot of headway to stay competitive. Iaccoca credits his successor with making GM the lowest-cost producer in Europe.
UP ALL NIGHT. To achieve that productivity, Eaton squeezed more output from existing plants in Europe, partly by negotiating innovative labor deals. For instance, at GM plants in Germany and Austria, he struck union pacts that allowed round-the-clock production.
Eaton was also quick to take advantage of cheap labor markets. After the Berlin Wall toppled in 1989, Eaton began building a $660 million plant at Eisenach, in eastern Germany, where wages are less than half those in western Germany. The plant will turn out 150,000 of GM's new Astra cars a year by 1993.
The lower-cost strategy was extended to car design as well. The new Astra compacts have 28% fewer parts than their predecessors. That reflects Eaton's admiration for the lean auto engineering methods pioneered by the Japanese.
The Chrysler that Eaton is set to inherit is about the same size as the GM Europe he left. The carmaker is also at the same stage in its turnaround--out of intensive care, churning out new products, and revved-up for a profits surge. Undoubtedly, Iacocca and the Chrysler board hope the comparisons won't end there. They want Eaton to roll up his sleeves and engineer as smooth a ride for them as he did for GM.