Maybe so, but close observers are concerned that what started as a publicity move to shame Carrier Corp. from closing its HVAC facility in Indiana and setting up operations in Mexico has become a worrisome trend. Today many U.S. companies—even mid-market firms—have operations abroad. Any CEO who is considering shifting production has to anticipate the public consequences any such move would entail.
Does Donald Trump think he can shame every CEO who is thinking of transferring operations to Mexico, or is he merely picking a select list of high-profile American companies to signal the remaining companies to rethink their outsourcing? If so, it is a clever ruse, but one that could backfire if tried too many times. For starters, the threat of a “big border tax” over Ford or GM’s car production in Mexico cannot be executed by executive order.
Trump will need Congress to agree to such a move and that could set up a fight that would clearly distract from other more important items on his agenda, such as repealing and replacing Obamacare and immigration reform. Trump is shrewd enough to know that he will need to pick his battles carefully.
Stuart Pearson, an auto analyst at Exane BNP Paribas, told the Financial Times, “the question now is whether this move by Ford is a sufficient win for Trump to ease the risk to imposing tariffs on Mexican imports.” U.S. manufacturing CEOs clearly got the message that there’s a new sheriff in town.
But there is a risk that such moves could degenerate into mere bullying. It only needs one CEO to push back, claiming that honest management requires independent decision-making, and that interference from a busybody president is counterproductive. Carlos Ghosn, CEO of Renault-Nissan, a company that produces much of its U.S. bound vehicles in Mexico, already has called for Trump to make explicit his policy on production repatriation.
For example, some forms of offshoring production add to the process innovation of domestic producers. Foreclosing such moves in certain cases can actually hurt domestic employment owing to complex supply chains. If Trump is as clever as he thinks, he will back off until his plans for tax reform and repealing counterproductive regulation can be set before congress, giving business leaders a more solid reason to rethink investment decisions.
Chief Executive Group exists to improve the performance of U.S. CEOs, senior executives and public-company directors, helping you grow your companies, build your communities and strengthen society. Learn more at chiefexecutivegroup.com.
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1:00 - 5:00 pm
Over 70% of Executives Surveyed Agree: Many Strategic Planning Efforts Lack Systematic Approach Tips for Enhancing Your Strategic Planning Process
Executives expressed frustration with their current strategic planning process. Issues include:
Steve Rutan and Denise Harrison have put together an afternoon workshop that will provide the tools you need to address these concerns. They have worked with hundreds of executives to develop a systematic approach that will enable your team to make better decisions during strategic planning. Steve and Denise will walk you through exercises for prioritizing your lists and steps that will reset and reinvigorate your process. This will be a hands-on workshop that will enable you to think about your business as you use the tools that are being presented. If you are ready for a Strategic Planning tune-up, select this workshop in your registration form. The additional fee of $695 will be added to your total.
2:00 - 5:00 pm
Female leaders face the same issues all leaders do, but they often face additional challenges too. In this peer session, we will facilitate a discussion of best practices and how to overcome common barriers to help women leaders be more effective within and outside their organizations.
Limited space available.
10:30 - 5:00 pm
General’s Retreat at Hermitage Golf Course
Sponsored by UBS
General’s Retreat, built in 1986 with architect Gary Roger Baird, has been voted the “Best Golf Course in Nashville” and is a “must play” when visiting the Nashville, Tennessee area. With the beautiful setting along the Cumberland River, golfers of all capabilities will thoroughly enjoy the golf, scenery and hospitality.
The golf outing fee includes transportation to and from the hotel, greens/cart fees, use of practice facilities, and boxed lunch. The bus will leave the hotel at 10:30 am for a noon shotgun start and return to the hotel after the cocktail reception following the completion of the round.
