CLERMONT-FERRAND, France-Groupe Michelin, breaking with a century-old tradition, is establishing an executive council to assist the managing partner troika of Francois and Edouard Michelin and Rene Zingraff set the future tone for the company. The change comes following a four-month review of the company's organizational structure, initiated by the managing partners, and is seen as a precursor to a more decentralized management structure in advance of Francois Michelin's retirement. He turns 70 this year, and 73 is the mandatory retirement age of executives in France.
Michelin has been managed for nearly all of its 100-year history by a managing partner or partners from the Michelin family. The managing partner or partners have personal liability for their company's actions and activities.
The announcement coincides with a multibillion-dollar expansion program that includes the company's first foray into eastern Europe, an increasingly visible presence in Asia/Pacific, and a considerable strengthening of its North American activities.
The new council will focus on four basic areas: technology; product lines; corporate services; and geographic distribution.
Michelin, traditionally a technology-driven company, will give the discipline a degree of autonomy through a technology center. Secondly, the company will organize responsibility along nine product lines.
Internally, the company will recognize 11 group services ``responsible for providing expertise services to other areas in the organization.'' One example would be finance.
Finally, management will be structured in four geographic zones; in the past, Michelin has identified its operations as France, other Europe, the Americas, and the rest of the world, mainly for accounting purposes.
The newly created executive council comprises nine Michelin executives, including Carlos Ghosn, head of North American operations.