Andy Palmer, president and group CEO of Aston Martin Lagonda, has led a remarkable revival at the historic British marque. He discusses a Japanese approach to decision-making, the importance of succession planning and why women hold the key to his firm’s future
You learn a lot in turbulent times. I loved my apprenticeship. It gave me a skill, money and freedom. But that period – the late 1970s and early 1980s – was blighted by wildcat strikes. I thought that all this industrial conflict was idiotic, because in essence managers and workers all wanted the same thing. I figured that there had to be a better way. That’s when my ambition to become an automotive CEO was born.
The Machine That Changed the World was a massive influence on me. That was published in 1991, at about the same time that Rover was working with Honda. Both the book and our collaboration changed my view of manufacturing, introducing me to just-in-time and lean techniques in particular. If you compared how Honda was developing cars for us against how we were developing our own cars, it was chalk and cheese in quality terms. Having read what would become my bible, I decided that I had to go [to Nissan] and learn what the Japanese were doing, because it was working.
My approach to innovation is to have a mix of “creative chaos” and discipline. British engineers tend to be extremely passionate and creative. Japanese engineers are less so in my experience, but their adherence to process and step-by-step development means that they never produce a bad thing. They might not make quantum leaps, but they’re always making incremental improvements. This ability to develop products quickly and iterate is amazing. What we’re trying to do at Aston Martin is combine the British and Japanese philosophies, not only in the manufacturing sphere but across the whole company.
I don’t engage in office politics and I won’t make key decisions in isolation. We operate a meritocracy at Aston. It’s the diametric opposite of politics. I abide by what the Japanese call nemawashi, which basically means “pre-discussion”. We make decisions collectively here.
You can quickly turn a negative into a positive. When we launched our DB11 model in 2016, we gave every customer my personal email address. Most of the correspondence I received was basically to say “thank you”, but there’ll always be some niggles with a newly launched car. The most important thing is to get these fixed within 24 hours. You can convert a slightly irritated customer into a real advocate for your business if you deal with their problem efficiently.
Never say “that’s good enough”. In 2016 Aston still wasn’t in a particularly good place financially. Yet, by standing on the end of the production line [to personally examine 1,000 new DB11s] and sending back any car that I thought wasn’t good enough, I conveyed a clear message to my colleagues: I will sacrifice everything before I sacrifice the quality of a car.
Appreciate the increasing global purchasing power of women. Look at Saudi Arabia: now that this very wealthy country has finally allowed women to drive, that has unleashed a lot of spending power. We have sold 85,000 Aston Martin cars in our history, of which four per cent went to female customers. That is changing quickly now. Half of our sales in China are to women, for instance. We have a female advisory group and at board level 30 per cent of my executive committee members are women. I’m not saying that this is good, by the way, but it is a step in the right direction.
We must encourage more kids to seek a technical education. We simply can’t find enough engineers in this country, so we end up having to bring in talent from abroad. Take the example of inner-city schools: sometimes the emphasis isn’t on getting people into Stem subjects. They’re expensive subjects to teach and it’s hard to find good teachers. What’s more, if you consider the direction that universities are taking, tuition fees will be tiered, with business studies becoming a £7,000-a-year subject and engineering becoming a £13,000-a-year subject.
I want to help set disadvantaged young people on a better course. The Palmer Foundation seeks kids from difficult, deprived backgrounds. We try to find them at about the age of 14. By 18 they will be as well educated as anyone who has gone to a private school. The first apprentices will start the process this September.
Don’t outstay your welcome. There is always the risk that a CEO sticks around too long. You see it repeatedly in our industry. The “second-century plan” that we developed in 2015 is about putting tempo back into Aston. The idea is for us to produce seven models in seven years, each car having a seven-year life. I hope I will at least steward the company long enough to oversee the launch of the DB12, but I can already identify two or three people in the company of whom I can say: “They are capable of becoming my successor.”
ANDY PALMER began his career as an apprentice at UK Automotive Products in 1979 – a chaotic time for the British car industry, which had become a byword for poor industrial relations and product quality.
After a stint with Rover, he spent 23 years with Nissan, where he learnt the Japanese formula for successful motor manufacturing. In 2014 Palmer joined Aston Martin and set about restoring the ailing firm’s fortunes. In 2017, after eight successive loss- making years, it posted a pre-tax profit of £87 million.
Later this year Aston Martin will launch the DBX – its first sport-utility vehicle – which Palmer hopes will be particularly appealing to female drivers. His long-term goal is to turn the business into a luxury goods brand. Last year he set up the Palmer Foundation, which will train young people from disadvantaged backgrounds to become engineers. He also chairs the Productivity and Skills Commission of the West Midlands Combined Authority.