As one of the most influential production managers in the world, Canadian businessman Louis Chenevert has had an amazing journey over the course of his career. Obtaining his bachelor’s degree in production management from HEC Montreal, he went on to work with General Motors for nearly 15 years. While at GM, Chenevert mastered the art of production management, making his way to Production General Manager.
Following his time at GM, Chenevert found an opportunity to join the aerospace manufacturer, Pratt & Whitney. At the time, the company focused on building aircraft engines and wasn’t doing particularly well. With Louis Chenevert onboard, Pratt & Whitney began to experience an economic increase and soon began to develop a greater level of market share in the aerospace industry. Within six short years, Louis Chenevert found himself promoted to the president of Pratt & Whitney.
Pratt & Whitney is a subsidiary of the United Technologies Corporation, a multinational conglomerate of numerous different industries such as aerospace engineering, HVAC, elevators as well as military contracts. During the 2006 subprime mortgage crisis, Louis Chenevert’s method and hard work were noticed by more than just Pratt & Whitney and he was elected as the President and CEO of UTC.
As you can see, Louis Chenevert’s rise to leadership at UTC was nothing short of meteoric. Moving from a six year stint at a company to becoming its president is no small task, and making the leap from the subsidiary leadership to having management and control over the entire corporation is an even bigger task. So what exactly was it about Louis Chenevert that allowed others to see that he was a leader?
For starters, Chenevert has a very strong command over both logistics and employee value. While other companies were in a race to the bottom, working quickly to export as much of their labor as possible, often outsourcing to foreign countries where the pay would be a lot cheaper, Chenevert ended up doing the opposite. Instead of allowing for the labor export to control the quality of his company, he instead opted for bringing workers back to work in the home state of Connecticut. Hundreds of engineers were moved to an American state, which allowed UTC to have a stronger level of flexibility since all of the workers were in one central area, meaning that they could quickly be applied to any type of job as quickly as possible. As this was during a time of economic uncertainty, it would almost appear as lunacy to do this, but during Chenevert’s time as the CEO of UTC, his brought the company’s share price from $37 to $117. Those numbers speak for themselves.
In addition to a willingness to focus on human capital and a willingness to pay them more, Louis Chenevert also brought about a significant moment in UTC’s history by leading a merger with Goodrich. Before UTC merged with Goodrich, it wasn’t considered to be a conglomeration, they didn’t have as much dominance over the market, and their production types weren’t that varied. With Goodrich in their sights, Canadian businessman Louis Chenevert lead UTC to victory by insisting on the $16.3 billion merger. This aeronautic company had everything to help establish UTC as a fully independent manufacturing company, allowing for them to produce just about anything they needed internally.
With this new setup, UTC was able to focus on investing in innovation and technological advances that would contribute to real success. Without the leadership of Louis Chenevert, the innovation and energy that went into acquisition and merging of small companies wouldn’t have existed. This kind of leadership, of working to find companies that would provide substantial benefits and industry expansions, helped create the UTC that we all know today: a powerhouse in many different industries.
One thing that helped keep UTC insulated from the chaos of the markets was the fact that they worked with both the private sector and the military sector. The private sector has its own temperature, rhythm and cycle of economic booms and busts. Sometimes the private sector is doing well, sometimes it’s doing terrible. Companies that are entirely dependent on the private sector often find themselves completely at the mercy of these market temperatures. But thanks to UTC’s policy of working with the military, they were able to ride out the rougher ways in the United States economy because the military sector doesn’t have the same clock as the private sector. The military’s economic system is different and the needs and budgets are usually very different from whatever is happening in the private sector. This stabilization of one market meant that UTC would be able to keep selling products and making money, even when times were tough in the private economy.
In addition to his work in expanding the company and increase the level of profitability, Chenevert also focused on decreasing greenhouse gas emissions and water consumption within the company, as keeping the planet alive and safe was one of his major goals as well. Emissions were cut back by 26% under his leadership, which is no small task. If every company were to work this hard to reduce emissions, it would certainly help the planet in more than enough ways.
At the height of the company, when it was roaring to life in 2014, Louis Chenevert decided to step down from his position as both the CEO and leader of UTC. It’s a rare thing to see a man depart from a company when it is doing so well, but for Chenevert, it was time to retire from that life. Not many can take this bold step, probably its only for the few determined individuals. While many CEOs and leaders tend to leave their companies in some form of disgrace or due to failings, he left on a high note. Indeed, UTC was able to show that they were still doing great at the time of his retirement. Now, Louis Chenevert spends his time working with Goldman Sachs and putting time into engineering yachts, enjoying a well earned semi-retirement.