Volkswagen Organizational Dynamics

Primary objective of the project is to identify and study the concepts of Groups and Organisational Dynamics by analysing Volkswagen’s current woes due to the diesel emission scandal, how the organization’s culture was one of its root causes and the current CEO’s measures to tackle the crisis within the organization’s structure. Based on secondary research, we analysed the situation by applying different theories and frameworks and how these theories can be applied in the organizational context.

2. PROBLEM STATEMENT

To examine the causes and repercussions of Volkswagen’s emission scandal on the cultural front and what changes the current CEO of the organization should incorporate in order to restore its brand image.

3. INDUSTRY PROFILE – AUTOMOBILE

It designs, manufactures and distributes passenger and commercial vehicles, motorcycles, engines, and turbo machinery and offers related services including financing, leasing and fleet management.

The company has operations in approximately 150 countries and operates 100 production facilities across 27 countries. The brands that come under Volkswagen are as follows The Group’s goal is to offer attractive, safe and environmentally sound vehicles which can compete in an increasingly tough market and set world standards in their respective class.

Mission Statement and Vision:

At Volkswagen it is our mission to build long term strategic partnerships with our customers. To assist them in making the right choices for their business needs, by minimizing fleet costs and providing world class customer service

Volkswagen wants to be the no.1 car seller in volumes overtaking Toyota by 2018. They call this vision as Mach18 .Their vision is to make this world a mobile, sustainable place with access to all the citizens. Their brands all work together in different segments to define Volkswagen group, as it stands today.

5. THE SCANDAL

The EPA's findings cover 482,000 cars in the US only, including the VW-manufactured Audi A3, and the VW models Jetta, Beetle, Golf and Passat. But VW has admitted that about 11 million cars worldwide, including eight million in Europe, are fitted with the so-called "defeat device". VW has been installing this software in certain models for at least 6 years

How it worked: The engines had computer software that could sense when they are being tested by monitoring speed, engine operation, air pressure and even the position of the steering wheel.

When the cars realized they were operating under controlled laboratory conditions - which typically involve putting them on a stationary test rig - the device puts the vehicle into a sort of safety mode in which the engine ran below normal power and performance. Once on the road, the engines switched out of this test mode.

The result: When on road the engines emitted nitrogen oxide pollutants up to 40 times above what is allowed in the US. Irregularities around Carbon di oxide emissions were also found which added to global