Managing a Change Process: Volkswagen Ag

Seminar paper

Managing a Change Process: Volkswagen AG

Introduction

This paper aims to analyze the change process that is going to happen in Volkswagen (VW). Firstly there will be the overview of the company given, short history, main figures and key facts. The next part will show company’s structure and description of the change that Volkswagen is facing with focus on firm’s goals. Finally the focus will be on structural measures that Volkswagen may consider introducing. In the end the evaluation and the summary of the change process will be given.

Overview of the company

Volkswagen AG is a German automobile manufacturer and what is more it is the biggest carmaker in Europe. The company was founded in year 1937 in Wolfsburg, Lower Saxony. In year 1952 the internationalization of the company has started and right now Volkswagen’s cars are sold worldwide. VW is a public listed company and the main shareholders are: Porsche Automobil Holding SE – 31,5%, Quatar Holding – 15,4%, Lower Saxony – 12,4% (Marketline, 2015). Company’s main products are commercial vehicles, trucks, buses and vans. VW has a lot of famous brands under its umbrella as examples : Porsche, Volkswagen, Audi or Bentley. In year 2014 the company delivered almost 9,5 million vehicles. The company hires around 600 000 employees worldwide in its 119 factories.

Besides being car manufacturer the company also provides financial services connected to the automotive industry like leasing, fleet management or insurance. When it comes to financial figures in year 2014 Volkswagen recorded revenues of over 202 million euros, which was an increase of 2,8% comparing to year 2013 (Marketline, 2015).

VW has a lot of competitors but as the main ones we can name : Toyota, Ford Motor and General Motors.

Volkswagen as every company also has its goals and vision. The company stands for reliability, strength and long-term success. It wants to be positioned as a global environmental and economic leader. The goals are to focus on innovation, increasing sales and being the most attractive employer.

Organizational structure

The organizational structure and culture in Volkswagen differs significantly from others in the automotive industry. In Germany companies usually consist of two boards, the Supervisory Board and Management Board. The first one, led by chairman, represents the shareholders and employees and is responsible for approval of important decisions (is supposed to have a monitoring and controlling role). The second one is responsible for running the business with chief executive officer as a head.

The Supervisory Board consist in Volkswagen of 20 members and its task is to appoint seven members of the Board of Management, however comparing to other companies in this industry VW’s Supervisory Board fails to control the CEO (Reuters, 2015). What is more the Supervisory Board in Volkswagen consists also of politicians from Lower Saxony (home state of VW). The representatives of employees and politicians have similar goals which is mainly securing the jobs at VW. That is why as long as the CEO delivers those positions the Board is not controlling him so strictly.