Harvard Business Review Article - Volkswagen Case Analysis Essay

The company has decided to use different applications instead of using a single ERP system, which in turns would make their operations smoother. They have chosen to do this in order to be cost efficient and to focus on the specific need so each department uses a different application. That is connected by middleware that they don’t fully understand on how to operate, and are afraid that if they attempt to change it, it would crash all of their system. This in turn makes their operational capabilities not the strongest as it relates to their business model. On the other hand, some of the challenges that they face is that they will not be able to complete all orders or be able to implement improvements due to the increase volume of request that need to be processed during this time. Some of the IT related issues are those that are associated with the different applications that are being used. If an applications crashes then it would hold them up significantly in completing all orders and having them be delivered on time. Primarily the lack of staffing and the lack of IS improvements puts them at a disadvantage against their competitors who more than likely have significant more sophisticated IS infrastructure.

1. How would you describe Boeing’s approach to project management? What are its strengths and weaknesses?

Because of the limitations and failures of this process, VPs were frustrated with the fact that everything with IT took longer than promised. On the other side, IT blamed the business for their lack of prioritization and planning about the projects. The lack of coordination in this situation was not sustainable in the future because the stability of the relationship between IT and the business units was in danger.

The next step to do is calling Gerd Klauss to get him informed about the problem and to get him involved in the solution process. A senior manager has to take a leadership role and responsibility in this IT decision. As any exception to the IT architecture must be justified, we should create a short statement in which we lay out the importance of funding VWoA’s priority portfolio and the SCM project at the same time and thus to raise funds from other sources. This draft should be done end of the first week in December 2007. After we convinced Klauss of the need of funding from other sources we should negotiate a higher budget with the IT department in Germany or try to raise funds within VWoA in accordance with Klauss.

The role played by the IT in the company to the rest of the organization is reactive to business conditions rather than a proactive approach. IT has been busy establishing several IT processes, policies, and projects in order to catch up with current demand from customers, and has been relying on the “diving catch” approach of finishing things at the very last minute.

Also, they think that they can send the IT folks onto the field once they are done with the planning and budget cycle. But, little do they understand here that it would be of no use sending the IT people after the planning as things to be changed as early as possible in a project life cycle. The more delay in the changes, the more complex and expensive the project would be.

• Meet regularly with other departments’ heads- Sales- HR-Accounting-Marketing-Customer Service-Institutional trading-R&A-Client Services to communicate IT strategies and projects. Gather feedback from other departments regarding current needs. Be sure that all departments are aware of an IT strategy and that all future projects and initiatives must fall within this strategy.

Alignment of an enterprise’s goals with its IT1 and IS1 systems has been a challenge ever since IT became a business enabler. Proposing an IT alignment requires a thorough understanding of the business goals of the enterprise and the knowledge that alignment is an iterative process which requires constant measurement and honing (Chan, 2002). Enterprises often face the problem of balance of priorities between IT and Business objectives. This report deals with one such case that faced alignment and prioritization hardships resulting in an unclear approach to achieve a corporate strategy.

When the CEO launches two new strategic initiatives requiring integration across all business units, the organization – whose IT decisions have been largely delegated to its business units in proportion to their revenue generating capacity – now faces the dilemma of how to prioritize its IT projects in order to support the new strategic “enterprise” vision.

Every enterprise engages in IT decision making, but firms differ considerably in how thoughtfully they define accountability and how rigorously they formalize and communicate decision making processes. Without formal IT governance individual managers are left to resolve isolated issues as they arise. These individual actions can be at odds. For example, the CIO at a global transportation firm was instructed to cut the corporate IT budget. This CIO introduced a chargeback system to curtail demand for IT services. Unhappy with their new charges managers within each of the business units hired technical specialists to provide services at a price they were willing to pay. The new technical specialists did not show up in the corporate IT budget so it looked like the CIO had achieved his goal, but the impact of the

Since September of last year, there is an ongoing investigation into the Volkswagen emissions scandal after research indicated a large discrepancy in emissions during testing and road operation conditions on some of the company’s diesel engine vehicles.[1] On September 9, 2016, James Liang, an experienced Volkswagen engineer and head of the company’s Diesel Competence unit in the U.S., pleaded guilty to taking part in a fraudulent scheme to allow certain Volkswagen vehicles that violated emissions regulations to pass testing procedures and to be sold in the United States. Beginning in 2006, VW was in the process of designing new “clean diesel” engines that would be used in vehicles to be sold in the U.S, but the company soon discovered that diesel engines could not be designed to meet the emissions regulations and while at the same time providing satisfactory driving performance.[2] Instead of redesigning the engines to comply emissions regulations or dropping the design altogether, Liang and other engineers developed a device to sense when the engine was being tested and run on an alternate low emissions mode until the test was complete to enable the engine to pass emissions testing. After pleading guilty, Liang is facing criminal charges, and is cooperating with investigators to determine others that should be responsible for the scandal. Should Liang and the other engineers involved in the development of the device be held responsible based on the morality of their

The IT strategic plan is properly designed to assist FFC in meeting its business objectives. In reviewing FFC’s organizational chart, it appears that the company has a clear reporting structure. The department has four executives that are responsible for different areas of the department. The VPs of applications, operations, information security, and database administration all report directly to the CIO, who reports to the CFO. In our interview with the CEO, explained how the IT Steering Committee develops IT policies and evaluates the operation of the IT department. Key members of the committee include Senior VPs, the CIO, the CFO and the aforementioned VPs.

Fiscal responsibility remains an obvious but viable mission pint in considering a new policy. Without monetary restraint, any area or division can become a costly damaging part of an organization that not only merit’s disfavor with management, but destroys morale throughout the company. IT leadership should demonstrate value in all aspects of technology and its integration through all business divisions. If the IT area is seen as another budget drain, it’s overall credibility severely limited.

Company develops the process of priorities to stay gather the information of which project would impact the company and would achieve their goals in the future and maximize business. With that being said prioritizing projects is the key to be successful in the business, to develop that strategy a company should allocate it resources in various explicit projects and their implementation.

Although communication and translation of strategy occur at the executive level, effective IT and business alignment must go beyond executive-level conversation to permeate the entire IT organization and its culture. Successful executives typically align by establishing a set of well-planned process improvement programs that systematically address obstacles to achieve full and meaningful engagement with the business1. Each organization has its own unique IT alignment needs and there are many areas in which executives can seek alignment, however, the following areas are the most important: