Essay about Vw Do Brasil

1760 Words Mar 16th, 2012 8 Pages
VW Do Brasil
Report by Khaled Akida – BU671
Word Count: 1749

For Case Discussion 1. What challenges does Thomas Schmall face upon becoming CEO of Volkswagen do Brasil in 2007 (VWB)?
Since 1999 till 1007, VWB faced market share decline and financial losses. Schmall and his management team started introducing balanced scorecard to monitor and analyzed the root cause of those problems: that was a big challenge as Schmall wanted the tool to be VWB primary management tool, and this needed to restructure part of the organization chart to accommodate new leads and task force for this project. The task force main focus was to come up with a strategy map based on finance, internal process, customer, and potential and growth. On the other
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By late 60’s, its strategic reliable production and low cost car made it earn 61% of Brazil car production market share. In the 70’s, VWB launched medium size cars and exported 40% of its cars to Europe and North America by late 70’s. The mid 80’s was somehow tough time due to macroeconomic situation in Brazil where car production declined by 20%. Fluctuation in sales and growth was the keyword within 90’s and early 2000’s. In 2003, VWB introduced two key indicators: Things Gone Wrong and Customer Satisfaction Index. When Schmall came on board, he wanted to change VWB strategy based on cost reduction, employees’ layoffs, and capacity downsizing. His vision was to build great team that strives to drive VWB to be the best in quality, innovation, profitability and sales on a well-founded basis. He moved managers inside the manufacturing units so they can plan and set target and align objectives with all teams, monitors all metrics and take action to mitigate problems. He also introduced new procedures in way managers can interact with production lines. Further, compensation system was related to employees results.

3. How do the strategy map [Exhibit 4] and Balanced Scorecoard [Exhibit 5] help Schmall and Serun implement the new strategy? What are the strengths and weaknesses of the scorecard and its implementation?
Schmall and Senn worked before with BSC and were convinced its introduction to VWB would boost the new strategy and culture

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