Behind the Wheels of Volkswagen’s Scandal: Flawed Management Structure Unveiled

Subject: Business
Type: Process Essay
Pages: 2
Word count: 556
Topics: Business Ethics, Management, Work Ethic


Identification of Problems

Several key problems are identifiable in the scandal involving Volkswagen. One such problem is the organization’s 2015 cover-up of the actual emissions levels caused by their vehicles. The cover-up entailed the installation of a defeat device that allowed for the alteration of emission levels during tests on the vehicles. The second key problem entailed the falsification of fuel efficiency on the part of Volkswagen. Notably, the falsification served to mislead clients who prefer fuel-efficient vehicles into purchasing the firm’s models. 

Problem Statement 

This case analysis focuses on two problems with regard to Volkswagen’s 2015 scandal. First, the case analysis examines the problem related to the organization’s flawed strategic management structure that gave a leeway for the installation of defeat devices in Volkswagen car models. Second, the case analysis evaluates Volkswagen’s organizational culture that may have bolstered the execution of the scheme. 

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Case Analysis

Issues such as those that transpired in 2015’s Volkswagen scandal may be attributable to the organization’s strategic management structure at the time. Strategic management in the organizational context denotes a management approach that allows for the establishment of prudent goals, as well as aims, and identifying requisite processes to attain proposed goals (Durmaz & Düşün, 2016). Strategic management also incorporates action plans, vision, methods, in addition to tactics. In the case of Volkswagen, the 2015 scandal was occasioned by a flawed strategic management structure since goals aimed enhancing sales were dependent on misreporting the emissions of their vehicles. Additionally, the requisite process for attaining predetermined aims for the organization relied on installing defeating devices on millions of vehicles across the globe and concomitantly falsifying their fuel efficiency capabilities. 

It is worth noting that strategic management incorporates internal organizational elements such as climate, style, and structure, and also includes implementation, as well as control (Pirtea, Nicolescu, & Botoc, 2009). Volkswagen’s leadership style at the height of the organization’s 2015 scandal was instrumental in overseeing the activities that occasioned the scandal. The leadership style of Volkswagen’s chief executive officer, Martin Winterkorn, for instance, played a part in the events leading up to the scandal. This is primarily because the installation of software aimed at manipulating fuel efficiency results occurred either under his supervision or was carried out by individuals under his supervision without his knowledge. Implementation, as well as control as key tenets of strategic management,  played a pivotal role in the events leading up to the uncovering of the 2015 scandal. To the detriment of Volkswagen’s clients across the globe, the organization’s flawed strategic management structure gave leeway to the implementation of a preplanned mode of circumventing emissions tests. 

Volkswagen’s organizational culture prior to the 2015 scandal also paved way for the implementation of a plan aimed at cheating fuel efficiency and emissions tests across its wide range of vehicle models. By definition, organizational culture refers to the shared philosophy, norms, ideology, values, behavior, assumptions, convictions, as well as aspirations that bind the members of an organization together. In the case of Volkswagen, the organization’s philosophy as instituted by its leaders prior to the 2015 scandal played a part in the occurrence of the scandal. The departure of the of the organization’s sales head, Christian Klingler, in the aftermath of the revelations also proves that Volkswagen’s organizational structure espoused values and beliefs that contributed to the cheating scandal.

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  1. Aktaş, E., Çiçek, I., & Kıyak, M. (2011). The effect of organizational culture on organizational efficiency: The moderating role of organizational environment and CEO values. Procedia-Social and Behavioral Sciences, 24, 1560-1573.
  2. Durmaz, Y., & Düşün, Z. D. (2016). Importance of Strategic Management in Business. Expert Journal of Business and Management, 4(1), 38-45.
  3. Pirtea, M., Nicolescu, C., & Botoc, C. (2009). The role of strategic planning in modern organizations. Annales Universitatis Apulensis: Series Oeconomica, 11(2), 953.
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