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Volkswagen Do Brazil

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Volkswagen do Brasil: Driving Strategy with the Balanced Scorecard
Q&A Case 3

A Business case
Presented to the
Accountancy Department
De La Salle University

In partial fulfillment
Of the course requirements
In MODMGT2 K33

Submitted To:
Mr. Aaron Escartin

Submitted By:
Apolinar, Jeneva Marielle
Arvesu, Franz Nicole
Aurelia, Sarah Mae
Basquinas, Judith
Bondoc, Maureen Felicia

April 4, 2014

1. What challenges does Thomas Schmall face upon becoming CEO of Volkswagen do Brasil (VWB)?
Upon Thomas Schmall’s appointment as CEO of Volkswagen do Brasil in 2007, he and his management team had to reverse eight consecutive years of market share declines and financial losses. According to Carsteen Isensee, the situation when he arrived in 2007 was a period of cutting costs and workforce reduction, low corporate morale, and the constant threat of having the unprofitable operations shut down by the head office located in Germany.

2. Describe VWB’s new strategy.
Schmall, the appointed new CEO of VWB, wanted to cease the reliance of the company on cost reduction, employee layoffs and capacity downsizing. He wanted to aggressively re-brand VWB into one with enthusiastic and highly-motivated employees who continually introduces high-performance, innovatively-designed cars and light vehicles. A new culture was to be instilled wherein employees would solve problems as they arose, eliminate defects and reduce health and safety incidents even if these actions cost money and decreased short-run production output. He have the ambitious vision of building a high performance team that could drive VWB to become the south American automotive industry’s leader in quality, innovation, sales and profitability on a sustainable basis. He wanted to change the mindset of the company.
The new strategy requires new relationships with…...

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