Volkswagen (AW) is a global automobile production corporation that manufactures, develops, and distributes engines, bikes, and turbomachinery for commercial and passenger vehicles (Robbins, & Judge, 2013). AW is the world’s third-biggest automaker enterprise, behind only General Motors and Toyota. Thanks to its biggest market in China, AW has seen outstanding success in its operations over the last few years. Volkswagen’s industry target is to become a major motor industry by 2018.
AW car sector has been listed as the biggest global business in 2016 Fortune Global for the last two years, continuing a recent pattern (Cooper, 2016). Additionally, the industry made a sale of 10.3 million units and overtook Toyota last year. Also, in the year 2013, Volkswagen was the most efficiency fuel production car in the world. Furthermore, due to the economic recovery of Eurozone consumers have improved their confidence in Volkswagen industry and this is likely to yield an increase of 3% to 4% in auto industry. Comparatively, due to new emerging economy in India and China, VW has rapidly increased its sells. The last layer, VW announced a corporate strategy which its aim is to offer twenty electrical cars or plug-in hybrid model models by the year 2020 and thirty all-electric model by the year 2025.
However, Volkswagen has endured some misfortunes for the last two years. For instance, in 2015, AW was accused of violating diesel emission by installing engine control unit software (ECU). The software was determined to be a conquest device that detected when the cars were being subject to emission testing; this forced the industry to spend 7.3 billion dollars on mending the fraud. Additionally, there has been a decrease in the auto sale due to slow economic recovery that has affected many countries in the world.
Characterizing company existing structure
Volkswagen organizational structure is characteristically hierarchical that defines the line of duties, authority, rights and communication. Additionally, VW is vertically incorporated energy within and is, therefore, subject to the provision of German energy industry act. The company board of management is the ultimate body that is accountable in management and is referred directly to the decision that is necessary for the corporation. Further, Volkswagen group (VG) board of the directorate that was made earlier to support the work of the governing council confirms that the interest of the group is taken into account in decisions that relate to the company group products within the basis made by law. The target set by the group and requirements laid down by management board must be fulfilled with the extent legalized by the law to reach the agreement between the parties involved.
Suggesting a new organization structure
In my opinion, the best body structure which can be applied by Volkswagen is a divisional structure (Jaruzelski, Staack, & Goehle, 2014). This is because VW is a large company and this type of structure is suitable for large organizations that operate in a significant geographical area. Moreover, the needs of industry are met more rapidly and precisely. Additionally, in divisional structure, the lines of communication are inhibited because of each employee work in his or her department. Further, division structure permits its members to concentrate on one major product with a management structure that supports primary strategic goals. The structure is more autonomous in that each division has its individual top decision-making and characteristically manage their planning, hiring, and even marketing.
Cooper, T. (Ed.). (2016). Longer lasting products: alternatives to the throwaway society. CRC Press.
Jaruzelski, B., Staack, V., & Goehle, B. (2014). Proven paths to innovation success.
Robbins, S. P., & Judge, T. A. (2013). Organizational Behavior (15th ed.). Upper Saddle River, NJ: Pearson Prentice Hall.