What Challenges Does Thomas Schmall Face Upon Becoming Ceo of Volkswagen Do Brasil (Vwb) ?

In: Business and Management

Submitted By ArnoldEduardo
Words 6240
Pages 25
9-111-049
REV: DECEMBER 20, 2010

ROBERT S. KAPLAN RICARDO REISEN DE PINHO

Volkswagen do Br rasil: Driving Strategy with the Balanced Scorecard d kswagen do Brasil (VWB), studied the color-coded charts and d Thomas Schmall, CEO of Volk indicators on his wall. The data sh howed financial, customer, process, and employee p performance through end-of-year 2008. Schmall a his management team had introduced the Balance Scorecard and ed in 2007 as part of a program to reve erse eight consecutive years of market share declines a financial and losses. So far, the turnaround had been successful. The new enthusiasm among the workforce, d e consumers, suppliers, and dealers h led to strong sales increases and a return to profita had ability. But Schmall, in January 2009, c could now see the impact of the global financial crisi Sales had is. th plummeted in the 4 quarter and newly-produced vehicles were parked around VWB’s plants d waiting for consumers to begin spen nding again (see Exhibit 1 for VWB’s monthly sales). Many of the previously green marks on sales and profitability on Schmall’s scorecard had turned yell d low and red. During the previous two months VWB had responded quickly to the slowdown i consumer in ion purchasing by cutting back producti and reducing spending. Schmall was cautious about whe ether it was time to restore funding or wait until sale recovered es before gearing up production sche edules and resuming the spending on discretionary programs. y Further cutbacks in production sch hedules and investment would jeopardize plans for m market share expansion and new product devel lopment. VWB, located far from the company head dquarters in Wolfsburg, Germany, had consider rable discretion for local, short-term decisions. The general rule from corporate headquarters came f from a German expression, whose English translation was, “Drive n as fast as…...

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