Case Study On Car Wars Of Wolfsburg Essay

Question:

Discuss about the Analysis of The Case Study- Car Wars of Wolfsburg.

Answer:

Introduction

This paper is going to present a brief analysis of the case study- Car Wars of Wolfsburg by means of answering some of the below mentioned questions. The paper shall focus on the two renowned companies- the Porsche and Volkswagen. It shall present a brief summary of the case study which is based on the conflict in between the executives and the chairmen of these two companies. It shall discuss the sources of conflict in between both the chairmen and would describe the conflict handling styles that are used by both of them. Finally, it shall evaluate the outcome of this conflict.

Write a synopsis of the case in approximately

In the case study, Car Wars of Wolfsburg, the conflict in between the CEO of two renowned car companies- the Volkswagen and the Porsche has been discussed. The CEO of Volkswagen is Ferdinand Piech and that of Porsche is Wendelin Wiedeking (Stowell & McLarty, 2017). Both the companies were popular in their own field of businesses. It is after their joint venture that made such a significant difference. The joint venture was a collaborative decision of both the chairman. Although Porsche depends on Volkswahen Group for the production of many of its cars, they had a conflict because of difference in their opinions regarding their vision for the growth and development of the companies after they had merged. Porsche was not ready to sell its products to Volkswagen and also it had a significant amount of debts in the market that reached about billions of dollars. This made Porsche to request Volkswagen to buy some of its businesses. The chairman of Porsche Wendelin Wiedeking was in an intension of increasing the profit of Porsche at the expense of its employees and therefore, he tried to display a very bade behaviour towards the management group which assisted in developing internal conflicts between both the chairmen.

Identify and discuss the sources of conflict between Porsche and Volkswagen executives.

The major sources of conflict in between the executive of Porsche and Volkswagen are the fact that both the chairmen had a significant breakdown in their style of communication and this has led to difference in their view points in regard to the goals and directions, which both of them wanted the company to follow after getting merged. Wendelin Wiedeking, the Chairman or the CEO of Porsche wanted the company to maximize its profits at the expense of its employees (Sharpe, 2017). His bad attitude and behaviour towards the management team also contributed significantly in increasing the internal conflicts in between him and Ferdinand Piech. Also, one of the other reasons for this conflict was that the CEO of Porsche used to belief that Volkswagen could be much more profitable if they get rid of the Bugatti and the Phaeton, the luxurious cars as because of the fact that they were very costly. This made the other chainman to think that his visions are been overlooked and threatened. This again contributed to the conflict of dissimilarities among both of them. This disagreements in between these chairmen tend to deepen with each passing day as Ferdinand Piech started focusing more on the concept of impressive engineering instead on the outstanding profits and this again resulted in the formation of turbulence in between the two CEOs (Mollers, 2015). Also, as neither of them had communicated about their visions with each other prior to the merger, problems began to occur and this too then resulted in the display of relationship conflict in between them.

Describe the conflict handling styles used by Wendelin Wiedeking and Ferdinand Piech.

As it is shown by both the chairmen, the conflict handling style that they used would be of “forcing”. It is regarded to be the use of formal authority in order to satisfy the personal concern of one’s own by neglecting that of the other party who too is engaged or is involved in the very conflict. To my point of view, Wendelin Wiedeking in this case had stronger forcing style than that which is held by Ferdinand Piech. This is because Wendelin Wiedeking tried to succeed in the battle of automobiles at the expense of Volkswagen and Piech. This conflict handling style would not be applicable or appropriate for any of the parties to use because this style was jeopardising the business itself. They should have made use of the problem solving or the compromising techniques in order to fix the problem by finding out proper solution for the same and this would have benefited to both of them and the business (Simon, 2015). The compromising technique could have formed a common ground in which both the chairmen would sacrifice something or the other in order to gain something beneficial and more advantageous. This would have stopped the growth and development of the company from being jeopardised.

What was the eventual outcome of this conflict?

Eventually, Porsche have to end up with facing severe financial issues which had led to the termination of Wendelin Wiedeking, the CEO of the company (Macrae, 2015). The conflict was never resolved.

Conclusion

Hence, from the above discussion it is clear that it was because of the failure of both the chairmen and their communication style that they had used to resolve the prevailing issue that have resulted in the termination of the Wendelin Wiedeking. The conflict would have never taken place if any one of them would be ready to sacrifice and compromise with the situation. With the same, the conflict handling style that they have used was also inappropriate to resolve the conflict.

References:

Macrae, V. (2015). Mastering Interest Rate Risk Strategy: A practical guide to managing corporate financial risk. Pearson UK.

M?llers, T. M. (2015). The takeover battle Volkswagen/Porsche: the Pi?ch-Porsche clan–family clan acquires a majority holding in Volkswagen. Capital Markets Law Journal, 10(3), 410-430.

Sharpe, N. F. (2017). Volkswagen's Bad Decisions & Harmful Emissions: How Poor Process Corrupted Codetermination in Germany's Dual Board Structure. Mich. Bus. & Entrepreneurial L. Rev., 7, 49.

Simon, H. (2015). Pricing in Crises and Price Wars. In Confessions of the Pricing Man (pp. 177-191). Copernicus, Cham.

Stowell, D. P., & McLarty, T. (2017). Porsche, Volkswagen, and CSX: Cars, Trains, and Derivatives. Kellogg School of Management Cases, 1-10.

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