forward thinking companies that galvanizes the global business community to

Forward thinking companies that galvanizes the global

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forward-thinking companies that galvanizes the global business community to create a sustainable future for business, society and the environment or the European Automobile Manufacturers' Association (ACEA) which represents leading car, van, truck and bus makers and works with a variety of institutional, non-governmental, research and civil society partners to address the global challenges of mobility, sustainability and competitiveness. If Volkswagen wants to be a world- leading provider of sustainable mobility, they need to put their money (and organizational resources) where their mouth is. Moreover, in order to appease the general public and smooth over all of the negative publicity they’ve received over the past couple of years, we also recommend that the automaker engage in extensive advertising while hiring a celebrity to frequently appear in these ads similar to how Kia is utilizing Lebron James. Recommendation #3 – Improve Quality and Productivity High recall rates are indicative of significant quality issues at Volkswagen. These quality issues are positively correlated with low productivity throughout the company’s global operations. As mentioned previously, both Volkswagen and Toyota produce approximately 10 million cars/year. At this production output rate, Volkswagen realizes ~6% profit margin with an input of 600,000 plus workers. Toyota on the other hand realizes a 10% profit margin with an input of only 300,000 workers. Better quality would lead to increased sales, production efficiency, and overall customer satisfaction. In addition, better quality would lead to fewer defects and reduce replacement/repair costs. The decrease in defects and repair costs decreases the input cost and increases the overall productivity. Ultimately, better quality serves as the best advertisement through word-of-mouth advertising by satisfied customers and decreases the costs incurred in sales
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17 | P a g e and marketing. We recommend that a robust Six Sigma initiative be deployed across the breadth of Volkswagen’s manufacturing operations in Europe, the Americas, Asia, and Africa. Substantial research and literature exists today that shows that Six Sigma not only improves both quality and productivity but increases profit and shareholder value as well. The collaborative, continuous improvement mindset required to realize Six Sigma benefits would further reinforce the new culture change initiatives. In addition, Mueller should press forward with his plans to significantly reduce the number of models Volkswagen makes. This will free up billions of dollars in annual spending and further help to improve productivity metrics. Recommendation #4 – Develop Joint Venture Partnerships to Rapidly Develop Core Competency in Battery Technology Batteries are the most important component of an electric car (Welch, 2015). Critical battery related issues that Volkswagen will have to overcome are the size and weight of the batteries the fact
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