For Volkswagen, Culture Change Is a Bumpy Road

For Volkswagen, Culture Change Is a Bumpy Road

Since 2015, when Volkswagen’s emissions cheating scandal cost it billions of dollars and severely damaged its reputation, the German automaker has taken some major steps to clean house and reform its corporate culture, including several rounds of management shakeups and the resignation of its head of US operations. Late last year, VW revealed that it was making some other changes like speaking English instead of German at management conferences and creating more opportunities for women to advance to leadership roles, in an effort to bring more diversity and international perspective to its leadership.

Shifting cultural paradigms at large, legacy companies is never easy, however, and Volkswagen is no exception. In particular, the company has had a hard time convincing managers of the need to change, CEO Matthias Mueller, who took the helm in the aftermath of “dieselgate,” said on Monday. Reuters reports:

“There are definitely people who are longing for the old centralistic leadership,” Mueller said during a discussion with business representatives late on Monday. “I don’t know whether you can imagine how difficult it is to change the mindset.” Before “dieselgate”, there was an extreme deference to authority at VW and a closed-off corporate culture that some critics say may have been a factor in the cheating.

One of his priorities since taking the helm has been to decentralize power and reform the command-and-control structure that was prevalent under former bosses Martin Winterkorn and Ferdinand Piech, Mueller said. …

“The process (of change) has been started but it’s a process,” Mueller said. “One now has to endure this, also as chief (executive), that some things go wrong and some things remain unsuccessful while other things are successful.” Many mid-level managers thrived under pre-dieselgate arrangements that allowed them to shift responsibility to others, and they are struggling to embrace Mueller’s drive for openness and leadership, sources at VW have told Reuters.