Bmw Cross Functional Team - Case Study

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Use of Cross-functional


Teams Role of Speed in the Structure Influence of Electronics on the Organization Strengths & Weaknesses of the Approach

Role of Outsourcing
BMW as Ambidextrous Organization

Sheer Driving Pleasure

Bayerische Motoren Werke AG found in 1916. German automobile manufacturer that focuses on the worldwide automobile & motorcycle markets. Owns 3 brands: BMW MINI Rolls-Royce Initially an aircraft engine supplier due to World War I at that time in Germany.

International ventures began in 1972 when it set up a production plant in South Africa.

In 1983, BMW built its first diesel engine.

In 1994, it purchased the Rover

Group, with the brands Rover,
Land Rover, MINI & MG.

In 1998, it purchased Rolls-Royce.

In 2000, it sold Rover, Land Rover & MG, but retained MINI.

Helmut Panke become CEO in

2001 as the company was
recovering from the failed 1994 acquisition of Rover.

Focused on innovation, technology & marketing, & enforced the culture of strong cost controls.

The company is driven by cost targets even in the early stage

of developing the car.

Developed ambidextrous

style, which is an informal,
open & non-hierarchical way to work, where employees are able to work with other departments without much

protocol & chain of command.

Results in innovative ideas and enabled them to solve problems more efficiently and


SWOT Analysis





Sheer Driving Pleasure

Diverse ranges of Products BMW, MINI and Rolls-Royce Strong Cash Flow Position Increase turnover and trading profits Strong Balance Sheet World's leading Premium Quality Automobile Manufacturer Brand Awareness Strong Human resources. Capabilities to turn resources into advantages innovatively Corporate reputation for the technological leadership and product engineering.

Weaknesses The limited target segment only luxury car segments. Expensive Germanbased Plant Perception of High Prices Environmental issues: Pollutions Buyer sophistication and knowledge Substitute products or technologies

Opportunities New Products

Market shift to

Innovation & Alliances
Diversification New Technologies in Automobiles


New & existing competition
Volatility in Price of Fuel Economic recession Takeover bids Environmental issues: Pollutions Extremely high competition for

customers and resources
Customers demand change to more relatively cheap cars

Sheer Driving Pleasure

Teams comprise of staff from

engineering, marketing, R&D, &

Workable on divisional levels

Strategic goals set by top

Less formal, less hierarchical, less stamp approval needed, & more open.

Can deal with complex

dynamic nature of production
system because knowledge & information sits in the brains of tens of thousands of employees.

How? By building a network or web of personal ties to speed problem-solving & innovation.

Work by helping them to create informal networks where they hatch ideas & resolve disagreements quickly.

Everyone is encouraged to speak up.

Sheer Driving Pleasure

Major source of competitive

advantage to provide current product,
accelerating new product development or improvement, & making decision


Complex customized production

system is easier to manage if workers
feel empowered to drive change.

Less structured & hierarchical organization enhance fast growing technological development.

More structured &

hierarchical organization
might hamper technological improvement & product innovation.

Speed can lessen rivalry
since competitors & new entrants find themselves

trying to keep up with rapid
changes rather than introducing them.

Sheer Driving Pleasure

BMW estimates 90% of innovations in its new models are electronics-


To stay ahead of...
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