Hazari Shravan Kumar (ID: 0916964)
Professor: David Lendry
Volkswagen of America Case Questions & Answers:
1. What is your assessment of the new process for managing priorities at Volkswagen of America? Are the criticisms justified? Is it an improvement over the old process?
To manage priorities at Volkswagen of America, a new process was implemented. It was the most efficient way of implementing a project in terms of selection and precedence, for the type of projects whose main aim was to meet the financial requirements in respect to the NRG goals. Although, there were some drawbacks in the system due to the way they evaluated all the projects using a type of ranking system. For example, if VWoA used a ranking system to select a project, their corporate did not fund for projects at the lower levels as they did not meet the company goals, even if the project would have a potential to gain success or a positive impact on the business.
According to me, the criticisms are not justified, as the company derides IT as the main reason for increasing costs. This aspect of the company about IT is not completely true. The costs involved in IT projects should be considered as a long term investment which yields higher return.
Therefore, the best way of selecting a project is through the ranking system which will not only help the project team choose the project easily on the basis of priority but helps in problem solving too. The new process however has helped in improving the business units in a big way because these business units choose the right project efficiently compared to the previous processes.
2. Who controls the budgets from which IT projects are funded at Volkswagen of America? Who should control these budgets? Should the IT department have its own budget?
Uwe Matulovic, the CIO of VWoA controls the budgets with input from the Executive of Leadership Team (ELT). Before the final approval of the funds for IT