Case Study of Volvo

Case Study of Volvo
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Case Study of Volvo
Introduction
Volvo Cars is a leading company in automotive manufactures. Its experience in the automotive industry spans more than nine decades (Sitecore, 2021). Today, Volvo cars boast of delivering an agile, innovative, and efficient digital experience associated with a positive company outlook. However, just like any company, Volvo has had its fair share of problems primarily emanating from its production line. The problem resulted in increased rates of absenteeism and staff turnover. This state raised tension among the company’s top management. The company’s leadership resolved to overhaul its production line while emphasizing teamwork and company culture anchored on FIKA. Each worker was required to complete at least 40-hour workweeks. Although the move to change the production line of Volvo has been lauded for having positive outcomes, several doubts exist, especially about the efficacy of the program. This paper examines the effectiveness of the new program instituted at Volvo and implications for managers guided by McClelland's achievement motivation theory and Bureaucratic management theory.
Description of the Management Elements of Volvo’s New Production Approach and Accompanying Outcomes
Recruitment and Selection
Human resource management is an essential department in a business endeavor. It ensures tasks are correctly defined and employees' concerns are given utmost priority. Fayad and Easa (2020) argue that a flexible human resource management plan is a recipe for enhanced strategic engagement, creativity, and innovational behavior. Recruitment and selection are the critical elements of human resource practice. This feature demands companies to ensure employees are appropriately selected and duties are properly outlined (Cooke, Dickmann, & Parry, 2020). Volvo’s resolution to reorganize its workforce reflected this human resource (HR) feature. In particular, the company did not conduct a new recruitment process; instead, it utilized the already existing workforce. But in this case, it was more concerned with having smaller, self-managed groups. This selection has comprised a group of employees between 5 and 12. This selection was done correctly because the grouped employees had undergone a rigorous interview before being absorbed into the company. After the selection, employees were provided with new roles dictated by HR policies that mediated role repetition experienced in the previous workforce. For instance, Volvo employees were required to be responsible for the assembly of a complete vehicle. This move ensured that each employee would be easier to manage.
Training and Development
Training and development is another critical element that defines the significance of HR in a company. This feature is evident in Volvo’s program. Ensuring that training and development achieves its intended objective is imperative to emphasize employee engagement (Fayad &Easa, 2020). In this case, the older workforce was not retrenched. Instead, the company decided to retrain them to achieve professional competence with the company footing the finances for the professional development courses offered to the older Volvo Workforce. This move aligns with weber’s Bureaucratic management theory that is characterized by a business having a hierarchy of command and the need to support and ensure employees are developed to greater heights (Ferreira & Serpa, 2019). Besides taking the initiative of educating the older workforce, the company has also created an appealing environment that aligns with human resource tenets and encourages employees to increase their productivity levels and commitment. It is evident from the case that employees are created with an appealing environment where they can discuss with their peers in their free time and emphasize having teamwork guided by the FIKA philosophy.
Performance Assessment, Rewards System and Welfare
HR policies demand a company to have a verifiable assessment and reward systems. Imperatively, it is essential to ensure workers' needs are considered to increase work output and increase job satisfaction (Cooke, Dickmann, & Parry, 2020). Volvo instituted a reward system that was based on a worker’s output rather than collective. In this case, each employee was to be rewarded for independently work completed. Equity among the employees was upheld by each receiving similar payments apart from the supervisor. Alongside this reward system, Volvo took care of its employees’ needs, as evident from organizing get-togethers and interactions guided by FIKA philosophy. Each employee performance assessment was to be pegged on completing 40-hour workweeks.
This program has laudable outcomes as far as an employee, and the company's well-being is concerned. However, it is worth noting that the positive results are punctuated with several pitfalls. From a positive side, the program is poised to ensure employees advance creativity, especially by emphasizing teamwork. Further, employees are likely to benefit from the program by having a robust social engagement promoted by the FIKA program. Employees can talk about their issues with peers when they have a get-together, and to some extent, this will limit cases of burnout and depression among employees in Volvo. To a broader scope, this will be advantageous to the company because it will realize the production of quality cars and employee increased rates of satisfaction. On the flip side, this program can be challenging since it requires workers, especially the older workforce, to be retrained. The older workforce can find this recommendation challenging a move that could be a catalyst to the resistance to change, and in an unlikely event, it may lead some older workforce to quit a job at Volvo. Mass resignation means that the company will face a workforce shortage, leading to low production and sales. This effect can negatively portray the company limiting it to considerable potential customers and investors.
An analysis of Volvo’s New Program Efficacy Informed by McClelland...