ANALYSIS ON VW CEO HERBERT DIESS

Abdul Rahman Shamhoon

Second Year MBA, Institute of Management and Commerce, Srinivas University, India,

E- mail: shamoonabdul14@gmail.com

ABSTRACT
Herbert Diess is a prominent business executive who has held several leadership roles in the
automotive industry, Diess was serving as the CEO of Volkswagen (VW), one of the world's
largest automotive manufacturers. Prior to joining VW, Diess held executive positions at BMW
and other companies in the automotive sector. Throughout his career, Diess has emphasized the
importance of innovation, sustainability, and social responsibility, and has led several initiatives
to drive positive change within his organizations. Under Diess's leadership, VW has made
significant investments in electric vehicle (EV) technology and sustainability, with the company
committing to becoming carbon-neutral by 2050. Diess has also focused on improving VW's
corporate culture and internal operations, implementing structural changes aimed at enhancing
efficiency and reducing bureaucracy. His efforts to rebuild trust with customers and regulators
following the company's emissions scandal have helped to strengthen VW's reputation and
reinforce its commitment to transparency and accountability. Diess's leadership style and focus on
sustainability and innovation have positioned him as a respected and influential figure in the
automotive industry.
Volkswagen (VW) is a global automotive manufacturer with a diverse portfolio of brands,
including VW, Audi, Porsche, and others. As of September 2021, Herbert Diess was the CEO of
VW, having assumed the position in 2018. One of Diess's main priorities as CEO has been to lead
VW's transformation into a more sustainable and electric-focused company. Under his leadership,
VW has made significant investments in electric vehicle (EV) technology and launched several
new EV models. In addition, VW has committed to becoming a carbon-neutral company by 2050
and has implemented a range of sustainability initiatives throughout its operations.
This paper includes introduction about company and CEO, Career saga of CEO, Predecessors and
Competitors, KPLs and Innovation, Interpret the result based on Strategies and Leadership
Theories and Suggestion.
Keywords: CEO Analysis, Volkswagen, Herbert Diess, CEO of Volkswagen, CEO
1. INTRODUCTION:
The highest-ranking executive in a corporation is known as the CEO, or Chief Executive Officer.
They are in charge of making crucial choices and steering the business in the right direction. A
CEO's function is essential to the success of any business since they define the company's strategic
direction and oversee day-to-day operations while also fostering growth.
Setting the company's vision and strategy is one of the CEO's most significant duties. This include
figuring out where the company should concentrate its resources in order to accomplish its
objectives, as well as figuring out its strengths and limitations and the market and competition.
Additionally, the CEO must persuasively and clearly convey the company's vision and strategy to
stakeholders including employees, investors, and other parties involved.
The day-to-day management of the business is another crucial duty of the CEO. This involves
keeping an eye on the work of other executives and managers, keeping track of financial results,
and making sure the business is conducting itself in accordance with all applicable rules and
regulations. To make sure the business is operating effectively and efficiently, the CEO must also
decide how to allocate resources, including hiring and budgeting.
The CEO must be concerned with fostering growth in addition to overseeing the business's
operations. In order to do this, the company must find new markets and business prospects, create
fresh goods and services, and broaden its market through marketing and other means. Additionally,
the CEO must have the flexibility to adjust to shifting market dynamics and make wise strategic
choices that will position the business for long-term success.
Being a good CEO requires having a lot of essential traits. Strong leadership abilities, great
communication skills, strategic thinking, and a readiness to take calculated risks are a few of these.
Along with inspiring and building trust among stakeholders, a great CEO must be able to lead and
inspire a team of employees.
In summary, the CEO is crucial to the success of every business. They are in charge of establishing
the company's vision and strategy, running day-to-day business, and fostering expansion. Strong
leadership abilities, the capacity for effective communication, strategic thinking, the courage to
take calculated risks, and resilience are necessary for success as a CEO. A CEO can guide a
business to long-term success and prosperity if they possess these traits.
2. ABOUT CEO & COMPANY:
German multinational car manufacturer Volkswagen (VW) was established in 1937. It is the
flagship brand of the Volkswagen Group, which also includes the automakers Audi, Porsche,
Skoda, and Lamborghini. Its corporate headquarters are in Wolfsburg, Germany.
The Volkswagen Beetle, Golf, Passat, and Jetta are among the models that Volkswagen is most
known for producing. The business is internationally renowned and sells automobiles in more than
150 nations.
Volkswagen has encountered a number of controversies in recent years, including the "dieselgate"
controversy in 2015. In this case, the manufacturer installed cheating software in millions of its
diesel vehicles. As a result, Volkswagen was hit with multibillion dollar fines and was the target
of international legal action.

Despite these difficulties, Volkswagen continues to be among the biggest and most prosperous
automakers in the world, with an emphasis on creating cutting-edge, environmentally friendly
automobiles for the future.
Since April 2018, Herbert Diess has led Volkswagen AG as CEO. Diess served as the head of
research and development at BMW before being named CEO. He was also a member of the board
of management for BMW AG.
Volkswagen has been concentrating on an electric mobility strategy and making significant
investments in the creation of electric vehicles under Diess's direction. He has also been in charge
of initiatives to improve manufacturing efficiency and optimise business operations.
It is important to remember that the car business is continually changing, and that executive
positions might change at any time. Therefore, it's feasible that the CEO of Volkswagen has
changed since my knowledge's expiration date of September 2021.
3. CARRIER SAGA & PERSONALITY OF CEO:
BMW
Diess joined BMW in 1996. He performed a range of tasks there and was widely credited with
creating the BMW i3 and i8. In 2015, he joined Volkswagen after leaving BMW.
Volkswagen
He was recognised by CEOWORLD magazine as one of the "Best CEOs in the World" in 2018.
The slogan "Arbeit macht frei" (Work makes you free), which was posted over the gate to
Auschwitz and other concentration camps, was parodied by Herbert Diess in 2019 when he told
VW employees at a work event that "EBIT macht frei." Herbert Diess urged Brussels (the EU) to
work for a peace agreement with Russia during the Russian invasion of Ukraine in 2022 so that
commerce could resume and the EU's business interests would be safeguarded. Following
complaints from labour leaders, Volkswagen declared in July 2022 that Diess had resigned as CEO
and would leave the organisation by the end of August. Oliver Blume took his place.
Herbert Diess is renowned for being an ambitious, results-oriented CEO who places a high priority
on technological advancement and innovation. He is recognised with spearheading VW's plan for
electric mobility and pressuring the corporation to make significant investments in the creation of
electric vehicles.
Diess is renowned for being a daring leader who is prepared to take risks in order to accomplish
his objectives. He has played a key role in a number of important VW improvements, including
restructuring the business' operations and promoting increased productivity and profitability.
Diess has additionally come under fire for his combative and harsh leadership style. According to
some sources, his management style may be demanding and challenging to collaborate with, and
he has engaged in some highly publicised conflicts with labour groups and other stakeholders.

Overall, it is evident that Diess has had a substantial impact on determining VW's strategy and
direction in recent years, despite the fact that his leadership style may occasionally be dispute.
3.1 CHARACTER AND TRAITS:
Visionary: During his time as CEO, Diess has made a significant effort to position Volkswagen as
a market leader in the electric vehicle sector.
Strategically, Diess is recognised with streamlining Volkswagen's operations, lowering costs, and
boosting productivity. Additionally, he has presided over large expenditures in infrastructure and
technology for electric vehicles.
Decisive: Diess is renowned for making courageous decisions and acting decisively despite
opposition. To advance the business, he has been prepared to make tough decisions like eliminating
positions and shutting down plants.
Innovative: Diess has pushed innovation at Volkswagen thanks to his technical training and indepth
technological knowledge. He has played a key role in the advancement of the business's electric
car technology and the formation of alliances with other businesses in the sector.
Results-driven: Diess is very focused on fulfilling objectives and delivering results. He has been
striving to make sure that Volkswagen reaches its lofty production and sales ambitions for electric
vehicles.
4. CONTRIBUTION THROUGH LITERATURE REVIEW:
Finding research gaps: A literature review can help to find research holes that can be filled by
future studies. This can contribute to the creation of new hypotheses and the advancement of
knowledge in a particular sector.
Creating research questions: Based on the gaps in the existing research, literature reviews might
assist in creating research questions. This can assist with narrowing the subject of the study and
guarantee that it is dealing with pressing issues.
Choosing research methods: A literature review can assist in determining the best research methods
to employ for a certain study. This can guarantee that the research is thorough and that the findings
are reliable.
Contextualising research findings: By comparing study findings to previous studies, literature
reviews can aid in contextualising research findings. This may contribute to the validity of the
results and deepen our comprehension of their relevance.
Finding research trends: A literature review can assist in spotting trends in research throughout
time, which can reveal information about how a certain field of study has evolved. This can ensure
that future research is relevant and current and help to direct it.
5. THEORETICAL SUPPORT:
Electric transportation: Diess has been a steadfast supporter of the creation and use of electric
vehicles. He has emphasised the significance of lowering carbon emissions and has established
challenging goals for Volkswagen to achieve in order to become a pioneer in the field of electric
mobility.
Agile Management: Diess has backed agile management techniques as well. At Volkswagen, he
has enacted a flatter organisational structure and emphasised the value of hastier decision-making
and increased teamwork.
Dietz has also emphasised the significance of lean manufacturing techniques in Volkswagen's
operations. He has put in place a programme named "Transform 2025+" that aims to boost
productivity and save expenses throughout the business's operations.
Digitalization: Diess has also highlighted how critical it is to Volkswagen's business processes. To
enhance the client experience and streamline processes, he has made investments in cutting-edge
technologies and digital platforms.
The importance of sustainability, efficiency, and innovation in Volkswagen's operations has
generally been the emphasis of Herbert Diess' theoretical support. His management and leadership
practises demonstrate a dedication to these values as well as a readiness to accept novel concepts
and strategies to realise them.
6. RESEARCH METHODOLOGY:
Case study: A case study might be done to look at John Donahoe's management and leadership
style in a particular setting, such his time at Nike or eBay. This strategy would entail gathering
information from numerous sources, including company records and financial data analysis as well
as interviews with Donahoe, his coworkers, and industry experts.
Surveys and questionnaires: Surveys and questionnaires may be used to acquire information about
John Donahoe's leadership style and the effect he has had on the businesses he has served. This
strategy might entail gathering information from current and past workers, clients, and industry
experts.
To determine the themes and messages John Donahoe emphasises in his leadership and
management style, a content analysis of his speeches, interviews, and other public remarks could
be done.
Historical analysis: To find out how John Donahoe's management and leadership style have
affected the businesses he has worked for over the years, a historical analysis might be done. To
identify important events and trends, this strategy can involve analysing financial data, business
reports, and news stories.
Ethnography: To investigate John Donahoe's leadership style and its effects on organisational
culture, an ethnographic approach could be utilised. This strategy would entail watching how
Donahoe interacts with his colleagues and investigating the social dynamics of the business.
6.1 ANALYSIS:
1. SWOC (Strength, Weakness, Opportunity, Challenges)
• Strengths:
Automotive industry expertise: Diess has more than 30 years of experience in the sector, during
which time he has held executive positions with BMW, Volkswagen, and other businesses. He
now has a thorough understanding of the business and its difficulties.
Focus on electric mobility: Diess has been in charge of the company's efforts to transition to electric
mobility, a top strategic objective. Volkswagen has made significant investments in the creation
of electric vehicles while he has been its CEO.
Operations optimisation: Diess has been trying to increase manufacturing effectiveness and
streamline Volkswagen's operations. The business is now more competitive on the international
market thanks to this.
• Weaknesses:
Disputes: During his time as CEO of Volkswagen, Diess has been embroiled in a number of
disputes, including arguments with the organization's strong labour unions and criticism of his
managerial style.
Dependence on the Chinese market: Due to Volkswagen's reliance on the Chinese market, any
political or economic unrest there might have a big impact on the business.
• Opportunities:
Electric mobility: Volkswagen has a chance to establish itself as a market leader in this field, and
Diess's attention to it may enable the business to take advantage of this chance.
Growth in emerging markets: Volkswagen has the chance to increase its presence in these areas as
they continue to grow.
Digitalization: Diess has emphasised the value of this trend in the auto sector, and Volkswagen
might gain from making investments in this field.
• Challenges:
Competition: Volkswagen confronts fierce competition from other businesses in the highly
competitive automobile sector.
Regulations: The cost of production for Volkswagen may rise if emissions and safety regulations
become more strict.
Economic instability could have an effect on Volkswagen's sales and profitability, particularly in
light of the COVID-19 epidemic.
2. PESTEL (Political, Economic, Social, Technological, Environmental, Legal)
• Political: This element covers governmental laws, regulations, and business-impacting
policies, as well as the political climate. Political factors could include any governmental
or regulatory initiatives that might affect Herbert Diess's leadership or behaviour.
• Economic: This component relates to the economic conditions and trends that can have an
impact on the organisation, including inflation, economic growth, interest rates, and
 currency rates. Economic variables, in Herbert Diess's eyes, might be any economic
measures he takes to boost Volkswagen's growth or profitability.
• Sociocultural: This component consists of social and cultural norms, trends, and values
that might have an effect on a company. Sociocultural influences can include any social or
cultural trends that affect Herbert Diess's leadership style or decision-making.
• Technological: This element relates to the developments and innovations in technology
that have the potential to affect business. Any advancements in electric vehicle technology
that have an impact on the business plan are considered technological elements in the
context of Volkswagen and Herbert Diess.
• Environmental: This element takes into account all aspects of the environment that may
have an impact on the business, including resource depletion, sustainability, and climate
change. Environmental factors for Herbert Diess may include any sustainability or
environmental programmes he develops at Volkswagen.
• Legal: The rules and regulations that may have an impact on the business are included in
this component. Legal considerations in the context of Herbert Diess and Volkswagen may
include any regulatory or legal difficulties the company faces or any legal actions brought
against the company.
3. KPI’s ( Key Performance Indicator)
• Financial Performance: The company's financial performance is one of the key KPIs for a
CEO. Metrics like sales, profit margin, and return on investment are included in this.
Volkswagen's efforts to increase profitability through cost-cutting measures and a focus on
electric vehicles have been led by Diess.

• Employee Satisfaction: The level of employee satisfaction is another crucial KPI. Surveys
on employee engagement can be used to gauge things like overall morale, motivation, and
work satisfaction. Productivity, creativity, and loyalty can all rise in a supportive
workplace.

• Environmental Impact: Given Volkswagen's emphasis on electric vehicles, Diess may use
the company's environmental impact as a key performance indicator. Metrics like carbon
emissions, energy efficiency, and the usage of environmentally friendly materials in
manufacturing could be included in this.

• Market Share: The company's market share is another crucial KPI. This gauges the
proportion of overall sales in a specific market or sector. In the market for electric vehicles,
Diess has been aiming to boost Volkswagen's market share.

• Finally, the degree of innovation and investment in research and development (R&D) may
be a KPI for Diess. Metrics like the quantity of patent applications, the amount spent on
R&D, and the successful introduction of new goods or technology might be included in
this.
 6.2 COMPARISION:
Volkswagen AG, the parent business of Skoda Auto, is led by Herbert Diess, although Skoda Auto
has a separate CEO. Thomas Schäfer was the CEO of Skoda Auto as of the knowledge cutoff date
of September 2021.
Even though one is a subsidiary of the other, it might not be acceptable to directly compare Herbert
Diess and Thomas Schäfer because they are in charge of distinct organisations. However, there are
some features of their leadership and businesses that we may compare. Since taking over as CEO
of Volkswagen AG in 2018, Herbert Diess has prioritised digitization and an electric mobility
strategy. He has also been in charge of initiatives to improve manufacturing efficiency and
optimise business operations. Volkswagen has introduced several electric vehicles and has made
significant investments in battery technology while he has been in charge.
Since taking over as CEO of Skoda Auto in 2020, Thomas Schäfer has concentrated on growing
the company's footprint in emerging regions like India. Additionally, he has been pushing the
selection of hybrid and electric cars from Skoda.
6.3 EVALUATION:
Volkswagen has been under Herbert Diess' direction at a period of substantial development and
transformation, especially in the field of electric mobility.
The creation and introduction of the Volkswagen ID.3 and ID.4 electric vehicles, which are a
component of the company's ambitious aim to become a dominant force in the electric vehicle
market, is one of his most notable accomplishments. To facilitate the transition to electric vehicles,
Diess has also oversaw large expenditures in battery technology and charging infrastructure.
Additionally, under Diess's direction, Volkswagen has been attempting to restructure its business
and decrease expenses by concentrating on models that are more profitable and eliminating
positions in non-core areas.
Diess has encountered some difficulties while working for Volkswagen, though. He was criticised
in 2019 for his leadership style and run-ins with the company's strong labour unions. Additionally,
there have been issues with how the business handled the diesel emissions incident, which
happened before Diess was become CEO.
1) TECHNOLOGY ADAPTION:
Electric Mobility: Diess has made it a top priority to transfer Volkswagen's attention to electric
transportation. Under his direction, Volkswagen has made significant investments in EV
technology and aspires to become a market leader in EV production. The business is launching a
variety of electric models under various brands, including the ID.3, ID.4, and ID. Buzz, using its
MEB platform, which was built exclusively for electric vehicles.
Digitalization: Diess has been pushing to incorporate digital technology into Volkswagen's
processes after realising the significance of digitalization in the automotive sector. The company's
"Car.Software" digitalization effort, which seeks to create a new software platform for all of
Volkswagen's vehicles by 2025, has just been unveiled. Volkswagen will be able to provide its
clients with additional digital services and capabilities thanks to the platform.
Diess has also been overseeing Volkswagen's initiatives in the field of autonomous driving
technologies. To create autonomous driving technologies, the business has partnered with firms
like Argo AI and Ford. Additionally, Volkswagen has created its own autonomous driving
software, dubbed "IQ.DRIVE," which is already present on a number of its models.
2) STRATEGIES AND INNOVATION:
Operations: To increase productivity and cut costs, Diess has been concentrating on streamlining
VW's operations. This entails streamlining the company's product line and consolidating its
production facilities.
Ford collaboration: VW and Ford formed a partnership in 2019 to work together on electric and
driverless vehicles. By combining their respective advantages, the two businesses hope to create
new technologies and cut expenses.
Investment in Battery Technology: Diess has also been in charge of Volkswagen's initiatives to
create and manufacture its own battery cells for electric vehicles. The business has made significant
investments in this field and intends to construct six battery facilities throughout Europe.
6.4 FINANCIAL STATEMENTS:

Fig 1: Financial highlights (2019-2021)

Fig 2: Operating Profit of VW (2006-2021)
6.5 INTERPRETATION:
Volkswagen has been successfully led by Herbert Diess during a period of substantial development
and transformation. Since taking over as CEO in 2018, Diess has made considerable investments
in this sector with a focus on repositioning the business as a leader in the rapidly growing electric
car market.
Diess has concentrated on streamlining and increasing the effectiveness of Volkswagen's
operations in addition to his work on electrification. This has included making efforts to cut back
on model variants and trim levels as well as placing more of an emphasis on digitalization and
production automation.
6.6 FUTURE OUTLOOK:
With aspirations to produce more than 1 million electric vehicles annually by 2025, VW has made
considerable investments in the technology of electric vehicles under his direction. Additionally,
the business has been attempting to streamline internal procedures, cut expenses, and increase
production efficiency.
Overall, Diess's emphasis on electric mobility and efficiency appears to be in line with the trends
and expectations in the automotive industry, and investors and industry analysts have generally
praised his leadership. But like any CEO, his prospects for the future at VW will be influenced by
a number of variables, such as the success of the business' strategic ambitions, the state of the
economy and the market, and probable changes in the company's top management.
7. SUGGETIONS:
Accelerate the company's transition to electric mobility: Volkswagen has already made significant
progress in this area, but it could push the envelope even further by increasing its investment in
research and development of electric vehicles, extending the range of electric vehicle models that
are available, and constructing a robust infrastructure for charging.
Enhance consumer impression and trust of the brand: Volkswagen has encountered PR difficulties
lately, especially in the wake of the "Dieselgate" incident. By being open about the company's
procedures and striving to allay worries about emissions and other environmental issues, Herbert
Diess might make it a priority to regain the trust of his clients, investors, and other stakeholders.
Focus on innovation and differentiation: Volkswagen might prioritise innovation and
differentiation by creating distinctive features and technology that set its vehicles apart from those
of its rivals in order to stay competitive in a crowded auto market. This could entail funding for
internal R&D as well as partnerships with IT firms or other industry players.
Address supply chain and manufacturing issues: Volkswagen, like many auto industry companies,
is anticipated to experience supply chain and manufacturing issues in the upcoming years,
especially in light of the COVID-19 epidemic and ongoing trade tensions on a worldwide scale. If
Herbert Diess wants to make sure that the business can successfully navigate these issues, he
should give risk mitigation and contingency planning first priority.
Expand into new markets: Volkswagen may look at opportunities to do so, particularly in
developing nations like Asia and Africa, in order to continue expanding and diversifying its
revenue streams. This can entail modifying its goods and services to suit the particular
requirements and tastes of different markets, as well as funding regional collaborations and human
resources.
8. CONCLUSION:
During his time as CEO of VW, Diess oversaw the company's transition to a more sustainable and
electric mobility model. Additionally, he has been concentrating on streamlining VW's processes
and enhancing manufacturing effectiveness. While Diess was CEO, there were some difficulties,
such as production holdups and poor quality with some of VW's new models. Additionally, there
have been rumours of conflict between Diess and a few management board members of the
business. Overall, it is evident that Diess has been a key player in Volkswagen's initiatives to move
towards sustainability and electric mobility. The length of his employment with the company and
the viability of VW's reform initiatives are yet uncertain.

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