What should Volkswagen do (Part II)? | MBA Learnings

Written by:
Kellogg
2 minute read

KSM_LinkedIn_SocialImage_FT_MBAlearningseries_646x220_f

Second-year student Rohan Rajiv is blogging once a week about important lessons he is learning at Kellogg. Read more of his posts here.

I shared a framework we discussed in a crisis management class three weeks ago – a few days after the Volkswagen emissions debacle came out in the press. I thought it was time for Part II.

I recently woke up to the following paragraph as part of my “Economist Espresso:”

“Volkswagen’s boss in America offered a congressional hearing a “sincere apology” for the company’s use of “defeat devices” which helped diesel engines cheat in emissions tests. Stressing that he was not an engineer, Michael Horn blamed “a couple of software engineers” for the modification, of which he said he had no prior knowledge. German prosecutors searched the carmaker’s headquarters.”

MBALearnings_Volkswagen

While I could have looked for a longer article with more details, this paragraph was very instructive. And I couldn’t resist throwing in the picture as well.

There are two things I would like to call out:

1. The crisis framework I shared offered four dimensions for an effective response to a crisis – transparency, expertise, commitment and empathy. It is safe to say that this response failed on all four.

2. However, that is not what’s most shocking about this response. It is the complete lack of spine that indicates a total failure of leadership. Let us, for a moment, try and forget the fact that he claimed no prior knowledge of something as massive as this. The fact that he felt it was acceptable to blame “a couple of software engineers” just blows my mind.

There are few tenets of leadership that are as fundamental as, “Take responsibility when things go wrong and give credit when things go well.”

A crisis can be a great opportunity to dig deep, go back to your values and show the world what you are made of.

Volkswagen seems to have missed the memo.

Rohan Rajiv is a second-year student in Kellogg’s Full-Time Two-Year Program. Prior to Kellogg he worked at a-connect serving clients on consulting projects across 14 countries in Europe, Asia, Australia and South America. He blogs a learning every day, including his MBA Learnings series, on www.ALearningaDay.com.