Volkswagen Case
Volkswagen of America: Managing IT Priorities Submitted by: Saahil Goel Q. What should Dr. Uwe Matulovic do about the unfunded Supply Flow project? A. There is clearly a problem with the classification of the Supply Flow project and its benefits. The Project Management Office and the Digital Business Council is responsible, in conjunction with the Executive Leadership Team, for prioritizing IT projects basis their alignment with the company’s strategic goals and the smooth running of the business.
The prioritization process considers IT projects most relevant to the business operating regionally. Since this project was “competing” for priority with other local projects, it was bound to be less important from a local perspective – and hence did not receive the kind of funding it required from the local budget. The Supply Flow project, even though being run out of the VWoA office, was going to have a global impact and therefore was going to impact a lot more than simply the American office.Consequently, this particular project should not have the same budget restrictions imposed by VWAG as other IT projects being run by VWoA. Since the project’s impact on the local American business was not considered as far-reaching as compared to the investment it required, it would obviously be considered unfair by the American ELT if funding was removed from other local projects and directed towards this “global” project. Another issue is the ownership of this project.
Currently it seems, from the case, that the supply flow project is “owned” by VWoA. This should not be the case for a project which has a global impact and hence a global set of internal customers. The project should typically be owned by the parent company in the first place. Dr. Matulovic should hold meetings with senior executives in the parent company (VWAG) to: 1) Obtain more funding specifically and exclusively for the Supply Flow project deeming it to have an impact on global company operations and not just in America.
) Make an argument that since the project was going to impact VW operations across the globe, a share of the IT budget of several of VW’s operations could be cut and allocated to this project. This way the impact would not be considerable on each of VW’s regional budgets and at the same time the required funding would be available to run the project. 3) A special team be setup at the head-office (VWAG) level which would supervise the budget and financial concerns of this project. This team would be independent of all regions and hence would be able to provide fair and unbiased opinions.
