Volkswagen: HR Strategies, Culture, Employment, and Practices

This report analyzes Volkswagen's human resource management (HRM) strategies and their impact on value creation, organizational culture, and employment models. It examines how strategic HRM, including recruitment, training, performance appraisals, and compensation, contributes to Volkswagen's overall performance. The report explores the influence of regional and national cultures, particularly in China, on HRM practices and policies. It also discusses various employment and organizational levers that create value within Volkswagen. Furthermore, it compares Volkswagen's HRM practices to Storey's 27 points of difference, highlighting the importance of local culture and employment laws. The report concludes with suggestions for employers regarding effective HRM practices, offering insights into how companies can optimize their HR strategies for improved performance and achieving organizational goals.

Assessment

Table of Contents
INTRODUCTION ..........................................................................................................................3
TASK...............................................................................................................................................3
Examine how value was created by the firm using HR strategies. Use of concepts of strategic
HRM should be evident..............................................................................................................3
Analyse impact of regional and national culture on the practice of HRM .................................4
Model of employment and organisation levers for creating value.............................................5
HRM practices used in the organisation on the basis of Storey's 27 points of difference .........6
Importance and significance of local culture and HRM practices .............................................8
Examine the difference in terms of employment laws when international HRM changes local
business systems..........................................................................................................................8
Example of firm using good HR practices..................................................................................9
Suggestions/ recommendation for employers regarding HRM practices ................................10
CONCLUSION .............................................................................................................................11
REFERENCES..............................................................................................................................11

INTRODUCTION
Human resource management plays a major role in any company, as it helps in managing
the people working in the company so as to gain better performance by maximizing their
performance level and able to achieve the common organisation goals.
In this assessment, the chosen company is Volkswagen an automotive company established in
the year 1937 by German Labour Front. It is of the leading seller in the world. In this assessment
it is been analysed and evaluated how HR strategies can have impact on the company's values
and how these strategies used in evaluating the culture of company. It is also mentioned that how
different models can help in creating the value of firm. It is also discussed, that a chosen firm
follows the HR policy or Personnel Management in their organisation. Lastly it is also asked to
given the views which can help employers to achieve higher performance so as to accomplish
their objectives.
TASK
Examine how value was created by the firm using HR strategies. Use of concepts of strategic
HRM should be evident.
Strategic HRM meant to be HR which is been formed so as to increase and improve the
overall performance of the business so as to achieve their targets. There are various HR strategies
like recruitment, training and development,performance appraisals, remuneration. This all can
help an organisation to create value. If an organisation has systematic (Wiblen,Marler,2019)and
good HR strategies then it gives a positive impact on the reputation of the firm with the
increment in business performance. These values can be created by using HR strategies in
effective way, which are examine below in context to Volkswagen:
 Recruitment and Selection : By this the organisation selects the right, talented and
skilful person for the vacant job so that they can work with efficiency which leads to
achieve their goals. In context to Volkswagen, the company fully examine their candidate
judge on different basis. This creates their(Aust,Muller-Camen,Poutsma,2018)value as it
increases the employer's brand and talented employee can work with full efficiency, this
increase the reputation of Volkswagen and thus its profits.
 Training and Development: Giving training to the employees on time upgrade their
skills and help them in developing their career. Volkswagen focuses on giving on the job

training to the employees so that they can work with full efforts and use upgraded skills.
This creates value as it develops the career of employee and bring efficiency in their
working performance, increase brand equity and build trust and creates a strong
workforce which perform their duties in well manner.
 Performance Appraisals: Appraisals helps in motivating the employees. It can be done
by giving rewards and recognitions so that it increases their morale and develop interest
in doing the work. Volkswagen give performance appraisals , they give rewards non
monetary and monetary incentives like bonus, promotion, allowance which enhance their
performance and it creates values as the employee(Aydoğan,Arslan,2020) retention get
low.
 Compensation: In context to Volkswagen, the company gives just and fair charges to the
employees without any partiality. This makes them feel satisfied and reduce the chances
of chaos, thus it gives positive environment at workplace.
These all strategies help Volkswagen operating their activities in any country to increase their
brand value globally , employer's brand and lastly increase the reputation and goodwill of firm.
Thus, it helps in creating and adding value of the company.
Analyse impact of regional and national culture on the practice of HRM
Impact of regional and national culture of HRM in Volkswagen at China
Culture refers to a the behaviour and ethical norms which is presented and adopted by
the society. Culture of country may vary from one another. There are variations in the regional
and national business culture. It is necessary to form policy as per the work culture followed by
the country in an organisation. In context to regional culture , China work culture has efficiency
in their work as the people there are punctual for their work. They use some Chinese words
while meeting to someone so that it gives attraction. Instead of using their names or sir ma'am
they address each other by using surnames. The HRM(Thite, 2018) needs to develop the policy
accordingly s, so that it gets easier for employees to get adjusted in that environment. They do
not allow their subordinates to take decision ,all decision making are in the hands of superior and
they don't even involve their employees in meeting. It has impact on the HRM policy as they
also implement these norms in their HR policy and does not involve subordinate participation in
decision making.

From the viewpoint of China , it follows a different culture then the company's originated
country. It has impact on HR practices as they need to follow the culture and make policies
accordingly. The HR needs to make decision related to setting time frame for the workers as
given by the country. In Asia, the working hours are, they need to do work for 45 to 48 hours a
week. In some regions they provide time for relaxation. Their mainly focus on employees
security and and train their employees so that they can (Brewster,Cerdin,2018)work efficiently.
They follow formal dress code, for that a company also needs to make this trend in the
company's HR policy. The culture spends a lot time and money so that they can build trust and
building network, so that it can expand their business terms. In terms of communication they are
straightforward and use busy language to make social interaction. The human resources of a
company can have impact as they need to provide open or proper flow of communication in their
business environment. So that, information can be spread and it balances the relation among the
organisation.
Model of employment and organisation levers for creating value
Employment model helps in giving job opportunity to the clients. Its main aim is to create
job opportunities. There are nine levers of organisation which helps in creating the value of
Volkswagen. There are detailed below:
 Source of value: In this, the leaders of Volkswagen, need to take appropriate decision so
that it results in profits and decrease the overall revenue. They mainly focus on increasing
the chances of having profits to generate more revenue. They lower the reduction of cost,
so that they can have more revenue.
 Measurement: The leader of Volkswagen evaluate the impacts they have on business
results. The leaders evaluate how their analytics have (Chanda,Goyal,2020)impact on
their business outcomes.
 Platform: In an analysis it is been analysed that the leaders of Volkswagen have some
percent of have predictive analytic capabilities, this proven beneficial for the company, so
that they can predict the profitability.
 Culture: The leaders make half of their decision by analysing the situations and an d
uses data. They do it so that they can take corrective decision,this ensure them to create
value of their company.

 Data: In context to Volkswagen,the leaders have great trust on the quality of data and on
their analytics, so this generates reliable information for them to create value by
providing reliable data.
 Trust: The company's leader had developed a high level of trust between the employee
and maintain a good environment by keeping the transparency. This motivated their
employees to work efficiently to achieve their goals.
 Sponsorship: The leaders uses the data analytics which help (Chaudhry,et.al., 2019)
them to guide he policy and strategy to others and measure them with standardised
methods and evaluate the outcome.
 Funding: The leaders of Volkswagen,make strategic plans for the fund requirement for
investment so that they can allocate and use it accordingly. This can create value for
them.
 Expertise: The leaders of company clearly established the paths for success and invest
more in developing the skills, so that they get better training and they can perform their
work. This creates value as the speed and efficiency of business improved.
HRM practices used in the organisation on the basis of Storey's 27 points of difference
Basis HRM Personnel Management
Assumptions
Contract Its motive to go beyond the
contract
A written document .
Behaviour Behaves as per vision and
mission
Behaves as per code of
conduct and rules
Management guidance It guides the business need. Follow procedures
Relations They are unitarist varied
Disputes minimized standardized
Regulations Less regulations(Dello
Russo,Mascia,Morandi,2018)
Have regulations

but need to do in clear way.
Strategy condition
Plan Central Minimal
Decision efficiency Fast decision Slow decision
Relations Consumers With labour management
Initiatives Gradually united
Line Management
Role of management Transformational leadership Transactional leadership
Awarded skills They facilitates They negotiates
Standardisation Low It is highly standardized
Conversation Have direct communication They have indirect
communication
Levers
Aspects Unity and harmony They negotiates
Labour management They have towards individual
contract
They have collective
bargaining contract
Pay Related to performance Fixed pay structure
Selection Separate task Integrated task
Employee relation They have minimal relations
with bargaining of some
change in models.
Gives training and
development
Job levels Have few levels Have many levels
Dispute handling It manages climate(Guerci
Decramer,Van
Waeyenberg,Aust,2019)) and
culture
It try to manage peace

Training and development Focus on developing and train
employees.
Focus on
Job design Have teamwork Have division of labour
Focus of attention Focus on cultural and
personnel strategies
Focus on personal procedures.
In China, the Volkswagen adopt and follow the human resource policy in their
management, this helps them in taking their decision in fast manner and by using the HR
practices help them to maintain good relations with the employees and labour of the
organisation. Volkswagen, in China follows HRM policy, so that they can focus on their
employee performance and give them benefits and provide
adequate(Viitala,Vesalainen,Uotila,2020) training so as to develop their career, give them more
opportunities,this gives employees satisfaction for their job and increase the productivity and
overall performance of company. Thus, this increases the morale of employees, gives motivation
to do more efficient(Harney,Alkhalaf,2020)h of company.
Importance and significance of local culture and HRM practices
Every company has global policies as well as local policy as per the country. Volkswagen
too have the same policy and the local culture of country has deep effect n hiring and firing of
employees. The HRM of each country varies from one another. As they need to make according
to their local culture. Volkswagen, has their global HRM policy, in China they hire people by
following proper structure of recruitment and selection, they (Salas-Vallina,Fernandez,2017)
attract employees by enriching their jobs wit lots of benefits and examine them conducting
different test to retain the best talent. Similarly, in Germany they also have same recruitment
process, in which they also evaluate the ability and knowledge of candidates , to get the best so
that they can work using their skills and put full efforts, and work with full potential.
The local culture may have difference in their firing policy, as they need to abide by the
legal laws and regulations of respective country. Volkswagen operating in China, need to follow
their laws for the termination of contract, in the employee is not performing well or they want to
fire the employee due to any reason, they (Liu,Chow,Gong,Wang,2019) need to follow the rule

by giving a 30 day notice to the company for the termination. The company may fire employee
without any notice in rare cases if there is any misconduct happens in the organisation.
While in Germany, Volkswagen ned to follow rules of firing employees, they can fire the
employees immediately without any cause or if they did something wrong or are not found
suitable for the job position on the organisation. The hiring and firing are somehow similar in
the local culture of both the countries. They have quite similar impact (Yassine,Singh,2020) on
their local cultures, the difference is just they need to abide by their county's laws, and work as
per the legal procedures as stated by the government of respective country.
Examine the difference in terms of employment laws when international HRM changes local
business systems.
Laws are important for every company to follow, as they need to conduct their activities
as per the rules and regulations given by their country. The employment laws are those which
protects the interest of employees by providing them certain rights in the company. Every
country has employment law,which differs from country. They are differentiated as below:
 Health and Safety law of Asia and Germany : This law states, company must provide
job security and safety at workplace to the employees. In both the countries European
Union and in Asia, they have this law and Volkswagen
needs(Malik,Froese,Sharma,2020) to provide safety to their employee at workplace by
giving them insurance, health benefits and safety while working on hazardous machines.
The HRM of company needs to give them job security, provide the a flexible working
hours so that employees may feel satisfied while working in the company and they need
to boost their morale so that they work with full capabilities and efforts. . The HR needs
to take this in consideration, and focus on health set 8 hours of work, so that their health
may not be affected and provide safety of employees. If they violated the rule, the
employees working in different country has the right to file complaint against company
and government will take legal actions against them.
 Minimum Wage law of Asia and Germany: This law stated that employees need to
receive at least minimum wage for from the company, as settled by the government of
particular country. In Asia, different country provides varied minimum wages depends on
the country's economy. Similarly in Germany, the government provide minimum wages

to employees varies in their currency value. The HRM
(Meacham,Cavanagh,Shaw,Bartram,2017) needs to fix a particular amount for the
employees working in Volkswagen, by comparing the amounts of their company
established in other countries too. By this there will be a fair deal and employees can
receive their minimum amount as settled by government and the company. If the
company is not giving minimum wage, then employees can take action against the
company.
Example of firm using good HR practices.
CSR OF VOLKSWAGEN:
Volkswagen is German auto mobile company and is the leading car manufacturer
company. The company has succeeded to provide good working environment and the company
is also actively participating in social support (Thite, 2018)activities such as education and
training programmes in India, awareness programmes on fuel consumption in Australia,
encouragement to technology, etc. The company plays an active and important role in CSR.
Through CSR it has become the company's responsibility to develop the society rather than just
earning gains. VW focuses more on the environmental (Mendy2018) responsibilities that helps
the company improve its internal environment and value of the organisation. The company
became the attractive employer as they provide employees with a lot of benefits. The company
also provides with a range of technology and innovation programmes. Many programmes that
are conducted brings profit directly or indirectly to the company Volkswagen .
By this programmes there is job creation in various countries like India where job creation is
very low and it also solves human resource problem by providing employees through training.
To promote social benefits VW produces product according to the sustainable ecology.
Volkswagen group considers itself as a global player with German roots.
Suggestions/ recommendation for employers regarding HRM practices
Recommendations
So from this, employers ned to focus on giving proper training to the subordinates so that
thy ca develop their career, avail the opportunities and perform their task with full potential. The
employers ned to create a proper flow of communication, this can help in communicating the
necessary information fastly, so that it maintain efficiency in working
(Rahman,Mordi,Nwagbara,2018) performance and boost the overall organisation performance.

The HRM practices need to be followed by employers so that they ca motivate employees to
work in appropriate time frame and achieve their targets. It is necessary that employers boost the
morale of employees and make effective teams having clear objectives,hire right , talented and
skilful employee and give them the task as per their calibre and understanding.
This enables to achieve their organisation targets as it ensures high performance. The
employers focus on making self managed team, in which (Nasir, 2017)every team mate knows,
what they want to do and familiar from every activities which they need to perform. The
employers neds to give fair and fix remuneration to the employees,as per the company's pay
structure so that they work in the organisation feeling satisfied and thus it motivates them to give
their best ans increase the overall performance. The employer need to give safety and security to
their employees of job as well as at workplace. The employer needs to maintain a healthy
atmosphere at the workplace by maintaining good relation among employees, give them flexible
work hours so that they can work in the organisation with less issues and reduce conflicting
situation. This all can help in increasing the working(Ojo,Raman,2019) performance of
employee. Thus, increase the overall performance of organisation with increase in productivity
and this leads to growth and increment in the profitability of organisation.
CONCLUSION
It is been concluded that HR strategies and helps an organisation to create values. The
culture of a company vary from nation to nation so it is necessary to follow the culture of country
so as to perform their work well and efficiently. It is also analysed that HR need to plan
different strategies depending on the culture of country they are operating. It is also analysed that
employment law of country has great effect on HRM policy, and also it is examined that
different country has different employment laws so the the HRM of country has to take decision
keeping the laws of both in consideration adjust their policy. Though operating in different
countries, but the hiring ad firing HRM practices are quite similar in Germany and China. Lastly
it is been concluded by suggesting employers, that these practices can useful and beneficial if
they implement these practices in their management as it, somehow increase their overall
performance.