Global business strategy and HRM
5.1 Recruitment and Selection
Recruitment and selection are paramount to Volkswagen and greatly influence its ability to achieve the aforementioned strategy through building a committed, competent workforce. In order to attract and secure such a workforce, Volkswagen targets experienced “experts” with a great deal of influence placed on innovative, revolutionary thinking and creativity: “We are looking for people to write history with us” (Volkswagen Karriere, 2020). This sentiment is continued throughout the recruitment function across all facets of the organisation. Notably within the IT Group, in order to attract the most agile, creative and competent workforce, Volkswagen employs recruitment techniques inspired by Silicon Valley start-ups (Volkswagen Group News, 2016). Under this recruitment strategy, IT graduates undergo pair programming, where the applicant is fully integrated within the team and given the greatest opportunity to demonstrate their abilities, communication skills and teamwork within a matter of days (Volkswagen Group News, 2016). As a result, Volkswagen is able to efficiently recruit and select the most suitable candidates who demonstrate the ability, agility and innovative thinking required in the Volkswagen team.
5.2 Career Development
Furthermore, with regards to the goals of excellence in leadership, employee commitment and diversity, the HRM function of development plays an integral role. Given the global nature of Volkswagen’s strategy and operations, the development of management is a significant HR practice. The company has recently updated its development policy for management, with a renewed preference for developing employees who possess broader experience, notably with experience in foreign assignments and with different brands and business areas (Volkswagen AG, 2016). The reasoning for doing so lies in generating managers with a broader perspective: possessing the flexibility and adaptability that enables them to lead with prowess and proficiency in subsidiaries around the world, in line with the global strategy Volkswagen had adopted (Volkswagen AG, 2016). Further to this point is the development of diversity within management positions at Volkswagen, with women to be provided with the development and capabilities required for management positions in a swifter manner (Volkswagen AG, 2016). As a result of increasing the need for broader perspectives, internationality and diversity within the management development function, Volkswagen can achieve the goals pertinent to its global strategy and HRM more readily.
5.3 Compensation
Moreover, the function of employee compensation at Volkswagen is used by HRM to further aid the organisation in achieving goals and adopting business strategies. At Volkswagen, HRM utilises the rewards and compensation function by providing employees with salaries under collective bargaining agreements in addition to performance based bonuses. Notably for 2018, Volkswagen AG employees received bonuses of €4,750 for their performance throughout a difficult year (Volkswagen AG, 2019). These performance based incentives are used by HRM in both motivating staff to increase their effectiveness, and in rewarding and encouraging employee commitment. As a result, Volkswagen supports its strategy of maintaining employee competence and commitment. These sentiments are extended to the top level of the organisation, with the board of management also receiving significant performance based remuneration in addition to their non-performance based amount (Volkswagen AG, 2020). This ensures the company’s HR strategies are being carried out across the entire organisational structure. As a result, through this management of the compensation function, Volkswagen ensures employee commitment and competency remains high and thereby enables effective employment of its overall HRM strategy.
