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Bmw's Dream Factory & Culture

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BMW's Dream Factory & Culture

Christian Chenard

Strayer University

Dr. Theresa J. Bowen

Leadership and Organizational Behavior - BUS 520

April 2010

BMW's Dream Factory & Culture 2

How would you describe the culture at BMW?
Entrepreneurial culture is rarely the norm in German corporations. Employees at BMW are innovative because management has learned from experience that listening to assembly workers' ideas and customers likes make for a very creative culture. The employees at the plant, to include engineers, assembly line employees and management are known to brainstorm when a problem arises with a car model in production. The task force concept is a powerful tool BMW has learned to use when it needs to either solve a problem or create a new concept of operation for a project. (Hellriegel, D. & /Slocum J, 2007, pp.522-524). Managers came to realize that they don't necessarily have all the right answers. Audi and Toyota are BMW's closest market rivals in Germany and this keeps everyone at BMW thinking from top to bottom. No sooner does an innovation hit the market, people at BMW stay on their toes to see if that is something their clientele might go for in a "Bimmer" or not.
Norbert Reithofer, the current CEO at BMW stated "we push change through the organization to ensure its strength. There are always better solutions". (Hellriegel, D, 2007, p522). Not being afraid of change, or from which level within the organization the new idea or concept came from, is perhaps one of BMW's best strengths at present.

What model of leadership is illustrated at BMW ? How does this impact BMW's culture?
American top managers at US auto manufacturers could perhaps learn a thing or two from other nations. For too long,(mid 1960s to the mid 1990s) one could not help but notice the planned
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obsolescence of US car models compared to the more refined finish of european and japanese made cars."Detroit's rigid bureaucracies were slow to respond to competitive threats and market trends." (Hellriegel, D., 2007, p522. )

At BMW however, flexibility and rapid response to changing market demands are the motto. BMW does not have formal coaching for newly appointed managers. So, for a manager to succeed, he or she must depend on others from different levels, above, next to and below them, to assimilate the entrepreneurial culture. This keeps managers egos in check as it hones their sense of creativity, practicality and sense of belonging as they integrate and absorb as if by osmosis the incessant rethinking of "how we do business here at BMW."

Why do employees derive high job satisfaction at BMW?
There is a true practice of give and take at BMW that keeps the employees happy. Employees at all levels know that they matter and that everyone's contributions can benefit the whole organization under the right circumstances. Employees come forth at any time, on any subject, with an idea that will make some part of the plant operate more efficiently, satisfy customers in a better way, reduce waste, what have you, and management listens and evaluates. Better yet, when demand for a product requires cranking out more of a certain model in a shorter period, workers may be asked to put in extra hours and even work at a different plant for a few weeks or months and they do it. This philosophy keeps BMW competitive.
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In return, the company guaranties the rank and file a weekly 40 hour paycheck. Also, since 1972, the company included all employees in profit sharing. And if the company meets its annual financial goals, a plan exists that distributes from one month's pay to one and a half month's pay at the end of the year. (Hellriegel, D., 2007, p523) Thus the employees know their ideas are welcome, job security is pretty much guaranteed, and there is a strong possibility at the end of each calendar year to earn a good bonus.

What attributes of organizational creativity are fostered at BMW ?
Everyone is encouraged to voice their new ideas. This keeps every level of the organization sharp and fine-tunes development. By observing what the competition is up to and how buyers react to others' new models, BMW decided to take on the remake of the 1960s Mini-Morris series cars and created a newer version four decades later with all the technical improvements since then and have a winner which has allowed them to maintain a high profit margin in that particular market. BMW top management extends some of its technological innovations into other car brands as well. The case of the remodeling and total redesign of the Rolls-Royce Phantom includes under the hood BMW state of the art technology. In so doing, BMW has given competitors Bentley and Mercedes super luxury model designers food for thought! (Hellriegel, D. 2007, p.524.)

Given the culture and work environment that exists at BMW, where everyone feels and is involved
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in more than one aspect of the design, performance, appearance, sale and dependability of the product, one can only admire the well deserved pride of all the employees, from CEO to the newest
BMW's Dream Factory and Culture assembly line shift worker. It takes courage for management to recognize it does not have all the answers. The final product is never quite that, and this is precisely why BMW continues to surprise it's competition and pleases its very loyal clientele. It is open to change and is not afraid to try. It does not sleep on its laurels, not since 1959 when it almost went under. BMW keeps and open mind and its sights pointed ahead, observing , learning and innovating.

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BMW Group. (September 2007)

Cokayne, R. BMW plan offers workers stable income. BusinessReport, September 3, 2007.

Edmonson, G. BMW's Dream Factory. Business Week, October 16, 70-80.

Hellriegel, D., & Slocum, J. W., Jr. (2009) Organizational Behavior: 2010 custom edition (12th ed.) Mason, OH: South-Western Cengage Learning., Integrating cases, Part 5, pp. 522-524.

Kurylko, D.T. Job swap works for BMW. Automotive News, July9, 2007, 48;

Pries, L. Emerging production systems in the transnationalization of German carmakers: Adaptation, application or innovation? New Technology: Work and Employment, 2003, 18, 82-100;

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