Challenges in Volkswagen's IT Project Prioritization

Volkswagen faced challenges in prioritizing IT projects due to internal cost factors, differences in ROI calculations, and changing timelines. The company had a complex IT project approval process, lacked alignment of project goals with corporate strategy, and experienced IT knowledge loss. Issues like incorrect prioritization, unofficial accommodation requests, and decentralized e-business adoption further compounded their difficulties in managing IT priorities.

• Volkswagen
• IT projects
• project prioritization
• challenges
• IT management

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1. Volkswagen of America: Managing IT Priorities Group Case Presentation: Anand Sidharth Jenne Foo

2. What did Volkswagen get wrong regarding its method of prioritizing IT projects?

3. What did Volkswagen get wrong regarding its method of prioritizing IT projects? Sources of IT knowledge at its disposal 1. Internal cost factor instead of an external structure; 2. Significant differences in ROI calculations; 3. Changing timelines as costs are reduced. Business unit relationships with the web-service providers Contract with Perot Systems Least costly is the Gedas USA group. (IT based subsidiary of the VWAG group) 1. Implement a strategic approval process thru the BPTO department Complicated IT Project Approval Process. (minimum of five levels of approval to reach the Project Management Team)

4. What did Volkswagen get wrong regarding its method of prioritizing IT projects? IT projects under Stay in Business (SIB) should not be ranked together with others. Mainly for legislative & business continuity reasons. Essential and not discretionary projects. Categorization of Essential IT Projects Unstructured & flustered approach Last-minute real-time phone consultations with business unit managers. The association of project-to-goal process in the last phase (Phase III) should be done at the initial stage rather than at the end. All project goals should be aligned to corporate strategy. Project-to-goal Alignment

5. What did Volkswagen get wrong regarding its method of prioritizing IT projects? Incorrect prioritisation led to teams requesting unofficial accommodation when their projects where not approved. Unofficial Accommodation They lost all IT knowledge twice due to outsourcing to different parties. Later had to increase IT strength by almost 200%. IT Knowledge Lost Approach to e-business was process decentralised adoption of independent process unlike systems thinking and interdependent. Decentralised Adoption Surprisingly there was non-existent PMO even when multiple projects were underway. Non-existent PMO