In 1983-1984 Volvo Monitor interviews covered all major Volvo
establishments outside of Sweden. It was a period of upturn in world trade in spite of
strong projectionist overtures. It was also a period marked by a sharply rising US dollar.
1984 was a banner year for Volvo worldwide. This undoubtedly colors the results of the
A total of 4840 interviews with Volvo employees were collected from Denmark, Norway,
Finland, West Germany, Switzerland, Belgium, France, Italy, Scotland, North America,
Brazil, Singapore, and Australia. In this summary analysis we have combined all operations
in the same country with the exception that Penta in Italy is treated separately from
Volvo Italia and Volvo White in the United States is treated separately from Volvo
Corporation of America. The various plants of Volvo White (Greensboro, New River Valley,
Ogden, Orville, and Columbus) are pooled in this summary. The Halifax plant in Canada
collected interviews only from its white-collar workers and not from its blue-collar
workers, and is, therefore, excluded from this summary.
In addition to the employee questionnaires information was collected in 75 informal
interviews with managers.
This summary is not intended to do justice to the details of the situation in each
country. (For that you must turn to the various country reports.) We will instead paint a
broad picture and get an overall view.
Managers on the Volvo Philosophy
There is something special about Volvo - this can be heard and agreed upon in all
countries where Volvo operates. However, Volvo executives around the world have a hard
time articulating the special qualities that are Volvo. This difficulty is obvious also
when they met a sympathetic interviewer. A typical manager rarely is able to go beyond
statements such as "Volvo is safe and sound" meaning in one sweep both the
Group's financial position, the products Volvo sells, and the operation of his own unit.
In some subsidiaries the Group's basic values and philosophy appeared rather unknown,
in others very imperfectly known.
Management in still other subsidiaries could identify the "Volvo values" as
articulated by the Head Office but noted that their particular unit was as yet unable to
live in accordance with the Group's principles, and even questioned whether it should, in
instances where such principles appeared to collide with local cultural norms.
Volvo's philosophy is sometimes described not in terms of the Volvo values but simply
as being "Swedish". This is a characterization that has both positive and
negative connotations. It frequently stands for "people-oriented," for example
an attribute that is generally laudable if not "carried too far." Caring for
people is welcomed, if not seen as an expression of a "socialist view, as is the case
among Volvo people in some countries. The Group's personality and by this is usually meant
impressions of middle management in Gothenburg is sometimes ascribed features that are
stereotypically Swedish: slow, methodical, dull, thorough, and cautious.
How transportable are Swedish views on personnel, leadership, etc? To most managers
interviewed, leadership development remains a problematic area. Some subsidiaries are most
eager to get clear direction and Head Office backing for management development, while
others express concern with the lack of articulation between their own views on leadership
and those of the Group. In some countries, it was said, subordinates may feel more secure
with a more hierarchic system and an authoritarian boss; for example, in Volvo White some
(not all) complained that the organization was too "flat."
it was not unusual for local managers outside of Sweden to contrast the Swedish
executive's group/committee approach and co-determination routines with their more
individualistic manner. Explaining the backgrounds to decisions and giving those concerned
an opportunity to voice their reactions to impending moves was thought by these managers
to consume an inordinate amount of time.
Managers' Dependency on Gothenburg
The middle management in Gothenburg with whom the outside managers regularly deal are
seen as good guys who are trapped in theft own world, about which they ask to few
question. There is a welcome acceptance of headquarters views and procedures when they are
based on superior analysis and understanding and practical experience. There is a
reluctance to accept headquarter procedure that is seen as purely Swedish without any
other redeeming quality.
When it comes to top management in Gothenburg, however, the profile changes: it is seen
as bold, strong, and dynamic - all qualities that are personified in the person of Pehr G
While this is admirable, a long-term corporate policy must eventually provide other
ultimate bonds between the far-flung managers end headquarters than the charisma of the
Utter dependence on Gothenburg is the unwritten premise for the managers in both the
manufacturing and marketing subsidiaries. Here is a first psychological key to the
understanding of Volvo outside of Sweden.
With the exception of Volvo White, the people working for the Group outside of Sweden
owe everything baste to Gothenburg design, products, parts, delivery time, quality,
prices, etc. This dependency is felt to be very asymmetrical. To be sure, Volvo in
Gothenburg depends on its marketing companies abroad. However, with the exception of VAC
in Rockleigh, the general feeling is one of poor leverage in dealing with Gothenburg. The
psychology of this asymmetry is probably not fully understood by management in Gothenburg.
The relation between subsidiaries and the Gothenburg offices is a source of anxiety,
sometimes anger, and always ambivalence.
Some subsidiaries (Volvo Far East and Volvo Trucks (Great Britain) are uncertain about
Volvo's long-range commitments to them, an uncertainty reinforced by, for example, lack of
capital investments. in such places there is a yearning for some sign of grace from
Olympus in Gothenburg.
The Head Office is not only "where the action is" and the repository of Volvo
knowledge, but is also the fountainhead of the Group's success. Most managers in
subsidiaries would like to have a closer association with Gothenburg, to visit there more
often, and have representatives from the Head Office visit them. Much like rivaling
siblings, the subsidiaries want attention end evidence of an on-going interest from the
Mother Company. Time and again one encounters expressions of disappointment at what is
interpreted as Gothenburg's lack of interest in a company as long as it is doing well.
This is when clear signs of appreciation would be welcome. One feels one deserves more
attention! instead, one gets attention mostly when the company is having problems.
Yet one would prefer visitors from Gothenburg either to conform to the role of an ideal
parent of a mature child, i e a parent who is concerned and supportive without being
controlling and interfering, or to be clearly labeled as Junior brothers who are there to
learn, not to lead. Also, like a good parent, one would like Volvo to respond without
delay to requests; Just about every one of the subsidiaries complained about Gothenburg's
painfully slow response time.
Some managers complain about what they see as a poor structure for managing Volvo
corporate news. It too often happens that they learn about Volvo developments from a daily
newspaper or a business magazine rather than from internally distributed reports, memos,
telexes or other forms of communication.
Subsidiary manager's desire more opportunity to rotate to other subsidiaries, other
countries, but this is perceived as the monopoly of Swedish management.
Managing the Consequences of Fluctuation in Local Markets
The second key to the mentality in the marketing subsidiaries is their response to
fluctuations in their own. marketplaces. This response is much more complex than optimism
in good times and pessimism in bad times. Once a marketing company has been through a
couple of ups and downs a pattern seems to crystallize among its managers that sets the
horizon for the company in both good and bad times. They develop either a consolidating
mode or a dynamic mode.
One's view of the present and the future s, of course, greatly colored by past
experiences. However, it is influenced not only by what one has experienced but also by
how one reacts to it. It is not a simple one-to-one relation whereby favorable past
circumstances automatically become harbingers of future felicity. The pessimist or the
worrier may even react to good fortune with unease and say to himself nothings cannot
continue to be this good." The optimist on the other hand may find in adversity an
impetus to reverse his fortune. One man will regard change as a threat, another as a
challenge. One manager will close himself to the uncertain future and withdraw into the
smaller office or shop where he can create a stable, efficient world, the other will be
open to the new day and go out to meet it.
The companies in a consolidating mode may be said to be in a process of premature
closure, of turning inward in response to market fluctuations rather than meeting them
head on. They seem to react to change like some chess players, who adopt a defensive
posture and concentrate theft resources on consolidating their internal structure rather
by breaking out and taking the offensive. The result can be preoccupation with guarding
one's territory, stabilizing procedures, and on shoring up internal mechanisms to the
extent that one's posture becomes too rigid for the market. The resulting structure is one
that is too locked to be able to expand offensively and take advantage of opportunities
when they present themselves. The commitment to work in such a climate may get high
percentage points, but it is of a different quality than the commitment in dynamic
companies. It is an energy-binding obsession with staying safe rather than an
energy-releasing freedom of action. Most companies in the Volvo Group represent the
latter, more dynamic mode. Here we find chess players who take advantage of openings and
work actively to create these openings.
A Map of Volvo outside Sweden
Let us look in more detail at how the major Volvo companies outside of Sweden are
coping with their human resources: We turn from the interviews with managers to the survey
By cluster analysis |on the whole using the same variables as in the clustering of
Volvo's domestic operations) we achieve the overview represented in Figure 1(1) This
overview does not follow the official organizational plan. It is a matrix of distances.
The criterion used is that differences between groupings should be greater than
differences within the groupings on a large number of scores. Where such groupings are
found they became "islands" on our map. We also want the distance between
various units to represent measures of the differences we have discovered between these
units. Although this is hard to achieve on a two-dimensional map the general rule is that
the closer two units are on the map the more alike in their attitudes are the people
working there. There is a great deal of difference between the attitudes of Volvo although
they share a common language. There is a great deal of difference between the attitudes of
Volvo in Denmark and Volvo in Ghent, Belgium, although the driving distance between them
is short. The difference in mentality between VAC and Volvo Italia is small although a
vast geography separates them.
There are three different clusters of marketing companies.
Group 1. The first group consists of Volvo of America
Corporation, Volvo Italia, Italia Penta, Australia, and Singapore. The latter two are in
the bottom part of the cluster, closer to the other groups of marketing companies. VAC and
Volvo Italia are the more characteristic members of the group.
More than in the other Volvo units here studied, Group 1 personnel have the feeling
that they work toward clear and common goals. They have a nearly boundless optimism about
Volvo's future and more than other Volvoites outside Sweden they describe Volvo as
successful. They feel more than others that it is easy to sell Volvo products and they
show more pride in both Volvo products and Volvo service. They know that there are
The cluster analysis employed the same variables as in our clustering of Volvo's
domestic operations. The model used is called NORMIX and was originally developed for the
clustering of US Navy personnel. See J H Wolfe, "Pattern Clustering by Multivariate
Mixture Analysis," Multivariate Behavior Research, 5, 1970.
Figure 1. Volvo worldwide clustered according to similarity of employee responses.
Most companies in this group have a management who are described as good listeners but
also very determined; the leaders trust their people. The employees have, in most places,
good relations to their local managers, and speak less gloriously about top management in
Sweden than is customary in the Volvo group.
This Group is good to Volvo. Volvo Far East, however, does not have the momentum of its
host economy. Volvo Australia is bothered by a gap between white- and blue-collar workers
that should be resolved to release full energies. Actually, all conflicts within a company
in this group should be resolved quickly. In no other Volvo units are the employees so
ready and able to take Jobs outside of Volvo as in Group 1.
Group 2. This group consists of the marketing companies in
France, Germany, and Finland. They have been less successful on the market in recent years
than the Group 1 companies and have entered a consolidating mode.
On their positive side is a strong imbued work ethic: if you have taken on a Job you
should do it and do it well. There is also a better-than-average feeling of being in the
know about what goes on. And there is a sense that the Job requirements are in line with
experience and abilities.
There is less reported independence and freedom on the jobs in Group 2 compared with
the other groups, less feeling of being useful and productive, less appreciation of
procedures for getting the work done, less cooperation between departments. The employees
report less often than in other Volvo units that their supervisor consults them, and they
do not think as often as in other Volvo companies that management notices when they put in
an extra effort. The leadership is more often described as unimaginative and distrustful.
This group has an excellent potential for Volvo, but needs to be put into the dynamic
mode. Each company in the group has activities in which this potential already is
manifest. However, the average age of the employees is high and the median time they have
served Volvo is long: 11.1 years in Volvo Deutschland, 9.1 years for Volvo Auto in
Finland, and 6.9 years in Volvo France. The lower figure in the latter company may
facilitate a process of change there.
Group 3. Within the Volvo world there is also a small
convivial culture that appears in small nations where the social fabric is relatively
unruffled untorn by major strife. Norway, Denmark, and Switzerland belong here.
The subsidiaries in these countries hold their own or make steady though somewhat
unspectacular progress. The coworkers in these companies appear to excel in interpersonal
relations. The social atmosphere at work Just couldn't be better: they feel they have a
say in decision-making, they feel well-informed, that people care about them, they have
good relations to their immediate (often inner-directed) supervisors and to management,
and they work with people they like. But that is not all: they also have a rosy attitude
toward their job, which they say is interesting, develops their potentials, is in line
with their experience and abilities, and affords them a lot of independence. Their
supervisors are open and inspire trust, as does top management. The only apparent wrinkle
at these pleasant workplaces is poor cooperation between departments, but this is a
nuisance they feel can be corrected. Not surprisingly, they want to stay with Volvo.
These job attributes would seem to describe the ideal workplace - if they were coupled
with a robust drive to excel in the business world as well. This, however, is not
regularly the case. It is as if these affable people have reacted to market fluctuations
by flocking together and seeking comfort from each other, rather than by grappling with
their problems. Whether by cultural orientation or individual disposition or both, they
seem to put a lid on healthy aggressiveness and open zest for competition, preferring to
be nice guys rather than ambitious and forceful. If you challenge them to a game of chess,
they'll suggest having a cozy cup of coffee and a chat instead.
For Volvo Group 3 is a problem In spite of or perhaps because of all its pleasant
qualities and their overload of humanistic Volvo values. These companies run the risk of
losing their sense of business urgency and competitive drive at least the Scandinavian
members in the group. They have a first-class management of human resources that is
somehow waiting to be put to the big market test.
Group 4. This group consists of the production companies in
Gent, Irvine, the Volvo White locations, and Curlttba in Brazil.
They are seen 4s providing reasonably good pay but not complete Job security. The
employees feel they produce something important and that they serve the community. The
Jobs are generally considered uninteresting and without independence but with good
procedures for getting the work done and with good training provided by Volvo. There is
good cooperation within various departments and between them.
Cultural Differences we may note in passing that the various companies in our cluster
analysis do not divide according to cultural lines. Anglo-Saxon culture is represented in
two separate clusters. The three Latin countries - France, Italy, and Brazil - end up in
three different clusters. The four Anglo-Saxon entries - Scotland, the US with VAC and
White, Australia - end up in two different clusters. And the five units from the Germanic
world - Germany, Flemish Belgium, Switzerland, Norway, and Denmark are spread over three
The cluster analysis looks at relations and patterns between answers to interview
questions and in this process other factors than cultural heritage become dominant, that
is, organizational, interpersonal, and leadership issues.
Management Practice. A Model.
The Volvo Monitor Survey asks about matters we think are important to running a good
business. There is a model of management built into this survey. This model is brought out
in the reporting of results to each participating subsidiary, and its implementation is
stimulated by local discussions, issuing from the survey results.
In simple terms this model of management can be represented by Figure 2.
Figure 2. Simplified Model of Volvo Management.
The starting point is leadership at all levels. This means that