The Volkswagen recovery: leaving scandal in the dust

Welch, James

doi:10.1108/jbs-04-2018-0068

Cited by 19 publications

(12 citation statements)

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“…Volkswagen adopted a proactive approach consisting of four sequential actions: key leadership positions replacement, starting from the CEO; organisational restructuring (i.e. revise the CEO's responsibilities, cut thousands of positions and change the compensation system); strategic redevelopment, centred on electric vehicles and sustainable mobility in general; and product rebranding to become a leader in electric vehicle manufacturing (Welch, 2019). Volkswagen also focused its communication on "downplaying the negative effects" and bolstering "the positive image of the company, with a strong forward-looking focus on jobs and investments" (Painter and Martins, 2017, pp.…”

Section: Volkswagen's 2015 Diesel Issuementioning

confidence: 99%

Repairing legitimacy through discourses: insights from the Volkswagen’s 2015 diesel scandal

Florio

Sproviero

2020

MEDAR

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Purpose This study aims to explore how corporate discourses enact legitimation strategies aimed at repairing pragmatic, moral and cognitive legitimacy types (Suchman, 1995) after a scandal involving sustainability, namely, the Volkswagen’s 2015 diesel scandal. Design/methodology/approach By drawing on the discursive nature of legitimacy, this study conducts a critical discourse analysis to identify how the scandal is depicted and which semantic, grammatical and lexical features characterise discourses. It then relates discourses and their features to legitimation strategies that help repair diverse types of legitimacy. Findings To repair pragmatic legitimacy, discourses on a few actors and processes enact strategies of creating monitors and avoiding panic. Such discourses include grammatical features only. Discourses on the event, actors, processes and topics of apology, trust and integrity aim to repair moral legitimacy. Enriched with grammatical and lexical features, they mobilise disassociation, excuse, justify and restructure strategies. Discourses on the event, actors, processes and topics of corporate qualities, history and future strategy help repair cognitive legitimacy by enacting an avoiding panic strategy. Grammatical, lexical and semantic features characterise such discourses. Research limitations/implications The study reveals the potentials of critical discourse analysis to bring out from texts practical modes of communicating, and specifically those discourses and features of discourses that serve legitimacy purposes. Originality/value This study offers insights into the connection among discourses, relegitimation strategies and legitimacy types by combining the discursive nature of legitimacy with critical discourse analysis. It also contributes to the growing literature on how organisations face the legitimacy challenges raised by scandals involving sustainability.

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Section: Volkswagen's 2015 Diesel Issuementioning

confidence: 99%

Repairing legitimacy through discourses: insights from the Volkswagen’s 2015 diesel scandal

Florio

Sproviero

2020

MEDAR

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“…These companies achieved an unprecedented turnaround by following a specific recovery model of replacing their leadership, restructuring the organization, redeveloping the strategy and rebranding the product. Implementing these four strategies helped these companies not only survive their scandals but also pave the way to move forward and away from the reputational harm (Welch, 2019).…”

Section: Four-step Model For Corporate Recoverymentioning

confidence: 99%

Will Boeing soar again? Navigating a corporate recovery process

Welch

2020

JBS

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Purpose This paper aims to examine the prospects of a Boeing recovery following disasters in 2019 and 2020. While some companies have navigated successful journeys through the process of reputational recovery following self-inflicted pain, Boeing faces significant reputational and global complications which have greatly prolonged the recovery process. Design/methodology/approach This paper is based on a case study approach examining the recovery process for Boeing, considering the safety issues of 2019 and the pandemic crisis during 2020. Although the Covid-19 spread was certainly a black swan event, Boeing had already inflicted a great deal of damage upon its business and reputation because of the 737 Max. This paper examines their recovery process thus far by using a four-step recovery model of replace, restructure, redevelop and re-brand that has been implemented in previous corporate recoveries. Findings When examining the corporate recovery process, though the four-step approach is a model that can work across industries, there are some challenges depending on corporate specifics. The major challenge with Boeing is the ongoing reputational concerns regarding safety combined with the new global reality because of the Covid-19 pandemic. A full corporate recovery will require attention to each of these four prongs of the process, stretched out over several years. Any missteps along the way will only prolong the pain for one of history’s most historic and influential manufacturers. Originality/value While several publicly traded companies have overcome significant obstacles over the past five years in the quest to regain trust within the marketplace, Boeing continues to face strong headwinds. Using previous examples of corporate recovery provides an interesting case analysis of what to do and what not to do during the corporate recovery process and provides a unique blueprint to what might bring Boeing back from the brink.

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“…The company was able to achieve an unprecedented turnaround by following the model of replacing the leadership, restructuring the organization, redeveloping the strategy, and re-branding the product. Implementing these four strategies help Volkswagen not only survive their scandal but continue to move the company forward and further away from the reputational harm (Welch, 2019).…”

Section: The Four Step Model For Corporate Recoverymentioning

confidence: 99%

“…In examining other recent corporate recovery stories it is apparent that Volkswagen is not the only company to achieve such positive results from the four-pronged approach. Carnival is another Fortune 500 company that used these same four steps to turn around their company prospects following a disastrous 2013 (Welch, 2019). Both Volkswagen and Carnival navigated a successful journey through this process of reputational recovery and provide excellent case study examples for other firms who may find themselves in the midst of turmoil and crisis.…”

Section: The Four Step Model For Corporate Recoverymentioning

confidence: 99%

What’s in a name? Complications in overcoming reputational damage during the corporate recovery process

Welch

2020

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Purpose It is an unfortunate and sometimes entirely avoidable prospect that very successful companies can suffer self-inflicted reputational harm due to poor corporate executive decision making. One contemporary example is seen with the once popular and rapidly growing pizza chain, Papa John’s as the company has been facing an uphill battle to recover its reputational standing following recent scandal. This article examines the recovery process and the very specific complications with the company itself. Design/methodology/approach This is a case study approach examining corporate reputational recovery using a four-pronged turnaround model of replacing the leadership, restructuring the organization, redeveloping the strategy, and re-branding the product. Findings While the four pronged approach of replace, restructure, redevelop, and re-brand, appears to be a model that can work across industries, there are some challenges depending on corporate specifics. The major challenge with Papa John’s seems to be in the ongoing connection to the founder with related problems dealing with the legacy of the corporate culture. After all, it is very difficult to move beyond reputational damage for a company still bearing the name of the corporate executive who had been the source of the scandal as well as a company that is largely intact structurally. Originality/value This article examines the corporate recovery process for Papa Johns Pizza using a four step model for corporate recovery. The new four pronged approach centers on replacement of the corporate leadership, restructure of the organization, redevelopment of strategy and the re-branding of the product. Papa Johns continues to struggle to regain traction following public relations stumbles in 2017 and 2018 and the four pronged corporate recovery model serves as a valuable analytical tool to examine the impact and effectiveness of their efforts thus far as well as their future prospects.

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The Volkswagen recovery: leaving scandal in the dust

Cited by 19 publications

References 0 publications

Repairing legitimacy through discourses: insights from the Volkswagen’s 2015 diesel scandal

Repairing legitimacy through discourses: insights from the Volkswagen’s 2015 diesel scandal

Will Boeing soar again? Navigating a corporate recovery process

What’s in a name? Complications in overcoming reputational damage during the corporate recovery process

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