BMW Group30.11.2010 Page 1 Human Resource
Management in Times of Change.
Dr. Schmidt-Reintjes, BMW Group.
BMW Group30.11.2010Page 2
Agenda.
BMW Group – A history of change and challenges
How is change managed at BMW Group?
Discussion / Q&A
BMW Group30.11.2010Page 3
BMW Group.Overview.
BMWGroup
CarsBMW, MINI, Rolls-Royce
Motorcycles
Financial Services
BMW Group30.11.2010Page 4
BMW Group. Global Vendor of Premium Vehicles.
BMW Group 2009
Car sales 1.286.310
Motorcycle sales 87.306
Employees 96.230
Locations in Germany Production PlantsCKD PlantsR&DJoint Ventures
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BMW Group.Annual Comparison 2005 to 2009.
3rd Quarter 2010Profit before tax 3.166m EUR
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1923: Developed within just a few weeks, the R 32 motorcycle hails the advent of BMW‘s great tradition in the two-wheeler market.
BMW Group.A short history of change (1/2).
1917: Foundation of BMW GmbH as a limited company. Registration of the white-and-Blue logo as the Company‘s official trademark. Production of the first aircraft engine.
1928: Taking over Fahrzeugfabrik Eisenach, BMW enters the car business (Dixi).
1945: Following destruction and dismantling of its facilities, BMW starts to re-built in a very hard process.
1952-1955: Large saloons, coupés, convertibles and roadsters in the 501 – 507 model rangecontinue BMW car production after the war, now for the first time at the Munich Plant. The BMW Isetta, BMW 600 and BMW 700 meet customer demand in the post- war years
1959: At the Annual General Meeting on 9 December 1959, small shareholders and Dealers prevent the company from being sold off. With BMW thus making a new Start as an independent mobility enterprise, Dr Herbert Quandt becomes the Major shareholder.
1962: BMW successfully makes its way out of the crisis with the sporting and compact midsize New Class Saloons.
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BMW Group.A short history of change (2/2).
1972: The new Headquarter designed by Professor Karl Schwanzer is completed For the 1972 Olympic Games. To this day the Four-Cylinder Building characterizesthe Munich skyline.
1986: The new Research and Innovation Centre (Forschungs- und Innovationszentrum, or FIZ) is built near the Group Headquarters and the Munich Plant. The FIZ is thehub of the Group‘s global research and development network.
1992: BMW AG took the decision to built a car production plant in the USA:the Spartanburg Plant.
1994: Purchasing Rover Group Ltd with its main brand ROVER, LAND ROVER,MG and MINI, BMW AG enters new market segments.
2000-2007: “Rover Demerger” and concentration on premium segments with theBMW, MINI and Rolls-Royce brands.
2007: “Strategy Number ONE” and new mission towards a sustainable economicmanagement.
2008/2009: Mastering world financial and economic crisis.
2010: Strong growth in BRIC markets, record performance on operating level.
2011ff. More to come…
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BMW Group. Strategy Number One has raised the necessity for continuing change.
Annual Report 2007
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BMW Group. New challenges and needs for change are under way…
Market, customers und competitors
Innovations and targeted business model design
Internal challenges
External challenges
• Shortage of raw materials
• Tighter legislation• Changing values• Mega-cities• Demographic effect• Sustainability• Economic developments
• Capital market
• Efficiency and profitability• Demographic effects
• Growth in premium segment
• Opening up new customer segments
• Differentiation and individual mobility
• Product differentiation• Downsizing/Downgrading
• Discernible customer benefits
• Partner management• Changes to sales channels• Service and after-sales business
Challenges and trends
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Changes in emissions legislation.CO2 regulations becoming much stricter worldwide.
Gewichtsklasse, Hubraumklasse)
-10%
-30%
-20%
USA EU 27 China
as of 2013under discussion
Japan
Group fleet 2008CO2
-10%
-25% to
-30%
-25%
by2016
by2015
as of 2020
-5% to
-20%
2010
as of 2015
> -20%
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Customer requirements.Understanding future customer requirementswill demand a more international approach.
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Agenda.
BMW Group – A history of change and challenges
How is change managed at BMW Group?
Discussion / Q&A
CMChartsPZ-32Seite 13
Leading Change – Situation Analysis. Factors of success in the change process.
Analysis
Unfreeze
Implementation
Sustain-ability
Know
Want
May
Can
Change Objective
Strategy Content
Basic Principles
Challenges
CommunicationDialogue
Mobilisation
Reward /Sanctioning
Alignment of managers
Enabling
Resources
OutwardOrientiation
Leader-ship
StructuresProcessesGuidelines
BMW‘s Change Model is based upon
- Concrete experience in BMW change projects
- Kotter (1997) Leading Change- Results of empiric research to
Change Management by Cap Gemini (2005) / TU München (2006)
CMChartsPZ-32Seite 14
6. Personal wish for change:Ambition and readiness for personal change
7. Personal match of valuesperception that personal and
company values are matched
8. Personal transformation plan:Knowledge of an target orientedplan for personal change
9. Personal efficiency:Trust in the individual ability and energy to change
10. Integration and participation: Perception that one is part of the company’s change activities
Leading Change – Situation Analysis. “Ability to change and implement.”*
Source: Harvard Business Review, Cracking the code of Change, May (2000)
Change of company Change of individual
1. Company’s Change requirements: Conviction that company mustchange.
2. Company’s Vision:Support for the company’s future vision of itself
3. Company’s transformation plan:Knowledge of an adequate planfor conducting the change
4. Company’s performance:Trust in the company’s ability to change
5. Leading and Advice:Conviction that practical changesupport will be given
Binding Processes
Push Factors
Pull Factors
Path Factors
Energy Factors
Engagement Factors
*for self-study
CMChartsPZ-32Seite 15
Leading Change – Change progress and implementation. Change direction is determined by the change concept followed.
Securing survivalCrisis Management/
organizational restructuring
MobilizingAdaptability and
developmental capacity
RenewalGrowth potentials
Learning organization
Market responsiveness
Radical repositioningStrategic
turnaround/organizational redesign
Change Map
low
high
Change capability/readiness
Cu
rren
t n
ecessit
y
for
ch
an
ge
high
Source: Doujak, Corporate Development
CMChartsPZ-32Seite 16
Leading Change – Change progress and implementation. Leaders in the role of Change manager.
COMMUNICATION QUALIFICATION COACHINGINFORMATION MONITORING
Personally perceived competence for change
7. INTEGRATION…of successful processes and behaviours in ones own active repertoire
6. RECOGNITION…why certain processes and behaviours are successful, and others not
5. TRIAL AND ERRORTrying new processes and behaviours: Successes – Failures – Confusions - Frustrations
1. SHOCKMajor discrepancy between own and others‘ expectations, and actual reality
4. EMOTIONAL ACCEPTANCE
2. DENIAL
…of reality; letting go of old processes and behaviour
Time
3. RATIONAL INSIGHT…that new processes and behaviour are necessary
Source: Change WorksW
ahrg
enom
mene
Leis
tungsf
ähig
keit d
es S
yste
ms
ZeitZeit
gering
hoch5
False sense of security; exaggerated view of own process and behavioural competence
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Change Competences – HR perspective. Changed competence needs on a corporate level are broken down to the level of individual employees and realized.
Competence
On a corporate level, competence means necessary abilities of the enterprise which ensure current and future success in business.
On the individual level, competence means usable abilities, skills and knowledge which employees are able to use to contribute to the achievement of corporate requirements and targets in the degree expected.
?
The more change is necessary, the more HR processes need to work hand in hand and in a larger context to deliver expected results.
Strategic and operating Competence Management
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How can competence be structured?One proposal among many.
Top Level Job Families
Detailed Job FamiliesJo
b F
am
ilie
s
Functions,Technologies
,Services,Products,
Markets, …
Overa
ll C
om
pete
nce L
evel
Functional Skills
Personal Skills
Skill level
General Job Profile
SpecificJob
Description
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Required Competence
Skills relevant for specific job profiles /
for specific positions
Multi-year competence requirements on a departmental level
Consistent competence catalogue
Targets for change in competence
Adequate qualification budget
HR processes
All relevant HR processes need to be aligned to pursue targeted changes in competence
EmployeeCompetence covered / potentials for coverage
Individual skills in relation to existing / new position
Com
pete
nce
Man
ag
em
en
t
??
Change Competences – HR perspective.A process to propagate change from corporate down to employee level was successfully piloted in a division of BMW.
Strategy
Critical tasks
Challenges
Resource allocation
Direction of inhouse vs.external service provision
Financialand employee headcount planning
Consistent development targets and general framework
Str
ate
gy a
nd
Lon
g R
an
ge
Pla
nn
ing
Development/ business plans
Target state, measures
General framework
Competence increase / decrease / change
Detailedplans
Decomposition to departmental level
Bu
sin
ess
div
isio
n
develo
pm
en
t
BMW Group30.11.2010Page 20
Change Competences – HR perspective. Complementary to this top-down approach, possibilities are currently investigated to strengthen employee self-organization and responsibility.
Daily needs of employeesand supervisors
Synergy potentials of an internal Social Network
Easy search of expert knowledge and transfer,identification of candidates for new areas / shifting employment focus. Future contact point for structured competence management.
Strengthening of networks / self-organization / change in habits. Spread of knowledge to groups instead of focusing on few experts.
Efficient co-work, savings in time spent, increased quality. Reproducible exchange on parallel topics as part of daily work. Transparency across countries and time zones.
Find or found by myself professional topic groups
Find experts / co-workers or be identified as an expert or as a contributor myself.
Work on professional topics together,deliver individual contributions.
Stay informed on any topic of interest / adapt my interests
as needed.
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It is People who will make the Change work.Thank you for your attention.
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Agenda.
BMW Group – A history of change and challenges
How is change managed at BMW Group?
Discussion / Q&A
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