In this chapter:
The Volvo Way is a fundamental Volvo Group policy that defines the company culture.
The values and principles contained in The Volvo Way guide the daily efforts to effectively realize the Group’s business strategies. The purpose is to set a standard of excellence in building a high commitment and high performance organization. The Volvo Way addresses business critical issues such as putting customers first, enhancing the alignment of culture with the business strategy, creating people alignment and developing global leadership qualities. The core principle is about enabling people.
Every manager within the Volvo Group is responsible for informing their team and discussing how the values and principles affect the team’s daily work.
Operational Development and Volvo Production System
Operational Development (OD) and Volvo Production System (VPS) are complementary and reinforce each other.
Operational Development (OD) is a process with clear steps that is used by the management and employees to change or improve a situation. It provides tools to formulate objectives, set targets and define an action plan. One of the basic principles is to value individual initiatives and capture employees’ ideas. In time of a crisis, OD helps the teams react quickly and can shift the focus and activities of an entire organization. The OD community comprises approximately 19,000 leaders and employees worldwide.
Volvo Production System (VPS) was initially a system to improve the production flow of the assembly line, but is also now used for many business processes throughout the organization, such as product development, business services and logistics. VPS is a way of working with just the resources needed. It is also about making sure everyone understands his/her role and how he/she can affect the quality of the products and services delivered to the end customer. Transparency and clear communication to employees working cross-functionally is essential.
The Volvo Group has conducted an annual employee survey, the Volvo Group Attitude Survey (VGAS), every year since 1999 with the exception of 2010. In 2012 a new index – the Performance Excellence Index (PEI) – was added to the Employee Engagement Index (EEI).
The PEI measures customer satisfaction, speed and quality of results while the EEI measures pride, satisfaction, commitment and referral level of employees. The combination of the two indexes ensures that we are evaluating the performance of the business and the organization’s capacity to change, learn and grow.
Employee engagement and performance excellence are compared against an international database of approximately 14 million employees, representing over 80 countries. In 2012 the Volvo Group was in the top quartile of companies surveyed for the employee engagement index. The EEI reached 76 percent which is above the global norm of 70 percent and on the same level as the High Performing Company norm. The Performance Excellence result was 74 percent, between the global norm of 71 percent and the High Performing Company norm of 77 percent.
Managers are responsible for analyzing the results of their team and, together with the team, establishing and following through on action plans to further improve employee engagement and performance excellence.
The response frequency in 2012 year’s VGAS was 92 percent.