Agile Transformation in the Automotive Industry : A Case Study of Volvo Trucks

Abstract: The automotive industry has seen revolutionary changes in the past two decades. Vehicles are starting to incorporate within themselves a significant amount of electronic and software based components, due to which the industry has seen rapidly changing customer requirements. The traditional work processes that automotive companies have ever so often employed, with excessive documentation, inefficient work teams and redundant reporting have proven to be insufficient in the newer fast-paced environment. Agile project management methods, as the name suggests, could be a tool that these companies can utilise in order to tackle such concerns. Agile methods, until a few years ago, had constrained themselves to dynamic software development applications, but they are now slowly starting to penetrate the automotive sector. This study, hence, tries to identify the factors that contribute to an automotive organisation’s decision to transform itself into an Agile based organisation, the challenges they encounter during the change process and the subsequent impact they see post transformation.   This thesis takes the form of a case study that has been conducted within the Swedish commercial vehicle company Volvo Trucks, a subsidiary of AB Volvo. Empirics were gathered in the form of interviews and surveys to get a deeper understanding of the internal processes and the transformational journey that helped Volvo Trucks become an agile based organisation. The collected empirical data is then further interpreted through the lens of theories pertaining to change and change management. Our findings suggest that the need for a transformation from traditional methods of management to agile can be driven by forces that are both internal and external, where the forces can present themselves at the same time. The internal factors here being, the inherent dysfunctions of the traditional methods. Significant challenges faced during transformation are of an organisational nature, where a partially agile organisation struggles to coordinate between its agile and non-agile departments. Lastly, a boost in worker morale and operational advantages such as increased planning efficiency and project transparency have been seen as major benefits post transformation.