Cheating With Intent
Have you ever been surprised to see a huge and seemingly sturdy tree lying on its side on the ground after a big storm? Then you took a closer look and noticed it was hollow inside. No wonder it fell.
If your organization has a rotten core, eventually it will fall too. And whoever is in the path of the fall will be crushed whether they share responsibility for the corruption within or are just innocent bystanders.
Last week, France announced that it had opened a formal probe into one such “fallen tree” citing its rotten core of “aggravated fraud”. Prosecutors in Germany have more than doubled the number of employees being investigated for contributing to the rot. Lawsuits against the company, one of the world’s largest organizations and best known brands , continue to proliferate.
The new CEO announced that the company would suffer “substantial and painful” damage to its reputation and finances. Deservedly so.
As I’ve follow the story in the Financial Times, The Economist, and other global media, I continue to be amazed at how the fraudulent actions of a relative few can exact such an enormous toll on a huge global company and its stakeholders. How professed company values of integrity and trust can be so easily usurped by a win at any cost culture fueled by a CEO driven to be number one.
When I first wrote about this company’s fall in my October 6, 2015 blog, Core Values: Walk the Talk, it was front and center on all major news outlets. Six months later the media have mostly moved on to new scandals.
Yet the affected employees, investors, customers, partners, and communities…those in the path of the falling giant…continue to suffer the effects of a failure of leadership.
The company’s willingness to commit illegal acts in its drive to become bigger by selling products that violated the regulations in numerous countries has cost investors about $30 billion dollars in lost value.
Its willingness to commit illegal acts in the drive to be become bigger could cost the company $50 billion dollars or more in fines, lawsuits, and other expenses.
The company’s reputation was damaged, its employees were led astray, its customers were lied to, and the environment was polluted. The company has caused a huge financial toll on both the few responsible and the multitudes of the innocent caught up in the debacle. And a complete erosion of trust.
All set in motion by the rot within, a leader and culture whose core value was winning at all costs.
Will Volkswagen learn from this experience? Who knows. Will those responsible go to jail as a lesson to the company and others? Hopefully.
Financial Times March 9, 2016 – Prosecutors widen probes into VW
The Economist March 5, 2016 – Emission impossible