By now, most people reading this know that Michael Horn, VW Group of America's CEO, stepped down this past week. This follows VW CEO Martin Winterkorn who stepped down earlier in response to the emissions scandal that began to unravel late last year. Both came after news leaked that VW had circumvented emission testing by installing a "defeat device" on millions of vehicles worldwide.
Corporations shown negatively in the spotlight, like sports teams that fail to maintain a winning record, want their fans, customers and the public in general to believe that all is made better by changes at the top. CEOs and coaches are often offered up in retribution for past sins of omission or commission. We have come to expect the captain to go down with the ship.
Was it really Horn's (or Winterkorn's) fault? Good business schools teach us to solve problems, rather than focus on symptoms. When a late night call to the doctor results in advice to "take two aspirin and call me in the morning," the aspirin may alleviate the headache but the doctor still needs to find the root cause to what ails you. Were the problems at VW addressed by Winterkorn and now Horn stepping down? Was the scandal a direct result of actions taken or decisions made by either, or simply with their knowledge and explicit or even implicit approval? Does it need to be their fault in order to satisfy the critics, or, more importantly, affect real change?
If it is true that more than 30 VW executives and engineers knew about the alleged "cheat code," then maybe the culture there was more consistent with the joke about the two campers running from a bear that just invaded the campground. One of them stopped to put on his running shoes and the other asked him if he thought the shoes would help him out run the bear, he said "no, but they will help me out run you."
Should Horn and the other captains go down with their ship? Alan Brown, chairman of the Volkswagen National Dealer Advisory Council, said Horn's departure is a serious setback. "We are troubled watching the mismanagement of this scandal from Germany, and how it may impact the ultimate decisions by the authorities in the United States," the Volkswagen dealers association said in a statement. "This change in management can only serve to put the company at more risk, not less."
Brown might be right in the short-term, but I disagree if we look at what works best for the company long-term. Even if it wasn't VW's executives' direct actions that allowed this to happen, they led in a culture that did. For that alone they should go.