Volvo's Product Development Practices: Focus on Safety

            
 
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Case Details:

Case Code : OPER042
Case Length : 18 Pages
Period : 1991 - 2004
Organization : Volvo Car Corporation
Pub Date : 2004
Teaching Note :Not Available
Countries : Sweden
Industry : Automobile

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Operations Management Case Studies | Case Study in Management, Operations, Strategies, Marketing Management, Case Studies

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Excerpts

Volvo's Production System

Right from its inception, Volvo was known for its innovative approach towards product development in the automotive industry.

Larson and Gabrielsson innovated the practice of 'building cars the Volvo way.' According to this concept, as against the usual practice of purchasing parts and assembling them, most car parts at Volvo were designed in-house and then manufactured by outside contractors according to strict technical specifications. Volvo conducted a major experiment in the field of automobile production during the 1970s. The company decided to deviate from the traditional assembly line system of manufacturing cars, in which the car was moved automatically along the assembly line at a pre-determined pace, while workers located at fixed positions performed their respective assembly roles...

Operations Management Case Studies | Case Study in Management, Operations, Strategies, Marketing Management, Case Studies

Commitment to Safety

Volvo's emphasis on safety dates back to its early days, when in 1927, the company installed a safety glass windshield, equipped with automatic windshield wipers. Over the years, Volvo came to be recognized for the high safety standards of its vehicles. Volvo's major contribution to automobile safety was the three point shoulder/lap seat belts developed by its engineer, Nils Bohlin in 1958. In 1959, Volvo became the first car company in the world to offer the three- point seat belt as a standard feature in all its cars...

The Volvo Safety Centre

Continuing with its commitment to safety, in 2000, Volvo established the Volvo Safety Centre (VSC) at Gothenburg at an investment of £50 mn. The VSC was believed to be the world's most advanced automobile safety testing laboratory. Volvo conducted various types of tests on cars, including computer simulation, component testing and crash simulation, to get a comprehensive understanding of how to make cars safer for drivers and passengers. Commenting on the importance of VSC, its head, Stefan Nilsson (Nilsson) said,

"We have the ability to move the reality of the roads into our crash laboratory. This unit gives us the technology and the capacity to continue being the world leaders in this field. Our new centre means we have the ability to create an unbeatable safety development package for new cars. When it comes to safety, Volvo leads the way." (Refer Exhibit IV for the various tests conducted at the Volvo Safety Centre)...

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