Strategic Management BMW Case Study

Read this comprehensive case study on BMW's strategic management including SWOT analysis, PESTEL analysis, Porter's Five Forces Model Analysis, and current business strategies. Get expert recommendations and conclusion.

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Strategic Management
BMW Case Study

Table of contentIntroduction
Mission and Vision
Internal and external audit
SWOT analysis
PESTEL analysis
Five force analysis
Current business strategies
Recommendation
Conclusion
References

Introduction
 BMW AG
 German Automobile, engine & motorcycle manufacturing
organizations
 Founded in the year 1916 by Frenz Josef Popp.
 Manufactures motorcycles and automobiles & aircraft
engines (BMW.com 2019).
 Manufacturing plant in Germany, Brazil, India, United
Kingdom and US.
 BMW became the twelfth largest producer of selling motor
cycles in 2015
 No. of employees working in the organization is 134,682 till
2018.

Mission
The mission of BMW is to sell the
different products to their
customers with the highest quality
along with integrity. It is the
leading provider of selling the
different premium products along
with premium services for the
individual type of mobility.On the contrary, the company’s
vision is that it aims in making the
different fascinating driving
experience in a more intense
manner in the future. The current
vision of the company is termed as
FAMILY which is the main way to
Vision

Internal Analysis of BMW - SWOT
 Strength
 Innovative advertising campaigns
 Positioning themselves as the first-class brand and it
resulted in High Top of Mind Awareness.
 Sustained the market position
 Selling of exclusive cars
 Developing hybrid and electric cars

Internal Analysis of BMW - SWOT
 Weakness
 Recalling more than 1.6 million cars
 Less strategic alliances of BMW
Company
 Level of debt of BMW is the highest
 Opportunity
 Increase in the portfolio
 Inclination of customers towards
premium brands
 Market expansion

Internal Analysis of BMW - SWOT
 Threat
 Level of competition
 Audi and Mercedes are the stiff competition for BMW
 Individuals are becoming price conscious.
 Rising problems related to fuel affects demand
 Downfall in the quality and sales due to recession

 Political factors:
 BMW has huge funds, brand image and profits to grow
 Powered with fifteen production companies
 Affect the ability of consumers to change the patterns of buying
directly as there are various concerns in Brazil, Russia and China.
 Economic Factors:
 Have affected the valuation, performance
 Along with profitability of the company
 Difficult to speculate the profit losses in future as the currency is
volatile in nature.
External Analysis of PESTEL

 Social factors:
 Products and services of the company needs to fit with the
demands of the customers appropriately
 BMW has different social media pages and on Facebook
 13 million fans which help the company in investing in
introducing the different kinds of aspects
 Technological Factors:
 Huge competition – needs to develop innovative
capabilities
 Known for the pride as well as mobility of the company
through introduction of hybrid and automotive vehicles
External Analysis of PESTEL

 Legal factors:
 Copyright laws related to the different vehicles
 Obligations related to technological advancements such as
Bluetooth
 changes in the respective laws can bring halt in
performance of Existing and new BMW technologies
 Environmental Factors:
 Customers in prefer to check the health of the planet
 Production and manufacturing of the cars include the
carbon emissions as well as the usage of the fuel by the
cars
 Introduction of hybrid models
External Analysis of PESTEL

Porter’s Five Forces Model Analysis
Competitor rivalry
• High in nature
Bargaining power of customers
• High in nature
Bargaining power of suppliers
• High in nature
Threat of new entrants
• Low in nature
Threat of product substitutes
• High in nature

 Competitor rivalry
 Different competitors : Mercedes Benz and Audi
 Huge advancement in the technological aspects
 Developing hybrid strategy – Toyota is ahead of
them
 Rivalry is very high
 Bargaining power of customers
 High in nature
 Availability of the different substitutes
Porter’s Five Forces Model Analysis

 Bargaining power of suppliers
 High in nature
 Supply chain network along with long lasting relationship
with the suppliers
 Alternative suppliers present , affect the growth of the
company negatively
 Threat of new entrants
 Low in nature
 Cost of capital is high
 Threat of product substitutes
 High in nature
 Audi and Mercedes Benz which have positioned themselves
Porter’s Five Forces Model Analysis

Current business strategy
Business Level
Strategies
• Powerful brand image of the company
• Maintaining the core values as innovation, quality,
reliability performance as & satisfaction among the
customers
• “The Ultimate Driving Machine” and “Sheer Driving
Pleasure”
Corporate Level
Strategies
• Product development and diversification
• firm is able to develop new products which are being
targeted to the existing market segments
• Enhance brand image and market share
Generic Level
Strategies
• Product differentiation aspect
• Has been satisfying different requirements of the
customers with assistance of the competitive
advantage
• Focus on the different values to generate high profit
margin

Current business strategy
 Analysis of Functional, Business, Corporate and
International Levels to Gain Competitive Advantage
 Overall, BMW is trying to build the sustainable base which
helped them in boosting the designing along with
mechanized capabilities.
 It enables the respective company BMW to bring to the
markets
 which are truly original in nature and the effective kinds
of automobiles are priced in a reasonable manner.
 BMW has created the efficiency range unlike the other
conventional hybrids
 application of the diversification and the product

Recommendation
 BMW Company needs to diversify their market
 Can expand their business operations in the
developing countries
 Such as in India and China in selling the electronic cars
as it will be appropriate for the overall success of the
company in the business environment which is
competitive.
 International manufacturing plant expansion
 Manufacturing facilities to the domestic and primary
markets as the international markets can help the
company in gaining more competitiveness
 Can make the different kinds of collaborations

Conclusion
 Strategic management is one of the processes which
are unique
 Structuring of the objectives of by the top management
of the BMW organization
 Assists them in becoming more competitive
 Gaining higher advantage from the operational and
market process
 Improve the business operations in an accurate manner.
 Effective in expanding the business operations of the
company in the foreign countries.
 From the internal and external analysis of the
company BMW,
 Identified various types of opportunities which can be

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