Business Strategy for VW AG

This report discusses the business strategy for VW AG, including organizational audit, environment audit, stakeholder analysis, and new strategies for growth. It also justifies the alternative strategies for the company.

BUSINESS STRATEGY

Table of Contents
INTRODUCTION
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4
TASK 1
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4
TASK 2
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4
P2.1 Organisational audit for VW AG ....................................................................................4
P2.2 Environment audit............................................................................................................5
P2.3 Stakeholder analysis for new strategy .............................................................................6
P2.4 New Strategy for VW AG- .............................................................................................7
TASK 3
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8
P3.1 Alternative strategy for growth .....................................................................................8
P3.2 Justification......................................................................................................................9
TASK 4
............................................................................................................................................................
10
4.1 Strategy implementation with roles and responsibility of personnel.................................10
4.2 Resources required for implementation of the strategy......................................................11
4.3 Contribution of smart target ..............................................................................................12
CONCLUSION
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13

REFERENCES
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15

INTRODUCTION
Business strategy is basically a plan made by the higher authority to ensure the growth of
the company in the market as this involve specified steps that are followed by all. Present report
is d based making new strategy for new business and defining goal, vision and mission. In also
define the factors affecting making business strategy and use of techniques. Business strategy is
all about the factors that are controlled by the company as they affect the business to the core .
This report contains all about the business whether it is internally or externally. Volkswagen is a
company is a car manufacturing company and has definite goals that will be achieved with the
help of business strategy.
TASK 1
Attached in PPT.
TASK 2
P2.1 Organisational audit for VW AG
Organisational audit is all about the internal analysis of the firm as it includes all the
factors that may affect the business to the core. This audit analyse all the factors within the
organisation in order to achieve the efficiency in the operations so the company can retain in the
market for longer period by earning more profit. Volkswagen company performs this audit as
they want to ensure that there is efficiency in the operations that is performed by their effective
work force. Organisational audit clarifies all the factors weather they are beneficial or harmful so
the company can take the measures accordingly.
Swot analysis -
Strengths- Weakness-
 Strong run position and brand image in
the market
 This company is the oldest car
manufacturing company so its having
market value.
 VW AG is having excellent qualities of
advertising through print media, online
 It is having the lowest market share in
India, United States.
 This company is develop lots of
harmful full guess for environment
through their manufacturing.
 It was also having limited share growth
in other competitors from global car

ads hoardings etc.
 It also having strong R$D branch. It is
work for public demand.
manufacturing companies.
 It has done controversy and fraud about
the emissions of car caused so its lose
the brand image.
 It also facing the diesel deception
scandal in September 2015 so loss
market value.
Opportunities Threats
 VW AG company is change in
technology then facing diesel scandal.
So they recover their image. They use
more environmental friendly
technology.
 It is also developed market value in
India and selling luxury care with
attractive feature and target market.
 It is also developed relationship with
non German car manufacturing.
 VW AG company is setting new more
manufacturing factories in china.
 Increasing demand in all over world
like India and US.
 It was facing carbon dioxide emission
standers. It will harm the company.
 Innovation factor use by competitor
can affect market share of VW AG
company.
 Decreasing in fuel price costs that can
reduce sales of hybrid car.
P2.2 Environment audit
Environmental factors are play most role in organization analysis. VW AG company is
having lots of value in the market and different image in the market. So this company is having
lots of competitors in the market so environment analysis is so important for it.
PESTLE ANALYSIS-
POLITICAL FACTOR -In this organization business environment political factor play
most important role. Political factor also including Govt. Polices, political stability, foreign trade
policy, tax police lobar low police environment policy etc. VW AG company is deal with lots of

foreign customer like UK, US, India etc. so political factor effect on company rule and regulation
related to the import and export. It can barricade the entry of VW in other countries as well.
ECONOMIC FACTOR- Theses factor is also doing impact on the VW AG company
because every economic doing impact on their organization VW AG company also having
impact when influences in the economic growth, interest rate, exchange rates inflation, the factor
also affected the demand and supply. It can affect the income of VW AG.
SOCIAL FACTOR- This factor is also impact on the business environment which related
to the customer choice, life style, culture etc. VW AG company is also need to understand the
customer, choice, life style, culture etc. so it can try to match with customer. Different countries
follows different cultures as there are different things that are considered by them. It will
persuade the company to change its choices as per the taste and preferences of the customers.
TECHNOLOGICAL FACTOR -This is also doing impact on the business environment
this can affect the VW AG company. Like company use innovation selling style, advertisement
etc. The company need to change technology which can add up to the cost to VW AG.
ENVIRONMENTAL FACTOR- This is also doing impact on the business
environment. It can impact on the manufacturing factor of VW AG company. In this change
doing impact on market factors like purchasing raw material, selling of product. Hence, it is
important for the company to opt for sustainable development programme for better and safe
environment.
LEGAL FACTOR- Legal factors are those factors that ensures health and safety of the
employees. This factors also ensures that the data of the employees that has by the company is
fully secure. Volkswagen ensure its employees that their data are safe with them and their safety
is their responsibility.
P2.3 Stakeholder analysis for new strategy
Stakeholder can have ability to affect be or by organization objective, polices action etc.
they are like creditors, employees., Govt., owner etc. they are play very important and effective
role in the organization. Stakeholder analysis is giving success of every project in any
organization. A company is use the opinion of the stakeholder they give new shape, and their
suggestion also improve the quality of project. Like VW AG company was face scandal of
manufacturing in product hey use lots of harmful guess then they use succession. Stake holder
is responsible for all the work that is done in the firm on the basis of the relationship. Stake

holder analysis is done by the company as they want to ensure that the operations are performed
with full efficiency so that they can retain n the market for longer period. Volkswagen company
performs this analysis as they want to be on top among all with the help of the stake holder as
they maintain the company all the way possible. Stake holder analysis is done to acknowledge
about the customer choice, need related to these products and services. Customers are the stake
holder as they affect the business in all the way possible because they have access over all the
prices, features, practices of product. In this time VW AG company take decision with
stakeholder and improving knowledge and understand the ta customer choice and need.
Stakeholder can help to understand customer need and wants. They give succession to develop
innovation in product. The stake holder analysis helps the Volkswagen company in its growth
and expansion as they are the person who holds the authority to change anything which is not
suitable for the business. This simplifies the work for the company the stake holder handle every
thing as at last they are responsible.
 Through this they can analyse all the various factors that affect the business as they take
the change of maintaining efficiency in each and every operation that is performed by the
company in the market as they supervise all the activities of the firm and id there is any
mistake then they take corrective measures against that. Volkswagen company uses its
resources in different ways as the situation required it so that they can satisfy their
customers and will be able to retain in the market for longer period.
P2.4 New Strategy for VW AG-
New strategy is made by the company in order to grow and expand in the market.
Volkswagen needs to develop new ways to produce their product as in the market there are so
many products required by the customers with maximum feature in the less price than others.
New techniques of production will automatically reduce the cost of the products as for
companies they are easily available. This will also help them in using the resources in a very
systematic way as it also reduces the wastage of the resources. Volkswagen can bring new
innovations in their operations as innovation improves the quality that satisfy the customers to
the core and increases the sales and profit.
New Strategies
 Customer found innovative product – customers satisfaction is most important for the
companies as without them they would not be able to survive in the market. By adopting

the above strategy Volkswagen brings innovation in their products and that attracts the
customer the most and they find their products more innovative than others.
 Increasing in sales- New strategies will help the company in its growth and expansion so
that it can retain in the market for longer period. Innovative product will help the
company in increasing its sales as they attract more customers by satisfying the current
with the quality and price that is best in the market.
 Making image of the brand –Innovation and new technology makes a wonderful image
of the brand in the customers eyes as they are brought in the use only for them so the
company can take the advantage of this. Image can be build by the companies by using
the price, quality, features and many more.
 Increasing in competition strength- New strategy helps the company in improving the
efficiency level in all the way possible as the efficiency level determines the ability of the
company to perform the task and also increases the competition for them in the market.
Innovation and techniques boost up the competition as they are followed by al in the
market.
TASK 3
P3.1 Alternative strategy for growth
Alternative strategies are made by the company for the backup in the trouble time as if
the former one is not working then then they can go for the other one. For this company needs to
analyse the entire market as there are many factors that are important but uncontrollable in nature
so the company needs to take the corrective measures according to that. Volkswagen makes the
alternative strategy as they want to retain their customers and position in the market. Some are as
follows :
 Exporting – Company export its product to the other companies in order to maximise it
turnover and profit that helps the company in growth and expansion in the market.
Volkswagen exports its product to access the other markets so that they can gain the
recognition in other market..
 Turnkey contract : This contract is used by the company in the international deals as it
contains all the clause including government and public. It also contains sub contract
that is important to be followed by all. Volkswagen has this type of contract in the
international business to ensure security of every thing.

 Licensing – This gives the right to the companies to expand its business in al around the
world. Through licence Volkswagen can sell its products so that across the whole world
without any interference.
 Joint venture- Joint venture refers to the partnership that is done by the companies for a
particular project. In the international market for survival there are lots of funds including
the funds are needed and this is very difficult for individual company that's why they
collaborate with others so that they can share every thing and reduces burden.
 Franchising- It has two parties that include one party is franchisee and other is
franchiser. In both are the anther one organisation trademark process of product, trade
name. All thing can use.
P3.2 Justification
Strategies are made by the company as it simplifies the work for the employees who are
working for the growth and expansion of the company in the market. Volkswagen may adopt any
of the above strategies as they are suitable to them according to their need. Exporting can be
adopt by them if they want to expand their business in the international market and want to
increase the sales. The other ones will also help the company to maintain efficiency in corrective
measures in all the way possible.
 New expertise and insights- Alternative strategies provide the expertise to the
companies as they will get to know about many unknown things that shroud be
considered for making the business more successful.
 Both companies share risk and costs – Joint venture strategy reduces the risk factor for
the company and also reduces the cost as in this the companies are collaborate with
others to maximise profit and increase sale.
 Temporary- Nothing is permanent in the business as the factors changes their nature
time to time. All the above strategy are not permanent as the company can opt any
strategy according to the needs and the situation in the market.
 Better resource –All the above alternative strategies provides the company better
resources as they include innovation and new technology that attract the customers the
most and with the help of this they can recover the needs of the resources.

 More likely to succeed- Volkswagen adopts many of this as according to the situation
that demands the most of it. Each and every strategy are different from each other as they
provide different benefit according to the need.
 Build relationship and network- New strategies build strong relationships and network
of the company in all around the world as this is important for the company to build
relationship with others so if they need some help then the other one will help them
because of their relationship and this leads to the growth and expansion of the company.
Network will help the company to achieve the efficiency level that is needed to carry on
the business successfully.
The Volkswagen adopts the joint venture strategy as this is the most beneficial and
improves the efficiency level by reducing the cost of production and maximising the
profit of the organisation.
TASK 4
4.1 Strategy implementation with roles and responsibility of personnel
New strategies are made by the companies so easily but the implementation is very
difficult as this needs attention that has to be paid by the personnel so that they can retain in the
market and will be able to achieve the organisational goals on time. Volkswagen has a
professional personnel that implements all the strategy by maintaining efficiency in each and
every task. The roles and responsibilities of the personnel in order to implement the strategy are
as follows :
Finance manager
Role
The main role of financial manager is to manage financial terms such as cash flows, borrowing
needs and maximize return on investments and minimizing the risk of VW.
Management of outsourced functions of VW.
Ensure the fund requirements for running operations and capital investments.
Keep necessary resources and functions under the budget of VW.
Responsibilities
 Prepare a documentary budget for VW (Johnson, 2017).
 Report to management if find variances in budget and its reason.
 Determine the competitors' performance and report it to management with key issues.

 Create an analysis of cost, budget, products and services to minimize the risk and
unnecessary investments.
Marketing manager
Role
 Marketing manager must aware of his customers, what are their needs and how to
achieve them.
 Marketing manager build a strong sales force of workers to sale their product.
 Management of the marketing mix and develop marketing plans and strategies.
 Managing customer services, innovation process and brand management.
Responsibilities
 Marketing research and market segmentation.
 To keep customer value, satisfaction and loyalty on top.
 Deal with competitors and make product strategies (Slater, Olson and Finnegan, 2011).
 Manage and design integrated market communications.
Production manager
Role
 He takes part in the organisation strategic decisions
 He reduces straggle in implementation of projects
 Evaluate the development and research efforts in developing self relevant technologies.
 Protect the business environment by reducing environmental norms.
Responsibilities
 Ensure the effective production cost and production process and schedule.
 Decides the requirement of need resources and make draft for timescale jobs.
 He is responsible for the selection of equipments and their maintenance.
4.2 Resources required for implementation of the strategy
Raw material
Company have the former and major resource which is required to produce production,
accessories and apparels for VW is raw material. With appropriate and proper raw material VW
can produce some new products or relevant according to the need of customers and for this the
raw material should be available on time in a decent quantity. Volkswagen should use all the

materials which contains the class so that VW can make luxuries items for the customers and
according to the market segment (Reich and Benbasat, 2013).
Human resources or middle and lower level employees
Human resources are the essential and basic need to implement a new strategic plan for
VW organisation. People with competitive skills and knowledge are the back bone of new
strategy plan. In few months the people became employees by training and planning process as
needed to the strategic plan.
Top level managers
Management structure is to be set in an appropriate line of authority which have clear and
open thoughts to communicate with the VW employees. Regular planing and strategy meetings
are some easiest way to put a management structure properly. Structure depends on planing so
this should be organise quarterly or monthly as per the suitable situations of VW.
Finance resources
Finance resources are so important for implementation that VW can't miss taking
advantage of upcoming opportunities. VW can find some resources through investors which are
public, private organisations. Business funds like cash, cash equivalents (securities, cheques)
also corporate capital and other financial resources (Higgins, Omer and Phillips, 2015).
Technology resources
Technology resources include equipments and machineries which can manufacture the
needs of VW. A highly better and advanced machineries can maintain a good class of
manufacturing and could save money and time for the VW. The investment of VW should be
relevant for acquiring new technologies from the market which help workers to complete their
work easily and on time. This will improve the production time and save man power, money
power and time.
4.3 Contribution of smart target
SMART targets contributes a lot towards the implementation of the strategy as it shows
the way in which it gets implements for the accomplishment of organisational goals. Volkswagen
uses the smart target as they want to retain in the market by satisfying the customers and this can
only be possible when these new strategies gets implemented by the personnel in all the way
possible.
SMART has it's each word meaning which is:

S = here the 'S' stands for some specific goals and targets which is the improvement or
growth in the profitability and market share for the VW organisation. This increment can
increase the market share for VW in relevant times.
M = here the 'M' stands for the goals and targets which are measurable and have been
accomplished by VW. It also helps to increase the market share in measurable terms (numerical)
even by the measurement of the profitability and the number of items or quantity sold by the VW
(Parnell, 2010).
A = here the 'A' stands for the goals and targets which are accomplished for VW. If the
strategy has been implemented with above measurements with an effective way than it is clear
that these goals and targets are surely achievable in effective manner. This will definitely get the
results which is expected by VW from these selected strategies. It also indicates the geographic
of the target or community.
R = here 'R' stands for the practical and realistic targets. It is totally clear that the
objectives has been provided by VW is applicative and practical. There is nothing unrealistic
(claim) with the company that it can respectively increase its market share. Realistic takes into
existing reasons which support the target population and involved community.
T = here 'T' stands for bound time formulation for the VW to relevance the SMART
goals and targets. This specifies that this is duration based assessments. The previous set goals
can be re applied if every quarter delivers successfully market share increment and however
these objectives can help VW to avoid the slowdown of business. Time bound also indicate the
time period when VW accomplish its targets.
CONCLUSION
Business strategy is all about the planning that is made by the companies as they want the
success for their business so that they can retain in the market for longer period and will be able
to maximize profit. This report is all about the business strategy as it contains the mission,
vision, objectives, goals and objectives as they are the first that is considered while making a
plan. Volkswagen is the car manufacturing company that applies many strategies according to
the situation and many strategies are special formed for this so that it can grow and expand in the
targeted market. Strategies are implemented by the personnel as he is the stake holder and
manages all the things including efficiency in the organization. There are many roles and

responsibilities that are performed by the personnel just to ensure that the company is growing
and earning more profit than its competitors in the market.

REFERENCES
Books and journal
Johnson, G., 2017. Exploring strategy: text and cases. Pearson.
Slater, S.F., Olson, E.M. and Finnegan, C., 2011. Business strategy, marketing organization
culture, and performance. Marketing Letters, 22(3), pp.227-242.
Reich, B.H. and Benbasat, I., 2013. 10 Measuring the Information Systems–Business Strategy
Relationship. Strategic Information Management, p.265.
Higgins, D., Omer, T.C. and Phillips, J.D., 2015. The influence of a firm's business strategy on its
tax aggressiveness. Contemporary Accounting Research, 32(2), pp.674-702.
Parnell, J.A., 2010. Strategic clarity, business strategy and performance. Journal of Strategy and
Management, 3(4), pp.304-324.
Online
Hanlon. A., ,2017. BCG matrix. [online]. Available through
https://www.smartinsights.com/marketing-planning/marketing-models/use-bcg-matrix/>.