Business Strategy for Volkswagen

Business strategy

Contents
INTRODUCTION.......................................................................................................................................3
TASK 1.......................................................................................................................................................3
Overview of the Organization..................................................................................................................3
Critical evaluation of Macro-environment for Volkswagen.....................................................................4
TASK 2.......................................................................................................................................................6
Critical evaluation of Internal environment of Volkswagen....................................................................6
TASK 3.......................................................................................................................................................9
Strategy to improve competitive edge for Volkswagen...........................................................................9
TASK 4.....................................................................................................................................................11
Strategic management plan for Volkswagen..........................................................................................11
CONCLUSION.........................................................................................................................................12
REFERENCES..........................................................................................................................................13
Books and Journals................................................................................................................................13

INTRODUCTION
Business strategy can be defined as those steps and initiatives that a businessman is
planning and willing to take in order to achieve specific objectives for its business. A strategy in
this order is formulated by a prolonged and analysis and research by businesspersons. This
required for listing down all important components which are part of fulfilling particular
objective and also for avoiding any deficiency in future. A proper strategy caters needs of present
and future for business organization (Yuliansyah, Gurd and Mohamed, 2017).
.
In this report an analysis of business and development of strategic management plan is
carried out for Volkswagen group. The report starts discussion with overview of the Volkswagen
Company, its business and business position in market. Further, analysis of internal and external
factors and their impact on business performance are also evaluated. Evaluation of competitive
advantage is also done and it is discussed how company can overcome any threats posed. And at
last, a proper strategic management plan is formulated. All these discussions and analysis are
supported by usage of proper business models and tools.
TASK 1
Overview of the Organization
Volkswagen is one of the most renowned brands in market of automotive vehicles.
Established since a little lesser than a century, the company have established a major footholds in
market. Volkswagen is not merely a company but, it is group in itself. The Volkswagen group
has several major brands under its name. Over than all, many popular luxurious brands of
vehicles such as Audi, Bentley, Porsche, SEAT, Bugatti and many more are parts of Volkswagen
group of vehicles. Besides these luxurious brands group have its reputation since a very long
time in market of economic vehicles as well. Economic vehicles are those which are at favorable
price for consumer segments of middle class and economy sections of society. These people
prefer general and genuine priced vehicles to meet their needs and ends of desires to own their
personal vehicles. Volkswagen group is dedicated to make these customers fulfill their desires as
well. In the economic vehicles company has launched several models in the name of
Volkswagen itself. Other than vehicles in the brand name of Volkswagen group, the economic
vehicles category also contains several other brands as well like Skoda. All these brands, which
are part of Volkswagen group, be it in the category of luxurious vehicles or in the category of
economic vehicles, together forms part of a larger group of Volkswagen, but when each of these
brands, if seen in isolation to their own identity, they have their own market share and share their
personal reputation among people.

These were some of the facts related to Volkswagen, relevant when group is seen from a
traditional point of view. Currently in modern market, Volkswagen is trying to establish and
develop its image as a leader in separate category of vehicles. Vehicles of new age technology
and choices of consumers’ in upcoming time. That is category of electric vehicles. For this
category, the market is kin evolving stage for all players. But, even in starting of this trend of
electric vehicles, competitions have grown at significant scale and Volkswagen is facing stiff
competition from global tycoons like Tesla. However, the already well-established image of
Volkswagen is seen helping group at this point of time, and will continue to help in upcoming
times as well.
Although, Volkswagen is a group that have its business operation and business interests
in almost every parts of the world, and it carries its business in order of Global Supply chain and
its mechanism. But still, the most profitable markets for the company are in United States and
United Kingdom.
Critical evaluation of Macro-environment for Volkswagen
Macro business environment for any company or business organization is formed of
those factors that exist in environment and boundaries of a particular organization. These factors
are present for a business in externalities and are seen generally out of control of strategic
management and planning of organization (Lim, Chalmers and Hanlon, 2018). Since, these
factors are beyond the limits of organization and exert influence over the planning, process and
operation of its business, management in Volkswagen is more required to get adaptable to these
factors in its strategic planning and formulate every strategy in accordance that these factors turn
into opportunities rather than bringing any threat. However, these can only be done after a
significant and extensive analysis of these factors. In this report it has been attempted to analyze
these external factors for Volkswagen group of vehicles. Since the dimensions of these vehicles
are very wide and they are seen influencing planning of organization from every possible
dimension of business environment, it is important to take a holistic approach for their analysis.
For this purpose, report has attempted to use PESTLE model of macro-environment analysis.
Political environment- Political environment stands for a wide range of political beliefs and
sentiments that prevail in a country or a region from the side of ruling government and
administration as well. Political beliefs are important for a business organization because more or
less a business is a part of society only and everything in a society is exposed to these
sentiments. In a political environment although there are range of beliefs and sentiments but for a
large scale multi-national business Volkswagen the most favorable political sentiments are
Capitalistic sentiments. Capitalistic sentiments are supportive in providing free market play for
the company. Government intervention in business operations are reduced for Volkswagen to a
very nominal level.
Economic environment- Economic environment is reflective of status and position of economic
factors for company, present in overall economy of country (Suoniemi and et.al., 2020).