Business Strategy Analysis and Planning

The assignment delves into the critical aspects of business strategy. It examines various frameworks and models used in strategic planning, including SWOT analysis and Porter's Five Forces. Students are expected to analyze how different business strategies align with competitive advantages, industry dynamics, and internal capabilities. The assignment also emphasizes the importance of implementing effective strategies for achieving organizational goals.

BUSINESS STRATEGY

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
TASK 2............................................................................................................................................1
2.1 Analysing strategic positioning of Volkswagen through organisational audit.................1
2.2 Environmental audit for Volkswagen Group...................................................................3
2.3 Impact of stakeholder analysis in the formulation of new strategies...............................3
2.4 Presenting new strategy for Volkswagen.........................................................................4
TASK 3............................................................................................................................................5
3.1 Analysing appropriateness of alternative strategies relating to market entry, substantive
growth, limited growth or retrenchment for Volkswagen......................................................5
3.2 Justification of selected strategies for mentioned company.............................................6
TASK 4............................................................................................................................................7
4.1 Assessing the roles and responsibilities of personnel who are charged with strategy
implementation.......................................................................................................................7
4.2 Estimated resource requirements in the implementation of new strategy for VW AG....8
4.3 Evaluating contribution of SMART targets to the achievement of strategy implementation
in VW AG...............................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
The term “Strategy” can be understood as a specific plan by which a predetermined goal of
an organisation is supposed to be achieved under head of uncertainty. Business strategy on
the other hand can be defined as a means by which target of a company is achieved. These
strategies are adopted as per the objective of an enterprise. According to the demand of a
business, strategies are evaluated and on the selection of best suitable one, mission of
business is achieved (Astrachan, 2010).Presented report is having focus on Volkswagen's
strategy for its Emission Scandal. Volkswagen is one of the largest automotive company in
world. It made luxury cars under Lamborghini, Bugatti, Bentley, Audi, Porsche and bikes
under the brand of Ducati. This company has a wide range of operations covering around
150 countries. It has two important joint ventures with FAW Volkswagen and Shanghai
Volkswagen in China. Under this report, various aspects of strategy formulation will be
discussed. Effectiveness of SMART target can be seen as a part of company's growth. Roles
and responsibilities associated with personnels for strategy plays a vital role in the success
ofv a company.
Covered in PPT
TASK 2
2.1 Analysing strategic positioning of Volkswagen through organisational audit
For strategic positioning of Volkswagen, SWOT analysis would prove to be very helpful
which is discussed as below:-
Strengths
 It is one of the most famous brand in all automotive companies. Firm is highly recognised
in market capturing a large area of market share (Hamel, 2012).Volkswagen Group owns
as well as sells around 13 automotive brands such as Audi and Bentley.
 They are the oldest manufacturer of car and still continue their operations in order to
grow in the market.
 Organisation represents the strongest market share as their major area of captured market
is China.
 They have a wide range of employees that are around 350,000 across globe. They are
working so efficiently that they can maintain their position in the market. Company’s
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research and development department is mainly focusing to keep its growing phase up to
date.
Weaknesses Weak positioning- Under this, company has a weak position in context of U.S customer. Negative publicity- This is a major factor that is ruining the entire image of company in
automotive industry. This brand has always been a great name among people. But due to
its negative publicity, brand name of Volkswagen is hampering. Matter of low market share in US- This firm is having a great impact on the people all
over world but still in US, it has been found that its market share is comparatively low. Little competency in manufacturing battery driven automotive- They are experts in
making luxury cars but when it comes to make vehicles that can be run with the help of
battery then they lack behind other company.
 Brand presence is not so strong- They still need to improve their brand presence like
Toyota and GM are having so as to capture higher market share (Hoejmose, Brammer
and Millington, 2013).
Opportunities
 Acquisition can be done in order to build a strong brand image with more competencies.
This will lead company to expand in new markets.
 Automotive industry is in boom phase and so, as demand of the products of this company
is increasing day by day, therefore, management dealing with this firm should focus in
order to attain a position of sustainability.
 Maintaining long term relationship with known car manufacturers other than one who are
from Germany will enable company to reach new market areas.
 Purchasing power of consumer has increased and thus, it will become a key factor by
which cited company can improve its areas of working. More people will be there to
purchase cars in the market.
Threats
 Increase in competition level is the most important factor that needs to be considered in
order sustain in the market (Hsieh and Chen, 2011). competitors can give a strong level
of competition. So, Volkswagen needs to be prepared in order to deal with the existing
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level of competition.Changes in government polices is another factor that affects the
basic operations of company.
2.2 Environmental audit for Volkswagen Group
For environmental audit, PESTLE analysis of Volkswagen has to be done. Environment
of any company affects its decision making capacity. In the same way, automotive firms are also
affected by these factors.
 Political factors- This includes all problems that is being faced by Volkswagen in
consideration of political elements. To expand, for any business, it is important to
consider all possible norms and legal approval of doing any work in the country
(Spender, 2014). Political condition of every country is different and therefore,
Volkswagen has to face many issues in order to expand its business in other
nations.Economic factors- Automotive industry is one of the most important sector
which helps in the development of a country. It is a major factor to contribute in income
of a country. Volkswagen is responsible for giving its part to GDP of country. Due to
several economic factors, there was a time when VG has seen a stage of decline in sales.
But due to strong brand image, they were able to survive in the market. (Woodcock,
Green and Starkey, 2011). This is how above mentioned business of automotive industry
has to take in account all perspectives of economic factor.
 Social factor- Target market of this company is mainly high earning people. They focus
on the upper class people of country. This is followed by giving employment to many
people. 502000 are approx. number of employees that are working in this company. This
industry plays a vital role in enhancing level of society and it also directs the way in
which people are living their life.
 Technological factor- Technology plays a major role in order to increase effectiveness
of the cited company. As per Volkswagen, they have introduced the best possible
technology in form of features they have provided in their car (Teece, 2010). Because of
maintaining high premium qualities of technologies in their car, there is demand of these
cars in the market. When it comes to buy a luxury car with all possible comforts,
Volkswagen is one of the brands that is considered to be the best.
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 Legal factor- It comprises with all those rules and regulation which is made up by
government. In context of cited company, all the legal aspects for running business is
important. Business law and company law should be followed in order to establish a
business. Discrimination act is also considered at working place. Therefore, all the legal
terms are fully avail in context of a enterprise
 Environmental factor- This is related with all natural resources such as water, minerals
petrol and so on. A car manufacturing industry has a strong connection with environment
because they make vehicles which are operated by petrol. Therefore, it is important for
them to make those car which consume less petrol. There should be no harmful effect in
the environment due to any product made by a company.
 .
2.3 Impact of stakeholder analysis in the formulation of new strategies
Stakeholder analysis is one of the major method which is used in today's corporate world.
The main focus under this analysis is to review impact of all stakeholders such as suppliers,
customers and employees on business. Company needs to understand the interest of each type of
stakeholder in order to address them properly in company. In context of mentioned firm, it is
important to conduct stakeholder analysis so that the best possible strategy for business can be
made. As far as this case is concern about, implementation of stakeholder analysis would be
beneficial for successfully achieving target of company. Importance of this method is discussed
below:- ,
1- Opinion of powerful stakeholders- This enables the company to shape all projects in the best
possible manner. Input from various stakeholder will help business to grow. As different mind
can produce numerous set of ideas, therefore stakeholder will help the company to achieve its
goal.
2- Availability of resources- Stakeholder helps to provide best resources. Therefore, they are
necessary in order to attain a level of sustainability. If a company is having good amount of
resources, it will surely achieve the main goal goal of business.
3-Good communication with stakeholders- This will become easy for company to inform
stakeholder about current requirements. So desired amount of resources can be avail by firm.
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There are several steps involved in the formulation of stakeholder analysis. First phase is
to identify the right stakeholder. This step is important in order to target right stakeholder as per
company's requirements. This is consists of customers,suppliers, shareholders and so on. Second
step is to prioritize stakeholder. This is done through listing down the effectiveness of each
stakeholder. Last comes the phase of understanding key stakeholders. This requires to cover all
perspective of stakeholder.
2.4 Presenting new strategy for Volkswagen
In the context of given scenario, there is a need to formulate strategy against “
Volkswagen emission scandal”. This scandal is also known as Emissionsgate or dieselgate. This
is started on September 18, 2015. Environmental protection agency of United States issued a
notice for violation of major act known as “clean air act to” Volkswagen. For resolving this
issue, there are many effective strategies used to overcome the problem.
1- Brand building is easy but maintaining brand image is tough- Mentioned company has
a strong brand building in all over the world. But due to this emission scandal, it is evaluated that
cited organisation need to give more focus on maintaining its reputation in the market. This can
only be achieved, if it gives full consideration to those methods of working which is more
reliable in nature.
2- Use of relevant source of work- Source of work should not be irrelevant. This is
because sources are responsible to produce the desired result. Therefore, it is important to have
right sources in order to maintain the authenticity of working method.
3- Review the process or method- To maintain the effectiveness of results, it is required to have a
periodical review on the process. This will reduce the chances of loop holes. Cited company can
increase the appropriateness of current method by having a periodical check on it.
TASK 3
3.1 Analysing appropriateness of alternative strategies relating to market entry, substantive
growth, limited growth or retrenchment for Volkswagen
Above cited company can adopt many techniques that would be beneficial in order to
attempt market entry , limited growth or retrenchment. Market entry can be defined as building
strategies in order to deliver goods and services to a new market sector. Available options for
market entry can be licensing, joint venture, partnering, franchising. For mentioned automotive
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industry like Volkswagen, there are many options that are available for them. Some of the best
one is discussed below-
 Joint venture- By adopting this techniques company can expand its business worldwide.
Under this concept it is reported that when two business unit come together in order to
share their resources to attain common goal than this is commonly known as Joint
venture.
 Licensing- Under this company can take licence from any other country to expand its
business. This is the most effective way of entering in any new market(Astrachan 2010).
This is important to maximize market share of any organisation as well as this will lead to
earn more profit.
 Now, in context of cited company, proper measures should be taken as a part of strategy
in order to attain a phase of market entry.
 Substantive growth strategy- This strategy is made up of many elements. These factors
are responsible in order to increase the existing growth of company. As far as this given
report is concern about, then this strategy is important in order to achieve the best
position of company.
 Limited growth strategy- is refer to as the procedure in which an organisation try to
avoid their debts from which their overall working get affected. With the help of this
policy firms can increase their return because all of their funding which are related with
growth is concerned with their own revenue not from outside an organisation.
Retrenchment strategy- This implies the concept of cutting down expenses in order to become
a financially stable company. This can be done through making a plan which is more effective in
nature. Above discussed organisation should focus on this factor to achieve a stability in their
business.
3.2 Justification of selected strategies for mentioned company
It is important to adopt a suitable strategy to focus in the area of market entry. One of the
best strategy that can be used as a source of market entry would be joint venture. This is a
concept where two companies meet up and collaborate in order to achieve a common goal. This
is the most suitable strategy as different companies possess different USP. They have different
plus point over any other business unit. Therefore, in joint venture, two company get benefited in
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order to achieve best possible result. They get more market share and this will improve the image
of company. .
TASK 4
4.1 Assessing the roles and responsibilities of personnel who are charged with strategy
implementation
A company is made up of interlinked departments which are guided by some major
people who are liable to access all operations of that particular department. As different working
people are in charge of distinct departments, their roles and responsibilities are different from
each other. Marketing plays the most important part in almost every firm. Main target of a
company is based upon two parameters. First is to capture maximum market share and second is
to earn maximum profit. Marketing manager utilizes a wide range of techniques in the working
area so that their main objective of marketing can be achieved (Margulescu and Margulescu,
2013). Duties and responsibilities of marketing manager can vary as per company's goals. In
context of Volkswagen, following are the major roles needed to be performed under the head of
marketing manager.
 Evaluating market trend- All prevailing strategies adopted by cited company will be
affected by determining current market trends and evaluating the maximum demand of
customers. This is important because market trends lead the industry to focus on areas
which are more demanded by consumers. As per people's choice, company needs to
introduce new features in their products and services. In automotive business, it is
necessary to be updated with technology as it improves the efficiency of car.
 Keeping an eye on competitor's performance- This is one of the most important factors
to consider while implementing strategy. Mentioned company should know what their
rivals are doing. This will direct the business to modify their current performance of
work. Also, other measures are needed to be taken so that their place in the market will
remain unaffected by any other factor.
 Finding new ways of doing work- This approach suggests that discussed company
should always focus on adopting those technologies by which effectiveness of performed
operations can be increased. This will allow them to improvise the existing products and
services.
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4.2 Estimated resource requirements in the implementation of new strategy for VW AG
It is important for above cited enterprise to fully capture all resources that will be needed
in order to manufacture cars. Sometimes, because of unavailability of resources, firm faces many
troubles. For successfully running of automotive company, it is necessary to handle each and
every resource in such a manner that it will be beneficial for the accomplishment of goal (Svee,
Giannoulis and Zdravkovic, 2011). Given below are some of the major resources that are needed
to implement the strategy without any delay:
 People- This represents the availability of human resources for carrying out any task.
They are actually liable for running machinery in the organisation. Any business unit
consists of many inter departments. Functioning of each department depends upon people
working under it. Therefore, maintaining human resource requirement is the major task
that is performed by any enterprise.
 Machinery- It includes those necessary equipment that are required in order to
manufacture cars (Grünig and Kühn, 2011). So, all important machinery, tools and
equipment should be available so that desired level of quality work can be achieved. This
is the main factor through which operations of automotive industry are performed.
 Finance- Next comes fund generation that is to have an idea about amount of money
required in order to run business. Finance includes all wages given to employees. This is
because; if people are working in any organisation, they will be expecting some monetary
benefits out of it. Second is to collect money for purchasing the raw material. If no raw
material will be there, this will hamper the next step in manufacturing of car. The third
most important parameter is to have sufficient amount for purchasing machinery as well.
 Time- This resource is often neglected but in order to attain target on time, this factor
needs to be considered. This will help company to achieve the goal on time.
 Plant- In context of automotive industry that is Volkswagen, in the present case, it is
important to have a designed infrastructure or a building where manufacturing of car can
take place. This acts like a working unit where all possible operations of company are
performed.
 Marketing and advertising resources- A company needs to advertise and market its
products in order to make people aware about it.. Volkswagen uses many platforms for
advertising their car. This helps in capturing attention of new customers as well as people
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will get to know about features of car and they can make a comparison between other
available cars in the market. So, this is how marketing and advertising resources help
company in achieving their target.
4.3 Evaluating contribution of SMART targets to the achievement of strategy implementation in
VW AGEvery established company needs to present their business in such a way that they
can shine in the market. Competition leads to boost morale of an organisation by giving
best possible result in the market. Talking about SMART target, than this concept hold a
significant importance in the success of any enterprise. SMART stands for- (Specific),
(Measurable), (Attainable), (Relevant), (Time bound). This is a major concept that is
fallowed by most organisation. In context of Volkswagen, this company have adopted
SMART approach to full fill its target.
For example they have determine fact of setting a specific goal. Any corporation should
not deviate from idea of what they actually want to achieve. For attaining a target, objective
should be clear and specific. This will lead to take corrective actions very easily.
“M” represent measurable, that means goal of cited company should be design like it can
be measured on parameter of every possible aspect(Grant and Pickett, 2015). If target is
ambivalent, than there will be no clarity in the techniques that is being used for attaining
company's objective. Therefore, it is suggested to adopt measurable mission.
“A” stands for attainable, that is there has to be a reality in what so ever aim is set by an
organisation. If determined goal is not realistic than it would not be possible to expect result out
of it. So setting up of objective in a manner that can be practically achieved is all that a company
need.
“R” is relevant, under which every decision irrespective of field like research and
development department, marketing mix and human resource development, this has to be
relevant. No decision should be taken which is beyond current expected requirement of business.
Discussed organisation is working according to this parameter by setting up relevant goal.
“T” symbolises time bond that is for accomplishment of every goal, there has to be a a fixed time
period under which particular task will be done. This is important because by adopting this
technique, Volkswagen can attain its desired target on time. If every objective can be achieved
on time than only a company can focus on their future targets.
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In context of Volkswagen, they have adopted SMART concept in their every step of
making strategy. In presented case, there were a case of emission scandal. For making strategy
against this, the company tried best to become more specific and measurable in formulating
plans. They formulate their strategy in such a way that it can be attainable. Reliability in their
strategy can also be seen as when they successfully implemented it.
CONCLUSION
Above discussed report enables to understand the concept of business strategy. There are
various factors that need to be taken into account while formulating strategy. Talking about
Volkswagen, it has been assessed from the report that several parameters are there for analysing
strategic positioning and examining environmental audit. Along with that, stakeholder analysis is
also carried out and many strategies that can be suitable for cited company are also mentioned in
this report.
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