Organizational Performance and Strategy

This assignment explores the complex interplay between strategic management, organizational performance, and key success factors. It delves into empirical studies examining how aspects like market orientation, human resource management, IT capabilities, knowledge management strategies, and leadership styles influence firm performance. The analysis incorporates diverse perspectives from various industries, drawing upon case studies and research findings to provide a comprehensive understanding of the strategic drivers behind organizational success.

Strategic Organizational
Performance
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ABSTRACT
The aim of this report is to identify the strategic approaches which are used by Peugeot-
Citroen and challenges faced by the company. Stake holder’s analysis is explained in the report
to determine stakeholder's expectations from company. . Moreover, BCG matrix is an
innovative tool which will be used by the company for formulating effective marketing strategies
for the business. It aids in identifying products that are successful and products which are less
successful. Along with this, stakeholder mapping aid for identifying about major expectations of
the individual person and it will also help in rendering better and effective services to the
shareholders of business.
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TABLE OF CONTENTS
Abstract ..........................................................................................................................................2
INTRODUCTION...........................................................................................................................4
1.1 Background analysis..............................................................................................................4
TASK 2............................................................................................................................................5
2.0 Mission and objectives of Peugeot .......................................................................................5
2.1 Peugeot group's core competences and capability.................................................................5
3.1 PSA-PEUGEOT-CITROEN environmental analysis............................................................6
3.2 Porters five forces model.......................................................................................................8
4.0 Stake holders analysis of company........................................................................................9
4.1 Stakeholder Mapping.............................................................................................................9
4.2 satisfying key stake holders expectation and requirements.................................................10
5.0 Strategic options...................................................................................................................10
5.1 BCG/ Position matrix...........................................................................................................10
5.2 Ansoff matrix.......................................................................................................................11
Conclusion ....................................................................................................................................12
References......................................................................................................................................13
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INTRODUCTION
1.1 Background analysis
PSA-PEUGEOT-CITROEN is the French car manufacturer company which established
in the year 1976. It is headquartered Paris (France) in The company makes auto mobiles and
motorcycles using technical innovation (Barrick and et.al , 2015). It is one of the leading car
manufacturer companies of Europe. The company is second largest auto mobile manufacture
after Volkswagen (Amason and Schweiger, 2014). Auto-maker has third rank among all the auto
maker organisation of Europe. The brands Peugeot and Citroen use distinct marketing structure
and sales structure in automobiles. . Its cars are popular among consumer and they holds good
customer base. Citroen brand was ranked first in 2014 for meeting customer demand and
satisfaction (Amason and Schweiger,2014). In 1974 PEUGEOT, it has obtained approx 38%
share in Citroen.
The organisation in 1976 has increased its stake in by 905 and then the group PSA was
created and it became PSA-PEUGEOT-CITROEN. Group has received financial success in the
year 1979. The PSA group has has given employment to 208,500 people in 160 countries, such
as United Emirate, South America and Asia. It has good share holders and stake holders base ..
The venture has sold approximately 40000000 auto mobiles worldwide in the year 2014.
Company's strength is its LCV’s and it is best seller of small cars and vans in United Kingdom.
Current challenges for the company are some internal factors which are decreasing profit of
company./. In the previous two years, the firm has faced a loss of £ 7 billion. In the year 2014
for rescue operation of the company, its Chinese partner reduced 9 percent stake in the company.
After suffering from net loss of 7 billion, the company has declared that they have stated
recovering from this loss. Its shares fell down to 5 percent to 13 Euros. In the year 2014, it has
signed a deal for rescue with government of France. The company has also signed contract with
its iChinese partner. Organisation is also planing to reduces cost of manufacturing by making
models which are in demand.. PSA-PEUGEOT-CITROEN group is continuously trying to
develop its position in the market. Company is selling its auto mobiles and vehicles in many
developing countries and various other developing regions worldwide. However, company is
shifting its focus towards innovation and trying to increase its customer base (Harris and
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Ogbonna, 2013). Company has recorded a growth of 7 percent in its share holder'sr base. It has
increased its customer base by implementing digital innovation and invention.
In start of year 2016, organisation has planned to re -enter in American market after 40
years of break. The organisation was trying to maximise the sales of vehicles into European
market. This group has significant market position. Organisation also have three most popular
brands in market such as Motion& Emotion, Creative Technology and Spirit of Avant- grade.
PSA-PEUGEOT-CITROEN is selling all the auto-mobile manufactured by its brand across the
globe.
TASK 2
2.0 Mission and objectives of Peugeot
The Peugeot group is famous for its cars design and innovation in manufacturing.
Mission of PSA-PEUGEOT-CITROEN is to manufacture vehicles using technical innovation
and providing services which meet the customer expectations and demands (Barrick and et.al,
2015). The aim of the group is to provide mobility services which will help in increasing
customer satisfaction. Organisation has workers and engineers which are skilled enough to
enhance mobility of vehicles to achieve customer base in all the countries of world. Vision of
PSA-PEUGEOT-CITROEN is to promote sustainable development by acquiring place for all its
models in global market.. Furthermore company also believes in maintaining good relationship
with all its employees and co-workers. Venture always tries to value their relationship with their
customer and clients (Ogbonna and Harris, 2013).
2.1 Peugeot group's core competences and capability
PSA-PEUGEOT-CITROEN group is having many branches in different countries
specially in UAE and Asia. Its research and development department is focusing on innovation
by using mobility in its auto mobiles. Company is trying to meet its future challenges and
competition from other rivalry companies by using product innovation. The company is also
manufacturing eco friendly vehicles which do not harm environment. Company is shifting its
focus on innovation to cope up with future competition in the market (Ittner and Larcker, 2015).
The organisation is also trying to combine its technical skills to meet innovation in products. The
company is also ensuring environment sustainability by deploying mobility in the services. The
venture has made partnership with university of PSA-PEUGEOT-CITROEN which is helping
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the organization to reduce the gap which has impacted productivity and profitability of enterprise
The university is conducting programs will improve technical skills of workers to achieve
profitability..
In a survey, it is found that the company is carrying out the innovation in the
manufacturing products as the strategic approach (Amason and Schweiger, 2014). Venture is
developing strategic approaches that are unique and distinct in nature. Customer driven strategy
is used by the company to make place in global market. Firm is continuously focusing on making
product according to needs and expectation of customer which is the biggest strategic approach
for it. Peugeot has included many skilled engineers in the organization to compete with core
competencies. Growing competition in the market has led company to provide solutions and use
simplicity approach to meet the consumer expectations. Customers of company in a global
business environment are seeking for profit oriented values. PSA group has implemented and
made strategic goals for the firm. These objectives are motivating the organization to move
steadily towards its mission (Ittner and Larcker, 2015).
The organisation is using democratic style to make innovation in its manufacturing
process. In this style of leadership, company encourages employee involvement in decision
making process. This style of leadership is used by the corporate in providing guidance to its
workers to move towards goals and objectives. Mission and vision statement of the company is
very clear to meet its targets (Chen and et.al, 2014).
3.1 PSA-PEUGEOT-CITROEN environmental analysis
PESTLE analysis of company: PESTLE analysis is tool used by the organisation to
determine current environment and conditions of the market. It helps the firm to identify the
factors that can influence its business in the global market (Lewis and Thomas, 2013). PESTLE
analysis environmental factors, social factors, legal factors, economical factors and political
factors that can impact business of PSA-PEUGEOT-CITROEN.
Political factors: Political factors affect the productivity and profitability of Automaker
Company. Government of UK is forcing companies to make vehicles which are environment
friendly and produces less carbon. Taxation policy levied by the government on automobile
company can impact the business of Peugeot-Citroen. Government’s stability also plays an
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important role in determining profitability of the company. Export and import rule made by
government can influence the automobile organisation (Chen and et.al, 2014).
Economical factors: Economical factors impacts company's performance. Auto mobile
companies are the ones who gets affected by crisis of economy. In 2012, most of the European
and other branches were under immense pressure due to partnership issues and leaving Iran. It
influences their revenue and turn into the situation of financial crises. Vehicle sale reduces if the
economy of the country falls. Poor economic conditions affect prices of the automobile products.
Inflation rise impact Peugeot-Citroen adversely on productivity and performance of the
company. High taxation levied by government of automobile company reduces purchasing
power of the customers (Greenley, 2014). Demand and vehicle sales increase if the economic
conditions are positive. Size and condition of economy in the country greatly impact profitability
of the organisation. Automobile companies are totally dependent on purchasing power of
consumers. Furthermore exchange rates, interest rate and inflation rate have the ability to affect
the growth of Peugeot-Citroen Company.
Social and cultural factors: Automobile markets are highly impacted by social cultural
environment of the country. Preferences of people and changes in trend of social and cultural are
influencing Peugeot-Citroen organisation. Automakers have to amend their product according to
trends and demand of the customers. New auto mobile product are first preference of
custoemrs... In this case, the company have to manufacture product according to the preference
of the consumers. Changes in social trends also affect the business of Peugeot-Citroen.
Companies have to make vehicle according to the class of people to meet expectations of all its
customers.
Technology factors: Innovation now days is most important for any company to survive
in market. automobile manufacturer company. Innovation in vehicles helps the organisation to
get position in market. Continuously increasing technology is making them update about the
latest trends and technology used in vehicles (Chen and et.al, 2014.). In the previous year,
changes in technology is making difference among various auto mobile companies Customers
prefer to buy vehicle which are efficient in term of fuel and petrol and provide high mileages.
Vehicle which are efficient in terms of fuel always have high requirement in the market. It
describes that technology and innovation affect the profitability of Peugeot-Citroen.
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Legal factors: Various laws made by government affect the business environment of the
company. Vehicles sold by the company in market are totally subject to laws which are made by
government for safety and security of the consumers. Government has made rules to control
pollution which is emitted through vehicles. In this case, the firm have to take these rules in
account while manufacturing vehicles. Law of taxation and laws of environment safety are major
laws for Peugeot-Citroen to deal in the market.
Environmental factors: Laws relate with environment safety and less carbon emission
are influencing the automotive companies. Government is encouraging vehicle which emits less
carbon and pollution. Government of country is testing the vehicles about the carbon emission to
check if they are compatible with current environment conditions. Environment factor is also one
of the major concerns for Peugeot-Citroen.
Peugeot-Citroen is facing various issues due to environment. It is creating
impact on the manufacturing process of auto-mobile such as coating, polishing etc. Moisture and
air is affecting coated layer of the produce, due to which degradation of material can be observed
and results in the form of cracks.
3.2 Porters five forces model
Porters five forces model is used to identify the profitability of business in the market. It
helps to examine attractiveness of the sector. Porter five forces analysis determines threats of
new entrants, power of supplier and buyers, threat of competences and threat of substitute.
Threat of new entrants: Threat of new entrant is always low for any of the automobile
company. The reason behind this is that the sector require large amount of investment to start
business. Capital requirement to start the automobile sector is very high and due to which only
few companies are leading the market (Barrick and et.al, 2015). So threat of new entrants to
company Peugeot-Citroen is relatively less.
Bargaining power of Consumers: Bargaining power of customer in the automobile
industry is relatively high. Customers have power to switch from one brand to another. r brands.
Other brand in the market are attracting consumers towards them by providing vehicles at low
prices . Consumer has high power of switching from Peugeot-Citroen to any other brand present
in the market because customer buys according to its budget.
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Power of supplier in bargaining: It is critical to evaluate power of supplier in the
automotive industry. Supplier in this sector provides parts which are used in assembling of
product. Various suppliers are present in country to provide parts for vehicles so it can be
evaluated that power of suppliers is average for Peugeot-Citroen
Threat of substitute: Substitution threat is high for Peugeot-Citroen Company because
consumers have variety of options to choose from (Peugeot Citroen, 2017. Increasing prices of
cars have led consumer to buy motorbikes and scooters (Kim and et.al, 2014)). Due to this
reason there of getting substituted ( by rivalry company is high for Peugeot-Citroen (.
Competition from rival companies: Competition among automobile companies is very
high. There are many companies present in the market such Volkswagen, Toyota, Ford etc.
which can give high competition to Peugeot-Citroen. Company can deal with this competition by
making cars and other vehicle which are efficient in terms of fuel, prices and environment.
4.0 Stake holders analysis of company
Stake holder’s analysis is a process for identifying major stakeholder of company. Stake
holders of Peugeot-Citroen include share holder, employee, workers, consumer, government and
local community of the area.
4.1 Stakeholder Mapping
Stakeholder mapping is a step by step procedure to identify list of share holderss of the
company. It is process of discussion, analysis, mapping and prioritizing. It is used to draw the
perspective of various stakeholder about the company. It is classified into four parts which are
as follows:
Identifying: This is the first step in mapping of stake holders. The list of share holders of
Peugeot-Citroen includes investors, consumer, shareholder, government, local authorities and
employees of the company. This list includes groups, and various other organisations that
constitute to stakeholders of automobile venture (Lewis and Thomas, 2013). Stakeholder
changes according to the requirement of company and the strategy company is using. Major
stakeholders of Peugeot-Citroen are Dongfeng- Peugeot-Citroen. Other stake holder of the
company involves government of France, employee of Peugeot-Citroen and its suppliers.
University of PSA group is also a major stakeholder of the organisation. Customer and buyers
who buys vehicle from the firm is also stakeholder of the venture.
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It is helps in determining the objective of the organisation, on the basis of that objectives
are implemented for attaining expected outcomes. It depends on the stakeholders and changes
introduced into environment. On the basis of that listing of characters considered such as
investors, agencies and customers and employee's of the organisation. Through implementing
this strategy Peugeot-Citroen is able to determine their stakeholders on the basis of their
requirement necessary changes are introduces into the process.
Analysing: After the identification of major stakeholders of the company analysing phase
come where perspective of stakeholders towards the company is evaluated. In this phase, issues
and problem which are faced by the stakeholder are analysed. Engineers of company who have
skills to identify issues of stakeholders can be fruitful for Peugeot-Citroen. The government of
country is also the major stakeholder and can influence strategies used by the automobile
company. Legitimacy of share holders is also analysed in this phase. Engagement of share holder
with the company and their willingness to engage with the company is evaluated.
Mapping: Mapping is the analysing tool which can be used by Peugeot to determine the
stake holders engagement. It is used to evaluate the position of stake holder in criteria specified
for all the stakeholders (Floyd and Wooldridge, 2007). Prioritizing: Peugeot have to prioritize its
stake holders because it is impossible for a company to engage all it shareholders at the same
time (Peugeot Citroen. 2017). Prioritizing stakeholder will support the company to identify
which stake holder they need to give priority. Through considering stakeholders mapping,
Peugeot-Citroen is able to determine the involvement of investors. It helps in analysing the
complexity of the process.
4.2 satisfying key stake holders expectation and requirements
The approach of mapping stake holders will support Peugeot-Citroen to determine the list
of stakeholders which are relevant to the company. This process has helped the organization to
identify major stakeholders which are workers and engineers who have skills and attributes.
These skills of engineer can help the organisation to accomplish its goals. Engineers who have
skills of satisfying needs of stakeholders. This will be an aid to growth of automobile venture.
Expectation of individual can be satisfied by prioritizing and identifying process of stake
holders mapping.
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5.0 Strategic options
5.1 BCG/ Position matrix
BCG or position matrix is used by the organization to develop strategic planning. This
matrix helps Peugeot-Citroen to determine opportunities and chances where should company
invest to get high profitability (Barrick and et.al , 2015). It also supports the organisation to
discontinue its agreement with stakeholder who is not able to contribute in growth of company.
The BCG matrix has four parts which shows the market share of company:
Dogs: Dogs constitutes product which have poor growth in the market and posses lower
progress in market.
(Source: BCG Matrix, 2017)
Question marks: Question marks are products which are producing high profit but have
very low share in market.
Stars: These are the products which have highest progress and there share in market is
also high.-
Cash cow: These are the products which have high share along with low progress.
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Illustration 1: BCG matrix

Peugeot-Citroen is facing many challenges related to their lower growth of company in
the market. The organisation should concentrate on models which are famous and are in demand
by the consumers. After this identification, venture will be able to get proper capital and funds.
The product which has slow progress in market should be terminated by organisation.
Peugeot-Citroen is considering cash cow approach into their organisation. It helps in
maximising profitability at low consumption rate. With the help of this strategies they are able to
maximise their profitability. On the other hand if they are implementing star approach, it helps in
increasing growth rate of company, for this large amount of investment is also required. If they
are applying it maximises the productivity but influences the market share of the firm. Similarly,
question mark increases the production and affects their productivity. Therefore, cash cow is
identified as suitable approach for the company in order to maintain profitability and production.
5.2 Ansoff matrix
This matrix is used by the organisations to determine the growth of the product in global
market. It supports the cited company to know that of its existing product are performing god in
market. market. Strategic growth of product is identified by using Ansoff Matrix. The matrix
has four quadrants:
Market Penetration: Peugeot-Citroen can use market penetration approach to identify
which of its product are famous among customers and possess good market growth.
Product development: The main challenge Peugeot-Citroen is facing is that company is
manufacturing extra products which is making burden on company. . Product development
approach will help the company to manufacture cars and vehicles which are meeting its
consumer’s expectations (Amason and Schweiger, 2014)
Market development: This approach will support Peugeot-Citroen Company to generate
another source of income. This approach will help in determining source of income available in
the market.
Diversification: It is an approach which includes marketing and selling of products for
auto mobile company. This is done by diversifying products
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CONCLUSION
` Summing up the present report, it can be concluded that PSA Peugeot Citroen is a leading
company which is offering superior quality products for its business consumers. It is critical that
strategic approaches should be used by the organization so that long term goals and objectives
for the business could be successfully achieved. There are diverse ranges of internal challenges
which are faced by an organization and due to that operational activities performed in the
business are influenced. Recommendation for the organization is as mentioned:-
 Company can allocate necessary financial resources, human resources so that all the
required functional activities could be successfully completed. Along with this, company
should make documnetation so that that all the data and information should be
colllected properly and proper record of all the activities could be maintained.
 Research can be conducted for assessing needs and requirement of buyers so that
products and services which are being offered by the firm could be made as per the
preferences shown by the consumers.
 Analysis of stakeholder expectations could be done and it will prove beneficial for
meeting the exact needs and requirement of the buyers.
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REFERENCES
Books and Journals
Amason, A.C. and Schweiger, D.M., 2014. Resolving the paradox of conflict, strategic decision
making, and organizational performance.International Journal of Conflict Management.
5(3). pp.239-253.
Barrick, M. R. and et.al , 2015. Collective organizational engagement: Linking motivational
antecedents, strategic implementation, and firm performance. Academy of Management
Journal. 58(1). pp.111-135.
Chen, Y. and et.al, 2014. IT capability and organizational performance: the roles of business
process agility and environmental factors.European Journal of Information System. 23(3).
pp.326-342.
Greenley, G .E., 2014. Market orientation and company performance: empirical evidence from
UK companies.British journal of management. 6(1). pp.1-13.
Harris, L. C. and Ogbonna, E., 2013. Strategic human resource management, market orientation,
and organizational performance.Journal of business research. 51(2). pp.157-166.
Ittner, C.D. and Larcker, D.F., 2015. Quality strategy, strategic control systems, and
organizational performance.Accounting, Organizations and Society. 22(3-4). pp.293-314.
Kim, T. H. and et.al, 2014. Understanding the effect of knowledge management strategies on
knowledge management performance: A contingency perspective.Information &
management. 51(4). pp.398-416.
Lewis, P. and Thomas, H., 2013. The linkage between strategy, strategic groups, and
performance in the UK retail grocery industry.Strategic Management Journal. 11(5).
pp.385-397.
Ogbonna, E. and Harris, L.C., 2013. Leadership style, organizational culture and performance:
empirical evidence from UK companies.International Journal of Human Resource
Management. 11(4). pp.766-788.
Online
BCG Matrix. 2017. Accessed through<http://www.smartinsights.com/marketing-
planning/marketing-models/use-bcg-matrix/attachment/the-growth-share-matrix/>[Accessed on
31st May, 2017]
Peugeot Citroen. 2017. Accessed through<https://www.groupe-psa.com/en/>[Accessed
on 31st May, 2017]
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