Business Strategy Report: HND Business, Semester 4

This report delves into the realm of business strategy, using the Hungary House and Volkswagen AG as case studies. It begins by examining the components of a business strategy, including vision, mission, goals, and core competencies, specifically for the Hungary House, a UK-based food service provider. The report explores the factors influencing strategic plan formulation and evaluates various techniques such as SWOT and PESTLE analysis. The analysis extends to VW AG, assessing its strategic position through SWOT analysis and conducting an environmental audit. The importance of stakeholder analysis in strategy formulation is highlighted. The report then proposes and evaluates alternative strategies for VW AG, justifying the chosen strategy. Finally, it assesses the roles and responsibilities of personnel in strategic implementation and identifies resource requirements, concluding with an evaluation of the contribution of SMART targets to achieve strategy implementation.

BUSINESS
STRATEGY

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Organisation vision, mission, goal, core competencies of the Hungary house................1
1.2 Components that influence of the formulation of strategic plan......................................2
1.3 Techniques for developing strategic plan for the Hungary house....................................3
TASK 2............................................................................................................................................3
2.1 Strategic position of the VW AG.....................................................................................3
2.2 Environmental audit of the cited venture.........................................................................4
2.3 Accessing the importance of stakeholder analysis while formulating new strategy for VW
AG .........................................................................................................................................6
2.4 Presenting a new strategy for Volkswagen AG................................................................7
TASK 3............................................................................................................................................9
3.1 Examining the appropriateness of alternatives strategies related to market entry,
substantive and limited growth for Volkswagen AG.............................................................9
3.2 Justifying the selection of strategy for Volkswagen organisations................................10
TASK 4..........................................................................................................................................11
4.1 Accessing the roles and responsibilities of personnel at VW AG Who are charged with
Strategic implementation process.........................................................................................11
4.2 Identifying the approximate requirement of resources in implementation process.......11
4.3 Evaluating the contribution of SMART target in order to achieve strategy implementation
in VW AG.............................................................................................................................12
Conclusion.....................................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
In an organisation, business strategy is one of the tactics by which organisation can
develop its own competitive advantage and strategic position in the market. In a simple word it
can be said that business strategy is a systematic planning for enhancing its existing position and
strength of the company and solve the problem in an effective manner. With assistance of the
business strategy, corporation can easily develop the strategic position in the market and
compete with rivals. The present project report is based on the Hungary house which is a UK
based food service provider under the Dragon Den list. The major objective of this assignment is
to understand the significance of the business strategy within the cited venture and its
implication upon company success and profitability. In addition to this, components that affect
the formulation of strategic plan and effectiveness of the techniques which is used in the
strategic plan has been also described in this report.
TASK 1
1.1 Organisation vision, mission, goal, core competencies of the Hungary house
Hungary House company is the UK based platform which provides the food and
accommodation facilities to its customer. Basically it is the online food store which deliver the
food facilities to its customer by online way. It allows the user to search for the restaurant and
browse local takeaway menus before placing an order online. The major objective of this
company is to meet the customer expectation about the food services and deliver food product at
the time period. It wanted to earn the extreme profitability and market share within the market
and become number one online food service provider in the UK market. Following are some
mission, vision, goal, and core competencies of the cited venture-
Company Mission- Hungary house company have major mission is to deliver the high quality
and effective food services to the customer in the UK market. In addition to this, it wanted to
become the number one online food service provider in the UK.
Objectives- Company have objective is to gain the highest profitability and market share in the
food sector and attract the large numbers of customer toward the food services.
Core competencies- It has various competitive advantage by which it has developed its own
effective and strategic position in the market. It has more than 10000 restaurants in the major
cities in the united kingdom. In addition to this, hungaryhouse has developed its onw online
platform by which it delivers food facilities and services by online and customer can easily
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access it. With assistance of this online platform, customer can easily make payment and deliver
their review and comments about the food facilities and services. Thus, it can be said that cited
venture have one of the effective competitive advantage is related to its online presence by
which it has created its strategic position in the food sector in the UK.
1.2 Components that influence of the formulation of strategic plan
As per the above discussion it has been analysed that there are very impressive position
of the Hungary House in the UK through which it can easily attract the large amount of
customers. In order to improve its existing services and develop new strategy about the business,
company required to focus on the development of strategic plan. There are various components
that affect strategic plan of the cited venture- Company objective- While company develop strategic plan then it must have required to
focus on the company objective. Strategic plan must be developed according to the
company goal, mission, vision and objective. Cost- While organisation develop the strategic plan then another significant factor is
related to the cost. Company have to consider the budget of the planning which included
in purchasing of material, transportation, distribution, advertisement, promotion,
production etc. SWOT- In order to develop the strategic plan for the business, corporation required to
focus on the swot analysis of the organisation. This will help to firm in summarising the
company existing position, strength, weakness, opportunities, threats. By analyse the
company existing position, form can easily develop the future plan.
 Time frame- Time is one of the significant component in the strategic plan which
company required to consider. At the time of development of strategic planning, form
required to focus on the time frame so as each and every activities can conduct
accordingly.
While Hungary house develop the strategic plan then some environmental factor can also affect
the company- Political- This includes governmental regulation, code of conduct, legislation, taxation
policies practices which can affect cited ventures strategic plan.
 Social and cultural- This includes customer taste, preferences, culture, region etc which
affect strategic plan of the cited venture about the product and services.
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 Economical- This includes countries economical condition like inflation, recession,
interest rate etc which affects the strategic plan of the organisation.
 Technological- Technological factor can also affect the company because in each and
every function and program of the company required an effective and latest technology.
1.3 Techniques for developing strategic plan for the Hungary house
Strategic planning of the company helps in attaining the business objective within a time
period. This can help to firm in attaining its target within a time period. Hungary house have
used various methods and techniques in developing the strategic planning which are as follows- SWOT analysis- SWOT analysis is essential method by which company can easily
design strategic planning for business. With help of this tool, company can analysis its
existing strength, weakness, opportunities and threats. Pestle analysis- This is another significant method by which firm can analyse its
business environmental component which affect business activities and function in the
large manner. By analysing the condition of the business environment, company can
effectively set its strategic planning.
 BCG matrix- BCG matrix helps to the company in identifying the growth rate and
market share of the business. With help of this technique, company can understand the
existing position of business in the competitive market through which it can easily
develop the planning.
TASK 2
2.1 Strategic position of the VW AG
As per the given case scenario, Volkswagen entity is the world famous auto mobile
company which sells passengers car under the various organisation such as Skoda, Audi,
Bugatti, Bentley, Ducati etc (Houdet, Trommetter and Weber, 2012). Cited venture operation is
developed in approx 150 countries and 100 production facilities across the 27 countries. In order
to identify the strategic position of the cited venture, SWOT analysis can helpful which are as
follows-
 Strength- Its major strength is its high quality and excellent material used in the
Automobile. Its brand is enough to enhance its sales and market share in the market. It
has high goodwill and brand image due to its extreme quality of product and services. It
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has joint venture with the local Chinese automaker through which it has easily enhanced
its sales and profitability.
◦ Weakness- Due to the high competition among the global car manufacturer its have
limited market share. In addition to this, it has very weak position in the Indian
market as well as united state. Furthermore, it's another weakness is that its car are
not environment friendly.
 Opportunities- Its major opportunities is to acquire the skill and competencies through
the acquisition and joint venture in the UK and US. It's another opportunity is to enhance
the fuel prices in the near future.
 Threats- Its major threat is related to high level competition in the auto mobile sector.
Regularly enhancing in the competition can create the major challenge for cite venture.
In addition to this, due to regular changing government policies, regulation and code of
conduct can create the challenge for the cited venture (Shi, 2016).
2.2 Environmental audit of the cited venture
In order to survive in the market for long time and fight with the rivals, it is very
important for the Volkswagen company to analyse its business environment and various
components. In order to conduct environmental audit, company required to focus on these
components which are as follows-
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 Political factor- This factor can largely affect the Volkswagen entity because in this
includes governmental interference such as regulation, rules, code of conduct, taxation
policies, legislation , norms etc which cited venture have to follow at the time of business
operation (Grünig and Kühn, 2015). Economical- This is another very huge component of the business environment which
can affect business operation in the large manner. In this includes country's economical
condition such as inflation, recession, interest rate, pricing policies etc. While company
enter in the market then it has to focus understand and analyse economic condition of the
country (Pestle analysis, 2017). Social and cultural- In this component includes the customer taste, preferences, region,
culture, life style, demographical condition etc. While Volkswagen firm distribute and
produce the auto mobile then it required to identify the customer taste, preferences, their
income level, culture, background etc. Environmental- The environmental factor also affect the Volkswagen entity because in
this includes the natural factor of the countries (Gonzalez-Padron, Hult and Ferrell,
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2016). Volkswagen entity can affected by this factor because government have imposed
some practices to control the pollution so company have to consider this factor at the
time of production and design of the auto mobile. Technological- As Volkswagen entity is an auto mobile company so technological
factor can largely influence the business activities and function. In order to produce the
product and services, company have to purchase the new technologies according to the
technological changes in the country (Mitchell and et.al., 2016).
 Legal- Government have developed some legislation related top the customer, employees
and business which cited venture have to follow at the time of business operation. For
instance, customer good etc, employment rights act, equality act etc.
2.3 Accessing the importance of stakeholder analysis while formulating new strategy for VW
AG
Stakeholders can be identified as persons those who are directly or indirectly
associated with business activities. Various decision taken by them have direct influence on the
growth and success of enterprise. The interest of these stakeholders vary according to their
concerns. Stakeholders play significant role in formulation of strategy. There are basically two
parties such as internal and e external stakeholders. Internal stakeholders are the people those
who are working within business unit and they participate directly in business activities. The
various persons that are considered as internal stakeholders are employees, mangers, board of
directors, equity shareholders etc. on the other hand the external stakeholders are outsiders.
These external parties participate indirectly in organisations activities. The role plays less
significant role to play in strategic formulation process.
Stakeholder analysis technique refers to the method of examining the importance of
important stakeholders. The important parties have high power and may have greater influence
on working of enterprise. There are various reason for conducting stakeholder analysis-
1. This technique help manager in identifying the important stakeholders which have high
influence on the success of firm.
2. This method enables management to analyse the power and influence of various
stakeholders on business activities.
3. To formulate effective strategy on order to take support from person those who have high
power and high influence.
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4. The enterprise can take suggestion from most powerful stakeholders for developing
organisation. It helps management in enhancing enterprise environment.
5. The support of stakeholder can assist firm in allocating and utilising resources in
effective an efficient way.
6. With the stakeholders' assistance the VOLKSWAGEN organisation can able to analysing
the reaction of various parties towards business activities (Baird and Baird 2017).
2.4 Presenting a new strategy for Volkswagen AG
The Volkswagen organisation is required to have focus on product development and
innovation strategy. It is very essential for the company to understand that there is huge
requirement of various resources and investment for implementing market development strategy.
By adopting product development strategy the organisation will able to enhance its growth and
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Illustration 2: Stakeholder Analysis
Illustration 3: Ansoff matrix
Source:Business jargons 2017

suitability. While market development strategy will assist enterprise increasing market share.
Further, it also important for the business to adopt innovation strategy in order to attract more
number of customer and it will also help company in enhancing its profitability as well as
revenue generation capacity. On the other hand product development strategy also have
significance for Volkswagen AG as the organisation is offering their product in luxury market
segment, where innovative product or product with attractive features are demanded by people.
(Bjerke and Renger, 2017).
From among various strategies of Porter, product diversification strategy will be the best
suitable plan for Volkswagen AG. By adopting diversification strategy the Volkswagen can
make wide use of market. BY adopting this strategy the organisation can gain opportunity of
exploring new market. Existing product can be introduce by enterprise in new market. On the
other hand company can launch its new product in existing market. The differentiation strategy
can be formulated buy business in order to differentiate their goods from competitors and this
strategy will allow firm to gain competitive advantage. This strategy will generate opportunity
for enterprise to develop its unique brand identity. The product development strategy can be
strengthen by using diversification plan. Marketing penetration strategy can be framed by
business in order to enhance its growth. The market penetration strategy involves selling
existing product into active market this will assist firm in increasing its market share.(Johnson
2017.).
TASK 3
3.1 Examining the appropriateness of alternatives strategies related to market entry, substantive
and limited growth for Volkswagen AG
The alternative strategy is very useful as it provides various opportunities to obtain
various solutions to business problems. The market entry strategy encourages organisation to
develop market. The firm can increase its market share by adopting market entry strategy. It
provides benefit to firm to target large number of consumers. There are various method that can
be used by business for implementing market entry strategy these are joint venture, franchising
merger and acquisition. This strategy can be used by firm for fostering international expansion.
The substantive growth can be ensured by Volkswagen enterprise b\y
taking support of effective diversification and integration strategy. Volkswagen can follow the
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upright integration thinking to augment their organisation. They can generate opportunity for
expanding their core business activities just by aligning their organisation activities with other
auto mobile enterprise. Volkswagen organisation can reduce its various cost by manufacturing
raw material rather than buying material from suppliers. In order to developed direct relationship
between substantive growth and business operation, various distribution channel can be
established by enterprise. As diversification strategy is concerned with increasing the product
line by offering wide range of differentiated products. The Volkswagen now should focus on
developing low price product for middle section of society.
Limited growth strategy assist form in handling adverse situation in business. This
strategy can be adopted by organisation when it is generating low profit, suffering financial loss.
Low market share, slow growth situation. This strategy assist firm in developing understanding
about market trend, current market situation, competitors strategy. The various method that can
be used for ensuring limited growth are innovation, market development and product
development. (Kavanagh and Johnson eds. 2017).
Retrenchment strategy can also be used as effective plan for dealing with adverse
business situation. This strategy is adopted by firm when its product has less or no demand in the
market.
3.2 Justifying the selection of strategy for Volkswagen organisations
From various analysis such as swot and Pestle analysis it has been identified that
Volkswagen organisation is performing well into the market. Their growth is tremendous. But
they are required to have little more focus on their decisions and it is required by them to
overview their decisions so that strategic could be designed in effective manner. Limited
strategies is being selected. This strategy emphasizes on product and market development. This
strategy allow Volkswagen to develop its focus on both consumers and competitors. Various
ways are being provided by this strategy using which the company would be able to resolves its
current business issues. Using diversification Methodism as a limited growth can generate
chance for firm to introduce its new products line of Auto mobile parts in market. This
diversification strategy assist organisation in strengthening their product and market
development strategy.(Pollanen Abdel-Maksoud Elbanna and Mahama, 2017).
Aligning these various strategy can help enterprise in enhancing its growth and
profitability. The organisation can invest large amount of its financial resources in enhancing the
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existing manufacturing quality rather than having focus on investment opportunities. By
investment in international expansion strategy the Volkswagen can increase its profitability. The
disadvantage of this strategy is that it divert the ficus if company.
Overall justified reason is that Volkswagen organisation can have concentration on
substantive growth strategy. By using this strategy the enterprise will be able to expand its core
business activities and this strategy will assist firm in ensuring success. The Volkswagen is
advisable to adopt diversification strategy as this strategy will help firm in increasing its market
growth and share. It will also allow organisation to have focus on set targets. These selected
strategy is the best suitable to the Volkswagen business structure and size.
TASK 4
4.1 Accessing the roles and responsibilities of personnel at VW AG Who are charged with
Strategic implementation process
There are three main roles that are associated with strategic implementation process.
Those roles include envisioning future strategy, orienting business unit to deliver plan,
incorporating change.
Envisioning future strategy -This role include communicating strategic plan to various parties
such as internal and external parties.
Orienting business to deliver change- This role include expectation that every stakeholder will
remain committed to strategy and will increase their contribution in ensuring successful
implementation of plan. In order to implement strategy in effective way the Volkswagen
organisation require motivating these people to follow strategy.
At one point of view both internal and external stakeholders are responsible for
implementing strategy. But leader play vital role in implementing process. The leader may
include CEO, top level mangers. Their role is to provide direction to employees. They are liable
for the result drawn by implementing strategy. While the role of manager is to communicate
strategy to all other members in an organisation.(Puig Michail Wooldridge and Darbra, 2017).
4.2 Identifying the approximate requirement of resources in implementation process
Resource has to play significant role in implementation process. The requirement of
resources may vary according to the size and structure of organisation. The various resources
are-
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