Business Strategy Report: Analysis of Volkswagen's Strategy

This report provides a comprehensive analysis of Volkswagen's business strategy. It begins with an introduction to business strategy and its importance, followed by an audit of Volkswagen's strategic positioning, including SWOT analysis. The report then delves into an environmental audit using PESTLE analysis, examining political, economic, social, technological, legal, and environmental factors. Stakeholder analysis is discussed, highlighting its significance in creating new business strategies. A new and effective strategy for Volkswagen is proposed, focusing on new product development. The report explores alternative strategies such as substantive growth, limited growth, market entry, and retrenchment, with a selection of the most appropriate strategy. Finally, it outlines the responsibilities and roles of personnel in strategy execution, resource requirements, and the contribution of SMART targets to successful implementation. The report concludes with a summary of key findings and recommendations.

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
TASK 2 ...........................................................................................................................................1
2.1 Strategic positioning of Volkswagen by carrying out an audit.............................................1
2.2 Environmental audit of Volkswagen.....................................................................................2
2.3 Importance of stakeholders analysis at creating new business strategy................................3
2.4 New and effective strategy for Volkswagen.........................................................................4
TASK 3............................................................................................................................................5
3.1 Alternative strategies relating to substantive growth, limited growth, market entry or
retrenchment................................................................................................................................5
3.2 Selection of a strategy...........................................................................................................5
TASK 4............................................................................................................................................6
4.1 Responsibilities and roles of personnel who are responsible in strategy execution.............6
4.2 Requirements of resources for executing a new strategy......................................................6
4.3 Contribution of SMART targets to the achievement of strategy implementation................7
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9
.......................................................................................................................................................10

INTRODUCTION
Business strategy is like the organisation’s working plan for the purpose of
accomplishing its objectives, vision, mission and also managing the financial performance of
business organisation. A business strategy is helpful in achieving the organisational goals and the
aim within particular time period (Alsudiri, Al-Karaghouli and Eldabi, 2013). Basically, the top
management formulated strategy for business for the long term.. In this present business report
mentions about the strategic positioning of Volkswagen top carry out an audit programme.
There is also an explanation about the importance of stakeholders analysis. In this business
report also mentions about the new and effective strategy for Volkswagen.
TASK 1
Covered in PPT
TASK 2
2.1 Strategic positioning of Volkswagen by carrying out an audit
Volkswagen is a large automotive business organisation and this company manufactures
the many different luxuries cars. The main competitors of this company are Skoda, Audi and
Bugatti, etc. Time to time, it make changes in its cars and also their features. Before
manufacturing the new cars, this company conducts a research programmes to know about the
customer’s preferences, their tastes, marketing strategy, other strong competitors, etc. The
employees of Volkswagen are very loyal towards company and they do their work in an effective
manner (Mehta and Mehta, 2011). This organisation has a strong brand name as well as goodwill
in the minds of customers. To conduct the audit, Volkswagen conducts SWOT analysis:
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Illustration 1: SWOT Analysis
(Source: How to Complete a Personal SWOT Analysis,
2013)
Strengths- It refers to the capabilities of the company. It is necessary for the company to
set up its objectives in an effective way. From this, management can achieve its business aims
specific time period. This company do some social activities and also programmes for the
purpose of develop of positive and good impact in the mind of customers.
Weaknesses- Company does not conduct the promotional activities at the large scale. It
does not reduce the cost its cars.
Opportunities- The great opportunity to this company is that it can increase its market
share and the level of income by conducting the large activities related to promotion.
Threats- Its major threat is that, in the automotive company, there is minimum
restrictions of entry in the new market (Montgomery, 2011). In this industry, there is many
strong competitors.
2.2 Environmental audit of Volkswagen
On the 18th September, 2015 year, there was a crisis taken place in the Volkswagen
business organisation under which its management found that the cars of this company produces
the more pollution and this is harmful for the health of people and also an environment. It
develops the bad and also negative impact on the business of this firm. From this, its productivity
was decreased.
In context to this, manager starts to develop a new plan regarding manufacturing of new
cars which are pollution free and do not harm an environment. For this, an audit of environment
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is necessary. With the help of an environmental audit, management of this company so the
comparison between its cars and the other companies cars (Palmer, Wright and Powers, 2012). It
also finds that the cars produce pollution or more. An environmental audit is helpful in identify
some factors which are impacts good in the business and also control the unnecessary factors.
PESTLE ANALYSIS of TESCO
Political factor- Under this Volkswagen faces many political complexities in its
productivity as this company deals in global market. In different countries it faces various
political problems. Rules and policies of every country are not same. So before deal in
international market there is a need to this company to know about the rules of another country.
Economical- Volkswagen gives its contribution in GDP of UK. Under this like in
European Crisis of the Debt is big issue for manufacturing of the car firms as people will not
have mote money to purchase more car. To dealing with this problem Volkswagen has many
brands with high segment and also low segment.
Social factor- It plays necessary role in automobile industry development. It impacts on
the society under which company operates its business. Volkswagen company provides
employment for the people of society.
Technological factors- Volkswagen business firm uses new technology in its production
process as well as operations of company so that from this quality of its car will be goods and
people buy more. Better and advanced technology is necessary for manufacturing of strong cars.
Legal factors- It is necessary that Volkswagen company should follow all the legal rules
as well as regulation of government at the time of doing business. Legal needs on which the
Volkswagen needs to be focus and these are protection law, labour law, taxation, consumer
protection etc.
Environmental factor- Automobile industry develops big impact on environment of
country. Petrol and diesel as fuel get polluted the environment and it develops bad impacts on
human body. So, Volkswagen requires to invest money on R & D department for protecting
natural environment.
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2.3 Importance of stakeholders analysis at creating new business strategy
The stakeholders play an important role in making the business successful and also
achieving the goals and aims of company in the determined time period. Stakeholder analysis is a
procedure of qualitative data and information in a systematic manner to identify their interests at
the time of developing policies or executing the policies and plans. The main stakeholders of the
cited company are customers, staff members, suppliers, society, shareholders etc. They all give
their good contribution in the organisational success. In context to this, it is the main duty of the
top management is to create the effective and efficient business related strategy. The
Volkswagen Company fulfil all the needs and preference of its stakeholders (Peteraf, Gamble
and Thompson Jr, 2014). The stakeholders mapping is a procedure and also the visual tool and
technique which is used in the specific analysis of stakeholders to categorised the different
stakeholders. The managers map their all stakeholders according to their good work and also the
working actions. Some of the significance of the stakeholder’s analysis are given below as
above:
 Volkswagen knows about the present market trend.
 With the help of stakeholder analysis, company can understand their opinions, ideas and
the viewpoints.
 The stakeholder’s analysis is helpful in formulating the coordination among the
stakeholders and project team.
 FTP already know about the strengths and also weaknesses of their employees, so in
context to this, manager assign them tasks or activities.
 The stakeholder analysis helps in providing the positive and the good response from the
shareholders side.
 The main importance of this type of analysis is that it helps in enhancing the
stakeholder’s satisfaction level.
2.4 New and effective strategy for Volkswagen
For the purpose of increasing the productivity and the profitability of business, there is a
needs to management to prepare a strategic business plan according to the stakeholders.
Regarding introducing the new business strategy, the top management of Volkswagen business
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enterprise prepares an effective business plan (Smith, Mills and Dion, 2010). It will also be
beneficial for the stakeholders. The main motive of this company is to satisfy the tastes and
demands of customers. The management of this firm introduces its business related strategy ion
the basis of stakeholders. Many of the effective strategies are taken place such as growth
strategy, market development and the business development. Among all these Volkswagen
selects the new product development strategy for increasing the sales of goods.
New Product Development- It is very helpful in increasing the market share of
business. Through the help of its stakeholders, this organisation can implement its business
related new strategy in the market. Regarding manufacturing of the new products, top
management of this firm prepare a plan. The main motive of this company is to enhancing the
sales and retain it at the market place. The Volkswagen manufacture the new and then attractive
cars to attract the customers towards it. Regarding new product development (NPD),
management of Volkswagen prepares an effective policies given below:
 The responsibility of this firm is to understand the needs and preference s of consumers
and then manufacture the new products or make some changes in the existing goods.
 It is necessary for the manager to select the right supplier who provides raw material on
proper time.
 Manager should increase the motivation level of employees regarding manufacturing the
new goods.
TASK 3
3.1 Alternative strategies relating to substantive growth, limited growth, market entry or
retrenchment
New business strategy helps in growth and development of the business. In addition to
this, management of Volkswagen wants to adopt that strategy which is helpful in focus on its
stakeholders. With the help of making the new strategy, company can maintain and attract the
many customers, suppliers at the market place and it will be beneficial for the business (Sokol,
2011). In addition to this, the alternative strategy related to the market entry, retrenchment,
substantive and the limited growth given below as above:
Substantive growth- In this the diversifications are not equal, there is a presence of
vertical and horizontal integration. This strategy can be assured by the effective integration as
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well as the diversification strategies. The main objective of the Volkswagen is to increase the
growth and the profitability of business. In this, if firm will reduce the horizontal cosy then there
will be the requirement to maintain the vertical integration in practice. In substantive growth
includes acquisition, merger etc.
Retrenchment- It is helpful when company deals with any kind of the difficult
conditions and also the problems. To increase the sales, management implement it (Spender,
2014). With the help of this, Volkswagen can manage and also control any issues and risks.
Market entry- It is necessary for the top management is to formulate the good marketing
strategy and with the help of this Volkswagen can develop its business. For increasing the
growth of market, it can increase its business. It consists franchising, joint venture, etc.
Limited growth- It is helpful in handling the harmful situations related to the business.
In context to it, top management develops the various strategies. It will helps in enhancing the
financial positions and the development of Volkswagen Company.
3.2 Selection of a strategy
At the market place, the performance level of the Volkswagen business organisation is
good as comparison to the other automotive company (Teece, 2010). The Volkswagen selects the
new product development strategy. But there is a on problem that it does not the high market
share because it does not make any kind of changes on the basis of current trend of market. So,
regarding the new product development, manager should make the good policies and also design
the new product in an effective manner. In addition to this, this company appoints an research
and it conducts a research related programme to determine the existing starting competitors,
market analysis etc.
In the formulation of new strategy, it is necessary that company should focus on the
society and the needs of people of society. From this, it can use the resources of the society. It is
the duty of manager is to include the employees in the strategy making process and also at the
time of execution.
TASK 4
4.1 Responsibilities and roles of personnel who are responsible in strategy execution
In the execution of business strategy, personnel plays an important role in a suitable
manner. The top management of Volkswagen prepares the strategies and plans and the manager
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is responsible for implementing the strategies in an efficient manner. In the Volkswagen,
manager control all the business related activities which are unnecessary (Valos and Bednall,
2010). Some of the roles and also responsibilities of personnels given below:
Managers- All the managers provides the guidance to the all employees and also
implement the new policies and plans at the workplace by including them at the time of
implementation.
Employees- The main role of employees is that they applies their skills and also
competencies in completing the activities and also tasks in an effective and systematic manner.
Engineers- It is the responsibility of engineers is to provide the technical support to the
manager at the time of execution of new business strategy.

4.2 Requirements of resources for executing a new strategy
There are some resources which are necessary for implementing the new business
strategy. Some of the effective resources are mention below:
Technological resources- It consists the equipment and machineries for the purpose of
manufacturing the vehicles and also their parts (Woerner and Wixom, 2015). It is necessary for
the company is to use the advanced machineries in this. From this the time as well as cost will be
save.
Human resource- The HR manager should appoint the creative, innovative and the
capable employees. The attitude of employees should be positive. For increasing their skills, it is
necessary for manager to provide training to workers. Employer should implement the policies at
workplace in a proper manner.
Raw materials- It is required at the time to manufacturing the attractive cars. Without the
resources, it cannot produce the car and also not satisfy the needs and wants of customers.
Financial resources- It is required for buying the raw material, paying salary to
employees, purchasing machineries, etc. Without money, company cannot implement the new
strategy at workplace (Woodcock, Green and Starkey, 2011). So, it is necessary to manage the
finance.
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4.3 Contribution of SMART targets to the achievement of strategy implementation
It is necessary for Volkswagen to prepare the effective and the good targets which are
helpful in achieving the organisation goals in an easy way (Alsudiri, Al-Karaghouli and Eldabi,
2013). In context to it, there is a SMART objective given below to achieve the strategic targets:
Specific- The management of Volkswagen needs to increase its market share by 10% so
it is necessary for the manager sis to set the specific goals. If the goals of company will be
specific or can say particular then it can achieve its set goals and objectives.
Measurable- The figures can be helpful in measuring the level of performance of
Volkswagen company on the basis of its targets. It is necessary for the management of company
is to achier its business objectives on given period of time. With the help of this the share of
company will be increased. From this, the market share will be increased 5 to 7 percent.
Attainable- The target those are unachievable can affect on the motivation level of staff
members so that they can perform well and also achieve the target of company (Carraher and
Paridon, 2015). With the help of this the market share of this company will be increased. It is
necessary for Volkswagen to accomplish its goals and objectives in an effective manner.
Relevant- It is necessary that the objective and target should be relevant through which
company can attain its goals. The Volkswagen company wants to make improvement in its
market positions by achieving the relevant target. In the every quarter, the market share of this
company will be enhanced by the 5 to 7% and it is realistic.
Time bound- It is helpful in maintaining the consistency in the activities and operations
of business. Through this, company can achieve its objective on proper time period. Like-
Volkswagen company has to increase its sales at the specific period time. After devising the
target, it is necessary to revised it in each 2 year.
CONCLUSION
It has been concluded from the above mentioned report that a business organisation
prepares a business strategy for achieving the goals and objectives in an effective manner and
within given period of time. In this present business report studied about the vision, mission and
the core competencies about the FTP organisation. There are some internal and the external
factors impact in formulating the business plans. In this above mentioned report studied about
the many tools and techniques used by the FTP company at the time of creating the strategic
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business plans. For the development of the business, Volkswagen carry out the environmental
audit.
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Smith, T.A., Mills, A.M. and Dion, P., 2010. Linking business strategy and knowledge
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2f8769aebd5e>./ [Accessed on 14th October, 2017].
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