BUS3001: Volkswagen Business Strategy Analysis Report

This report provides a comprehensive analysis of Volkswagen's business strategy. It begins with an introduction to strategy and its importance in business, followed by an examination of Volkswagen's internal and external environments through SWOT and PESTEL analyses. The report assesses the significance of stakeholders in framing a new strategy, emphasizing the roles of internal and external stakeholders. It then details the preparation of a new strategy for Volkswagen, outlining goals, objectives, and tactics, including the marketing mix. The analysis includes Volkswagen's 'Together Strategy 2025', aimed at re-establishing the brand's image and gaining a competitive advantage in the automotive industry, focusing on digitizing and manufacturing less-polluting vehicles. The report further examines related strategies for business growth and development, focusing on market entry strategies and the importance of adapting to the changing environment. The analysis covers market entry strategies and the importance of adapting to the changing environment. The report highlights the roles and responsibilities of personnel in implementing the strategy, resource requirements, and the use of SMART targets to achieve objectives.

Business Strategy

Table of Contents
INTRODUCTION ..........................................................................................................................1
TASK 1............................................................................................................................................1
Covered in PPT...........................................................................................................................1
TASK 2............................................................................................................................................1
2.1 Strategic positioning by performing organizational audit.....................................................1
2.2 Carry out an environmental audit for choosing the appropriate strategy..............................2
2.3 Assess importance of stakeholders of business in relation to framing new strategy............3
2.4 Preparation of new strategy for a business............................................................................4
TASK 3............................................................................................................................................5
3.1 Analysis of related strategy for business growth and development......................................5
3.2 Justification for using the selected strategy..........................................................................6
TASK 4............................................................................................................................................6
4.1 Roles and responsibility of personnel in relation to implement strategy..............................6
4.2 Analysis for resources required in strategy implementation.................................................7
4.3 Use of SMART target in accomplishment of objectives......................................................8
CONCLUSION................................................................................................................................8
REFERENCES................................................................................................................................9

INTRODUCTION
Strategy is a framework which enable a firm to do all of their operations in a proper
manner. In every business consent, strategy plays an effective and major role (Scholes, 2015).
Thus, business strategy is such tools and techniques which are helpful to an entity to in ascertain
all of their goals and targets on time and in more adequate format. This report includes the
impact of wrong business strategy on Volkswagen and how they lead to implement the new one
in their entity. Moreover, for every business finance is required which get arrange through
various sources. Thus for this response management have to formulate an appropriate strategic
plan. Further company have to evaluate their new business strategy which enable them in doing
all things in a right manner. Once the strategy get selected, authority have to identify the manner
in which it get implemented.
TASK 1
Covered in PPT.
TASK 2
2.1 Strategic positioning by performing organizational audit
It is essential for an association to conduct internal audit to determine their frauds and
errors. Along with this, by using SWOT analysis they can easily know about their strengths and
weaknesses; thus they can develop some strategies to overcome from their shortcomings.
Additionally, they will know about their threats and opportunities which are there in market
(Leonidou and et. al., 2015).
SWOT investigation of Volkswagen is examined as beneath:
STRENGTHS WEAKNESSES
VW is one of leading automotive organisation
which is established in United Kingdom.
Portfolio of company is classified into almost
14 brands and it will comprises Bentley, Audi
and so on. They are adopting new methods or
techniques into their business timely, this will
enhance demands of their products. Along with
Competitive range of VW is not much
effective at marketplace. People are not
familiar with their items and services.
Additionally, organisation is very popular but
in many countries they are struggling to
maintain their brand image as in some
countries persons do not know about this
1

this, almost 4,00,000 individuals are working
with them.
brand. Therefore, they have high competition
in market and their rivals are Toyota, Gm etc.
As sometimes they are doing false
advancement which will decrease their
goodwill and market share (Verbeke, 2013).
OPPORTUNITIES THREATS
Volkswagen is continuously updating their
products by using new tools and methods.
They are utilizing inventive techniques and it
will attract numerous customers towards their
items and services. To acquire more market
and competitive benefits, they need to develop
eco friendly goods (Blackburn, Hart and
Wainwright, 2013).
They have high competition at marketplace
with another brands which are already much
famous in market. If government formulates
new laws as well as policies then it can affect
their production process either positively or
negatively.
2.2 Carry out an environmental audit for choosing the appropriate strategy
If manager of Volkswagen wants to determine their extrinsic surroundings then they can
use two sorts of model, one is Porter's five force and another is PESTEL analysis. It can be
discussed as beneath:
Porter's five force model:
Threat of new entrants: It is essential for company to develop unique approaches for
firm, so that they will not get influenced by any another new organisation. As if, new company
get formed then it can affect the business or existing enterprise. Rather than this, main advantage
of new association is that they give occupational opportunities to individuals.
Bargaining power of supplier: An organisation need to maintain an appropriate contact
with suppliers. An enterprise can also import some parts for their cars from outside, it will help
them to reduce their unwanted cost. Therefore, they can provide items to individuals at
reasonable value.
2

Bargaining power of customers: As there is wide competition at marketplace so that
clients will buy goods from those organisation who are providing them quality products at
sensible cost (Klettner, Clarke and Boersma, 2014).
Threats of substitute: It is fundamental for an organisation to distribute their goods in an
appropriate way so that they can accomplish needs and wants of every single user. This will aid
company to improve their goodwill at competitive world.
Rivalry amongst existing firms:If many enterprises are selling same kind of products to
individuals then it will enhance competition at marketplace. Therefore, to gain advantages they
need to do effective advertisement.
PESTLE analysis:
Political factor: It is required for an association to follow rules and policies of every
nations where they are doing their business. As there are several components which can affect
their firm like market, additional charges, laws and many more (Sabherwal, Hirschheim and
Goles, 2013).
Economical factor: If there is much modifications in rates it can influence VW. Hence,
they need to use effective marketing tools so that they can increase their revenues.
Socio cultural factor: To accomplish demands of buyers, organisation needs to provide
them quality goods.
Technological factor: To take benefits from contenders, it is necessary for Volkswagen to
utilize unique methods into their production process. This will assist them to acquire maximum
market share and along with this they can easily improve their customer base.
Environmental factor: Company needs to manufacture eco friendly commodities for their
users; thus, they can reduce wastage.
Legal factor: It is essential for VW to comply all laws which are required them to follow.
If they are not following them, then their business will be illegal (Leonidou and et. al., 2017).
2.3 Assess importance of stakeholders of business in relation to framing new strategy
When higher level authority is using new strategies at marketplace then they can do
examination of their bondholders as it will help them to about their interest, needs as well as
position of organisation. Along with this manager can describe about significance of shareholder
in firm.
3

Fundamentally, stakeholders are related to an association either in direct or indirect way.
They take participate in overall administration of an organisation which will comprises investors,
workers, owners and many more. To increase revenues of firm manager can develop some kind
of strategies which are advantageous for business. Hence, decided schemes are imposed by staff
members. To do their work in an adequate way, they want better working condition and in
addition effective pay (Bentley, Omer and Sharp, 2013). It will work as a motivation and they do
their task with maximum effectiveness. Instead of this, there are some more additional elements
which will aid association to enhance their benefits like clients, regulatory bodies, creditors,
suppliers and so on. It is required for company to fulfill all laws as well as regulations. It is
necessary for manager of VW to provide their annual report to their stakeholders.
Therefore, these sort of investigation help to maintain an adequate relationship amongst
bondholders as it will give support to structure of firm. It is fundamental for an employer of
organisation to cater advantage to their shareholders either they are internal or external because
both are essential part of company.
 Staff members are count in internal stakeholders, if they take participate in decision
making procedure of firm then it works as motivation. As a result, they will do their task
more adequately.
 Superior will provide extra benefits to them, for example rewards, commissions, bonus
and many more (Martinez-Simarro, Devece and Llopis-Albert, 2015).
 Volkswagen need to render salaries to their employees on time; therefore, they will
maintain their reputation.
Hence, it is required for company to provide some advantages to their stakeholders and if
they want to keep up their interest in firm then they have to give quality goods to their users. As
a result, it will enhance income and market share of organisation.
2.4 Preparation of new strategy for a business
To develop new strategy for company, it is needed to comprehend entire requirements,
targets, methods, goals etc. of VW.
Goals: They want to improve their sales, therefore, they can take benefits from their
rivals. It will aid them to increase their goodwill at marketplace (Scholes, 2015).
Objectives:
 To enhance automotive quality.
4

 To become popular at market amongst people.
 To improve sales of goods and services through pulling numerous clients.
Strategy: They are setting their objective till 2024; hence, they are making effective plan
so that they can create their proficient image in automotive segment (Chen and Jermias, 2014).
Tactics: Manager of company is promoting their products as well as services by utilizing
many tools. For example: newspaper, leaflets, television, internet, social sites and many more.
As a result, they can easily reach to maximum people who are residing different places.
Target market: Organisation can divide their market into various sectors to fulfill
demand of each and every individual. Psycho graphic: As indicated by this, people can divide into groups as per their income
level. Therefore, firm can reach to middle as well as high class persons easily. Demographic: As per this, market can distribute according to cast, age, gender, culture
etc. of an individual.
 Geographic: According to this, market can divide as per cities.
Marketing mix: It can include various components which can influence sales and
revenues of an association. It will classified into four types, such as place, product, promotion
and price (Leonidou and et. al., 2015).
Volkswagen is one of an established car manufacturer in the world. At some point of time,
they were engaged in a issue which consider as selling of high polluted vehicles which directly
affect their brand image and strategy. To get overcome from this consent, management take a
serious step and prepare future oriented strategy which named as a ‘Together Strategy 2025’.
Through this, business is going to modify more and more concept of their core business
functions through which target ascertainment become easy and appropriate. Companies will
going to manufacture 30 new e vehicles and attain sales target of more than two million. This
made a dramatic change in automobile industry under which a new digitize and less polluted
vehicles will start to get manufacture. Although, business wants to ascertain all goals and targets
in an appropriate manner through which management become able to accomplish all targets in an
appropriate time frame.
This is a preparation of new business strategy by VK AG group whom want to reestablish
their brand image and again gain goodwill as well. Through this, they are going are gain
5

competitive advantage and frame their strategy again as well. This new strategy will support
in increase market share and gain sustainability for their project in an appropriate manner.
TASK 3
3.1 Analysis of related strategy for business growth and development
Best possible techniques assist in different parts of firm in maintaining association as
well as surroundings of business. Volkswagen fundamentally a multi national company which
create automotive products and in addition sale their items and services at global market. They
need some other alternative scheme; therefore, they can easily sort out those problems which
they will face in future (Haley and Haley, 2013).
Market entry: With assistance of franchisee, joint endeavors as well as other coordinated
efforts, an organisation can enhance their productivity. As a result, this will aid them to improve
their incomes and market share at market. Furthermore, help in convey products to numerous
clients. If they are expanding their market then they can also use some innovative techniques into
their goods and it will help them to pull buyers towards them.
Substantive growth: When combination arranging and in addition categorization then it
will cater development substantively to firm. Volkswagen is maintaining values of their items in
both manner, horizontal as well as vertical. If they give products to their buyers at sensible cost,
then it will aid them to enhance their incomes (Mellat-Parast and et. al., 2015). As a result, they
can compete their rivals at competitive world.
Retrenchment: If company wants to accomplish their desired targets and along with this
goals more effectively, for this they can develop more products for their users. But if they are not
fulfilling demands of their buyers properly, then they have to sell their assets. Hence,
retrenchment strategy is utilize by an association if they want to become more financial stable.
3.2 Justification for using the selected strategy
As per examination of Volkswagen it has been comprehended that company can face
many circumstances at market and they need to deal with all of them in a adequate manner.
As the rate of performance of firm is very fast because from last some years they are investing
much time in production. Along with this, they are working with very famous cars like
Lamborghini, Bugatti and so on. Several approaches will aid effectively in distinctive manner:
6

Flexible: It is essential for manager of an enterprise to promote their services and items
in an adequate way. They have to develop or choose strategies for business which are much
flexible in nature; thus, they can modify it as per needs and wants.
Reliable: It is entirely depends on approach which is utilizing in appropriate planning and
in addition budgeting. It is required for superior to set some targets; hence, they can accomplish
it by using various promotional methods (Fontana, Sastre-Merino and Baca, 2017).
Sustainable: Efficient arranging as well as execution of systems aid organization; thus,
can survive at marketplace. This will assist firm to improve their market share.
Therefore, Volkswagen is using market entry strategy for their company so that they can
reach to various countries. It will improve their sales and along with this profits.
TASK 4
4.1 Roles and responsibility of personnel in relation to implement strategy
It is fundamental for VW to taken into under consideration the significance which are
associated with procedure of professional approaches. Role of a personnel is much important as
they aid to impose all strategies into business process; thus, overall work will complete within
sufficient period of time (Malerba and et. al., 2015). Administration of organization's precisely
partition into three areas, which are stated as beneath:
Top level management: They are higher authorities in an organisation and will comprises
pioneers, Chief executive officer and many more. There fundamental duty is to analyze entire
market and develop policies accordingly. Along with this, they have to consider tastes and
preferences of their users. It will assist them to create policies and as a result they can easily get
success at marketplace by accomplishing coveted objectives and targets.
Middle level management: At this stage Human resource manager and another staff
members will include. They have to maintain their work as per design of strategy and implement
everything into business procedure in an adequate manner (Amran and el. al., 2016). It is
necessary for them to coordinate with working surroundings and continuously examine their
action plan. Therefore, if any obstacle determine then they can eliminate it timely. Along with
this, they have to motivate their employees so that they can do their work more proficiently.
Lower level manageable: Without this level of people an enterprise cannot fulfill their
targets and goals. They are like a crucial part for each and every kind of firm. Labours who
7

include in this, need to do their task in an adequate way; hence, company will satisfy needs and
wants of their buyers and can easily compete their competitors at competitive world.
4.2 Analysis for resources required in strategy implementation
To impose effective strategies into market, it is fundamental for an association to acquire
some resources; therefore, it will assist them into their growth as well as improvement. With aid
of appropriate assets company can easily attain their coveted targets and in addition objectives in
an effective way (Sabherwal, Hirschheim and Goles, 2013). There are several resources which
are needed for implementing new strategy for firm, are discussed as below:
Human resource: It is foremost part for each and every sort of company. Manager needs
to maintain their employees in an appropriate way; thus, entire activities will accomplish within
sufficient time duration. They have to assign task to individual as per their skills and capabilities
so that he can fulfill his work effectively and efficiently.
Financial resources: An enterprise required sufficient fund for their business to
accomplish their work. If organisation is financially strong then they can easily complete their
task and achieve desired targets. Additionally, they will buy essential things for their firm also
such as equipment.
Technical resources: It is necessary for an association to use new and unique methods
into their business, so that they can improve effectiveness of their products and items. If
company is producing goods by using innovative methods then they can pull numerous clients
towards them. As a result, VW can enhance their revenues and market share. This will aid them
to compete their competitors at competitive world (Klettner, Clarke and Boersma, 2014).
4.3 Use of SMART target in accomplishment of objectives
With assistance of SMART objectives, manager of Volkswagen can easily accomplish
their coveted targets and goals within minimum period of time. SMART target stands for:
S – Specific: As indicated by this, an employer need to decide their objective which are
particular in nature. It will help them to attain goals adequately. In this answer of some questions
will determine, like what VW wants to attain, when and where ?
M – Measurable: Decided objectives have to be measured easily; therefore, difference
can be identified easily (Blackburn, Hart and Wainwright, 2013). Such as VW is continuously
improving their profits almost 6% per year.
8

A – Attainable: Targets have to attain specifically; hence, company will grow at
marketplace.
R – Realistic: Objectives which are set by manage need to be real not fictionary. Thus,
staff member will aid their employer to attain them in an adequate way.
T – Time bound: Particular time need to be provided to workers. Hence, firm can
accomplish needs and wants of their clients timely. Such as VW is going to start a new project
and they have to complete it within 10 months (Verbeke, 2013).
CONCLUSION
It get concluded from report that, strategic planning is an essential element for business
which includes its mission, vision, core competency which support in making them different
from others. With every due course of time it is essential for business organization to frame their
strategies according to time. For this purpose, management have to identify various deviations in
their operation and then evaluate a new strategy for that. Market growth strategy work as a
beneficial tool through which an organization can easily enter into a market and then operate
their working as well. At last, authority have to find out the manner which enable them in
implementing the action plan properly.
9