Business Strategy: Strategic Planning & Formulation at Volkswagen AG

This report provides an overview of business strategy, focusing on the process of strategic planning and formulation within organizations, using Volkswagen AG as a case study. It assesses how business missions, visions, objectives, goals, and core competencies inform strategic planning. The report analyzes factors considered during strategic plan formulation, including engagement, communication, innovation, project management, and organizational culture. Furthermore, it evaluates the effectiveness of techniques used in developing strategic business plans and analyzes the strategic positioning of Volkswagen AG through organizational and environmental audits. The significance of stakeholder analysis in formulating new strategies is also assessed, concluding with a discussion of Volkswagen's innovations and technologies and their impact on corporate and social responsibility. Desklib offers a platform to access this and similar assignments for student reference.

BUSINESS
STRATEGY

TASK 1: Understanding the process of strategic planning:
• A processed strategic planning is very essential in a business organisation. According to
Rammal (2014, p. 83), a strategic plan needs to be followed in an organisation in order to
assess the main focuses, ideas and the objectives in it. The well planned structure of the
strategic plan helps in directing the organisation in a focused path, maintaining a well
attachment with all the variables in the organisation. An effective strategic planning in an
organisation guides the company in choosing the main objectives, that the organisation
intends to, discusses all the essentials for aiming the goal, evaluate the process of success
and also to assess the outcomes of the success.
• According to Jeston (2014, p.74), the process of strategic planning needs to follow few certain
steps, as:

Cont..
• Assessment of the plan: the organisation of Volkswagen AG needs to, at first, focus on the plan
and frame the strategies in change, in order to understand the developments needed for the entire
situation in fulfilling the objectives of the organisation.
• Formulation of strategies: now, the organisation needs to construct the concrete frame of the
strategies, which needs to be applied in the organisation in future increment of sale.
• Execution of the strategy: after the main strategy has been framed, it needs to be dispatched
within small executive plans, so it can be worked out by all.
• Evaluation of the strategy: at last it comes to the responsibility of the managers in Volkswagen
AG to evaluate the assessment on the perfection of the strategies in the plan, if well handed by
all the departments involved in the plan.

1.1. Strategy planning:
• Business mission:
The business mission of an organisation defines the basic objectives of the organisation,
being followed in the current time (Chang, 2016, p.147). Volkswagen has focused on the
quality and the quantity in the production of vehicles. The organisation has always intended
to be the leading company in the market in automobile industry. In a very recent time the
company has focused on the beneficial side of the production in the environmental issues
(Earthtalk.org, 2016). The company has focused on manufacturing vehicles, those are
completely environmental friendly. The new range of cars has been able to emigrate less
amount of polluting gas. The success of the company has yet not brought satisfaction as the
organisations are fully satisfied with the cars as they are not totally customer friendly due to
the excessive costing price (vw.com, 2017).

• The vision of the business defines the future assessment of the organisation’s
missions. According to Jeston (2014. P. 117), the vision answers the “what”
questions. An organisation’s vision changes along with time and needs to be
changed. Along with the time the intentions and the goals of the companies may
change. Here Volkswagen AG has been observing several goals till date, defining
the vision of the organisation. Volkswagen has till date focused on modeling sound
vehicles in the market for the various range of consumers, which the organisation
has followed quite efficiently. The organisation has focused on further planning in
taking the company’s reputation as the world’s best automotive industry within the
upcoming year.
Business vision:

Spender (2014, p. 176) has observed in defining business goals, that business goals are the
objectives of a company that the organization intends to achieve within a deadline.
Volkswagen AG has shaped their goals in five specified categories in order to construct a
concrete framed future (volkswagen-poznan.p l, 2017), which are,
• The organisation has focused on teaming a strong group of customers, to whom the
company can rely upon with the range of products.
• It has also focused on a concentrated group of employees in the process of new invention
and motivation.
• The company has intended to frame a solid finance structure that can assist the
organisation in further progress.
.
:Business goals:

Cont..
• It has always kept the goal of supplying better opportunities to the
customers in the means of quality and quantity.
• The impact of global warming and pollution has also affected the
organisation, which is why it has decided to invent technologies which
will prove both eco friendly and cost friendly to the customers

Objectives
• The objectives of Volkswagen has been defined by the company in four
categories, which are,
• The organisation, by 2018, intends to be the leading manufacturer in automobile
industry with the help of technology and intelligent innovation.
• The company plans to increase the sale by 8% within the upcoming year, by
increasing the sale above 10 million vehicles.
• It has committed to prove itself as a marvelous employer in the market in order to
be a better competitor the market of invention (volkswagen-poznan.pl, 2017).

Core competencies:
• The organisation of Volkswagen AG has been blessed with the power of new inventions
and technologies, on which the organisation has focused the most. The company has its
primary focus on the environment friendly cars, which has been expected to be brought
in the market in a low price, so that it can be affordable for all the range of consumers
(volkswagen-poznan.p l, 2017).

1.2. Considering factors in formulation of strategic plan:
• In processing a successful strategic plan, an organisation needs to keep some important
factors in mind, while accessing the plan. According to Uggla (2014, p. 56), there are
five factors in processing a strategic plan to success, which are:
• Engagement: Volkswagen AG has focused on the engagement of all the employees and
the departments, starting from the top most to the lower level, in order to successfully
spread the importance of the strategy.
• Communication: Volkswagen has focused on coordinating with all the departments and
the employees involved in the industry and maintain a perfect communication between
all of them.

Cont..
• Innovation: Volkswagen AG has always given importance in new innovations on
manufacturing new upgraded vehicles, taking the risks of failure, which is important in
the enthusiasm of strategy planning.
• Management of the project: Volkswagen AG has always put effort on the managers to
supervise the accuracy of the process of the strategic plan.
• Culture of the organisation: the culture of the organisation needs to be in favor of the
strategic planning, as the employees depend on the culture. Ignoring the culture is next to
impossible in strategic planning.

1.3. Effectiveness of techniques:
• Volkswagen has the reputation in the innovation and technologies. Since
1937 the organisation has been a success in new innovation and
technologies, that spirit has yet not stopped, rather upgraded. In the twenty
first century smart world, Volkswagen AG has been a master of inventors
in the automobile world. Even the company has now focused on
producing pollution free vehicles in the betterment of the world and to
ensure the corporate and social responsibility in the organisation.