Strategic Planning and Formulation for Business Growth

This assessment provides an opportunity for learners to demonstrate their understanding of the strategic planning process within a business context. Learners will assess the role of missions, visions, objectives, goals, and core competencies in informing strategic planning. The task involves evaluating different factors considered during the formulation of strategic plans, as well as analyzing techniques used in developing effective strategic business plans. Additionally, learners must analyze an organization's strategic positioning through organizational and environmental audits. They will also assess the importance of stakeholder analysis when formulating new strategies.

BUSINESSES STRATEGY

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Explain various business vision, mission, goals, objectives and core competencies inform
strategic planning when formulating strategic plan................................................................3
1.2 Explain factors which is very important in strategic formulation....................................4
1.3 Examine the effectiveness of techniques which is used in developing strategies plans. .5
TASK 2............................................................................................................................................7
2.1 Explain the strategies positioning of given organisation by carrying out an organisational
audit........................................................................................................................................7
2.2 Explain environmental audit for a given company...........................................................8
2.3 Explain the significance of stakeholders when formulating new strategy ....................10
2.4 Explain new business strategy........................................................................................11
TASK 3 .........................................................................................................................................11
3.1 Explain various strategies related to retrenchment or limited growth, market entry
substantive growth................................................................................................................11
3.2 Explain appropriate future strategy of Volkswagen.......................................................13
TASK 4..........................................................................................................................................13
4.1 Explain roles and responsibilities of personnel needed for strategy implementation....13
4.2 Explain many resources required for implementation a new strategy...........................14
4.3 Explain smart objectives of VWAG ..............................................................................14
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................16

INTRODUCTION
Effective strategic planning is very important for any kind of organisation for achieve
their goals and objectives. Business strategy is play very important role in management planning
because with use of these strategies a company can develop and improve their performance. For
attain success in future, enterprise is made various strategies. Apart from that there are many
internal and external factors which directly and indirectly affect the operations and activities of
the organisation(Moseley, 2017). To analyse the performance of the company it is important to
monitor these strategies. This report will discussed Volkswagen group which is the largest auto
mobile enterprise in the world. Cited enterprise is manufacture various variety of cars and
operate their business activities approx more than 150 countries. This report will going to
describe vision, mission, competencies and objectives. Business strategies are help to overcome
from financial difficulties which is faced by the enterprise. To understand the effectiveness of
various factors report will be describe SWOT and PESTLE analysis. Strategic plan is very
important for execution of strategic plan.
TASK 1
1.1 Explain various business vision, mission, goals, objectives and core competencies inform
strategic planning when formulating strategic plan
Strategic planning includes decide the policies and plans which is very important for full
fill the organisational objectives and targets. External and internal factors can also identified with
the helps of this planning.
Mission: Decide the mission of the company is starting step to achieve the targets and goals.
Employees can motivated and provide their full contribution towards improve and develop whole
organisational performance. Vision is the based on the mission of the enterprise. Cited
organisation have mission to maintain their profitability level and give full satisfaction to the
various customers situated in wide geographical area.
Vision: It involves long term objectives and goals of the enterprise which have to be achieved in
future time period for getting success(Ireland, Hoskisson and Hitt, 2012). They also focuses on
the give profits to stakeholders which helps to create goodwill and brand image of the cited
company. Success of the enterprise is depend on the effective vision creation which helps to full
fill the long term targets.

Goals: This includes organisational long term and short term goals which depend in the
requirements of the company. Main goals of the cited enterprise is that give their best and quality
products and services and increase the probability level. It is like long term planing which need
lots of time consumed(Chang, 2016). Goals are designed by the top level management and lower
level workers and employees helps to them accomplish these goals.
Objectives: There are the difference between objectives and goals. Nature of objectives is that
they are short term in nature and helps to attain the ultimate destination. Purpose of the cited
enterprise is to give the motivation to every workers so they can increase the productivity and
improve performance.
Core competencies: Cited company want to achieve competitive advantage and for this purpose
they have to increase their core competencies. Volkswagen focuses on their competencies in
terms of product manufacturing, process, development and distribution facilities. These abilities
of the organisation is helps to make brand image and goodwill in the market.
1.2 Explain factors which is very important in strategic formulation
There are various factors which affect the strategic planning which have to be considered
by the cited organisation. Five phase which is play very important role to improve and develop
the strategic planning are mentioned below:
First step involves identify the SWOT analysis which play very important role to
maintain the good performance of cited company. There are many external and internal factors
which affect the profitability and progress of the organisation. So it is important to analyse the
internal strength and weaknesses and opportunities and threats which are exists in the external
environment.
Second stage to monitor strategic planning is includes PESTLE analysis. This includes
political, legal, social, technological and environment etc. productivity and performance can be
improved by the identification of the these factors.
The third stage is to identification of SWOT matrix which is very important for strategic
planning. These matrix is are divided in four parts such as S-O which consist Max max, S-O
which describe Max min, W-T means min min and last is W-O which is min max
strategy(Wheelen and Hunger, 2017).
There are many tools and techniques which is used by the cited organisation to analyse
the strategy planning. Many challenges is faced by the enterprise which arises from internal and

external factors existing in the environment. Internal factors includes organisation structure,
culture, availability of human resources which have to be managed by the top level management.
If talk about the cited company they face many financial crises which affect the income level. To
overcome from this condition CEO have to change their rules, regulations and climate condition.
Main problem is that society of UK is greatly affected by the diesel auto mobiles and it gibe
harm to the health of public(Pretorius and Maritz, 2011).
1.3 Examine the effectiveness of techniques which is used in developing strategies plans
For effective execution of strategic plans various tools and techniques can be used by the
cited organisation. Strategic business plans includes various activities and operations which are
based on the identification of PESTLE and SWOT analysis. There are two models and their
advantages are given below:
SWOT MODEL
Internal and external environment is properly identified with the help of this model which
affect the operations and activities of the organisation. Internal factors are influenced strength
and weaknesses or workers which affect greatly performance of the company. On the other hand
external factors consists opportunities and threats which are exist in the market. Profitability and
goodwill can be analyses with the use of this technique.
Advantages of SWOT analysis: It is important for the company to analyses their internal
strength so that they can provide their best and quality products to the customers. Cited company
can also focus ion their strength so that they growing fast and developed performance continue
sly. Risk can be reduces by the analyse of the internal weaknesses of the organisation. So
basically with the help of this model a company can over all improve their performance in terms
of profitability and development.
Disadvantage: The main problem arises when the use of this model is that some companies do
not analyse their weaknesses and threats which directly affect their performance and
productivity. Another disadvantages is that they do not give relevant information which arises
adverse effect to the business(l‐Najjar and Anfimiadou, 2012).
PESTLE analysis: This analyse includes political, economical social, technological, legal, and
environmental factors. Theses are explained below:
Political: This factor are includes change in fiscal policy, tariffs and government stability which
directly affect the operation of the cited organisation. Volkswagen are conduct their business

activities in many countries so it is difficult to coordinate with various situation. It is important
for the company to operate their business according to rules and regulation developed by the
government.
Economical: This factor includes change in exchange rate, inflation rate and interest rate which
affect the income level and purchasing power of the people of the society. When economic
condition is bad in a county than it directly affect the prices of various commodities which affect
the growth and performance of the Volkswagen(Harris and Rae, 2011).
Social: This kind factors are includes many elements such as mobility of people from place to
another, change in taste and preferences of customers, living standards of the people and
demographics. If talk about cited organisation today knowledge about auto mobiles are enhanced
in people so they want to purchase comfortable and economy auto mobile. So it is important for
the organisation to understand the needs and wants of the customers.
Technological: Today technologies are enhanced day by day so for the cited organisation they
have to focus on the adoption of latest technology so they provide quality products to the
customers. A negative point of this factors is that employees faces many challenges and
problems when company adopt new techniques. With the help of technologies cited enterprise
can innovate their products.
Legal: According to this factors various rules, regulations and legislations developed by the
government are includes which affect the operation of the company. Cited enterprise conduct
their business activities in various countries and government is changed after some time and
proposed new rules. So it is difficult to coop up with the these legislations. Operation of
Volkswagen is restricted in UK because these affect health of human body by the use of diesel.
Environmental: This factors are includes such as change in climate, conditions and natural
disaster also. These are affect the taste and performance of the customers which is very important
for the cited company. Income level, purchasing power are also influenced with bad condition of
the environment(Mukerjee, 2013). Supplier is also affected by the change in the environment so
prices of the commodities will be increased.

TASK 2
2.1 Explain the strategies positioning of given organisation by carrying out an organisational
audit
Volkswagen is the largest organisation which manufacture commercial vehicle and motor
cycle and operate their business activity in whole world. The cited company is focuses to achieve
their goals and objectives to provide best produ8cts and services to various customers. They are
operated their business activities in wide geographical area. When they formulate their strategic
planning it is important to set the goals, objectives, mission and vision. Main purpose of the cited
enterprise to to improve their performance and profit maximization(De Haes and Van
Grembergen, 2012). The top level management is prepare goals and objectives so the employees
of the company try to achieve these targets. Any kind of company doing business with the view
to earn profits and to full fill this motive it is important that they gave full satisfaction to various
customers. Apart from that the cited enterprise is also focuses on the use of innovation models
and also adopt new technologies. This helps to increase the profit level and income. It is
important for smooth functioning in the company to make good and positive relation with many
employees so that they can feel important and able to give their full contribution towards achieve
goals and targets of the cited organisation. They are also give motivation to their workers by
conducting training and development programme so that they can increase their effectiveness
and efficiency. Cited company have large amount of money by which they can do better
improvement in their enterprise. They can also conduct events and occasion to launch their new
products which helps to attract the various clients.
SWOT Analysis Volkswagen is evaluated as under:
Strength
Volkswagen is a most popular multinational
company who deals in various departments
across the globe. The company operated their
business activities over 160 countries. The firm
has its business operations such as Germany,
China, Brazil and Asian countries. The
company invest a huge amount in research
Weaknesses
The major weaknesses of Volkswagen is that
the company has its business operation in some
certain country and it is difficult for people to
taking benefits of offered goods and services of
firm. As less number of market share it is not
possible for firm to capture a wide area of
market.

development program in respect to analysing
the current needs and wants of customers and
produce variety of goods as per the
requirement of customers.
Opportunities
Opportunities can be considered as the power
of firm which are implemented through putting
the strength of firm at right place. Company
deals in manufacturing luxury cars and having
their business operation in big cities. These
type of organisations are having chance to
expand their business operations at
international level. The company is focused
on implementing various changes through
using new tools and techniques at market
place.
Threats
Issue and conflicts are uncertain in nature as a
multinational company they faces various
issues that are related with any kind of change
arises in the rate of currency. The major threat
of Volkswagen is that the company facing high
loss in their profitability due to increasing price
of fuel.
2.2 Explain environmental audit for a given company
There are various factors which are existing in the environment and directly affect the
operations and functioning of the cited organisation. Environmental audit means to monitor all
the activities and functions that they do not harm environment in any term. For effective
identification of external factor company can use various tools and techniques in which most
effective is PESTLE which stands for political, economical, social, technological, legal and
environmental(De Haes and Van Grembergen, 2012). Cited organisation have various
subsidiaries by which they can easily conduct their business in every location. One major
competitor of the Volkswagen is that Aston martin, which also engage in auto-mobile and
generate similar product at lower prices. So goodwill is affected of cited enterprise and the
produce better mileage vehicles which helps to attract more and more clients. Apart from that
they are produce various vehicles which focuses to reduce the pollution and for this purpose they
use some Eco friendly fuels in place of diesel and petrol. To remove pollution from environment

they use zero chemical parts for manufacture vehicles. To attract the various customers, cited
organisation is manufacture their car wheels on computer system(Schneider and Meins, 2012).
For safety of environment government is restricted various policies which uses by the
organisation to produce their vehicles. If they follow all these rules and regulations they can
increase their profits level and performance. This will help to create brand image and goodwill in
mind of different customers.
Environmental analysis can be done through applying PESTLE analysis as it is most effective
tool in automotive industry, the elements of PESTEL are evaluated as under: Political Environment: The essential aim of each business organisation is to expanding
their business operation all over the world in respect to generating more profit and growth
at market place. Volkswagen attain success by paying less tax, tariffs, and exercise duties
as they are dealing in high profile auto mobile industry. As a well known brand
government is also helps the company through providing benefits in tax and tariffs. Economical Environment: It is necessary for each small as well as large business firm to
develop strategies in respect to diversify their business activities in systematic and well
planned manner so that goals could be attained at very high scale in economy. Various
conflicts and issues are arise due to inflation in economic condition of firm. Social Environment: This is the most effective element of environmental analysis. These
are mainly linked with the environmental factors of an organisation that are valuable in
rendering shape to behavioural aspects of customers with the involvement of buying
preferences of client in respect of developing features of car as per the taste and
preferences of buyers who are willing to taking benefits of Volkswagen. Technological Factor: In this modern era each business firm is focused on adopting new
and innovative tools and work place. This factor is concerned with manufacturing
products as per the involvement of advancement in technology that are suitable for
developing the productivity of firm. The company is concerned on producing goods and
services as per the demand of clients in order to sustain them for long run of business
activities. Environmental Factor: The company described environmental element in their business
venture, so this will not affect their business operations and activities (Azar, 2011). The
company is centred on resolving the issue of smoke in their cars and develop new and

innovative cars with more advance features. As in this modern era people go with high
definition features and quality of products.
 Legal Environment: This part mainly consist of present legislation policies and plan that
are affecting their business operations vastly. It is required for each business organisation
to follow some effective and common rules and regulation which are assembled by
government in respect to managing their business operations within and out side of the
country in most effective and efficient manner.
2.3 Explain the significance of stakeholders when formulating new strategy
Stakeholders are includes customers, suppliers, creditors and employees of the company.
these are the important part of any kind of organisation because all functions and operation are
related to all these persons. It is important to analyse the behaviour, attitude and response of
various stakeholders. They have power to influence the profitability level of the enterprise. When
any assignment is prepared, this step is executed. When company is examine the attitude of all
business partners than there is chances to arise change in near future. Superior is analyse the
behaviour of stakeholder in one year. Attitude of stakeholder some time times and positive
towards the services providing by the particular company. A enterprise have various types of
stakeholders are given below:
Primary stakeholder: Various actions which executed by the company and it influence
stakeholders in negative or positive way.
Secondary stakeholder: These kind of stakeholders are affected indirectly when there is
miscommunication between the company and other business partners.
Key stakeholder: These are the important business partners which are hybrid between the
primary and secondary k8ind of stakeholders and they have power to affect the operations and
activities of the company.
Stakeholders are made various goals and objectives which helps to develop and improve the
relations between the investors and managers. It will help in arises positive results for te
organisation and it directly increase the income of the company(Krajewski, Ritzman and
Malhotra, 2013). For getting success in near future it is important to give satisfaction and make
good relations with every business partner so it will helps to increase the profit margin of the
enterprise(Hofmann, Busse, Bode and Henke, 2014).

2.4 Explain new business strategy
To increase the market share and products for the clients it is important to formulate
effective business strategy. A organisation can easily adopt any kind of strategy which are
available in the market. There are are some strategies are given below:
Market penetration: It includes segmentation of the market so various customers can be
attracted and take more interest to purchase the products of cited organisation. Market
penetration is focuses on increase the sell of product in new and existing market. Every kind of
company like Volkswagen can also adopt this kind business strategy to achieve the maximum
profits and success.
Product development: This kind of strategy includes adopt new innovative models and
techniques by the enterprise so that they can provide their best and quality products. It is very
important techniques because today people have great knowledge about the auto mobiles. This
innovation is helps to company to sustain for long time in market and get success in near future.
Product development is based on the needs and wants of the various customers. So it is important
to develop their products and gain profits against their competitors.
Market development: This kind of strategy is includes finding new customers and clients and for
this purpose organisation have to divide whole market. It is important to understand the taste
preferences of various customers so that enterprise is focuses on their manufacture pattern and
provide products and services in best way. Volkswagen is conduct their business activity
basically in UK so it is important to segment market and sell their existing products to many
customers which are located in wide geographical area.
Diversification: This business strategy is play very important role to increase the profits margin.
It includes sell new products in new markets so peoples can easily attract and take more interest
to purchase the products. Apart from that this strategy is full of risk because it consumed large
amount of time and money. So diversification is helps to spread the risk(harma, 2011).
TASK 3
3.1 Explain various strategies related to retrenchment or limited growth, market entry substantive
growth
Market entry growth: Some points are including in this which are explained below:

Organic growth: This is starting step which includes that when development of a organisation on
its own business and as the same way it is called organic growth(Valmohammadi, 2011).
Merger: It involves when two companies are combined their whole operations and activities and
start working through a single name than it is called merger.
Acquisition: It describe when a organisation is take over another enterprise and conduct business
activities separately than it is known as acquisition. Which is known as acquisition and it is differ
from merger.
Strategic alliance: To accomplish the goals and targets some times organisation acquire other
companies assets which is known as strategic alliance.
Licensing: it is like business model in which one enterprise is provide the rights to another to
produce their product and for this they charge some amount which is already discussed in both
company.
Substantive growth: It also includes some points which are mentioned below:
Related diversification: Any kind of diversification which is co0nducted by the organisation and
related to product line than it is called related diversification.
Unrelated diversification: It is totally opposite from above discuss diversification. It includes
when product line is not related to diversification than it is known as unrelated kind of
diversification(Moseley, 2017).
Horizontal integration: It includes when two different organisation conduct business activities
and attain same level of production is called horizontal integration.
Vertical integration: This is opposite from horizontal because in this production level of two
organisation are different.
Retrenchment: It also have some important points which are describe below:
Turn around: According to this it focuses on the underdeveloped companies which are faces
financial crises. So it includes analyse the sources of finance which will help to convert into
profitable organisation.
Liquidation: This is the last stage of company in which they sell all the assets and property for
pay the creditors.
Disinvestment: When one organisation is sell whole business to another than it is known as
disinvestment(reland, Hoskisson and Hitt, 2012).
Limited growth: