Business Strategy Report: Volkswagen Strategy and Analysis

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 examination of Volkswagen's mission, vision, goals, and core competencies. The report then delves into factors to consider when formulating a business plan, including communication, innovation, and culture. It uses the BCG matrix to evaluate Volkswagen's strategic position. The core of the report includes an organizational audit using SWOT analysis to identify strengths, weaknesses, opportunities, and threats. An environmental audit using PESTEL analysis is also conducted. The report explores the significance of stakeholders in strategy formulation and proposes a new strategy for Volkswagen. It assesses the appropriateness of alternative strategies, justifies the selected strategy, and outlines roles, responsibilities, and resource requirements. The report concludes with a discussion of SMART targets and their contribution to strategy implementation, supported by references.

BUSINESS STRATEGY

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Business strategy of company..........................................................................................1
1.2 Factors which must be considered while formulating plan..............................................2
1.3 Effectiveness of techniques businesses need when developing their plans.....................3
TASK 2............................................................................................................................................4
2.1 Strategic positioning of Volkswagen by conducting its organisational audit..................4
2.2 Environmental audit of Volkswagen................................................................................6
2.3 Significance of stakeholders while formulating strategy.................................................7
2.4 New strategy for Volkswagen........................................................................................10
TASK 3..........................................................................................................................................11
3.1 Appropriateness of alternative strategies........................................................................11
3.2 Justify selection of strategy............................................................................................12
TASK 4..........................................................................................................................................12
4.1 Roles and responsibilities of personnel..........................................................................12
4.2 Resource requirement to implement new strategy.........................................................13
4.3 Contribution of SMART targets.....................................................................................14
CONCLUSION..............................................................................................................................15
REFERENCES..............................................................................................................................17

INTRODUCTION
Business strategy assumes an exceptionally prominent role in growth as well as
development of each and every sort of association. It is essential for employer to create an
effective plan, which will assist employee to achieve goals and targets in an appropriate way.
Along with this, it is a continuous procedure. Company named, Volkswagen is a top most
automotive firm, which is established in UK (Agyapong and Boamah, 2013). Their main purpose
is to cater quality items to their clients, thus they can improve their market share and in addition
revenues. Along with this, it is must for them to utilize new or unique techniques in their
business, while they are manufacturing products for their buyers. If manager of company
develop some strategies then it will aid them to achieve targets and goals in proficient manner.
Additionally, they have to implement it into their business adequately as it will assist them to
compete their rivals in competitive world. Employer distribute task between their staff members
as per their capabilities as well as skills.
TASK 1
1.1 Business strategy of company
An appropriate plan of firm plays an essential role to fulfil mission, goals, vision, core
competencies and so on. If association create an effective strategy then it will assist them to
decrease cost of products as well as services. Therefore, they can improve their sales and along
with this incomes. Enterprise can compete their competitors at marketplace more effectively.
There are some business strategies which are related with Volkswagen, are discussed as
beneath:
Mission: Organisation wants to create their items as well as administrations
more innovatively and along with this environment friendly as it will
assist them to improve their market share and reputation. They need to
develop their merchandise more attractively, thus, it will help them to
take benefits from their rivals at commercial centre.
Vision: It is essential for firm to maintain quality of their items, as it assist
them to retain their clients and pull more customers towards them.
They have to utilize unique technology in their cars and along with this
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keep up cost of it. As result to, they can enhance their productivity and
sales. Employer of Volkswagen can lead research to know demands of
their purchasers. Therefore, they can fulfil their needs and wants more
effectively as well as efficiently within an appropriate time span.
Goals and objectives: Company need to enhance their clients, as result to they can improve
their revenues and goodwill in marketplace. Additionally, if they want
to compete their competitors, them it is essential for them to increase
their market share. Along with this, they can create plan for item
development. It is must for them to develop some opportunities at
marketplace and take benefits from it. They cater training to their staff
members so that they can achieve their desired goals and targets in a
proficient way. Along with this, it assist them to reduce unnecessary
cost from their business.
Core competencies: Volkswagen has numerous items for their purchasers which will give
them more satisfaction. It is essential for them to utilize best quality of
accessories into their business, as it will aid them to maintain standard
of their products. Enterprise is providing their administrations from last
20 years to their clients.
Manager of organisation has to implement business plan which comprises various stages
and in addition mission, vision, objectives, goals and core competencies plays a prominent role.
BASIS TIME PERIOD
Research 18 days
Identify aim of plan 6 days
Determine profile of organisation 4 days
Documentation 3 days
Choose appropriate strategic marketing plan 5 days
Implementation and evaluation 12 days
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1.2 Factors which must be considered while formulating plan
Fundamental obligation of higher level authority is to create strategic plan for enterprise.
It is essential that, each and every person of company must understand it, thus they can follow it
in an adequate manner. There is an another reason to create plan is that they can attain their
desired goals and targets in an effective as well as efficient way. There are some factors which
must be taken into consideration by employer of Volkswagen, while they are developing strategy
for firm, are mentioned as beneath:
Communication: It is essential for each and every sort of association to develop an open
conversation in company, as result to staff members can share their thoughts as well as
suggestions with their superiors easily. It is must for leader to share plans with their workers so
that they can help them to attain set target. Along with this, manager can get feedback for their
employees through organise some group meetings. Hence, it will cater more growth and in
addition development to enterprise and they can improve their revenues.
Innovation: It is necessary for employer to create items in an creative way as wit will aid them
to pull more clients towards them. Along with this, it is essential to utilize inventive thoughts
into their current goods because it will help to improve their efficiency. Additionally, they can
take benefits from their competitors in marketplace and enhance their profits.
Culture: Each and every individuals has their own values as well as beliefs, which is follow by
them. There are numerous staff members in company, who never accept alternations easily.
1.3 Effectiveness of techniques businesses need when developing their plans
Volkswagen can develop some plans for their business, as it will aid them to achieve
goals and targets in an effective and efficient manner. For this purpose, BCG matrix is utilized
by managers, thus they can compete their operational actions in an adequate way. As indicated
by this matrix, it comprises four units which will assist them to depict growth as well as
development in marketplace. As per this, each and every cell has their own mean, which are
mentioned as below:
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Illustration 1: BCG matrix
Stars: As indicated by this cell, firm is growing very quickly. Along with this, market share of
organisation is much high which will help them to take advantages from their rivals in
commercial centre. They need extra investments in their company so that they can generate more
cash for their business. For example: Volkswagen and Audi is extremely popular brand in
Europe and US as well as it delivers innovative products to market.
Cash cows: As per this unit, growth as well as advancement of firm is very low but market share
of enterprise is much high. Along with this, they can develop cash for them easily as their
goodwill in society is far better. As result to, persons can trust these sort of organisation easily.
For example: Bentley and Lamborghini has high and luxury market also these luxury markets
continuously bring in millions every year.
Dog: It shows that, growth and market share of company is less. If organisation wants
advancement, then it is must for them to eliminate unnecessary cost from their business. Along
with this, if existing items are not providing benefits to firm, then it is must for them create
essential alteration in them or they can stop manufacturing of that particular product. They can
use other option, that they can create new item for their buyers. For example: Commercial
vehicles like vans, trucks and others these products has very low market share.
Question mark: It represents that market share and growth of enterprise is low. Along with this,
it shows that basically company develop new merchandise and administration for their clients
and takes hazards. For example: SEAT (Fiat 500), environmental causes are correlated to it and
its fastest growing market share.
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TASK 2
2.1 Strategic positioning of Volkswagen by conducting its organisational audit
Intrinsic audit is necessary for each and every sort of organisation like Volkswagen, with
assistance of this they can easily identify mistakes as well as errors. For above stated purpose,
they can lead SWOT investigation of Volkswagen company, thus manager of organisation can
easily determine strength, weakness, opportunities and in addition threat (Aithal, 2016). Along
with this, they can achieve their desired targets and goals in an effective and efficient way.
SWOT analysis of Volkswagen is discussed as beneath:
Strength Weakness
 Company has broad portfolio as
comparison to other automotive firms.
 Manager of association utilise
diversification strategy into their
business.
 Cited association has joint venture with
many Chinese auto developers which
will assist them to improve their profits.
 Enterprise has almost 350,000 staff
members in their business.
 They have many new or unique model
for their clients which will cater them
more satisfaction.
 Brand image of Volkswagen is not
amazing as compare to some other
establishment like Toyota.
 United Kingdom's recall rate is too
high.
 Market share of UK is not much
effective (Alsoboa and Aldehayyat,
2013).
 Items which are produced by workers
of Volkswagen, are not much
environmental friendly.
 Car sale of company is not too much as
value of them is too high for customers,
thus every client cannot afford it.
Opportunities Threats
 It is essential for them to focus on their
policies as it will assist them to increase
reputation and as result to, they can
improve their profits.
 Their relationship with car
manufacturer is very long term.
 Rules and regulations which are created
by regulatory body is continuously
increasing.
 Values of crude materials is rising
which can influence revenues of
company.
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 Staff members of Volkswagen develop
cars more creatively as it will aid them
to compete their rivals in marketplace
(Basili and et. al., 2014).
 As people want their life style more
better, so their buying power is
continuously enhancing.
 Price of their cars is much high, thus
they are not able to pull clients of
middle class society towards their
items.
 Value of fuels in increasing day by day.
 Their rivals are utilizing inventive
techniques for their goods which can
influence products of Volkswagen.
 Along with this, international
competition is also increasing
continuously.
Therefore, it has been comprehended that company can utilize their strengths to
overcome from their weaknesses. If they acquire opportunities from marketplace then they can
easily improve their market share and in addition compete their competitors at marketplace. They
need to develop effective strategies; thus, they can improve their customer base.
2.2 Environmental audit of Volkswagen
It is must for every sort of organisation to know their extrinsic surroundings very well as
it can affect business activities directly as well as indirectly. Additionally, it is both uncertain and
uncontrollable (Bozkurt and Kalkan, 2014). Therefore, company has to lead PESTEL
investigation for this, which is mentioned as beneath:
Political factors: It can influence operational exercises of Volkswagen as they are
conducting their business in almost more than 145 nations. Therefore, they can face many kind
of political problems. It is essential for them to develop an appropriate plan, thus they can face
them in an adequate way. Along with this, there are some sector which will help firm to improve
their sales, such as banking and in addition financial sector, because they can provide loans and
advances to persons, thus they can buy it as per their choices. Alongside this, rate of interest is
according to policies of government. Therefore, it is top most challenge to comprehend policies
of each and every country which are facing by Volkswagen. For example, rules and regulations
of China is distinctive as compare to United Kingdom.
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Economic factors: Automotive firms cater growth as well as advancement to each and
every nation, because it contributes in national income of country (Campling, 2012). Alongside
this, they likewise take part in state's GDP. This sorts of organisation helps in success and
development of glass, steel and so forth. This kind of sector never be certain, such as there is a
major issue of crisis which can influence sales of automotive company. Due to, if individuals do
not have much money then they cannot buy car. Additionally, if value of fuel enhancing then
likewise it can affect economic situation of nation.
Social factors: It is an essential factors which assumes an exceptionally prominent role
in growth of Volkswagen. If they want to improve their business, then it is must for them to
develop occupational opportunities for entire society. Along with this, they have to handle social
problems in an adequate way, like road accidents are continuously enhancing day by day.
Therefore, it can give adverse image and in addition Volkswagen need to take care of each and
every sort of issues appropriately.
Technological factors: It plays an important role in each and every form of company. It
is must for organisation to utilize new or unique techniques in their business, thus they can
enhance effectiveness of their items as well as administrations (del Río and et. al., 2011). With
assistance of this, they can render more satisfaction to their customers and along with this,
increase their profits and goodwill at commercial centre.
Environmental factors: This can influence firm negatively as well as positively. There
are some elements which can affect surroundings of country, such as diesel, crude material,
steels and so forth. Hence, it is necessary for Volkswagen that, they need to invest in research
and development which will assist them in their advancement of production and in addition they
can easily secure environment of nation.
Legal factors: It is essential for every sort of company to fulfil legal requirements which
is needed for them. Along with this, they have to follow each and every legitimate which is
related with their business (Firnkorn and Müller, 2012).
Hence, it has been understood that VW has to analyse their external factors also; so that,
they can do their work accordingly. They have to follow legal rules and regulations to conduct
business in right way. If they do not fulfil it then, fines will get imposed on them. It is required
for them to reduce wastage to protect environment from harm.
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2.3 Significance of stakeholders while formulating strategy
Shareholders are an important part for every sort of company as they render growth as
well as development to business. It may comprises a person, group an in addition firm. It is must
for them to take part in each and every activities of company, as they invest their fund in their
business. Along with this, it may likewise consists employees, government, creditors and so
forth. Bondholders always support in every exercises of organisation.
There are many significance of shareholders analysis while developing new strategies,
which are described as beneath:
 It is necessary for bondholders to identify those persons who can affect their business
operations in both form internally as well as externally.
 If employer of Volkswagen needs to enhance performance of their staff members, then it
is must for them to inspire them. Hence, it will assist them to improve their revenues and
in addition goodwill at commercial centre (Godlevskaja, van Iwaarden and van der
Wiele, 2011).
 They have to comprehend nature of every sort of individuals within company, thus if
there is any problem arise they can reduce it with assistance of an appropriate
communication.
 Manager always wants support of their employees, as it will help them to achieve setted
goals as well as targets of Volkswagen.
 Along with this, superior of company can take assistance of powerful bondholders, when
they are going to start their business.
 It is essential to identify those factors which can influence their business plans either
positively or adversely (Houdet, Trommetter and Weber, 2012).
If enterprise wants to achieve more growth as well as advancement then it is must for
them to interpret their bondholders in a careful way.
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Illustration 2: Shareholder's grid
Shareholder analysis can also known as shareholder mapping and it is a fundamental step
which aid to design program in better manner. There are many sorts of bondholders such as an
individual, government, company and many more. They can be internal also, for example
employees. In the context of shareholder matrix, in which included four major contents such as:
 Keep satisfied: In which concluded those stakeholders who has high power and low
interest.
 Manage Closely: These type of stakeholders have high power and high interest due to
this they have rights to take decisions. For example: Large investors, shareholders and so
more.
 Monitor: It includes low interest and low powers stakeholders of the business firm thus
they do not have any rights and powers to take decisions such as employees.
 Keep informed: This is the last content of shareholder matrix, their have low power and
high interest due to this they cannot take decisions but company has responsible to
provide proper information to them. Like, government.
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