Volkswagen Business Strategy: Organizational and Environmental Audit

This report provides a comprehensive analysis of Volkswagen's business strategy, encompassing strategic planning, organizational and environmental audits, and stakeholder analysis. It delves into the company's strategic positioning, evaluating internal strengths and weaknesses through SWOT analysis, and external factors using PESTEL analysis. The report examines the role of stakeholders in strategy development and explores the formulation of a new business strategy for Volkswagen, including market entry, growth, and sustainability strategies. Furthermore, it discusses the implementation of the chosen strategy, outlining the roles and responsibilities of personnel, the resources required, and the evaluation of SMART targets. The report aims to provide a detailed understanding of Volkswagen's strategic approach to achieve its business objectives.

BUSINESS
STRATERGY

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1 ...........................................................................................................................................1
Covered in PPT...........................................................................................................................1
TASK 2 ..........................................................................................................................................1
2.1 Strategic positioning of VW AG by carrying out organizational audit................................1
2.2 Environmental audit for Volkswagen...................................................................................2
2.3 Measures linked with stakeholders in development of strategies.........................................4
2.4 Developing New strategy for Volkswagen..........................................................................5
TASK 3 ...........................................................................................................................................6
3.1 Alternative strategies linked with market entry, growth and sustainability..........................6
3.2 Selection of best & effective strategy...................................................................................6
TASK 4 ...........................................................................................................................................7
4.1 Roles and responsibilities of personnel in implementation of strategy.................................7
4.2 The resources needed for execution of new strategy for Volkswagen..................................8
4.3 Evaluating SMART targets in business strategy...................................................................9
CONCLUSION .............................................................................................................................10
REFERENCES .............................................................................................................................12

INTRODUCTION
Business strategy can be termed as organisational plan which is useful in order to achieve
all business goals and objectives. It is a useful method in order to achieve set aim and thus, for
gaining competitive advantages. Main objective of every business is related with making plan
which had to be achieved within desired time frame in order to make organisation achieve
success in their operations. The working of businesses should be organised in an effective way in
order to make the work flow in a systematic and planned way by which business can easily
achieve success in their operations. The strategy is formulated in order to make employees work
according to plans so that they can easily achieve all their targets which are useful for the overall
organisation (Acquaah, 2013). Volkswagen is the biggest firm which is dealing in auto-mobile
sector. Undermentioned report is based on understanding the concept and process of strategic
planning, plans adopted in order to design new business strategy, different approaches which can
be used for evaluation of plan of action and various plans which can be adopted in order to
implement strategies at workplace which are effective for achieving growth and success for
business.
TASK 1
Covered in PPT
TASK 2
2.1 Strategic positioning of VW AG by carrying out organizational audit
The main requirements of each business is linked with making plans and policies which
are useful for them in order to attain higher growth and thus, achieving success in business.
There are various factors which are harmful for business and it affects the working of
organisation. Internal audit tools are used by firms in order to evaluate those factors by which
Volkswagen is not able to achieve set targets. It is also reflected as organisational activities
which are developing values in order to successfully perform all business operations.
Organisation audit tools are helpful for business in order to reduce all conflicts at workplace and
thus, working will be executed in an effectual and planned way by which firms can achieve
success in their operations (Astrachan, 2010). These are important tools used by firm in order to
identify all their weak and strong points as well as threats and opportunities for business. All
these factors can be easily measured with the help of conducting SWOT analysis which is
evaluated as below:
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Strength Volkswagen is running their business operations all around the globe and
thus, they are earning higher profits and revenues. They are mostly
focusing on regions like Brazil, Asian, China and Germany as their
business is highly achieving success in these areas by running business
operations. The firms are leaders in manufacturing cars and they are
involved in research and development activities in order to analyse the
current trends at market place and accordingly, manufacture products.
Weaknesses Volkswagen has achieved growth by running their operations in few
countries only and thus, their profitability is not so high. Their shares in
Asian regions are only 4%. Organisation has to focus on developing plans
in order to generate large market areas where they can easily achieve
success in their operations (Auzair, 2011).
Opportunities The selected business is having many opportunities in order to easily
expand their business operations at international regions as it opens door
for them in order to earn higher revenues and profitability. They can
adopt new and effective market strategy in order to increase market
shares. Modifications can be made in their business operations by
utilising various tools and techniques which are easily available in the
market areas.
Threats Volkswagen had face huge losses as there vehicles were eliminating large
amount of smoke thus they were not able to earn profits. There fuel rates
were very high so there sales ratios automatically declines. They were
facing high competition from their rivalry business thus growth factors
were affected.
2.2 Environmental audit for Volkswagen
In the year 2015, there were issues faced by firms like the cars which were developed by
them were eliminating smoke in large amount thus they were polluting the environment and its
natural beauty was lost also health of people were largely affected by this factor. This is an
important issue which should be considered by Volkswagen were not having any idea about this
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issue. Organisation looked into the problem when there realise that there sales ratios were
constantly decreasing thus there profitability factors were also greatly affected. This can be
solved if planning was done in order to formulate strategies which are beneficial in order to
enhance their sales. The vital tool for resolving this issue is PESTEL analysis in auto-mobile
sector which is evaluated as:
(Source: PESTEL Analysis, 2017)
Political Environment Main purpose of each business is related with
expanding their business activities in order to
achieve higher growth. Volkswagen has
achieved growth in their operations as they are
paying minimum tax rates, less quotas,
exercise duties and tariffs. This results in the
achievement of higher revenues for auto
mobile sector.
Economical Environment Volkswagen need to formulate plans and
strategies which are different from their rivalry
business in order to attain all their aim and
objectives in a well-defined way. If there is
inflation in economy then prices will be
increased and thus, strategies will have to be
developed accordingly in order to stabilise the
economic conditions (Azar, 2011).
Social Environment This factor is related with behavioural aspects
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Illustration 1: PESTEL Analysis

which are useful in order to analyse the needs
and preference of clients. Thus, products can
be manufactured accordingly in order to earn
profitability.
Technological Factor Volkswagen should develop plans in order to
manufacture goods according to technological
advancement and thus, their profitability and
production ratios will be enhanced. This is an
important factor which helps the firms to
sustain them for long time duration in market.
Environmental Factor Firms have to focus on adopting those plans
which are not affecting the natural beauty of
environment and all these resources are utilised
in an effectual way in order to attain higher
growth (Barberá and et. al., 2012). The issues
which are faced by firms should be solved in
order to increase their sales.
Legal Environment Firms should follow all plans and policies and
so, it will not affect their business operations.
Volkswagen can achieve higher growth if they
are following all laws which are outside the
business and thus, stabilizing their business
operations.
2.3 Measures linked with stakeholders in development of strategies
Stakeholder are described as blood cell of every business organisations as they are
developing plans which are beneficial in order to achieve all business aims and objectives. They
are putting their best efforts in order to develop long and short term business objectives thus
productivity factors of firms can be greatly enhanced. Research and development activities are
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organised in order to identifying present demands of customers so that products can be
manufactured accordingly thus development of competitive gains (Bharadwaj and et. al., 2013).
The selected business is using matrix structures for their operations as it helps them in
identifying needs and wants of all their customers.
Values of stakeholder analysis are evaluated below as:
Stakeholders are important persons for business as they are making plans in order to
enhance sales and profitability ratios of firms. They are also involved in developing plans in
order to implement corporate social responsibilities at work places.
Plans are developed in order to organise effective research which are helpful in
identifying conditions at market places which results in achievement of strong positions at
market places.
Strategic planning is beneficial methods in order to execute all business operations in
effectual and planned ways by which firms can achieve success in their operations and
employees will be working while making coordination with one another.
They are developing plans and strategies in order to enhance productivity factors so that
Volkswagen can achieve growth and success in their operations.
2.4 Developing New strategy for Volkswagen
In the present age of competition firms are developing plans in order to formulate
business strategy which are useful in maintaining coordination among all business operations.
Firms should offer high quality services to all their potential customers in order to enhance
performance and profitability ratios this results in attaining growth and development for
performing all business activities. Businesses strategies are developed in order to increase
productivity and profitability ratios so they can achieve success in their operations. The
formulation of new strategy involve stakeholders as they are valuable factors in order to identify
target markets where products and services can be easily sold (Burlton, 2010). This results in
attaining higher profitability and building positive images at market place thus attainment of high
positions at market areas. The new and effective strategies which are designed for Volkswagen
includes the following steps which are evaluated under as:
 Firstly mapping of all stakeholders in order to analyse current demand at markets and
according manufacturing of products (Stakeholder Mapping, 2014).
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 Next the strategies should be designed which are valuable in order to expand their overall
business operations at national and international areas by offering value added product to
all their potential buyers.
 Growth strategies are most important and valuable tools for firms as they are helpful in
analysing those areas where business operation's can be easily expanded without facing
any difficulty.
 Research are important in order to easily evaluate changing needs and wants of customers
thus developing products according to their needs.
 All these factors are useful for Volkswagen in order to achieve sustainable competitive
advantage at market places.
TASK 3
3.1 Alternative strategies linked with market entry, growth and sustainability
Each firms at market places are focused on adopting those plans which are beneficial for
them in order to attain growth and success in their business operations. There are many strategies
which are implemented by Volkswagen according to situations at market places and these are
evaluated below as:
Market Entry: Volkswagen are focused towards achieving all their business goals and
objectives in desired and planned ways so they can achieve sustainable positions at market
places. If there operations are spread in different locations then it result in easily consuming
goods for customers according to their continence and safety.
Limited growth strategy: This strategy is mostly used by those business who are not
having enough capital by which they can enhance their business activities. This the best strategy
which have been adopted by Volkswagen in order to increase current performances and build
strong images at market places (Campbell, Edgar and Stonehouse, 2011).
Retrenchment: In this factors firms are adopting completely new strategies which are
valuable for them in order to enhance growth and profitability ratios. Volkswagen are choosing
best and effective strategies which are valuable for them in order to capture large market shares.
Sustainable growth: This strategy can be adopted by business if they are focused on
adopting economical pricing strategy in order to get attention of large group of customers thus
their sales ratios will be enhanced.
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3.2 Selection of best & effective strategy
The best and effective strategies which are chosen by Volkswagen are helpful for them in
order to achieve growth and success in their overall business operations. They have made plans
in order to analyse the current situations at market places. Company should focus on effective
designing and implementation of plans in order to gain higher profitability and this could be
achieved by increasing productivity. Customers should be satisfied with products thus enhancing
profitability ratios. The best and effective strategy for Volkswagen is Limited growth strategy as
they are helpful in order to implement new and innovative technologies at work place by which
there productivity can be enhanced. This factors is also valuable in order to use all the resources
which are available in economy in effective and planned ways. Volkswagen should develop
plans in order to enter into those market areas which are productive and their sales ratios can be
enhanced. Plans and strategies are formulated in order to gain high competitive advantages at
market market places as compared to their rivalry business. Research activities are valuable for
firms in order to identify current market positions so firms can manufacture products accordingly
this results in enhancing their profitability factors. The main target of firms are cust9omers who
will use their products and services thus company can achieve success in their overall business
operation's (Chang and Chuang, 2011).
TASK 4
4.1 Roles and responsibilities of personnel in implementation of strategy
In business organisations different types of persons are involved who are executing
strategies so firms can achieve growth in their operations. These individuals are helpful in order
to accomplish all business goals and objectives in desired time frames. The persons who are
involved in executing strategies are evaluated below as:
CEO The Chief executive officers are the most
important parts of stakeholders who are
involved in executing strategies in effectual
and planned ways in order to gain high market
positions. These are independent owners are
taking care of all activities which are organised
at work places (Elliot, 2011). They are mainly
focusing on assigning roles to employees so
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that works gets completed in effective and
planned ways.
Managers These are the sole authorities who are having
responsibilities for overall business operations
and they include board of directors, Top
management etc. They are guiding employees
in order to carry out their operations in right
direction so firms can gain success. They
communicate most vital informations which
are valuable for firm in order to gain success in
their operations.
Engineers and research personnel These are most important players who are
valuable in order to enhance productivity at
work place by applying tools and techniques
thus their profitability factors will be enhanced.
They are having responsibilities in order to
make their employees understand the task
which had to be performed by them.
Top management These are sole authorities who are having
responsibilities in order to execute plans
according to their skills and knowledge level.
They are analysing all weak point of
employees and organising training and
development programmes for enhancing their
current skills (Ghezzi, 2013).
4.2 The resources needed for execution of new strategy for Volkswagen
In order to execute effective strategies firms need to implement plans and policies which
are useful for them in order to gain success in their operations. The resources which are used by
Volkswagen for framing strategies are described below as:
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Human resources: This is the most valuable factor which include managers,
subordinates and employees who are putting their best efforts in order to achieve business goals
and objectives. This is valuable factor for firms in order to achieve high competitive advantages
at market places. Managers should evaluate needs of employees so they can easily achieve all
business goals and objectives.
Financial resources: This is one of the valuable resources by which all activities are
carried out in proper directions so that organisations can achieve success in their business
operations (Jocovic and et. al., 2014). This the most vital factors which should be considered by
every business in order to execute business operations in proper directions.
Physical Resources: In the present age of competition all business are focusing on
adopting those strategies which are valuable for them in order to gain success in their operations.
Managers should analyse needs of employees in order to carry out all their operations in
effective and planned ways.
4.3 Evaluating SMART targets in business strategy
The mangers of Volkswagen are facing difficulties while executing their business
operations in effectual and planned ways. They are not able to achieve their targets which are set
by them in order to gain success. Thus there market shares and growth rates will be enhanced.
There are various plans and strategies formulated by business which are useful in order to
improve skill and capabilities of employees. The SMART objectives indicates the following
which are evaluated below as:
Specific: The strategies which are developed by mangers should be specific they should
easily convey the message so that employees can execute their work according to those plans.
Measurable: The objectives which are framed by Volkswagen should be measurable with
time and organisation at which business is running their operations.
Attainable: The aims and objectives of business should be attained in desired time
frames which have been allotted to them (.Meskendahl,2010).
Realistic: The objectives should be reliable on which firms can dependent they should not
be based on assumptions.
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Time bound: All business aims and objectives should be completed in specific times
which have been decided thus firms can gain success in their operations.
Volkswagen is setting targets in order to complete their business operations in desired time thus
productivity factors can be enhanced. The objectives of business are evaluated below as:
 If mangers are developing effective strategies then it result in increasing working
capacity of employees and they can easily achieve all their targets.
 The stakeholders who are involved in business operations should be valued as they are
main body who are responsible for increase profitability ratios of firms.
CONCLUSION
From the above report it can be concluded that business should focus on making plans in
order to implement best and effective strategies at work place by which they can easily achieve
success in their operations. Strategic planning is also vital tools in order to make business
activities run in proper direction by which firms can achieve success in their operations. SWOT
analysis are important factors in order to make effective decisions which are useful for business.
Role played by personnel in implementing strategies are valuable for attaining growth for firms.
SMART targets are useful in order to complete all business operations in desired time frames.
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