Analysis and Report: Volkswagen AG Business Strategy and Planning

This report provides a detailed analysis of Volkswagen AG's business strategy, examining its organizational and environmental audits, as well as the importance of stakeholders in the strategy-making process. The report utilizes SWOT and PESTLE analyses to assess VW's strategic positioning and the external factors impacting its operations. It also explores the company's new strategy, 'Together-2025', outlining its goals, objectives, tactics, and target market, particularly in response to the emissions scandal. The report discusses the roles and responsibilities in implementing the strategy, resource estimation, and the evaluation of SMART targets, ultimately aiming to provide insights into VW's efforts to regain market share, enhance brand image, and promote eco-friendly production.

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Covered in PPT............................................................................................................................3
TASK 2............................................................................................................................................3
2.1 Strategic positioning of VW AG by its organizational audit.................................................3
2.2 Environmental audit for VW AG...........................................................................................5
2.3 Importance of stakeholders at time of strategy making.........................................................6
2.4 New strategy for organisation................................................................................................7
TASK 3............................................................................................................................................9
3.1 Alternative strategy's effectiveness........................................................................................9
3.2 Justifying chosen strategies..................................................................................................10
TASK 4..........................................................................................................................................10
4.1 Roles and responsibilities of personnel in implementing strategy.......................................10
4.2 Analysing resource estimation for new strategy..................................................................11
4.3 Evaluating SMART target's contribution............................................................................11
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Strategy of business play very crucial role in the development of every organization.
This is very complex to maintain the development and growth in the modern competitive market.
Short and long term business strategy helps in maintain suitable growth as well as constant
development nowadays. Purpose of this report is to present a plan of start up including
determining vision, mission, core competencies and their future plan (Boons and et. al., 2013).
This report will examine the organisational and environmental audit for Volkswagen which is
one of the largest automate company operated in UK. After the big scam the organisation have to
face a large fall in the sales of their cars and goods for recovering this negative impact, they
require to manage a proper plan or strategy to increase the competitive position among
consumers. This is fundamental for company to meet the desired goals and competitive
objectives to meet the expected results.
TASK 1
Covered in PPT
TASK 2
2.1 Strategic positioning of VW AG by its organizational audit
For meeting the aims and objectives of business, an organisation require to develop and
evolve effective strategies and plans. Volkswagen is a large automate enterprise which operates
it business at global level (Briggs and Grisaffe, 2010). The organization is recently facing
various types of issues and problems which require to enlarge the operations effectiveness. The
company required to manage and analyse these issues to enhance the performance in
international market. The competition among the car manufacturer are strong in United
Kingdom. To analyse the strategic positioning, it is required to examine the strengths and
weakness as well as threats and opportunities of Volkswagen to identify the capabilities which is
performed with the help of SWOT analysis summarised as below:
Strength  Volkswagen products broad products range and most
luxury cars such as Lamborghini, Ducati, Bugatti, Porsche,
Audi and many others.
 Organisation is one of the most successful car brands which

provide competitive benefits.
 The brand is one of oldest car company with a lot of
potential and credible buyers all around the world
(Brinckmann, Grichnik and Kapsa, 2010).
 It have approximate 350000 employee of enterprise
working in entire company's departments.
 They have their own plant of production located in various
place of world such as America, Europe, Asia and other
continents. This makes them relay on oneself than other
organisation in regard of production.
 The R&D departments of organisation is powerful that aid
in designings and innovating the older models and
modifying the services and products of company.
Weakness  Volkswagen is facing fall in overall profitability and market
share because of the tough and intense rivals in the
automate market.
 The controversial and scam have decrease the credibility
level as well as impacted adversely on the recognition of
brand.
 The products and services of organization emit green house
gases which is strictly prohibited by the government and
consumer are being aware about environment as well.
Opportunities  Volkswagen have various joint ventures which support a
wide network to the organisation worldwide as well as
strong consumer base (Bryman and Bell, 2015).
 Company can deploy their business in more populated and
open trade countries such as India, China, Indonesia which
can aid in gaining consumer base as well as more market
share.
 Later globalisation, international trade have interlinked that
increase the individual's per income capital as well as guide

toward strong consumer purchase power.
Threats  The policies and new legislation of state in regard of
reducing the environmental pollution can impact negatively
on the brand.
 Tesla and google have started a new start-up and producing
Hydrogen cars which is new technology dominating the
auto-mobile market.
2.2 Environmental audit for VW AG
This is essential to understand and examine the aspects of business environment for the
future purpose. Market is dynamic which require alternation within a period of time for the
achievements of the applied strategy. There are two types of environment in business including
internal and external environment (Carroll and Shabana, 2010). This is significant for
Volkswagen to investigate those environmental factors as it affect the decision making and
performance. Internal environment includes those elements which affects the business such as
employee, investors, supplier etc. On the other hand, the external factors often situated in outside
of organisation such as political factors, social factors etc. This helps in gaining a reputation in
competitive market and affect the major art of its operations as well. For evaluating these
external elements, PESTLE analysis can be done which have explained below:
Political factor This is one of the main elements where it is required for
Volkswagen to control the political factors of an organisation. It s
liked with the recession period as well. This can affect the
business growth in negative and positive way.
Economic factor The economic role is prominent in context of Volkswagen. In
market, there are several elements which affect organization such
as rates of GDP, inflation, interest rates, capital per income and
many other (Cavusgil and et. al., 2014). AS an example, in case
of lower interest rates, He sales amount of cars of Volkswagen
will raise.
Legal factor Government introduce various types of laws and legislation that
affect the organisation and its growth. The sate have come up with
several acts for reducing the emission of dangerous gases.

Company was in controversy for the production of GHG gases
which can cause for new laws implication in the entire UK.
Social factor Several elements such as culture, interest, preferences, language
and other can affect the system of organisation in various ways.
The company is manufacturing products and services or all
demographic and geographic of people such as some are super
luxury cars whereas some are low budget as well (Drucker,
2017).
Technological factor Technology is a required elements in the matter of auto-mobile
business which play a vital role in gaining consumers as well as
increasing sales of products and services. The technology of
Volkswagen is appreciated in as company manufacture various
types of automate products and services. The company is
spending million for introducing more eco-friendly production
process and services.
Environmental
factor
The organisation is majorly affected by this factor of external
environment. It context of Volkswagen, it have more negatively
on the business. The company was in Emission Scandal
controversy in which it was claimed by the environmentalist that
most of the organisation vehicle are emitting dangerous gases
which is arming to the environment. Those are injurious for
people's health and harming the nature. The organisation more
effective ethnologies for producing eco-friendly products to gain
the credibility of customers. For this organisation have developed
new strategy in which they have announced to reduce 50% of their
Carbon emission by the end of 2020.
2.3 Importance of stakeholders at time of strategy making
Stakeholder are those individuals which affect the process and operations of organisation
directly and indirectly (Elliot, 2011). This consist of shareholder, investors, employee, consumer,
worker, unions, state , society, communities and other individual. This have a significant place in

the activities of Volkswagen including sales and business strategies. This is required to
understand and identify the important stakeholder for managing the practices of enterprise. The
techniques which are used for evaluation avail in recognising values and interests in regard of the
various actions.
Value of Stake holders
 Render fundamental ideas or opinion related to strategy of business.
 Support the organisation activities and operations.
 Avail in recognising and completion of he nature as well as interest of organizational
people.
 Evaluate and examine the feedback of people.
Th analysis of stakeholder can be doe through step by step which are briefed as below;
Step 1: Employer of stakeholder who are involved in organisation operations are analysed on the
initial stage of evaluation (Osterwalder and Pigneur, 2010). They consist of shareholder, worker,
public, consumer, investors, governments, and many other.
Step 2: In the second stage, the manager analyse the interest and power of different stakeholder
and eliminate them. Volkswagen have identified those on the ground values and interest which
have been summarise here:
 Individual with high interest and high power who impact on the activity's major part by
rendering their bets performance.
 Higher power but less interested people affect the process and are essential to taken care
of. These includes less interested with high powerful stakeholders.
 Those individual who have high interest in t he operation's of organisation but less power
which help in the every day activities.
 These people make less efforts for the organisation activities as they contain less power
and lower interest in organization.
Step 3: In the final step of Volkswagen analysis of stakeholder, the organization establish an
effective communication and interactive activities among them for proper evolution. This
support the organization's operations as well as help in analysing responds.

2.4 New strategy for organisation
For presenting new strategy of Volkswagen, the organisation required to decides the vision,
aims, objectives and goals of organisation as well as tactics and target audiences to implement
them more effectively and impressively.
Goals
Major goal of Volkswagen is top provide the bets and value added services of auto-mobile
in the global trade and increase the competitive sustainability of organisation among the rivals
(Schaltegger, Lüdeke-Freund and Hansen, 2012).
Objectives
 To create an effective brand image to become the best and most selling organisation of
airmobile again.
 For increasing the base of buyer which is more potential with the enterprise to make
increment in the quantity of sales. To develop the quality of products and transform the manufacture process more healthy
and eco-friendly.
Strategy
'Together-2025' is the strategy which organisations have developed for making an
effective image in the competitive market in order to gain the domination recognition again and
increase the sales of products an services.
Tactics
Volkswagen is utilizing various promotion mix tools and media forms such as hoardings,
billboards, t,v, radio, online, advertisements and many other.
Positioning
Positioning refer to the place of organisation in the minds of consumer. After the scandal
of Emission the organization have lost its credibility for which they are introducing new
'Together 2025' (Sharma and et. al., 2010). This aims to gain more consumer and innovate more
ecological [production process and vehicle.
Target Market

Target market refer to the focused group of people for which the respected products and
services is aimed to launch. Volkswagen have eliminated their audience on the basis of various
segments: Psycho-graphic: Consumer are distinct on the grounds of income as well as attitude. The
company aims to middle and elite class of people. Demographic: On the basis of demographics, the consumer are eliminated such as
Volkswagen an focus on families and business men.
 Geographic: On geographic grounds, clients are aimed and eliminated. Organisation
desire to expand business in most countries.
TASK 3
3.1 Alternative strategy's effectiveness
It is essential element of organisation which is required for the management of operations
and performance of activities (Teece, 2010). This s required for the respected organisation to
develop effective strategies for rebuild brand image of enterprise and evolve overall. Here are the
justification of mentioned strategy appropriateness:
 Retrenchment
 Substantive growth
 Market Entry
Substantive Growth strategy
For managing the evolution of Volkswagen, it is indispensable for enterprise to design
strategy of substantive growth. For which the organization create diversification and integration
strategies and conduct in the market. In horizontal and pr icings techniques of vertical, firm can
determine few patterns on cost of them. Organization can manage those providers which can
monitor the cost and are more cheaper.
Retrenchment
Those expense which are not necessary for the enterprise, are trimmed with the help of
retrenchment process. Volkswagen can use divestment, liquidation and reversal techniques for
controlling expenses of interest of loan, loss in credit and many other. Volkswagen can use
liquidation strategy for the organization expense control (Trkman, 2010).
Strategy for Market Entry

Through the help of techniques of expansion such as joint ventures, merging and
franchisee, Volkswagen can deploy their business in global trade and enter new traffic. These are
helpful for gathering funds and sponsors as well as increasing sales of commodity of enterprise.
3.2 Justifying chosen strategies
Later the Emission scandal was leaked in 2009, United Kingdom's agency of
environment protection claimed which the organisation themselves are accountable for it. To
evolve in business as well as gaining trust of consumers again, this is necessary for Volkswagen
to acquire an effective plan for implementing and relaunch the organization with new impact
'Together-2025' is an effective strategy which can render assistance in raising the value of
company among rivals because: Workable: This activity is more practicable and workable that can easily applied on
several different structures guiding the organization toward achievement. Sustainable: The respected strategy can aid organisation in sustaining which have nor
short terms but long term impacts as well as aid in refraining in the automobile industry
(Business environment within different sectors of industry, 2015.).
 Satisfactory: Through this, the organisation can be able to earn the credibility of
stakeholders ad clients as it is more comfy and satisfactory plans.
TASK 4
4.1 Roles and responsibilities of personnel in implementing strategy
Without the assistance of personnel of an organisation, there can be no execution of any
strategy can be imagined. Here are few of roles and duties of human resources of Volkswagen
regard of implementation: Upper Administration Level : The responsibility of blue print or designed plan is of
higher authorities of Volkswagen. They manage whole process as well as set the vision
and goals of company. It is their duty to manage the interpersonal communication and
proper flow of message among the organisation.
1. Mid level: These are indispensable to control and manage the worker and peer of the
enterprise for conveying the message of higher authorities. This is done through
allocating them a target and recording their activities as well. These are responsible for
administrating the structure of different operational departments of organisation.

 Worker/ employee: Worker are the main assets which assist in executing the planned
strategies in various functional parts to get the maximum outcome. They are responsible
for implementing and meeting the daily target provided by employers.
4.2 Analysing resource estimation for new strategy
Each enterprise require some of resources to execute a planned strategy and proper flow
of operations which are essential elements. In order to properly imply 'Together-2025',
Volkswagen need to manage some basic resources for balancing the needs and requirements for
the success of plan (Overview of the Business Environment Working Group , 2017.). Here are the
discussed plans: Human resources: This is the major resource which is needed to impalement the strategy
of Volkswagen. They play a wide and very crucial role in through rendering to
organisation their skills and qualities and perform the operation of enterprise which lead
them to success. Raw material & time: Achievement is the game of perfect timing. Volkswagen required
to analyse the environment and implement the strategy on time to get the maximum result
of implemented strategy. Also they should focus over the cheaper suppliers of raw
material to trim the extra expenses so they can focus over the other important aspects. Financial resources: Financial and funds support is also one of the major resource which
the organisation will require as the process of manufacture and distribution is more
expensive (Wild, Wild, and Han, 2014). This is required for Volkswagen to arrange the
needed funds for the effective implementation.
 Other Resources
1. Marketing Resources
2. Technological Resources
3. Content & another Resources.
4.3 Evaluating SMART target's contribution
SMART technique is method of achieving the desired result in more efficient way. The
organisation can use this techniques for measuring the effectiveness of their new strategy to
impact on market after the scandal of Emission in 2009.

Source 1: S.M.A.R.T. Goals Settings, 2016
Specific: this refer to the goals that are specific. Volkswagen is aiming to gain 20% return
of the investment within the 6 months of year.
Measurable: M refer to measurable objectives. Volkswagen can measure the outcome of
expense and income of 6 months which they have been set.
Attainable: This refer to the achievable objectives. Volkswagen have focused to get the
20% of the expended money within 6 months. With the help of this strategy, it can be achievable
for them to achieve this amount (Zott, Amit and Massa, 2011).
Relevant: This is aiming to the relevancy of the goals and objectives. Volkswagen goals
are relevant as the stagnation is implying very effective and long terms activity, it is needed to
control the operation within a period of time and set the fixed targets.
Time: The time is referred by T of SMART. Time period have been set by Volkswagen is
6 month for measuring the income of entire activities and operation which should be equalise or
more than 20% of expenditure.
CONCLUSION
The above report represents that it is essential to plan and effective business strategy to
dominate the market as well as make an impact on the consumer. This aids in determining vision,
goals and objectives of company. This also states that through the help of environmental and
organisation audit, an organisation can develop a new strategy and analyse probable outcome.
With the help of SMART techniques, company can achieve their desired goals with more
effectively and efficiently.

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