Strategic Analysis and New Strategy for Volkswagen Group Report

This report provides a comprehensive analysis of Volkswagen's business strategy, commencing with an introduction to the core concepts of strategic management and its importance. The report delves into an organizational audit to assess Volkswagen's strategic positioning, followed by an environmental audit that examines the company's operational context and the impact of the emissions scandal. Stakeholder analysis is critically evaluated, highlighting its significance in formulating new strategies. The 'Together strategy 2025' is explored as a pivotal new strategy, focusing on technological upgrades and mobility solutions. The report then assesses the appropriateness of alternative strategies, such as market entry, growth, and retrenchment. It also addresses the selection of the most suitable strategy, outlining the roles and responsibilities of personnel charged with strategy implementation. The report concludes with an analysis of the resources required for implementing the new strategy and the contribution of SMART targets to the achievement of strategy implementation. The report leverages scholarly sources to support its findings.

Business Strategy

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Covered in PPT...........................................................................................................................3
TASK 2............................................................................................................................................3
2.1 Analyse the strategic positioning of Volkswagen group by carrying out an organisational
audit.............................................................................................................................................3
2.2 Environmental Audit of Volkswagen group.........................................................................4
2.3 Assess the significance of stakeholder analysis when formulating new strategy.................4
2.4 New strategy for the Volkswagen group...............................................................................5
3.1 Appropriateness of alternative strategies relating to market entry, substantive growth,
limited growth or retrenchment for Volkswagen .......................................................................6
3.2 Selection of strategy ............................................................................................................6
4.1 The roles and responsibilities of the personnel who are charged with strategy
implementation............................................................................................................................7
4.2 Analysis of estimated resources that required for implementation of new strategy in
Volkswagen.................................................................................................................................7
4.3 Contribution of SMART targets to the achievement of strategy implementation in
Volkswagen.................................................................................................................................8
CONCLUSION ...............................................................................................................................9
REFERENCES..............................................................................................................................10
Books and Journals...................................................................................................................10
Online........................................................................................................................................11

INTRODUCTION
Business strategy is the long term plan of the organisation that is required to execute to
achieve the goal and objective of the business. Business strategy also helps the management to
set the goal and the objective of the organisation and in setting up the plan and the procedure to
achieve such target (Acquaah, 2013). It is important for the business to have effective strategic
management because without it there is no specific roadmap to guide the business to achieve the
business goal and the objective. Business strategies are derived for the long time as it covers the
period of 3 to 5 years.
TASK 1
Covered in PPT
TASK 2
2.1 Analyse the strategic positioning of Volkswagen group by carrying out an organisational
audit
Strategic positioning is the term that is used to predict the future position of the
organisation taking into account the environmental changes and the realization of that
positioning (Astrachan, 2010). It includes the arrangement of the future position of the
organisation with the consideration of the present situation and the future predicted
developments and making of the plans to realize the future positioning. Strategic positing of
Volkswagen group ensures the continuity of the organization. Survival, legitimacy, market
positioning come under this context. It considers the future of the organisation and the position
of the organisation in the future. It covers the kind of the product and service that is used and the
values that make the organisation differentiate form the other competitive organisation
(Bharadwaj and et. al., 2013).
There are the different methods of strategic positioning by carrying out the organizational audit.
 Differentiation
Driving up cost is the essential part of the organisation top gain more profit and increase the
income of the organisation. It places different values to the customer as to provide the quality
according to the taste and the preference of the customer, cost as per the capabilities of the
customer.

 Cost positioning
It is important for the organisation to consider the cost positioning because it gives best price of
the product to the customer so that they can buy such products. This is the another technique to
increase the profitability by cutting down the cost.
2.2 Environmental Audit of Volkswagen group
Environmental audit is the essential tool for measuring the effects on the environment. It
is used to investigate, understand and identify the issue that may affect the environment. These
are used to calculate the adverse impact of these activity on the environment. It covers the
scrutinizing, inspection, survey of the environment so that no issue can arise in the organisation
in relation to the environment (García‐Rodríguez and et. al., 2013). Environmental audit evaluate
the business environment so that evaluation of the result can be made successfully. The issue
related to the environmental legislation and the pressure from the customers are the main reason
behind the environmental audit.
Managing director Paul Willis of Volkswagen group appeared before the environmental
audit committee to answer the question on emissions scandal. The emission scandal started on
18th September 2015 and the Environmental protection agency of US issued notice to the German
auto maker Volkswagen to clean air and to control the pollution that is produced by the vehicle.
The main objective of this scandal is to control the emission that occurred in laboratory. The
international council on clean transportation (ICCT) added the three estimates of three vehicle in
year 2014. This scandal created the awareness about the pollution produced by the vehicles and
the emission occurred in the laboratory in the country and created the awareness to control the
impure of the air in the environment and to reduce the effect of such on the environment.
2.3 Assess the significance of stakeholder analysis when formulating new strategy
Stakeholder are the key part of the organisation. It is important to consider the
stakeholder view while taking the decision in the organisation by the top management. When the
management formulate new strategies in the organisation then it is required to consider the view
point of the stakeholder so that better decision can be taken up by the management. Strategies
can be formulated and implemented in the organisation only with the help of the stakeholder.
Stakeholder are the person who can affect the organisation plan of action and human actions.

They are the person who have stake in the company in any way and have power to affect the
business of the company (Coad, 2011).
It is required by the management to consider the interest of the stakeholder while
formulating the strategies. They play important role in the company and all the plans and
procedures of operation of the company can be successful only if there is positive attitude of the
stakeholder.
There are different stakeholder that are associated in the business as:
 Primary stakeholder- They are internal stakeholder as customer, supplier, creditor and
employees of the organisation. They are involved in the business transaction.
 Secondary stakeholder- Secondary stakeholder are those person who are not directly
involved in the business as media, community etc. they are also called external
stakeholder.
 Excluded stakeholder- They are the stakeholder who are not involved in the business
transaction and have no impact on the business. General public with instrumental value is
considered in this group (Jocovic and et. al., 2014).
It is required for the business to consider the stakeholder in the business strategy because they
are the person who have the power to affect the business of the organisation and they have direct
impact over the business.
2.4 New strategy for the Volkswagen group
By innovatively implementing the new strategy to the business of Volkswagen, the
business of the company can be enhanced to the new parameter so it is important for the
company to adopt new innovative ideas so that their business can grow over the future. There is
one strategy that can be used by it i.e. Together strategy 2025.
The Volkswagen group is formulating new strategy to fulfil the challenges of mobility and the
technological up gradation so that they can move their business to the new parameter. They are
systematically moving with transition to the mobility world, initiated by 'Together strategy 2025'.
this concept considers that the company will produce more than 30 electric vehicle by 2025 and
the company has set a goal to sell a million of electric cars by 2025. they said that e-mobility can
not be achieved without the strong progress in batteries and infrastructure so they are working
very hard on battery charging projects. This strategy is adopted by the organisation to fulfil the
demands of the consumer form the organisation. They are continuously trying to provide batter

services to customer so that they are making new innovation and adopting latest technology
available in the market so that market standard product can be provided. They have launched
new initiatives in field of mobility (Maté, Trujillo and Mylopoulos, 2012). To ride hailing
services they made collaboration with partner Gett. They are working on shuttle service and car
sharing concepts for urban mobility.
3.1 Appropriateness of alternative strategies relating to market entry, substantive growth, limited
growth or retrenchment for Volkswagen
There are many strategies available to entry into the market, substantial growth, limited
growth or retrenchment and their alternatives are also available which are also effective.
There is a alternative for the market entry i.e. Merger, acquisition and joint venture. It is very
effective method to enter into the market. When a new business enters into the market then it is
very difficult for it to survive in that market so there is alternative available to make a
collaboration with an existing business to enter into the market. Acquisition is to takeover the
existing company and it is to take ownership of other business (Meskendahl, 2010). This strategy
provides the substantive growth to the business as to enter into the new market to run their
business more efficiently. These alternative strategies are beneficiary for the business to enter
into the new market and such strategies are more impactful to the growth of the business. These
strategies make the growth and the development in the business of the organisation so it is
important to consider such strategies when the business is unable to run their business in growth
oriented and to run their business to be more profitable because it is difficult for the new
business to enter into the market so they can take the help of such strategies.
3.2 Selection of strategy
The selection of the appropriate strategy is the key part of the organisation that help in to
achieve the target with in the time frame. Strategies are formed to achieve the targeted objective
and goal of the organisation but it is more important to choose best strategy out of the available
strategy. It requires effective selection process to choose best service. The Volkswagen has
selected Together strategy 2025 to move with transition of mobility and the technological up
gradation so that they can move their business to the new parameter of the market (Montgomery,
2011). It is very important decision of the business to select the best strategy because the

business moves on the strategy and when the corrective strategy is not selected than it creates
hurdles and barriers to the growth of the business.
4.1 The roles and responsibilities of the personnel who are charged with strategy implementation
The person who is charged with the implementation of the strategy plays very important
role in implementation of the strategy. It is important to formulate effective strategy but it is
more important to execute such strategy and the person who is responsible for execution must
devote his skills for implementation of strategies.
Following are the roles and responsibilities that strategic implementer play-
1. Involvement-
It is the key part for the person who is charged with implementation to make the involvement of
all the level of staff while formulating the strategy because every employee of the organisation is
important to the success of the plan.
2. Monitoring-
It is important to monitor the strategy that has implemented so that if there is any loop holes in
such strategy then they can resolve the issue that arise in the implementation (Munir, Ansari,
and Gregg, 2010).
3. Interest-
It is required to consider the interest of all the staff so that they can understand how the company
benefits from the implementation of the strategy.
4. Encouraging staff member-
Leader and the strategic implementer encourage the staff member to devote their skills to the
implementation of the strategy so that effective implementation can be made.
4.2 Analysis of estimated resources that required for implementation of new strategy in
Volkswagen
Following are the resources required for implementation of new strategy-
 People
To effectively implement the plan it is important to have right number of people on board. The
right people means the person who can support to the plan. Strategies can not be implemented
only if there is adequate number of the people who can implement the strategy (Rossi, 2010).
 Resources

There are many resources that are required to implement the strategy to achieve the targeted
result. It includes the fund, time and true cost to support to the implementation. True cost is the
time that is committed by the staff to complete the task, identification of expenses, unexpected
cost by vendor.
 Systems
System helps to track the progress of the plan. It builds milestones that required to complete
within the time.
 Culture
It creates environment that help the employee to connect with the organisation's mission. It
develops the positive and negative consequences for achieving or not achieving the strategy.
 Structure
It is important part of the implementation of the strategy because strategies can be implemented
successful only when the structure of the organisation as well as the strategy is effective (Teece,
2010).
4.3 Contribution of SMART targets to the achievement of strategy implementation in
Volkswagen
SMART target is very important for the business to consider because it help the
organisation to determine many criteria that can be helpful in implementing the strategies in the
business. The word SMART means Specific, Measurable, Attainable, Relevant and Time
oriented. This help the organisation to set the goal and objective of the organisation to implement
the plan to achieve the target of organisation.
 Specific
Specific means to adopt the specific rule and regulation so that the plans and procedure can be
implemented to achieve the target and the goal of the organisation. It is required to follow the
specific rules and regulation according to the norms and the policies of the company (Verbeke,
2013).
 Measurable
it means the identification of the exact goal that is actually seen, feel when the final goal is
achieved. It means to break the goal into measuring element. The goal that can be measured go
for the long run and make clear and easier to reach to the goal.
 Attainable

It means to find that the goal is really attainable or not and it is acceptable or not. It is required to
expand effort, time and cost to gain the profit against it. It is important to check that the goal that
is set can be reached or not.
 Relevant
It is required to check that the result that one want to achieve is relevant or not to the
management goal and the objective and it helps the organisation to achieve their overall task or
not.
 Timely
It is important to consider the time that is required to devote to the work to achieve the target of
the organisation. Time is the key element that every business must consider to achieve their
targeted result (Rossi, 2010).
CONCLUSION
As per the above study it can be concluded that the formulation and the implementation
of the strategy is the key part of the organisation and if management fails to adopt the adequate
measures to effectively implement the strategy then their business can not achieve the their
target. It is also very important for the business top consider the environmental element in
implementation of the strategy.

REFERENCES
Books and Journals
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García‐Rodríguez, F.J and et. al., 2013. Corporate social responsibility of oil companies in
developing countries: from altruism to business strategy. Corporate Social Responsibility and
Environmental Management. 20(6). pp.371-384.
Jocovic, M and et. al., 2014. Modern business strategy Customer Relationship Management in
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Maté, A., Trujillo, J and Mylopoulos, J., 2012, November. Conceptualizing and specifying key
performance indicators in business strategy models. In Proceedings of the 2012 conference of the
center for advanced studies on collaborative research (pp. 102-115). IBM Corp.
Meskendahl, S., 2010. The influence of business strategy on project portfolio management and
its success—a conceptual framework. International Journal of Project Management. 28(8).
pp.807-817.
Montgomery, C.A. ed., 2011. Resource-based and evolutionary theories of the firm: towards a
synthesis. Springer Science & Business Media.
Munir, K., Ansari, S and Gregg, T., 2010. Beyond the hype: Taking business strategy to the
“bottom of the pyramid”. In The globalization of strategy research (pp. 247-276). Emerald
Group Publishing Limited.
Rossi, C.L., 2010. Compliance: an over-looked business strategy. International Journal of Social
Economics. 37(10). pp.816-831.

Teece, D.J., 2010. Business models, business strategy and innovation. Long range planning,
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Tsamenyi, M., Sahadev, S and Qiao, Z.S., 2011. The relationship between business strategy.
management control systems and performance: Evidence from China. Advances in Accounting.
27(1). pp.193-203.
Verbeke, A., 2013. International business strategy. Cambridge University Press.
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Online
Techniques Used in Development of Business Plans. 2017. [Online]. Available through:
<http://smallbusiness.chron.com/techniques-used-development-business-plans 2558.html>.
[Accessed on 24th April 2017]