Business Strategy Evaluation and Development: Volkswagen AG Report

This report provides a detailed analysis of Volkswagen AG's business strategy. It begins with an introduction to business strategy and its importance. The report then conducts an organizational audit using SWOT analysis to identify Volkswagen's strengths, weaknesses, opportunities, and threats. An environmental audit is performed using PESTLE analysis to assess political, economic, social, technological, legal, and environmental factors. The significance of stakeholder analysis in formulating new strategies is discussed, followed by an exploration of Ansoff's Matrix and Porter's differentiation strategy. The report examines market entry, substantive growth, limited growth, and retrenchment strategies, justifying the selection of a limited growth strategy for Volkswagen. Finally, it outlines the roles and responsibilities of personnel in strategy implementation, estimates resource requirements, and highlights the contribution of SMART targets to achieving strategic goals. The report concludes with a summary of the findings and a list of references.

BUSINESS STRATEGY

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
COVERED IN PPT..........................................................................................................................3
TASK 2............................................................................................................................................3
AC 2.1 Evaluate the strategic positioning of Volkswagen AG by carrying out an
organizational audit ...............................................................................................................3
AC 2.2 Carry out an environment audit for Volkswagen AG................................................4
AC 2.3 Significance of stakeholder analysis when formulating new strategy in Volkswagen
AG..........................................................................................................................................5
AC 2.4 new strategy for Volkswagen AG..............................................................................5
AC 3.1 Strategies relating to market entry, substantive growth, limited growth or
retrenchment for Volkswagen AG..........................................................................................8
AC 3.2 Justify the selection of a strategy for Volkswagen AG..............................................8
AC 4.1 Roles & responsibilities of personnel at Volkswagen AG who are charged with
strategy implementation.........................................................................................................9
AC 4.2 Estimated resource essential for implementing a new strategy for Volkswagen AG10
AC 4.3 Contribution of SMART targets to the achievement of strategy implementation in
Volkswagen AG...................................................................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business strategy is a type of planning for achieving their goals and objectives. Strategic
plan is useful for company to increase their sales and productivity in marketplace. Strategy plans
succeed when they lead the business growth, maintain competition level and positions, and
strong financial performance. The group must change their approaches and strategies according
to the requirements and needs of a business.
This report will discuss about Dragon den organization to identify their specific goals,
objectives and vision of strategic planning. There are many effective techniques which is helpful
in developing strategic business plans for growth and development.
This assignment will also discuss about Volkswagen AG to analyze the strategies
positioning and also planning of the new strategies (Baraibar‐Diez, Odriozola and Fernández
Sánchez, 2017). This report will determine the roles and responsibilities of Volkswagen AG in
the marketplace. It will determine the estimated resources which are required for planning an
effective business strategy.
TASK 1
COVERED IN PPT
TASK 2
AC 2.1 Evaluate the strategic positioning of Volkswagen AG by carrying out an organizational
audit
The organizational audit is the best technique which is helpful for identifying internal
strengths, weakness, competitive advantages and opportunities in the existing marketplace.
The organization audit can be done with the help of SWOT analysis, it is as follows
Strengths- The main strength of Volkswagen AG is that they have specific objectives and
goals for their business. Volkswagen AG is a leading organization in manufacturing different
automobile products in marketplace. They provide the best quality of service and products in the
global market. Volkswagen AG continuously earns profits every year. Sometimes, the profit rate
is low but they will manage their business and profit in proper manner. This organization has
expanded their business across the world. It is important to improve performance of business and
understand the market value. Volkswagen invested $8-8 million in the economy.

Weaknesses- Volkswagen AG organization is increasing their business and their structure
and cost in global market. They are not focused on their business approaches. They provide the
products at very high costs as compared to other brands (Cagnin, 2018). It is very important for
Volkswagen to maintain their relationship in global marketplace. Sometimes, the gross profit of
company is very low
Opportunities- Volkswagen mainly focus on their business strategies and new market
development. They provide the facilitates and services to their customers. They have launched an
effective product which impacts on the business process and also increased their sales and
productivity in marketplace.
Threats- The competition level can increase in market because many new entrants that
can enter in the business all over the world. There is less entry restriction in the Volkswagen AG.
Modern technology frequently changes because most of the organizations use technology to
promote their products in marketplace. Volkswagen AG is an automobile company and provide
the products in market with help of technology.
AC 2.2 Carry out an environment audit for Volkswagen AG
The environmental audit is a process which is helpful for Volkswagen AG by authority in
order to formulate effective strategies in business processes. There are external factors that could
be affect the business operations and functions. This analysis not only support an association to
acquire knowledge about their complete environment but also assists in knowing about global
concepts that are applicable in different countries in order to understand the nuances of auditing
required for development and growth.
PESTLE Analysis has been implemented for an organization and are as follows:
Political environment- Volkswagen AG could get the advantages because they have less
entry restriction in marketplace. It is determining as a threat but it is advantage of organization in
the international market. The structure of tax is not high as compared to another.
Economic environment- This consists of external factors in the business process. The
Volkswagen AG organization is dealing with the automobile industry as they provide the best
quality of product in marketplace. Economy influences business process and it can divide into
two form such as micro environment that is effect the decision making and another macro-
economic factor that affected the entire economy of automobile industry. Customer cannot buy

the product in marketplace because price of Volkswagen AG is very high so that most of the
customer against them.
Social environment- Social environment is important part of society. Each and every
society construct their own social environment. Some people believe in social culture,
traditional. most of the people give more preferences to luxury brand products in market and
middle class people also buy branded product in marketplace. It indicates that the market has
been developed and chosen people also different. The people move to old products and services.
It is important for Volkswagen to change the market and also change the trend of Volkswagen.
Technological environment- Volkswagen AG invest some money for growth and
development. It also adopts a new technology and platform to improve the performance of
organizations. Volkswagen also uses different techniques to increase their quality and services.
Technology is helpful for managing the supply chain and management of Volkswagen AG.
Legal Environment-Volkswagen is not strict about their legal laws, rules and regulations.
It is important to follow all the legislation tax, health and safety and competitive policies etc.
Environmental environment- It is an essential factor that is based on nature because it
generates threats. Volkswagen installed the illegal software in their engine and produce 40 times
more pollution in the environment (Chotipanich and Issarasak, 2017).
AC 2.3 Significance of stakeholder analysis when formulating new strategy in Volkswagen AG
Stakeholder analysis is called as a stakeholder mapping which is helpful for
understanding the specific roles and responsibilities of stakeholders in the business process and
they take effective decisions for making new strategy formulation. Volkswagen AG has
prepared an effective strategy for growth and development.
The significance of stakeholder analysis is that it is helpful for increasing the satisfaction
level of stakeholder. It also analysis or identifies the competencies of staff members. It is the
main success key strategy for Volkswagen. They are identified the capability and potential of
employee. Stakeholders are determined by the latest trend of marketplace. The stakeholder
strategy is helpful for fulfilling the needs of financial requirements that is essential for any
business process.

AC 2.4 new strategy for Volkswagen AG
Volkswagen AG proposed the Ansoff's Matrix which is helpful for them to identify the
needs and requirements of business. This is main important strategy in Volkswagen which is
helpful for They are identified the relationship of company products with marketplace. Ansoff's
strategy analysis employees by establishing business all over the world. New market and
develop business all over the world. Ansoff's strategy is useful for Volkswagen AG because it
analyzes the entire business and market conditions. It is helpful for the management and
marketing to promote the products and services at marketplace.
According to Volkswagen, Management worry about the targeting customers in
marketplace. An effective strategy and approach is helpful for improving the quality of product,
services, promotional activities. It is essential for organization to develop the market
development and there is huge amount invested in the business operations and functions.
Volkswagen has expanded the business process and generating high revenue in marketplace.

With respect to support the product’s development strategy, Porter's strategy is helpful for
differentiation in Volkswagen because this strategy introduced an effective element that impact
on business process. The competition level is very high in market so that it can directly impact
on Volkswagen AG. The differentiation strategy helps in introducing new products at
marketplace. (Gattorna, 2017). In this way, they gain competitive advantages in the market. They
create an effective brand identity in front of the customers. Differentiation strategy is important
for Volkswagen to determine actual roles and responsibilities of businesses in the global market.
Illustration 1: Ansoff Matrix
(Source: Ansoff’s Matrix, 2017)

AC 3.1 Strategies relating to market entry, substantive growth, limited growth or retrenchment
for Volkswagen AG
The alternative approach and strategies are very helpful for organization to provide
opportunities to identify solutions to problems in the business process. The new entry market
strategy is an effective approach to determine the needs and requirements. The market share is
increased because of new entry. It is helpful for more chances to attract number of customer
towards the organization. Volkswagen is using this strategy for increasing the business process
all around the world. Sometimes, alternative strategy is supporting enterprise operations in
expansion of international business. The entry market strategy is planning an effective method to
deliver the best quality of product and services. When exporting and importing services that
manage and establish the contract between the other country.
The effective integration and diversification strategy is helping in the growth of
substantive. Volkswagen is a leading company and manufacturer of the automobile parts of
vehicles in marketplace. (Woerner and Wixom, 2015). It also establishes a channel of
distribution. In this way, substantive growth is increases so that business operations also
increased which is important for Volkswagen to maintain performance in marketplace.
Substantive growth strategy is applied in the joint business vendor for growth and development.
According to Substantive growth, Volkswagen organization merge with the competitors to
maintain their business process in proper manner.
Volkswagen started to set up goals for growth and development. They also manufacture
the products at low rate and give many options to innovate new ideas for production (Idemudia,
2017). Sometimes, they mainly focus on limited growth and implement innovative ideas for the
business process. The limited growth provides innovation, product development and market
development and it is the best strategy to increase their productivity and profitability in market.
They will change their strategy according to the needs and requirements in marketplace.
Volkswagen company is targeting to their existing customer to promoting, increasing revenue
and also changing the brand in global marketplace.
AC 3.2 Justify the selection of a strategy for Volkswagen AG
As per survey, it is found that Volkswagen is a leading organization in market but
nowadays, there are various competitors in marketplace so it is required for maintaining their
product and services. For growth and development, Volkswagen has required to manage the

resources in proper ways. It is important for planning an effective strategy and improve the
decision making power (Whitehead, 2017). The growth limited strategy is applicable in
Volkswagen because they provide the products at reasonable rates. They mainly focus on
competitors and customers to identify their needs and requirements with the help of strategies
and approaches.
The limited growth strategy is helping Volkswagen to get more chances to solve
problems of their business. This cited organization provide new products in market according to
the requirements of customers (Welford, 2018). Another strategy is differentiation which is
useful for product development and manufacturing of an effective product in marketplace.
According to a survey, it is justified that the Limited growth approach is useful for
Volkswagen because they are concentrated on overall business processes. It is the best for
business structure and size of company. The Limited growth strategy is helpful for company and
justified for feasible growth and development.
AC 4.1 Roles & responsibilities of personnel at Volkswagen AG who are charged with strategy
implementation
Volkswagen needs to understand the efficient and experienced employees who have the
responsibility to manage the business strategies and approaches in proper manner. Volkswagen
gives more priority to their old employees because they have skills and knowledge to manage t
business operations and functions in effective ways. (Matt and Benlian, 2015).
The main role and responsibility of personnel is related to the communication strategy.
Communication is the main part of an organization to interact with another department to
maintain the relationship. Personnel has created an active strategy which helpful for convincing
employees in proper manner. The operative communication is helpful for Volkswagen to revise
their mission and vision. The personnel have more responsibility to increase the number of
employees towards approaches and implementing this process for growth and development.
Role and responsibility of Volkswagen organization to manage all necessary resources
that required for growth and development. (Waage and Anderson, 2017). The distribution and
allocation of resources is essential for implementing an effective strategy.

The personnel have the main responsibility to always observe the approaches that
implement in the business process. It is important for business activities to track all operations
and functions that must be recorded in proper manner.
AC 4.2 Estimated resource essential for implementing a new strategy for Volkswagen AG
Volkswagen company is implementing new strategies and approaches for product and
market development. This is helpful for business process in increasing productivity and
profitability in marketplace. Volkswagen mainly focuses on the effective strategy that can be
implementing in business process.
Technological resources- technological equipment is required for the business operations
and functions for manufacturing various types of products such as equipment, machine parts etc.
Volkswagen use high quality products and also maintain the manufacturing as well as
production. This is an essential resource to increase their sales and production in marketplace.
Raw material- Raw material is one of the important resources which is required for
Volkswagen to maintain their services and products (Raghunath and Rose, 2017). For proper raw
material, Volkswagen produce new products in marketplace and it is important for organizations
to avail raw materials in proper quantity.
Human resources- It is important resource because they are innovating new ideas that
can be implemented in the business process. Human resource is the strength of Volkswagen
because they will manage the entire business activities and operations in proper manner. They
have quality and potential to design the best quality products.
Financial resources- Financial resource helps for company to gain positive outcomes. It
is required for identifying raw materials and also buying the necessary machines, maintenance,
provides salaries for employees etc. (Morelli, 2018). The necessary resources are maintained by
Financial departments.
AC 4.3 Contribution of SMART targets to the achievement of strategy implementation in
Volkswagen AG
In Volkswagen, Smart Target is playing important role in achieving their goals and
objectives. Smart target is important to set up fix parameter and Volkswagen company moving in
right directions.

'S' Stands for specific target that is helpful for increasing the market share and profitability for
Volkswagen. The cited company always increase their market value every year.
'M' stands for measurable targets which measure profitability and productivity in numerical
terms. Every year, 6% increment in marketplace (Peng, 2017).
'A' stand for achieving targets and it is clear that effective strategy is helpful for implementing
innovative ideas for growth and development. Volkswagen can be achieving their results and
outcomes.
'R' stands for realistic objectives. Volkswagen sets their own goals and objectives and it is based
on reality.
'T' stands for time bound strategy or approach of Volkswagen. They are fixed some time bound
on the basis of assessment.
CONCLUSION
From this report, it is concluded that business strategy is an essential part of organization
that helped to grow and develop. Further, it described various strategies and techniques such as
matrix, BCG, SWOT analysis and bench-marketing that is beneficial in analysing market
condition. This report also concluded various types of resources used by Volkswagen to expand
their business across the world. Company used SMART objectives to develop goals and
objectives. The alternative strategies are developed by them to improve the performance of
business and market value in different countries.

REFERENCES
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