Analysis of Business and Corporate Strategies for Volkswagen Group

This report provides a comprehensive analysis of the business and corporate strategies employed by the Volkswagen Group, a multinational automobile manufacturing company. It delves into the business-level strategies, focusing on the company's vision, mission, target market, and functional strategies, including manufacturing and consumer relationship programs. The report also examines the corporate-level strategies, particularly the differentiation strategy, and how it has been implemented to improve product quality and expand services. A key aspect of the report is the comparison of business and corporate strategies, highlighting the company's focus on anticipating the competitive environment and meeting consumer needs. The report further explores the application of the differentiation strategy in both slow-cycle and fast-cycle markets, discussing the differences in achieving competitive advantage in each. The conclusion emphasizes the importance of aligning business and corporate strategies for operational efficiency and brand image, using the Volkswagen Group as a case study.

Running head: BUSINESS STRATEGIES
Business Strategies
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Table of Contents
Introduction................................................................................................................................2
Business Level Strategies...........................................................................................................2
Corporate Level Strategies.........................................................................................................3
Comparing both the Strategies...................................................................................................4
Differentiation strategy in slow and fast-cycle markets.............................................................5
Conclusion..................................................................................................................................6
References..................................................................................................................................8

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Introduction
Business management can be referred to as the art, craft and science of implementing,
evaluating or formulating cross functional decisions, which enable the organizations to
achieve their long term objectives. In simpler terms, it can be defined as a procedure of
specifying any organization’s vision, mission as well as objectives on developing policies or
plan (Armstrong et al., 2015). The report discusses about the business level strategies of the
Volkswagen Group for the long term success of the firm. Moreover, it throws light on the
corporate level strategies for the firm’s success and the competitive environment. In addition
to this, the strategies are being compared at each level and how they differ in the slow cycle
or fast cycle markets. Volkswagen Group, often known as Volkswagen AG is a multinational
automobile manufacturing company of Germany. It manufactures, distributes and designs
commercial and passenger vehicles, engines, turbo-machinery, motorcycles and other
services like leasing, fleet management and financing (Volkswagenag.com. 2018).
Business Level Strategies
Volkswagen Group has overarching vision, which is to become the leading provider
of mobility all across the world. Their mission is to offer tailor made solutions of mobility to
its customers. They serve their target market in accordance with their diverse demands and
needs, along with a portfolio of stronger brands. Their responsibilities regarding the social,
safety and environmental issues are highly satisfactory. Moreover, the company believes in
acting with integrity, reliability, passion and quality as the foundation of their activities. The
company’s strengths are its customers’ trust, excellent employers, sustainable growth and
competitive profitability. The company is considered to be the role model for safety, integrity
and environment (Wesseling et al., 2015). Moreover, Volkswagen Group’s business
strategies are to achieve greater success as the aim of their products relies on best consumer

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analysis. There business strategy aims at achieving stronger customer value proposition and
according to the internal and external analysis; the company has greater strategies for their
long term success.
In addition to this, the company has implemented a number of functional strategies in
order to achieve the consumers’ desires and demands. This includes manufacturing strategies,
source strategies that is establishment of the domestic funds and continuously improving the
quality of the product. The consumer relationship programs and other strategies are being
implemented by the company for their long term success. The well developed strategies
include four dimensions, which are well product market investment strategy, strong value
proposition of the customers, assets as well as core competencies and lastly, good functional
area strategies. These strategies of the company help in analyzing the external as well as
internal factors affecting the industry (Charles Jr, Schmidheiny & Watts, 2017). Moreover,
they stress on developing a strong consumer value proposition and identify their needs
through market analysis as well as research.
Corporate Level Strategies
A well developed corporate strategy should address the strategic choices,
organizational structure, primary concerns of the people and dimensions of organizational
culture. The Volkswagen Group has identified the differentiation strategy as its major
corporate or marketing strategy. Developing these strategies has helped in improving their
products’ quality and expanded services, which go beyond the normal standards of
automobile manufacturing. The company focuses on their quality strategies, which is seen as
a part of the whole differentiation strategy. The differentiation strategy is being undertaken in
order to differentiate the company’s products or services from its competitors and compete on
the international platform (Ephraim, 2016). The management of the company assigns its

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employees to the particular value creation projects as well as roles, which are linked together
in order to create a framework. This helps in increasing quality provision, responsiveness,
effective service delivery, competitive advantage and innovation (Li et al., 2018).
Volkswagen Group has succeeded by integrating the efforts its employees all across
the company’s structure, business sections and functions just to specify the set of strategies
that are being achieved by the company. Moreover, the organizational culture is also very
flexible along with all the roles and responsibilities clearly mentioned and allocated to the
staff members. The organizational structure has been one of the most contributing factors for
providing effective implementation of the strategies, where each and every employee know
his/her job expectations as well as descriptions. However, the development of the corporate
business strategies should take into consideration, all the public involved into the procedure.
This can be done by ensuring the fact that the production is of good quality along with the
services in order guarantee target consumer satisfaction (Bayçu & Kılınç, 2017). In order to
achieve this, Volkswagen Company has been installing certain programs for training its
human resource managers prior and also after the strategy is implemented and devised.
Comparing both the Strategies
Both the strategies have been designed in order to achieve the desired results or
outcomes. On comparing the business level and corporate level strategies, it can be said that
the Volkswagen Company is more concerned about speculating the future environment of
competitiveness as well as meeting the needs of its target consumers. Moreover, it has
developed these strategies in order to develop its products or services, which will be able to
compete under favorable conditions with their competitors. The strengths as well as
weaknesses and opportunities and threats are being considered, while designing the
component. The definition of these strategies enables in executing their business as well as

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corporate strategies, while ensuring that both the units are being integrated together for easy
management. The competitive contacts are more concerned regarding the opportunities and
threats of the business and coordinating the usage of the company’s resources, the company
formed its corporate relationships and activities as well (Rhodes, 2016).
The differentiation strategy undertaken by the Volkswagen Company is the most
successful one and it will benefit the company on the long run. The company will be able to
differentiate its products from its competitors and leverage their internal strengths as well as
potential for the operational efficiencies. The choice between decentralization and
centralization of the corporation needs more and more considerations so that the external
factors do not affect their competition level. In addition to this, the company will get
benefitted in terms of availability of the resource as well as workforce. This strategic choice,
principles, organizational culture and designs will help the company in shaping their
employees’ behaviors, values, beliefs and norms as well (Crane & Matten, 2016).
Differentiation strategy in slow and fast-cycle markets
In order to understand the differences of the differentiation strategy in the slow and
fast-cycle markets, it is important to know what a market cycle is. The most significant
competitors of the company are Ford Motor Corporation, Toyota Motors and others. The
competitors depend upon the condition of the markets as well as market cycle. The cycle can
be divided into three different parts that are slow-cycle, fast-cycle and standard-cycle market.
If the company is in the slow cycle, then most of the competitors will be different from its
fast cycle market (Miranda-Agrippino & Rey, 2015). It can be mentioned that in slow cycle
markets, Volkswagen Group’s differentiation strategy needs to increase its strategies
alliances into the restricted market, in order to maintain their market stability. The

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competitive advantage of the company can be attained by gaining an understanding regarding
the copyrights, patents, ownership of the IT resources as well as geography (Haldane, 2015).
The competitive advantage of the differentiation strategy in the fast cycle market can
be attained by protecting, maintaining or extending its competitiveness and segregating its
products or services as per the consumers’ demands or desires. However, in the slow cycle
market the company can get back towards the actions of competitiveness by launching some
new strategies or objectives. On the other hand, it is seen that the competitive advantages of
Volkswagen Group is more protected from imitation in the slow cycle market, as in fast cycle
markets imitation takes place very fast. The competitive advantages of the differentiation
strategies undertaken by the company are less sustainable during the fast cycle period. The
company can use innovative technology of higher quality products or services in order to take
the competitive advantages within the fast cycle markets. On the contrary, it is seen that the
slow cycle market is less violent than the fast cycle market due to the rapid decline of the
prices in organizational products, which also tend to decrease the overall profitability
(d'Amato, 2015).
Conclusion
To conclude, each and every organization need to look carefully as their intended
business level as well as corporate level strategies are being compared to that of their
competitors. It helps in leveraging their internal potential and strengths for the operational
efficiencies as well as effectiveness. Poor strategies of any company may lead to the downfall
of the organization and malign their brand image as well. The report throws light on the
business level as well as corporate level strategies of the Volkswagen Group and after
comparing both, it is found that the differentiation strategies adopted by the company would
benefit it on the long run. In addition to this, the report has also highlighted the differences of

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the differentiation strategies in the slow cycle as well as fast cycle markets. It can be said that
the slow cycle market is less violent than the fast cycle market, as it reduces profitability.

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References
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Bayçu, S., & Kılınç, Ö. (2017). Analysis of Volkswagen Emission Crisis in the Context of
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Crane, A., & Matten, D. (2016). Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. Oxford University Press.
d'Amato, M. (2015). Income approach and property market cycle. International Journal of
Strategic Property Management, 19(3), 207-219.
Ephraim, P. E. (2016). Transparency and Ethical Considerations in Business Organizations:
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Rhodes, C. (2016). Democratic business ethics: Volkswagen’s emissions scandal and the
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