Volkswagen UK Plc: Sustainability and Operational Analysis Report

This report provides an individual analysis of Volkswagen UK Plc, focusing on its sustainability practices and operational excellence. It begins with an introduction to the organization, highlighting its position in the automotive industry, particularly in the UK market. The report identifies key challenges faced by Volkswagen, including external factors such as political and economic pressures related to environmental regulations and internal issues like declining customer trust and lack of skilled manpower. It discusses the expected challenges in implementing operational improvements and recommends strategies to address them, including the identification of material issues, building a strong communication chain, and establishing key performance indicators (KPIs). The analysis incorporates a TOWS analysis to assess strengths, weaknesses, opportunities, and threats, and also includes scenario planning to address software fix issues and rebuild customer loyalty. The report further examines the evidence of Volkswagen's commitment to sustainability, emphasizing the need for strategic planning and stakeholder engagement to achieve operational efficiency and maintain a strong market presence in the face of environmental concerns and regulatory changes. The report concludes with a summary of the key findings and recommendations for Volkswagen UK Plc.

Individual analysis of an
Organisation

Table of Contents
INTRODUCTION...........................................................................................................................3
a) Introduction to the organisation..............................................................................................3
b) Expected challenges in implementation and recommended strategies to address..................4
c) Evidence of a genuine commitment to sustainability.............................................................7
d) Introducing a company wide Operations
improvement strategy.................................................................................................................8
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
In today's era, role of sustainability and operational excellence is the vital scope to tasks
of any firm to gain profitability into the market along with production of goods or services. Also,
sustainability is about how organisation performs when producing goods or services to grow
high performance of any business firm (Henttonen, et. al., 2016). Focal purpose of sustainability
is to increase ability of the firm to develop its reach and led process of business with values and
core ethics. This report will be carry on Volkswagen UK Plc is one of the leading automotive
firm known for its quality of automotive car or vehicles. Volkswagen is specialised in making
cars, SUV and engine and sell it to the other automotive firm. Volkswagen's biggest market is
the United Kingdom which deliver 40% of its sales and profits. In the UK, Volkswagen has
given tag line of the “people car”. Although, firm is working in manufacturing and selling of the
car, SUV's, automotive parts along with full-fledged outsourcing of the engines. Here, my role is
of consultant to recommends Volkswagen to be practical & loyal for sustainability and develop
excellence out of their operations. Moreover, focus of this project is to cover discussion about
operation excellence and sustainability of the business. Volkswagen is facing challenges related
to control of pollution and lack of support to take remedial actions. Along with this, challenges
such as downgrading of the operational method, lack of emerging workforces to take implements
solution on pollution control as part of the sustainability. Also, report will cover discussion on
external and internal challenges along with scenario planning with use of a TOWS analysis and
then analysis of the stakeholders.
b) Expected challenges in implementation and recommended strategies to address
As, in the previous assessment, clear issue or say challenges occurred are measured as
critical and therefore correct solution is required to implement in the future production process to
build sustainability and process for long time duration (Healey, et. al., 2017). Challenges
associated to Volkswagen are both internal and external such as TOWS and Pestle analysis is
vital to identifies any forces which is highly threat for sustainability along with its core values to
operates in the UK. In the past period, Volkswagen has faced lots of breakthrough of the
customer trust, software fix issue to indicate emission light along with decreasing standards of
their performances. In Pestle analysis, forces such as political, economic, social, technological

etc., are found relevant to put given scenario to check for perfect solution & outcomes The
critical challenges in context of the internal and external are as follows:
External challenges: For this, major points such as political, economic, social &
technological factors. So , external challenges are as under:
Political: Due to change of the governance, several legal regulation is turn up by
authority in regards of the nature protection and also taxation policies, which is seriously instant
burden on automotive sector to adapt into the defined manner. Such related policies has initiated
previously, whenever political adaptation happen, new elected bodies have amend these policies
and forcefully automotive sector needs to be implement such change within a set time period.
Due to time constraint, automotive sector is prominent to invest huge in adaptability of such
changes in policies (Bogers and et. al., 2017). Chaos and instability or heavy taxation by
governments can lead to loss and business disruption. As a result, this continuous changes in
policies has become headache for Volkswagen to take instant action for getting solution of their
emission warning light software issues to go along with policies stated in the given policies. This
is seriously a severe situation for Volkswagen to survive into the UK market.
Economical: Economic factors have a direct effect on businesses and they do by
effecting demand. In UK, where inflation rate is recorded at 1.9 percent and exchange rate is also
going unstable, ultimately this has create burden on automotive industries to pump money in
their product development, Due to inflation situation, it’s not affordable for Volkswagen to put
advance technologies in its car and then cut down its prices. If they do so, huge decline will be
seen in their capability to build or grow profits. Hence, it would not be affordable for this firm to
invest money in software fix issues.
Social: Social awareness and diversification is one of the prominent elements of the
social change. In UK, which is largest tourism hub and contributes to 19 percent of revenue to
the nation, people and governance has started focused on environmental protection and clean
climate to this nation (Saridakis and et. al., 2017) To promote this, government of the UK has
passed advisory for firms who are working in automotive to develop core values in favour of
environmental protection. Failure of emission warning light is recalls for Volkswagen to rectify
it in 290000 cars in lesser time.
Technological: Due to the technological advancement in automotive sector, major
challenges is being faced by firm to keep it work and lower down chances of its failure. So, they

have to invest huge on its development and rectification, in case of its failures. Volkswagen has
decided to rectify software fix for emission warning light in overall about 250000 plus cars, but
before government of the UK would takes action on it.
Internal challenges: It deals with internal aspects such as manpower, stakeholders along
with processes of the firm. Volkswagen UK is currently suffering with the loss of trust and brand
loyalty diminishing of their customer as due to some past failure in the commitment & customer
service onto the long side of the businesses. This all happens as because of internal challenges or
failure occurred in past or present.
Lack of skilled manpower: Due to high turnover in the automotive sector, skilled people
are removed and new are advised to work on higher role. Also, all new people are working in
trend where technology is evolving and become advance (Cairns and et. al., 2016). Along with
this, 60 percent of current workforce is not aware of Emission warning light software planted in
their cars. It’s a challenges to train them in lesser time to rise their ability and practice to rectify
current challenges of the Volkswagen UK. For this, training will be given through use of the live
demonstration which is a costlier deal.
Support of stakeholders: These are suppliers, customer, investor, government etc., who
is able to put common interest in the firm's business and its functioning. Volkswagen is currently
facing loosen of trust of their stakeholders along with brand loyalty of their customers. People of
the UK are very environment friendly and failure of emission warning light software has broken
down trust of their customer (Calvo-Mora, et. al., 2016). It’s a challenging task for Volkswagen
to recover same trust by evaluating their sustainable commitment for people and environmental
friendly.
Ineffective operational planning: When Volkswagen has decided to implement process
of environmental safety equipment’s, they were on right direction, but their strategies and data
over its adaptability was insufficient. As per experts, company was able to demonstrate and test
that system into the real scenario and then implant in that vehicles. Hence, this kind of the failure
is not justifiable for the top managers.
After discussion of both external and internal challenges, its clearly viewed that situation
is not any more responding for success of the Volkswagen and it’s a threat for failure to business
to survive in the real market. Volkswagen is eligible to led changes in Emission warning system
by go through root cause of failure by technical department.

TOWS analysis:
Strength (S) Weakness (W)
Opportunities
(O)
Volkswagen is currently enjoy
strength world top class mobility
brand in terms of technology and
environmental priority vehicles.
They have opportunity to be highly
sustainable toward pollution free
mobility to become market leader
and convert it to their major strength.
Weakness of the Volkswagen is less
hands on sustainable tools such as
carbon emission tools which even
Toyota, Honda etc. uses to force
towards healthy, Volkswagen can
convert into its major strength to
gain customer trust and belief.
Threats (T) Strength of the Volkswagen is its
wide of top class car along with
emerging assembling section in their
operational capacity, which can be
converted as threat, if effective
measures or future changes and
rectification would not be taken.
Weakness of decreasing of
customer's loyalty would be convert
into threat, if Volkswagen will not
work on sustainable prevention or
make its mobility more safer.
Scenario planning: Volkswagen has decided to go for root cause of this failure and try
to do assessment correction proposed for it. One of the necessary aim is to spread message about
a sustainability and plans effectively for development of the operational excellence into function
of the production of car and other automotive. Using this scenario, consultant has gone through
certain valuable assumption as to meet software fix and brings back loyalty of customer.
Scenario planning is same as long term plan, Volkswagen has decided to build work force and
give them training to solve all kind of challenges. Moreover, stakeholder such as customer's,
investors, supplier, shareholders etc., must be in light of information, so that Volkswagen and
stakeholder must have common agreeable on bringing changes onto identified situation. Detailed
analysis of the stakeholder is having discussion in further assessment (Wood and Logsdon,
2017).

As, Volkswagen UK is looking to come up with new sustainable operational strategy to
minimise future occurrence of any auto-motive failures to retain and maintain reputation of a
firm in the UK market. Also, there are relevant strategies to support the implementation of a new
operational strategy that builds in sustainability are as follows:
Identify material issues to focus resources: Volkswagen plc has found failure of
technical aspects such as non-optimisation of the software, incorrect positioning and use of old
technical is found as the material issue and analyst has made proposal such as identification of up
to date tech and use of an advance skill manpower is a proposed solution.
Build chain of the communication: It’s a major hurdle for Volkswagen to craft approach
is responsible for an overall improvement of an environment and social impact while excellence
values oriented vehicles and communicate it to respective stakeholders.
Establish KPI: KPI stands for key performance indicators. It would help Volkswagen to
manage & monitoring sustainability progress for rectifying issue of software fix and this needs to
be conduct in an ethical way.
c) Evidence of a genuine commitment to sustainability
Volkswagen has found its critical for self to develop necessary changes so as to bring
effective functioning in an organisation along with accomplishing defined goals or target for
accomplishing operational efficiency. In the auto-mobile sector, every firm has its own defined
values and core competencies on basis of which they conducts their business operations (Vera-
Baquero and et. al., 2016). Volkswagen is facing governance restriction & loss of the customer's
loyalty as because of failure of an environment protection equipment in its cars and SUV.
Moreover, Volkswagen is advisable to inform their stakeholder over development and
implementation of new operational strategy. Also, this will be done by use of evidence or any
kind of strategic plan to convince them to take defined decision making. There are four types of
the sustainability are as given:
Economic: It is useful to implies method of production that satisfies existing uptake
levels without yielding future needs. The ‘sustainability’ that ‘economic sustainability’ seeks is
the ‘sustainability’ of the economic system itself. Its a main pillar of sustainability, wherein most
of the businesses feel that they are on profitable ground.
Environmental: It needs keep natural capital as part of both supplier of economic inputs
called ‘resources’ as well as absorber called ‘sinks’ of economic outputs. Using this pillar of

sustainability, companies has its essential focus to reduce its carbon footprints, packaging waste,
water usage and its overall impacts on an environment.
Social: Social pillar of sustainability is used to ties back into another poorly developed
concept named as social license. A kind of sustainable business should have support & approval
of its employees. On global social scale, business is required to be aware of its current supply
chain which is being filed to sustain environment.
Organisational: Such sustainability takes place, when businesses start focus on retention
& engagement strategies, including more responsive changes such as better maternity &
paternity benefits, flexible scheduling along with learning & development. Along with this,
major purpose of organisational sustainability is to brings effective performance & activities of
the organisational resources.
Currently, Volkswagen is suffering with challenges of environmental sustainability along
with diminishing efforts of its workforces to make or rectify any critical faults.
As, this issue is a part of an environmental sustainability concern and Volkswagen has
found emission warning light which was failed in approx 290000 cars, hence Volkswagen UK
Plc is suggested to for background of this issue and use technical solution. For providing
evidence to them, consultant of the Volkswagen is required to identify their stakeholders and
with use of stakeholder mapping theory, all of the likely stakeholder is identified as follows:
Suppliers: It’s a third party, which is vital to outsource advance technology, assembling
parts and supportive elements to the company so that production of the auto-motive in the UK
takes place effectively (McAloon, et. al., 2016). Suppliers have provided equipment to implant
emission warning light in the car, in response they must be under chain of informer to be shown
evidence in respect to the process of sustainability.
Customer's: These are priority people for the Volkswagen to act upon and maintain very
common relationship among each-other. Approx 290000 customer's has informed about stopping
of an emission warning light which as per their point of view, root cause of the pollution in the
UK. Moreover, its necessary to be given by making budget and creates proposed chart with the
defined deadline to make sure that stakeholders are agree upon this. This is to be common
relationship among them to company will fortune about its moral of sustainability and operation
excellence.

Investor: Investors are those people who in reality pump into the business process and for
firm is required to be ethical and be ready with supportive evidence to meet and apply full effort
to have strategic relationships with all of them (Goyal, et. al., 2016). Bringing software
rectification of the emission warning light, Volkswagen needs invest of 2 million pounds and
investor are ready to bear cost, unless until a strong operational plan would be provided to them.
All given three are major stakeholders of the Volkswagen and evidences such as annual
CSR report will be used to showcase them best supportive evidence to convince them to show
their interest towards sustainability and operational excellence. But all three stakeholders have
no similar concern as because their duties or work are not similar. Also, CSR report as convince
evidence will be presented by conducting a formal meeting and explains them appropriately the
whole plan.
d) Introducing a company wide Operations
improvement strategy
This assessment is covering process of strategic plan which in reality asks three questions
namely, “Where we are now”, “Where are we going” and “how will we get there” and plan is
having strategic thinking and making critical point of view to arrive at the valid conclusion (How
to Write a Strategic Plan, 2019).
Mission statement: Mission is “To offer attractive, safe and environmental sound
vehicles which must can compete in an increasingly tough market and set standard in their
respective classes”. This mission is unique and translating actual aim to take care of customer's
health and be sustainable about environment.
Values/guiding principles: Slogan of the Volkswagen is “Designed with the environment
in mind”. They wants company with integrity through and be respected in the best sense of word.
TOWS analysis:
Strength (S) Weakness (W)
Opportunities (O) Volkswagen is having prominent
strength of international brand
presence along with large product
portfolio which is helpful for them to
set opportunity based on product
Weakness of the Volkswagen is
decrease in the customer & brand
loyalty, which they have option to
convert it into opportunities being on
its commitment for sustainability and

sustainability by solving an
environment equipments to work on
visions effectively.
environment protection along with
rectifying emission warning light in
almost 290000 cars.
Threats (T) Strength of the Volkswagen is its
wide of top class car and strong hand
s in assembling parts outsourcing,
but its failure of necessary equipment
in car is becoming threat by loss of
the customers and business.
Weakness of loss of customer's
loyalty can be convert into threat, if
Volkswagen will not work on quality
and technical aspects of its car.
Sustainable competitive advantage: Volkswagen has their hands in strong durability and
longevity of the car vehicles which in reality makes it compared to its competitor. It straight
away gives competition to the Toyota, Nissan, Honda, Hyundai etc., in terms of the
technological advancement and uniqueness (Henttonen, et. al., 2016). When it comes to use of
technology and develop AI in cars, Volkswagen is much greater in value and putting down
investment in such so. Outer body of the Volkswagen car is strong in comparison to Hyundai,
Nissan etc. They are also top in terms of the fuel efficiency and longer running distance. All
these can also be said to as uniqueness of the Toyota.
Vision statement: Future vision of the Volkswagen is to become global leader to provide
sustainable mobility to the people for safe and secure experience.
Strategic objectives: The strategic objectives of the Volkswagen is strong empowerment
of technology and use of the AI is its mobility to convert mission of safe and secure vehicle into
sustainable mobility for environment and people.
Strategies: To bring role of technology and AI in mobility of the Volkswagen, effective
investment in R&D is required along with understanding customer's priority and needed tech in
car so as to reduce cost of the final product. Actually this strategy match with strength to become
world class mobility services.
Action plan: A separate setting of the budget plan is first step as part of the action plan to
have appropriate allocation of cost to be incurred. Also, have a view on strategy, looks at the
trends and then making changes is the best option.

CONCLUSION
In this report, its beneficial to conclude understanding of the sustainability in auto-motive
sector to develop effective processes and operational method to produce environmental friendly
mobility. Moreover, focal discussion has tried to be put on stakeholder analysis who are suffers
and being neglected firm over challenges related to sustainable protection. Challenges such as
operational strategies might be faced as because of lack of support of stakeholder in developing
the same. In future, benefit such as sustainable would be acceptable to seen by using current
trends.

REFERENCES
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