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A Real-Time Case Analysis

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Written assignment Unit 3

                                                                        “A Real-Time Case Analysis”

Dr. Hall


The article “A Real-Time Case Analysis” provides an analysis of modern business strategy tools using the example of evaluating the strategy and performance indicators of Volkswagen, the second largest automaker in the world.

Volkswagen is currently a concern with several subsidiaries. The group produces cars of twelve brands: Volkswagen, Audi, SEAT, Skoda, VW Commercial Vehicles, Bentley, Bugatti, Lamborghini, SCANIA, MAN, Porsche, Ducati, Scania. Volkswagen AG sells its products in 18 countries and has the largest sales markets in Germany and China, in which sales of Volkswagen-owned car brands reach more than 1 million cars a year. Volkswagen uses a differentiation strategy, according to which it is essential for a company to position itself as a unique manufacturer of a product with exceptional attributes.

1. What is Volkswagen’s Strategy 2018 originally announced in 2008?

According to their Strategy 2018, originally announced in 2008, Volkswagen’s strategy was to “become the most successful, fascinating and sustainable automobile manufacturer.”

So, Volkswagen is the safest car among German manufacturers. Given the fact that consumer preferences vary from the desire to purchase a sports car for a fast ride, or a car that is comfortable to drive, or beautiful in design, a manufacturer can occupy its niche in the market, as well as several niches. Volkswagen, as already revealed, fills a niche of safe cars, but it can also meet the needs of those who are looking for an inexpensive car with low fuel consumption, high-quality interior and a wide range of models of different colors.

2. List the Key elements of Volkswagen’s Strategy 2018

Key aspects of the strategy 2018 included innovation, increasing market share, increasing productivity (as measured via return on sales), and becoming a top employer to build a first-class team. This strategy was recently superseded by Strategy 2025 in response to the emissions scandal (Magadia et al., 2019).

Innovation: Volkswagen has been a leader and pioneer in innovation, resiliency, and innovation, providing the world with innovative ideas and technologies since the late 1930s, from autonomous vehicles to forward-thinking, active suspension technologies, to highly efficient in terms of fuel.

Increasing market share: The company produces a wide range of products: from motorcycles to small cars and sports cars, also, from small commercial vehicles to trucks and buses. Thus, the company manages to be participants in the markets of different segments, to win its customers and to occupy a growing market share, both in vehicles as a whole and separately in each part of the industry. The described state of affairs is nothing but a multi-brand strategy of the company. It is undoubtedly one of the Concern's main competitive advantages, which allows it to cover all market segments, while meeting the needs of people from different segments of the population, with different incomes, social status, needs. In addition, it allows the company to present its products in almost all countries of the world, taking into account the cultural, national characteristics of each people and observing the laws of these countries.

Increasing productivity (as measured via return on sales): the concern also uses this strategy, which is aimed at an audience with specific needs. Volkswagen's main loyal customers are those who prefer reliability and comfort at an affordable price. However, this only applies to the Volkswagen brand. At the same time, there are other cars in the Concern, the cost of which exceeds the possibilities of people with average income. We are talking about luxury cars such as Bentley, Bugatti, and Lamborghini. These companies are financially independent; however, if we consider the power of the Concern as a whole, then these brands help to occupy a niche for expensive cars for people with high incomes who care about their status and approach the choice of car to maintain their social status or increase it.

Becoming a top employer to build a first-class team: However, as the authors of the article “A Real-Time Case Analysis” point out, it was Volkswagen’s confident, relentless and closed management culture that affected the emissions scandal in 2015.

 3. In order to execute Strategy 2025 (which supersedes Strategy 2018) in response to an emissions scandal, what was suggested in the article and why?

The authors of the article have developed recommendations for Strategy 2025 to be effective and realize the expected benefits.

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