Professional Documents
Culture Documents
SID# 1546886/1
STRATEGIC AUDIT
OF
VOLKSWAGON AG.SID# 1546886/1
WORD COUNT: 4000
FINANCIAL ANALYSIS
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ABSTRACT
This paper represents the individual undertaking of a critical strategic analysis of Volkswagen
Ag. The paper comprising of two parts Part A and Part B. Part A contains data collected and
presented as a group presentation and Part B represents the individual undertakings of the
Author. In this study, the author examines the current strategic position of Volkswagen Ag, based
on an in-depth evaluation of its internal and external environment. The resource competencies
and capabilities are critically appraised together with the macro business environment of the
airline industry to determine where value added lies, and the extent of alignment with its
environment, which can result in the enviable and sustainably competitive position of strategic
fit.
Informed by the findings of the study, a recommendation is offered for the future strategic
direction of Volkswagen Ag. In making this recommendation the author takes into account the
financial implications for Volkswagen. Its feasibility, acceptability and suitability are considered
and are bolstered by a comprehensive implementation plan.
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ACKNOWLEDGEMENT
The author acknowledges the effort and contributions of colleagues as well as the course
facilitator in the production of this material
DELIMITATIONS
The scope of the report has been delimitations of the parameters of the parameters of the
question in application to Volkswagen.
ETHICS
The opinions expressed in this report are a result on an objective interpretation of the data
collected. There was no bias, subjectivity or any interference in the judicial process and objective
criteria
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METHODOLOGY
Research Philosophy
-
Data Collection
-
Primary Key informant interview, Lynch (2009) and Johnson & Scholes (2008);
existing theories
Secondary data Annual Reports, Online Sources, Other published but validated
information
RESEARCH OBJECTIVES
1. To analyze the current situation at Volkswagen Ag through the critical evaluation of its
internal and external business environment
2. To critically assess the strategic resource capabilities of Volkswagen Ag.
3. To examine the extent to which Volkswagen Ag is a strategically fit to deliver its goals
and objectives
4. To provide a critical appraisal of the range of strategic options available to Volkswagen
Ag through the application of available theories, concepts, literature and best practices as
it relates to strategies management
5. To determine a new future strategic direction for Volkswagen Ag.
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Table of Contents
1.0
2.0.............................................................................................................................. 2
3.0
Financial Analysis........................................................................................ 3
Financial SWOT Overview........................................................................3
Value Chain Analysis................................................................................... 3
Value Chain SWOT Overview...................................................................3
Mc Kinsey 7S Model.................................................................................... 3
Mc Kinsey 7S SWOT Overview.................................................................3
Cultural Analysis......................................................................................... 3
Turners Cultural....................................................................................... 3
4.0
5.0
6.0
5.1
5.2
Industry Overview....................................................................................... 3
5.3
PESTTLE...................................................................................................... 3
5.4
Customer Analysis...................................................................................... 3
5.5
5.6
Competitor Analysis.................................................................................... 3
Strategic Capabilities..................................................................................4
7.0
8.0
REFERENCES............................................................................................................... 4
APPENDICES............................................................................................................... 6
Appendix II : VW Balance Sheet- Five Year Trend................................................................7
Appendix III : VW Cash Flow Statements- Five Year Trend.....................................................8
Appendix IV: VW Ratio Table- Five Year Trend....................................................................9
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Financial Analysis
The financial analysis reveals that VW major growth strategy has been acquisitions
and mergers. Although several of these acquisitions were not to drive immediate
financial returns. The analysis revealed that VW core business fdrivers are the
revenues from
The core cost drivers of the business is .
Examilation of VW historical performance limited to the five year period 2010 to
2014 has had positive revenue growth however the impact on profit margins has
been marginal.
3.1.1
STRENG
WEAKNE
HT
SS
Product
Portfolio
Price
Strategic
Financial
Analysis
(SFA)
Profitability
Gross Profit
Margin
Net Profit
Margin
YES
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Return on
Assets
Return on
trended downwards.
ROE had a steady incline from 2010 to 2012 with
Stokholder
Equity
Liquidity
Current Ratio
& Quick
Activity
Ratio
Accounts
Receivable
Account
Payable
Inventory
Turnover
Leverage
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Debt to Assets
Debt to Equity
MarketValue
Dividend Ratio
3.2
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3.2.1
3.3
Mc Kinsey 7S Model
Pursuant to the Mc Kinsey 7S model, the soft areas can be likened to the internal
forces described in the Turner 7 model, Turner (1999).
3.3.1
3.4
Cultural Analysis
3.4.1
Turners Cultural
United States is merely 3% and 4.8% market share respectively. The company cars
are also not environmentally friendly with three of its most active brands emitting
excessive carbon-dioxide... These factors have resulted in value loss
and does not align to the business goals and objectives
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5.2
Industry Overview
5.3
PESTTLE
5.4
Customer Analysis
5.5
5.6
Competitor Analysis
Strategic Capabilities
Source
Source: http://fba.aiub.edu/Files/Uploads/MGT110044.pdf
6
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REFERENCES
Berman, K. Knight, J. Cass, J., And Financial Intelligence: A Manager's Guide to Knowing What
the Numbers Really Mean. USA: Business: Literacy Institute
Gurufocus., n.d. Where are WE with Market Valuations. [online]. Available at:
http://www.gurufocus.com/stock-market-valuations.php [Accessed 12 January 2016
Standards and Poor Research., 2012. Summary: Volkswagen AG. [online]. Available at:
http://www.volkswagenag.com/content/vwcorp/content/de/investor_relations. [Accessed 14
January 2016]
Volkswagen AG , 2010. Annual Financial Statements of Volkswagen AG. [online] Available at:
http://www.volkswagenag.com/content/vwcorp/info_center/en/publications/2015/03/Annual_Fin
ancial_Statement.[Accessed 10 December 2010
Volkswagen AG , 2014. Annual Financial Statements of Volkswagen AG. [online] Available at:
http://www.volkswagenag.com/content/vwcorp/info_center/en/publications/2015/03/Annual_Fin
ancial_Statement.[Accessed 10 December 2014]
Volkswagen AG , 2013. Annual Financial Statements of Volkswagen AG. [online] Available at:
http://www.volkswagenag.com/content/vwcorp/info_center/en/publications/2015/03/Annual_Fin
ancial_Statement.[Accessed 10 December 2013]
Volkswagen AG , 2011. Annual Financial Statements of Volkswagen AG. [online] Available at:
http://www.volkswagenag.com/content/vwcorp/info_center/en/publications/2015/03/Annual_Fin
ancial_Statement.[Accessed 10 December 2011]
Volkswagen AG , 2012. Annual Financial Statements of Volkswagen AG. [online] Available at:
http://www.volkswagenag.com/content/vwcorp/info_center/en/publications/2015/03/Annual_Fin
ancial_Statement.[Accessed 10 December 2012]
Volkswagen, n.d., News. [online]. Available at:
http://www.volkswagenag.com/content/vwcorp/content/en/homepage.html. [Accessed 12
January 2016]
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APPENDICES
Appendix I : VW Income Statement- Five Year Trend
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2010
2011
2012
2013
2014
16.9
5.7
0.0
10.2
16.1
17.6
9.9
7.1
12.7
18.8
18.2
11.4
6.0
7.8
20.2
18.1
4.6
5.9
5.7
11.2
18.0
5.5
6.3
5.8
11.6
1.1
0.9
1.0
0.8
1.1
0.8
1.0
0.8
1.0
0.8
1.1
0.0
6.4
1.0
0.7
5.8
1.1
0.7
5.6
1.0
0.6
5.8
1.0
0.6
5.2
0.8
0.0
3.3
1.6
0.2
5.5
1.5
0.2
0.0
1.1
0.2
0.0
1.2
0.2
0.0
7.2
0.3
4.9
0.6
5.5
0.8
10.6
1.0
8.2
1.0
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