INTRODUCTION

Volkswagen Worldwide
Volkswagen is an auto organization from Germany. The word Volkswagen signifies "Peoples
car" in German. It was begun in the 1930s, at the solicitation of the nation's pioneer, Adolf Hitler
to deliver an auto outlined by Ferdinand Porsche.

Volkswagen Group Malaysia.

The Volkswagen brand is no more bizarre to Malaysians. Eras of Malaysians have grown up
with their own or another person's Volkswagen Beetle possessing a position of warmth in their
souls and biographies. Till today, this sign of the Volkswagen brand's enduring quality and
particular character keeps on getting a charge out of a loyal after even as more up to date
models from Volkswagen have begun to start off their own gatherings of fans in the nation.
Volkswagen Group Malaysia was authoritatively propelled in Malaysia on 16 February 2006,
with the Corporate Headquarters arranged in Wisma Volkswagen, Bangsar. From here, it will
control showcasing, deals and after deals to provide food and satisfy the Malaysian client's
wishes for individual portability in all circumstances of life.
1

a) Identify and comment the VALUES of the company.

Volkswagen Values
Social responsibility, sustainability, a spirit of partnership and Pro Ehrenamt volunteering
initiative
Volkswagen is more than a business. The company is in charge of individuals, the economy,
society and nature. All the employees at Volkswagen tackle obligation by getting to be included
in voluntary work, Sustainable, synergistic and capable deduction underlies all that we do. As
from above table, Volkswagen has four main values that important for the company operation.
By having the values, its will help the company to shape a strong culture within the organization
and will produce a productivity of the company. One of great entrepreneur said, Your culture
really is one of the most important things of your company. Its who you are; its why customers
choose you. Build a great company which you would want to do business with yourself. If you
get this right, your culture is right. (Branson, 2013). In the Volkswagen, the first values of the
company is social responsibility. This is one of the fundamental component of Volkswagens
corporate policy and the company comes with various activities for their people itself.
For example, Volkswagen is sponsoring the social projects, devises innovative employment
models, invests in the employability of its employees and also offers job security. These can be
prove where, in Wolfsburg, Volkswagen, together with the city of Wolfsburg as accomplices in
Wolfsburg AG, is making more employments and enhances the personal satisfaction. The
organization gives backing to organizations beginning up or moving to the range, starts and sets
up learning systems, bolsters exploratory and open offices and creates recreation ventures particularly in territories that are critical for personal satisfaction, i.e. relaxation, environment,
education and health. The attention is on the car business, a generally solid region of mastery in
the district. (Social Responsibility for People). This showed that the Volkswagen is responsible
toward the people around them and this value is suitable to the company. There are many more
that Volkswagen has done included the social activities named as Work2Work, CSR Europe,
One hour for the future and else.

The second values of Volkswagen are sustainability that the company will conduct their
business activities based on a responsible and long-term basis. This will involved all the people
that will get profits from the company growth such as the customers, investors, society and
employees. This can be proven by when the company has been awarded as the Worlds Most
Sustainable Automotive group in 2015. (Volkswagen, 2015). Apart from that, Volkswagen has
support some of 200 projects worldwide in order to enhance the economic and social structures,
placing special emphasis on continuity and sustainability. Since 2002, the company joined one
of the largest and the most essential Corporate Social Responsibility (CSR) which is Global
Compact. There are involving with 12,000 companies from over 170 countries. Other than that,
one of the projects also has been awarded that won the National Energy Globe Award
Germany in July 2014. (External environmental awards, 2014). The project named as Think
Blue that commitment to the environmental protection.
Then, third is a spirit of partnership. A spirit of partnership in the working environment is an
important basis for a decent working climate and for economic achievement. Inspiration and
duty can come in the workplace that if the employees practice fairness and appreciation when
dealings with one another. However, if the harmony in the workplace of Volkswagen is irritated,
this can have sweeping outcomes for the wellbeing and the wellbeing of the staff and also the
company itself. Volkswagen will consequently not endure any infringement of individual rights
and respect. As a result, the company, Volkswagen has an agreement back in 1996 where the
Volkswagens management and work council will commit themselves in order to maintain the
spirit of partnership in the workplace. (Volkswagen). The company has set up the training
program for their employees in order to implement this agreement. Apart from that, the
employees also responsible to prevent any discrimination, sexual harassment and bullying in
the workplace.
Lastly is Pro-Ehrenamt volunteering initiative. The purpose of this value is to gain the
awareness of volunteer work and also to support and promote the activities of Volkswagen. This
value suite to the company because based on Volkswagens website, they have work with the
volunteers and the communities for some of the activities such as CSR. Furthermore,
Volkswagen has been a volunteer for every year. Through this value, the company able to have
a good relationship with the communities, gather experiences and also improve their social
skills.

b) Identify and analyse the MISSION statement based on nine criteria.

Volkswagen Mission Statement
The Groups goal is to offer attractive, safe and environmentally sound vehicles which can
compete in an increasingly tough market and set world standards in their respective class
Volkswagen Mission Statement
At Volkswagen it is our mission to build long term strategic partnerships with our customers. To
assist them in making the right choices for their business needs, by minimizing fleet costs and
providing world class customer service. The six principles of this shared mission statement are:

Business must serve the good of the people.

Business that serves the good of the people requires competition.
Business that serves the good of the people is based on merit.
Business that serves the good of the people takes place globally.
Business that serves the good of the people must be sustainable.
Business that serves the good of the people demands responsible.

Customers
Yes
Technology

Product / services
Yes
Concern
for
survival,

Markets
Yes
Philosophy

Yes
Self-concept
Yes

growth & profitability

Yes
Concern for public image
Yes

Yes
Concern for employees
Yes

1. Customers
From the mission statement of Volkswagen, it has customers criteria. As from the
mission, the company wants to offer the products or services toward the customer. The
products that will offer will come out with attractive, safe and environmentally sound
vehicles as well. Volkswagen also concern on the relationship with their customers. This
means that the company wants a long-term relationship with the customers that able to
make the customer to repeat purchase. Volkswagen also has been awarded as 2015
Customer First Club Award Member.
2. Product or services
In the mission statement of Volkswagen, it also has product or services criteria as well.
The company has various type of products and services that they offered worldwide
which are automobiles, commercial vehicles, engines, motorcycles, turbo machinery and
many more. Volkswagen also owns the Audi, Bentley, Bugatti, Lamborghini, Porsche and

overseas-brands SEAT and Skoda. Apart from that, Volkswagen also offered services
toward the customers, which includes the banking, financing, fleet management,
insurance and also leasing. In 2014, Volkswagen has prove that they able to produce
more production that lead to 10.14 million of vehicles.
3. Markets
While for markets criteria, Volkswagen also has fulfill this criteria based on the mission
statement above. The company wants to serve their products or services globally
including the Malaysia itself. The Volkswagen has sells its vehicles in 153 countries
including the Africa, Asia, Europe, North America and South America. (Volkswagen,
2014). However, Europe and the Asia Pacific region are the most important markets,
each accounting for 40% of the companys sales.

Figure 1: Market distribution of Volkswagen in 2014

Sources: http://www.dw.com/en/volkswagen-a-tumbling-giant/a-18728202

4. Technology
In the mission statement of Volkswagen, the company has technologys criteria. This is
because the company needs to compete with tough market and other competitors.
Therefore, Volkswagen will use the advancement technology in order to produce a high
quality of product and also increase the production of vehicles. Apart from that,

Volkswagen able to produce greater operating range, more powerful engines, more
comfortable travel that only consume less and producing fewer emissions.
5. Concern for survival, growth and profitability
Then the mission statement of Volkswagen also concern for survival, growth and
profitability. In the mission statement, it said that the offer by Volkswagen can compete
even in a tough market. Since 1937 where the Volkswagen is founded, the company still
able to survive in the market and also growing in automotive industry as well.
Volkswagen also produce a profit for every year and the company still trying their best to
increase the performance of the company.
6. Philosophy
The mission statement of Volkswagen also has philosophys criteria. In the mission
statement above, Volkswagen wants to offer an attractive, safe and environmentally
sound vehicles.
7. Self-concept
Volkswagen also has self-concept criteria in their mission statement as well. In 2014,
Volkswagens technical innovations again impressed the German Center of Automotive
Management (CAM). For the fourth time in succession, CAM awarded the Volkswagen
Group its Automotive INNOVATIONS Award in the category Most innovative carmaker
as well as in the categories Conventional Powertrains, Alternative Powertrains and
Networked Vehicle as the worlds best manufacturer.

8. Concern for public image

Apart from that, mission statement of Volkswagen also concern for public image. Based
on above mission statement, it said that the company would produce products that
environmentally sound vehicles. Volkswagen also produces hybrid vehicles that can
reduce the usage of fuel as well. The company will concern toward the social,
community and environment. In 2014, Volkswagen received the policy award in the
Corporate Social responsibility category for its strategic partnership with the Nature and
Biodiversity Conservation Union (NABU). (Volkswagen, 2014)

9. Concern for employees

Lastly, the mission statement of Volkswagen also has concern for employees criteria.
The company is responsible for their employees at the workplace. Their employees will
be provided with the job security that will make sure the employees in a good condition.

c)

By using Davidsons six requirements, identify and analyse the VISION of the

company.
Volkswagen Vision Statement
By 2018 the Volkswagen Group is to be the worlds most successful and fascinating
automobile manufacturer and the leading light when it comes to sustainability.
1. Provide future direction
7

Based on the vision of Volkswagen, its has provide future direction. The company has
made a target for their company, which is in a period of time by 2018. The company also
know what the company would be do in the future in order to be the most successful
company.
2. Expresses a consumer benefit
Through the vision of Volkswagen, the company did not mention even expresses a
consumer benefit in their vision statement. Even though the company did not mention of
consumer benefits but the company has giving consumer benefits to the customers.
Volkswagen is trying to give the best satisfaction to their customer by giving after sales
and financial services. Based on the annual report of Volkswagen in 2014, the company
provides service that included the supporting dealership to ensure the company can
provide quality advice and maintenance.
3. Is realistic
Based on the vision statement of Volkswagen, its has a realistic vision statement where
the company will be the most successful and fascinating automobile manufacturer by
2018. From the previous performance, Volkswagen has received many awards and
recognition for the products and services that the company provided. Apart from that, the
sales revenue of Volkswagen has almost doubled to over 200 billion euro and also lead
to operating profit has more than double. Therefore, the vision statement of the company
can be a reality after face all the obstacles during the operation.

4. Is motivating
The vision of Volkswagen also motivating that will make people aware with the vision.
The company wants to be the worlds most successful and fascinating automobile
manufacturer. Through this vision, the company showed that they able to success in the
automobile industry. Therefore, when the vision is motivating, its will create a high spirit
toward the company itself.

5. Must be fully communicated

Through the vision statement, all of the employees in the company should aware and
know what they responsible with their works scope. The employees was communicated
and understood by the members of the team. In this vision statement, it does not stated
that the vision has the criteria of must be fully communicated but its has mention in the
Annual Report of Volkswagen in 2014. According to the Annual Report, Volkswagen will
explain the what, how, why and when. As a result, these have build trust, which in turn
empowers of team members.
6. Consistently followed and measures
The vision statement of Volkswagen also consistently followed and measures. The
company always followed the vision for every steps they are taking in order to achieve
the goals of the company. Therefore every department in the organization able to
followed the vision statement.

d) Explain and evaluate the OBJECTIVES of using SMART criteria.

The main goal of the group's strategy is for Volkswagen to become the economic and ecological
leader of the global automotive industry. We defined four objectives through which Volkswagen
shall become the most successful and fascinating enterprise of the global automotive industry
by 2018.
Volkswagen Objectives

1. Volkswagen wants to gain a position of the world's leading manufacturer by using intelligent
innovations and technologies to shape customers' satisfaction and quality
2. Sale is expected to exceed 10 million vehicles per year; whereas Volkswagen wants to rely
upon development of large growth markets.
3. The profitability of sales before taxation is expected to reach at least 8% thus guaranteeing
financial safety and ability of the group to function in the periods of economic downturn.
4. Volkswagen wishes to be an excellent employer on all markets, among different
communities and in all regions; this is the prerequisite for creation of great teams of
employees.

Specific
Based on the above table, the Volkswagen has specific criteria of objectives. The objectives
should be written and clearly define what the company are going to do. Through the specific
criteria, Volkswagen should know what, why and how they operate in automotive industry. This
can be showed in the first objective of Volkswagen that able to fulfill the specific criteria as
below:
What?
How?
Why?

Volkswagen wants to gain a position of the worlds leading manufacturer

By using intelligent innovations and technologies
To shape customers satisfaction and quality

Measureable
Then, the objective of Volkswagen also can be measurable. From the objectives above, the
company wants the profit of sales before taxation is expected to reach at least 8%. Based on
the previous profit, Volkswagen afforded to create their own profit for every year and of course
the companys objectives is measurable. As from figure below, the profit of Volkswagen is
increasing by year.

10

Figure 2: Volkswagen operating profit

Achievable
Apart from that, the objectives of Volkswagen also achievable since the company have a
powerful workforce. In order to achieve the objectives, the company should have knowledge,
skills and abilities that help the company to achieve the goals. When Volkswagen has
achievable objectives, they can motivate the employees to work while if the objectives are
impossible to achieve, the company may not even try to accomplish it. As in the objectives of
Volkswagen, the companys sale is expected to exceed 10 million vehicles per year; whereas

11

Volkswagen wants to rely upon development of large growth markets. This can be achieving
since based on the previous performance of the company where the company able to sell
exceed 10 million vehicles for a year. From the graph below, the sale of vehicles has increasing
by year.

Figure 3 : Sales of Volkswagens vehicles in units

Relevant
The objectives of Volkswagen also relevant that the company can achieve. Volkswagen wishes
to be an excellent employer on all markets, among different communities and in all regions; this
is the prerequisite for creation of great teams of employees. Through the objectives, based on
the performance of Volkswagen previously, it is relevant to be an employer on all markets since
the company able to produce high technology of vehicles. The company also gives their
employees global access to the automotive industry.

12

Time bound
However the objectives of Volkswagen did not have time bound. The company should mention
their time bound in the objectives that will creates a practical sense of urgency and the target of
the company in a period of time. As a suggestion for Volkswagen, the company should mention
the specific date such as By December 31, 2016 at the objectives as well.

e) Explain how strategic DECISION of the company impacts its stakeholders.

There are many strategies that the company of Volkswagen will be implement for the
sustainability of the company. One of the strategies is sustainability strategy that is the
responsibility and environmental protection. Through this strategy, the company can has a longterm business activity based on ethical criteria for acting in an environment-friendly way and
also responsible toward the future of people within the company and in society. (Volkswagen,

13

2014). This means that the Volkswagen focusing in particular on the environmentally friendly
orientation vehicle projects. As from figure below, through this strategy, the Volkswagen spend
for the operating cost in order to do the responsible and environmental protection.

Figure 4: Operating Costs for environmental protection at Volkswagen in 2014

Sources: Volkswagen Annual Report 2014

Unknown

Power of the stakeholder over strategy

Little / no Moderate
Significant
effect

Unknown
Little / no
effect
Moderate
Significant

Community
Employee

Supplier

Volkswagen

14

Effect of strategy on the stakeholder

Customer

(BOD)
Shareholders

Table 1 :
Volkswagen (Board of Director) (Significant power; significant effect)
The board of director of the company will have a significant power of the stakeholder and also
significant effect of strategy. The BOD has a significant power because they will be the
representatives of the brands and regions especially in this strategy. The BOD also has a high
power in making the decision for the company. Since the strategy is to responsible and
environmental protection, the BOD need to responsible of any outcomes that will happen in the
future. Based on the Annual Report 2014, the company has implement Green Key Performance
Indicators (KPIs) in order to check the progress towards achieving their targets.
Shareholder (Significant power; significant effect)
The shareholders have a significant power of the stakeholder and also significant effect of
strategy because they are having share in the company. There are many shareholders that
involve in the company and the highest shares is Porcsche Automobil Holding SE (31.5%),
followed by Foreign institutional investors (26.3%), Qatar Holding LLC (15.4%), State of Lower
Saxony (12.4%), private shareholders / others (12.3%) and German institutional investors
(2.1%). These shareholders also have rights in order to suggest for the strategy of the company
either they agreed or not. While the effect also significant since the shareholders will receive the
dividend. If the strategy successful, its will benefit the shareholders but if the strategy failed, its
also give a bad impacts toward the dividends as well. The Board of Management and
Supervisory Board will propose to the Annual General Meeting a significantly higher dividend of
4.80 euro per ordinary share and 4.86 euro per preferred share in 2014.
Supplier (Moderate power, significant effect)
15

Then for the supplier, its has moderate power of the stakeholder and has significant effect
Volkswagen Group procurement mainly purchases production materials, services and capex
centrally. In the reporting period, the purchasing volume including the Chinese joint venture
companies increased by 7.7% to 145.5 billion. Suppliers in Germany accounted for a share
of 36.1%. This showed that the supplier also have a moderate power toward the company.
Without the supplier, strategy of responsible and environmental protection cannot be done if the
raw materials used are not suitable for eco-friendly. The supplier knows the quality of their
products that can suit with the strategy. Apart from that, supplier gives a significant effect
because they supply the products for Volkswagen. Volkswagen wants vehicle projects that have
an environmental protection. If the suppliers cannot supply the materials used for the vehicle
projects, its will effect entirely of the company even the strategy itself. Therefore, Volkswagen
also provides training for their suppliers, which is Sustainability in supplier relationship.
Through this training, the suppliers will be provided with a digital training module in nine
languages on the Group Business Platform.
Employee (Little / no power; significant effect)
In this strategy, the employees have little or even no power of the stakeholder and significant
effect of the stakeholder because the employees only follow all the instructions given by the
company. They cannot make a decision for the strategy that has been implemented. However,
the employees will give a significant effect toward the strategy on the stakeholder. As from figure
below, Volkswagen has almost 600,000 employees worldwide that make the company
accomplished its strategy. Without the employees, Volkswagen cannot do the sustainability
strategy that will responsible and care on the environmental. The company involves their
employees in this strategy by informing them about their targets and any related procedures that
need to be followed. Since the employees give a significant effect, the company responsible to
provide information events and specific training programs.

Customer (Little / no power; significant effect)

16

Then for the customer, there will be little / no power of the stakeholder and has a significant
effect of the stakeholder toward the strategy. The customer cannot make a decision in the
strategy of the Volkswagen because they did not have any power. However, the customer will
give a significant effect toward the strategy. This is because when the customers satisfy with the
product offer, which is the eco-friendly products, the customers will spread their satisfaction with
their family, friends and people around them. However, its will effect a bad image of Volkswagen
if the customers dissatisfaction with the strategy make by the company. For example in the
previous issue, the customers feel betrayed by emissions cheating scandal by one of the
Volkswagens dealer. These have effect the reputation of Volkswagen that not suitable with its
slogan Dealer and customer satisfaction is a top priority for Volkswagen.
Community (Little / no power; moderate effect)
Lastly, the community has little / no power of the stakeholder and has a moderate effect of the
stakeholder. The community also did not have any power toward the decision making make by
the company in order to accomplish the strategy. They only have moderate effect when then
strategy implemented. Since the Volkswagen wants to create a environmental protection of the
products, the community will satisfy with the company because the pollution can be reduce.
However, if the strategy implement by the Volkswagen give a bad impact toward the
environment, its can raise the awareness of the community to boycott the production of
Volkswagen as well.

f)

Based on Mintzberg managerial roles, identify and explain the differences of

MANAGEMENT roles and responsibilities from two selected departments.

17

Product department
Entrepreneur roles
While for product department, the managerial roles is entrepreneur where the manager need to
create an innovative goods and services for the company. This department will solve the
problems and generating new ideas for the product that able to expand the businesses of
Volkswagen. Apart from that, the product department of Volkswagen will initiate an innovative
methods and processes and assist with their implementation in the vehicles projects. The
Volkswagen itself has product range worldwide for more than 190 vehicle projects with twelve
brands in more than 150 countries. (Volkswagen). This department will devise the product
strategy, control vehicle projects for the small, compact and mid/full-size model lines.
Spokesperson roles
The product department of Volkswagen also has a spokesperson role where the product
department needs to inform toward the public about the new production of the company. This
product department will communicate with the external environment, from advertising the
Volkswagens product and services. This can be proving where the product department of
Volkswagen makes an announcement on the issue of emission scandal toward the public.
(Volkswagen, 2015). In the announcement, the product department responsible to give
information to the public especially the customer of Volkswagen regarding on what had
happened.
HR department
Liaison
While for interpersonal roles for human resources department is liaison roles. In the
Volkswagen, HR department will establish and maintain communication with internal and also
the external contacts. Its will coordinate the work of employees in different work units. An
organization may have the capacity to get by even with worldwide rivalry in the event that it has
a top group, characterized by a high level of competence, dedication, inventiveness and fitness.

Monitor roles

18

Lastly, based on the informational roles, the HR departments also need to have monitor roles.
The HR department needs to watch for the changes in the environment and within the company.
As in Volkswagen Group, the HR department should observe their employees either they able to
do the works given. This is very important for the survival in the face of international competition
among the other companies. According to the website of Volkswagen, the HR department will
recognize and uphold the performance and learning potential of each and every member of
staff. (Volkswagen).

19