Sustainable Policies and Strategies Plan

Discuss about the Sustainable Policies and Strategies Plan.

Introduction

With the increasing ramified economic changes and complex business structure, each and every organization faces several issues in its operational working chains. Operational issues arise when the employee’s preferences confront with the organizational operational plans. It is analyzed that in order to achieve the long term goals and objectives, company needs to mitigate these operational issues. There are several operational issues examples such as complex organizational issues in operational activities, project management implementation operational program, formulated strategies and job design and HRM work program. These are the most popular operations issues which are faced by organization while running its business in this report; Volkswagen Group has been taken to evaluate the business functioning of organization

Volkswagen Group the international automotive manufacturing company which has been running its business on international level. It is automotive manufacturing company having its headquartered in Wolfsburg, Lower Saxony, Germany. This company has strong brand image on international level and directed by  Herbert Diess (13 Apr 2018–), Matthias Müller (25 Sep 2015–Feb 2020). This company has been facing several operational issues in its operations functions (Chan, Luo, and Mo, 2016.).

The Volkswagen Group generated sales revenue of €217.3 billion in fiscal year 2016, thus surpassing the prior year figure by €4.0 billion. However, due to the operational functional program issue, company has faced loss in its overall revenue and had to suffer big loss in its business. There are several big problem which have been faced by Volkswagen Group such as it lost market shares to its rivals group, drop in sales due to the emission scandals, problem in its product mix and the biggest loss in its using ground in burgeoning Chinese market (Choi,., Bone, and Zhang, 2016).  The benchmarking of the organization is the best method which could also be used by Volkswagen Company to mitigate its operational issues.

The biggest operational issue which company has faced throughout the time is related to increase labour turnover in its operational work functions. The newly designed functional program introduced by the management department in its work process has shown that company has faced high complexity in its business process due to the introduced functional program in its business. It is analyzed that Volkswagen Group have adopted the life cycle strategic program to encounter the market distress and less effective work program (Elson, Ferrere,  and Goossen, 2015). It is analyzed that company has been facing issues of adapting of new machines and process system which not only affect the business process system but also demotivate employee in their work program. It is analyzed that if company has been facing high employee turnover because all the employees would face trouble in their process system while delivering the work. It is analyzed that company has been following the life cycle work program in which each and every season Volkswagen Group has to introduce new models and designed cars in market (Gong, 2013).This strategic program demands organization to consistently change the process system and value chain activities program. It is evaluated that in order to consistently pave with the ramified economic demand, Volkswagen Group have been using the cyber computing system and changing designed functional program in its business. There are several motivational theories which could be used by Volkswagen Group in its business to lower down these types of issues and problem in process system. It is analyzed that if company uses the Maslow Hierarchy motivation program, ERG motivational program and other programs are used by organization to pursue its employees towards the changes in the business process units.  It is considered that employees are afraid of the changes in its value chain activities as they find more comfortable in their existing work process. However, Volkswagen Group has to change in its business process system with a view to give the tough competition in market to meet the current business liabilities (Hölzel, 2017). It is analyzed that adapting with the changes is the key strategic program which need to be undertaken to adapt with the ramified economic changes. Volkswagen Group has to change its value chain activities program all the time which requires changes employees to adapt with the changing value process system. It will require employee to learn changed work process and new learning skills to deliver the expected outcomes. The management of company has also faced issue while taking the resolution in the board meeting due to the complicated process system (Hunke, and Prause, 2014). It is analyzed that if company uses the proper training and development program in its value chain activities to achieve the set objectives and goals.  In addition to this, company has also faced issues related to cost cutting. In many of the cases, Volkswagen Group has faced issue of high costing of its cars in market. Due to the high costing of the cars in the market, company has to mark the price of its cars which will impact the business functions of the organization. Company will have to re-engineering of its business activities to create the core competency in the cost leadership strategy in market. This strategic program will not only increase the overall outcomes of the business but also differentiate the business functioning of organization in long run (Jede, and Teuteberg, 2016).  The cost leadership strategic program is one of the best methods which are used by organization to achieve the certain goals and objectives. It is analyzed that if company could offer its cars in market by following the cost leadership strategy then it will attract more clients in market. This strategic program could be achieved when company re-engineering of its value chain activities. It will require proper implementation of the strategic program, installing new machines and hiring of expert employees who could achieve the set objectives and goals in determined approach (Juergens, and Brumlop, 2017). The operating issues of the company are accompanied with the process issues and increased labour turnover. There are several theories and system process which is used by organization to maintain an effective organizational culture. The motivation theory is used by organization to motivate employees to deliver the best possible outcomes in the best interest of the organization (Baldassarre, and Campo, 2016).  Volkswagen Group has faced issue of the less effective internal control system which not only increases the overall costing of the business but also increase the complexity of the organization. It is analyzed that employee turnover in the Volkswagen Group is the biggest issue in the business process. Many of the organization have faced employee turnover issue and went into liquidation process such as One Tel Company, HIH Insurance Company (Koplin, Seuring. and Mesterharm, 2007).

It is analyzed that Volkswagen Group has complicated business process and it has adopted strategies of life cycle approach (Li, et al. 2018). In this strategy, each and every time, Volkswagen Group has to change its value chain activities and install new advance machines in its business process. This will not only assist company to create core competency in the product differentiation strategy but also enhance the brand image of company on international level. In order to survive in the market for the long run, Volkswagen Group needs to develop cost leadership strategy. The operational issues have emerged in the process system of company due to the increased labour turnover and complicated business process (Miroshnik, and Basu, 2014). The increased labour turnover has resulted to losing of experienced employees in the business and less effective value chain activities. It is analyzed that increased operational issues in the business process have rendered business less profitable and drain business resources and energy for the less sustainable benefits. The increased labour turnover affects the profitability and business process system of the organization. Volkswagen Group has faced this issue because the motivation program and pay scale cycle of company is less effective.

Star performing and benchmarking

 The start performing and benchmarking could be done to evaluate the best possible recourse which could be undertaken by company to mitigate the operational issues. Employees of the Volkswagen Group faces issues related to the changing or ramified business which increases the fear in their mind to adapt with the changes. In addition to this, whenever the new process system and new life cycle approach is adopted in the business process of the factory of the Volkswagen Group then at the time, no proper training and motivation process is adopted for the motivating employees towards the changes.  In 2010, Volkswagen Group adopted the automated strategic program which played very crucial role in the business success of organization (Pineda, 2016). However, it also impacted the increased labour turnover which leaded to future hindrances into the plant and product flexibility. This strategic program of Volkswagen Group includes two main parts such as level of automation and increased manufacturing cost.

In addition to this, another operational issues faced by Volkswagen was related to increased complexity in the digital planning to increase the efficiency of the operational functions of organization (Rogerson, 2017).It was analyzed that Volkswagen wanted to increase the overall efficiency of the Vehicle and body production to strengthen the process efficiency. However, it also affected the increased labour turnover and less effective business functioning. However, in the automation design process, Volkswagen used the modular toolkit strategy in its value chain activities to lower down the complexity and eliminates the hindrance in the process. However, the modular toolkit process strategy caused thunder in the automotive thunder in the automotive sector which was called MQB- Modular Transverse Matrix. Company benchmarked its business process and MQB by the other industry rivals i.e. Toyota & Ford. It was the biggest mistake for Volkswagen to compare its business process with other business organizations (Rogerson, 2017).

Recommendation

• There should be proper application of the MQB system process in the process chain of the Volkswagen Company.
• The management of company needs to set up proper system process which will assist organization to make the proper deployment of the resources.
• Design planning should also be used to make the proper operational plan and increased business efficiency which will strengthen the business outputs in effective manner.
• Green production planning and its environmental friendly products should also be manufactured by company with a view to strengthen the sustainable business practice.
  Management department of Volkswagen Company should arrange proper training and development program in its business activities to mitigate the business complexity and issues. The mass production flexibility and life cycle strategic approach will assists company to meet its long term and short term goals. The Modular plan of the business process will also work as backbone of the business system.
• The Corporate policies and system process work should be compared and analyzed by using the Star- performing companies in industry which will increase the overall output in effective manner (Santos, ., 2014).
• There should be appointment of the line managers and use of motivational theories which could be used by management to motivate employees in the changing working environment.

Conclusion

There are several operational issues which have been faced by Volkswagen Company throughout the time. It is analyzed that if proper working methods and less complex business process is adopted by organization then it will strengthen the business process of company and also mitigate the operational issues of the business.  The modular system process is one of the best changes in the process system of Volkswagen Company which will assist management to cope with the adapting business process system. Now in the end, it could be inferred that Volkswagen Company should use consistent training and development program and modular system to make employees to adapt with the changing business.

References

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Chan, K.H., Luo, V.W. and Mo, P.L., 2016. Determinants and implications of long audit reporting lags: evidence from China. Accounting and Business Research, 46(2), pp.145-166.

Choi, Y., Bone, C. and Zhang, N., 2016. Sustainable policies and strategies in Asia: Challenges for green growth., 6(2), pp.145-166

Elson, C.M., Ferrere, C.K. and Goossen, N.J., 2015. The bug at Volkswagen: Lessons in co?determination, ownership, and board structure. Journal of Applied Corporate Finance, 27(4), pp.36-43.

Gong, Y., 2013. Global Operations Strategy: Fundamentals and Practice. In: 46(2), pp.145-166

Hölzel, M., 2017. Crisis Management, CSR, and Crisis Communication in the Volkswagen Emissions Scandal16(2), pp.45-66

Hunke, K. and Prause, G., 2014. SUSTAINABLE SUPPLY CHAIN MANAGEMENT IN GERMAN AUTOMOTIVE INDUSTRY: EXPERIENCES AND SUCCESS FACTORS. Journal of Security & Sustainability Issues, 3(3).

Jede, A. and Teuteberg, F., 2016. Understanding socio-technical impacts arising from software-as-a-service usage in companies. Business & Information Systems Engineering, 58(3), pp.161-176.

Juergens, U. and Brumlop, E., 2017. Rationalisation and industrial relations: A case study of Volkswagen. In Technological change, rationalisation and industrial relations(pp. 73-94). Routledge.

Koplin, J., Seuring, S. and Mesterharm, M., 2007. Incorporating sustainability into supply management in the automotive industry–the case of the Volkswagen AG. Journal of Cleaner Production, 15(11), pp.1053-1062.

Li, L., McMurray, A., Xue, J., Liu, Z. and Sy, M., 2018. Industry-wide corporate fraud: The truth behind the Volkswagen scandal. Journal of Cleaner Production, 172, pp.3167-3175.

Miroshnik, V.W. and Basu, D., 2014. The Management System of Japanese Companies: Macro and Micro Perspectives. In Corporate Culture in Multinational Companies(pp. 21-43). Palgrave Macmillan, London.

Pineda, R., 2016. Making the climate change issue “real” for managers. Journal of Global Responsibility, 7(1), pp.84-97.

Rogerson, S., 2017. Is professional practice at risk following the Volkswagen and Tesla revelations?: software engineering under scrutiny. ACM SIGCAS Computers and Society, 47(3), pp.25-38.

Rogerson, S., 2017. Is professional practice at risk following the Volkswagen and Tesla motors revelations?. ORBIT Journal, 1(1).

Santos, L.M.D., 2014. Efficiency optimization of the transportation supply chain activity: the maritime option for Volkswagen Autoeuropa (Doctoral dissertation) 47(3), pp.25-38.