Current Strategy Of Audi Company And Three Strategic Options

Strategic suitability and trends

Businesses require strategies that are clear and distinct to successfully thrive. For this reason, businesses should strive to have a well-defined strategy by evaluating the suitability i.e. determining whether the strategies ranges with the external environment, acceptability  and feasibility i.e. identifying whether the organization has the capability of implementing the strategies with the available resources in the business (McGregor, 1999).

Audi, an automobile manufacturer in Germany that produces, designs, markets and distributes luxurious vehicles, is currently undergoing important changes due to sustainability, urbanization and digitalization developments which will help in achieving the company’s strategies by 2025 (Bolos, 2016).Basically, basis for coming up with the strategy was to manufacture cars that are emission free or with low emissions for maintainable premium mobility services, intelligent connections and more quality ideas and concepts.

Sustainability aims at improving and increasing technologies and ensuring the circular economy principle (Filieri, 2014). Consequently, this will ensure good designing of products and procurement processes to recycling of vehicles. This reduces the negative impacts of the vehicles like pollution to the environment. Digitalization ensures provision of good quality vehicles all time to their customers. According to Ansoff Matrix, business leaders should never stick to the idea of running the business as usual for them to succeed and in making more profit (David, 2011).This ensures success in the business. Audi has several competitors and for them to be outgoing, the company has to consider some issues. Therefore, they could come up with options or strategies other automobile companies have not adopted to yield best results. For instance, Audi Company should adopt this mindset for it to be more competitive in the market.

Audi Company should strive to target new markets or probably new areas of the present market (Camillus, 2008). By doing this; they will put the company in a position where they can comfortably sell more of their products to other people who had no idea about their products. To achieve this, they could target several markets both within and outside the country. They could conduct a PEST analysis to establish threats and opportunities in the different markets.

Secondly, the company could ensure market penetration by selling more of their same products to the same consumers or markets (Coles, 2008). This could therefore be achieved through; coming up with a new strategy of marketing that will encourage more customers to choose their products and not the others, introducing other special offers for promotions, increasing the activities of the sales force, identifying products that would require further or future investment or which should be ignored and finally buying a competitor company.

Thirdly, the company should ensure development of the products by selling several and different products of the company to the same customers (Muller, 2012).This could be achieved by; production of different forms of the products, manufacturing related services and products and improving the quality of services offered to customers.

Lastly, Audi could consider diversifying although it is considered a risky step to take because there is usually a small range for applying existing skills and competence or for obtaining or yielding economies of scale since one is selling totally different services and products to different customers (Rugraff, 2012). Otherwise, an advantage for diversification is that the company will have the opportunity to improve and expand the business.

Option 1: Targeting New Markets

Global warming has become a great threat to both human beings and the environment at large. This is because of its great effects on the environment e.g. climate change which consequently affects human health in one way or another (McMichael, 1993). This is greatly contributed by the fact that many people use private means to public means of transport to go wherever they want to when most cars are not environmentally friendly. Awareness on human and environmental effects of global warming has made people change their minds to start using public means hence reducing the quantity of exhaust fumes being released into the environment. Audi Company should take advantage of this and start manufacturing several vehicles to be used in public transport often.

The Audi Company should consider partnering with companies or industries with more fans. The music industry is well known and really appreciated by people globally (Baym).In fact, the Audi Company should partner with famous artists known globally to advertise its products and services. Many people will recognize the vehicles used in video clips used by famous artists and will want to go for them (Bryman, 2015). Sports, football in particular, is also one industry with several fans and Audi should probably consider using this as a chance to market and advertise their products and services (Akpinar, 2009). This will be easier because Audi Company has the capability, financially, to fully partner with the Premier League.

Usually, Audi vehicles and services are known to be expensive in Europe such that only the high class individuals can comfortably afford.. Audi Company should take a step and manufacture more public vehicles especially buses to be used and this will create a large market for the company (Mangram, 2012). This will be more convenient to the company mainly because they have the skilled/professional manpower to manufacture the public vehicles needed on the roads.

Generally, Audi Company is known for manufacturing expensive cars. On the other hand, several individuals cannot afford to buy the vehicles because of the economic imbalances (Womack, 1990). Audi Company should reconsider manufacturing vehicles that can be afforded by the middle class people too.

To crown it all, the option on partnership with Premier League is the best preferred option with the least risk associated with it.

	Assessment of options accessibility	Risk Management
Stakeholder	Interest	Power	1st option	2nd option	3rd option	Risk	Likelihood	Mitigation
Managers	High	Low	Acceptable with low risks	Acceptable with medium risks	Increased investigation to eliminate/reduce risks	High		Improving advertisements and promotions via social media
Shareholder	High	High	Acceptable with low risks	Acceptable with high risks	More study in the field to avoid loses	High		Termination if partnerships fail
Existing customer	High	High	Not affected by risks	Not affected by risks	Not affected by risks	Low		Can leave business due to low legal ties with company and low risk
New customer	High	High	Not affected by risks	Not affected by risks	Not affected by risks	Low		The party is not compelled to shop products

According to the above table managers should come up with innovative promotion and advertisement mechanisms through social media plat forms. Social media advertisement is a productive upcoming trend that the company should exploit. The number of potential new customers is high and the company should ensure they are persuaded to buy their products as well as improve legal ties with existing customers to keep on purchasing. The company should perform a comprehensive study on shareholders to avoid any loses to the company.

Type	Resource audit	Valuable?	Unique?	Scarce?	Organizational learning
Tangible	Fifteen factories worldwide	Valuable because of competition from plant construction	Unique	Rare but valuable.	Open more factories worldwide.
Top quality equipment used in production of vehicles	Valuable because of the total cost required to build it	Though it is valuable it is not rare because the company requires equipment.	Not rare though it is valuable.	Ensure the employees get quality equipment.
Operating cash of #7.5billion and working capital of #11.6billion	Valuable because it’s used in company operations	It is unique since it is different from others.	Not rare but valuable.	Provide necessary budget.
Intangible	Individuals with good knowledge about vehicles	Valuable because its needed by the human resource sector	Resources unique	Not rare although valuable	Train employees gain skills required

As observed from the above table, thencompany has to open up more factories in countries with potential to reach many more customers. Technology is progressing as days go by and the company also needs to ensure that they provide their employees with quality equipment which will consequently improve product quality. For the company to expand its operations it has to provide the necessary budget required.  The company also has to improve the knowledge and skills of employees by providing periodic trainings to update employees on new techniques in the vehicle sector. Human resource is valuable and directly affects the quality of the company’s product.

In conclusion, Audi Companies, being among the best automobile manufacturing companies, it should still strive to offer the best services and give the best products to the customers to enable them earn maximum profit. This can be achieved through formulating and implementing strategies for the company to produce its best.

References

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