2022 BTEC Business Level 3 - DISTINCTION* Unit 1 Learning aim A & B VW & AMNESTY
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Course
Unit 1 - Exploring Business
Institution
PEARSON (PEARSON)
Book
BTEC Nationals Business Student Book 1 Activebook
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A report that examines the features of two contrasting businesses, looking at how each is organised, how their structures enable achievement of their aims and objectives and the relationship and communication with stakeholders. For distinction standard, l...
Features contributing to the success of contrasting businesses
Introduction
The point of this assignment is to research and gather evidence about two contrasting organisations to
know why they are successful. In this case, I have chosen the VW Group and Amnesty International for
my profit and non-profit organisation.
Volkswagen Group
Purpose
Generally speaking, a profit organisation’s main aim is to primarily make money 1 .Similarly, an example
of a profit organisation is the: Volkswagen Group; which is an international company that was
established in 1937 by the German Labour Front; with the purpose of assembling cars towards the
average people who could afford it, in 1937. Hence, the name Volkswagen which renders to:” People’s
car”.
Momentarily, the main purpose of Volkswagen Group is to become a world-leading provider of
sustainable mobility by using intelligent innovations and technologies, while at the same time delivering
customer satisfaction and quality. Due to this, it led the VW Group to become famously distinguished as
the biggest automaker worldwide2 for producing 10.1% of all passengers’ cars globally including twelve
prominent vehicle brands such as: Volkswagen Passenger Cars and Commercial Vehicles, Audi, SEAT,
ŠKODA, Bentley, Bugatti, Lamborghini, Porsche, Ducati, Scania and MAN 3 . This is good as having a strong
brand builds customer recognition as customers are more likely to buy a brand, they are familiar with
instead of those they don’t know. Linking back to the VW Group’s purpose it clearly shows that they are
already achieving their purpose of becoming a world-leader of providing sustainable mobility.
Nevertheless, another Volkswagen Group’s purpose is to provide financial services which operate in 51
countries, plus specialising in loans, investments and insurance services through having their own bank
to fund trades between purchasing vehicles from customers and supporting payments of new vehicles
by retailers4 .This is great as it means that the VW Group can manage cash flow via their banks and can
1 "What is for profit organization? definition and meaning ...." http://www.businessdictionary.com/definition/for-
profit-organization.html. Accessed 18 Sep. 2018.
2 "Focus2move| World Car Group Ranking - The Top 25 Manufacturers ...." 10 Sep. 2018,
https://focus2move.com/world-car-group-ranking/. Accessed 18 Sep. 2018.
3 "Volkswagen Group." https://www.volkswagenag.com/en/group.html. Accessed 18 Sep. 2018.
4 "Volkswagen Financial Services." https://www.vwfs.co.uk/. Accessed 18 Sep. 2018.
,Unit 1 – Learning aim A and B
make payment methods for customers and them much quicker as they don't need to rely on a third-
party bank to take and fund money. Thus, making the organisation increase its customer satisfaction for
customers as they can purchase a vehicle in various ways like finance or Personal Contract Hire.
Aims and Objective
On the one hand, an aim is a long-term plan of which organisation's objectives are derived to become
successful5. Likewise, the VW Group's aim is to safeguard its long-term future and generate profitable
growth within the next seven years. This is done by the VW Group transforming the automotive
business, through establishing new mobility solutions to significantly increase the efficiency of their
organisation, strengthening innovation power and entrepreneurial mindset in the Company 6 .This is
good for the organisation as having a strong mindset of innovation adds value to the VW group by them
establishing a unique selling proposition for a product.
On the other hand, an objective is a specific target which must be achieved within a short term in order
to accomplish stated aims7 . Similarly, the VW Group's central objective is to strengthen the trust of their
stakeholders by complying with laws and regulations. This suggests that the VW group wants to improve
their public reputation, by avoiding their dirty past like the Diesel emission scandal. Through doing this it
helps them achieve their aim of sales maximisation by "increasing unit sales to more than 10 million
vehicles a year"8, as they can gain customers' trust since they know they are buying an attractive, safe,
environmentally-friendly vehicles. Hence building a vivid picture that the VW group can survive against
rivals as they have a source of income; to help attain their mission of competing "in an increasingly
tough market and set world standards in their respective class." 9 Nevertheless, offering eco-friendly
vehicles; aids the VW Group to accomplish their next vision of reducing their "carbon footprint" which
contributes to being a "role model for the environment”. This implies that the VW Group are working
ahead to plan their future of providing electrical-powered vehicles whilst at the same time being
innovate as this has been the biggest shift that the VW Group primarily focused from the original long-
serving of Beetles in the late-1970s.10 An example of this is the Volkswagen ID R high-performance
electric racing car: which set a world record of 7 mins and 57 seconds at Pikes Peak, Colorado on June
5 "Mission, Aims & Objectives tutor2u - SlideShare." 7 Apr. 2012,
https://www.slideshare.net/tutor2u/mission-aims-objectives. Accessed 30 Nov. 2018.
6 "New Group strategy adopted: Volkswagen Group to become a world ...." 16 Jun. 2016,
https://www.volkswagen-newsroom.com/en/press-releases/new-group-strategy-adopted-volkswagen-
group-to-become-a-world-leading-provider-of-sustainable-mobility-1852. Accessed 30 Nov. 2018.
7 "New Group strategy adopted: Volkswagen Group to become a world ...." 16 Jun. 2016,
https://www.volkswagen-newsroom.com/en/press-releases/new-group-strategy-adopted-volkswagen-
group-to-become-a-world-leading-provider-of-sustainable-mobility-1852. Accessed 30 Nov. 2018.
8 "Volkswagen Group - Annual Report 2009 - Strategy 2018."
http://annualreport2009.volkswagenag.com/managementreport/reportonexpecteddevelopments/strategy/
strategy2018.html. Accessed 15 Sep. 2018.
9 "Strategy - Volkswagen Group." https://www.volkswagenag.com/en/group/strategy.html. Accessed 1 Oct. 2018.
10 "VW reveals the platform its electric future will be riding on - Autoblog." 17 Sep. 2018,
https://www.autoblog.com/2018/09/17/vw-ev-meb-platform-10-million-electric-cars/. Accessed 1 Oct. 2018.
,Unit 1 – Learning aim A and B
24th 2018.11 This shows that the VW Group "intends to become a world leader by using intelligent
innovations and technologies"12 whilst keeping it eco-friendly and keeping up with competitors like
Tesla, Toyota and Renault Nissan as electric cars.
Similarly, innovations have aided VW Group to create fuel-efficient cars like the XL1: which is proclaimed
for the world’s most fuel-car that does 280 miles per gallon 13. This is advantageous as it allows the VW
Group to increase the brand reputation of improving efficiency and changing with customers' needs as
consumers are very sensitive in rising fuel prices. Therefore, demands of fuel-efficient and hybrid cars
tend to grow more in time. In this case, VW Group targets to sell 2-3 million electric vehicles by 2025
14
and electrify all 12 brands by 2030. 15 Clearly, this illustrates that VW Group is working really hard to
provide safe and non-polluting vehicles for customers.
Type of ownership
Advantage
The ownership of the VW Group offering its shares to the public means it's a Public Limited Company.
This is beneficial as it has the potential to decrease the VW Group's personal liabilities. This is done by
more shareholders buying shares in the group to make it safer as the level of risks are spread out wider
amongst them. This impacts the VW Group in a good way as they have fewer chances of losing huge
sums of assets. This is considerably good as it means they have some money left if something bad
happens but the downside is that the shareholders are at risk as well.
Notably, increasing Capital stocks via buyers symbolises that anyone can invest in the VW Group.
Therefore, proposing vast opportunities for the VW Group like having the potential to make innovative
products as they have the essential funds. Furthermore, an increase in funds which makes it appealing
to their stakeholder as they have the money to achieve their aims and objectives to be successful.
Likewise, owning a PLC offers prestigious state for the VW Group as opening a business to the stock
market delivers an idea of importance which intensifies the value. Therefore, increasing the chances of
11 "7:57:148—Volkswagen makes racing history with record-breaking ...." 29 Jun. 2018,
https://arstechnica.com/cars/2018/06/757148-volkswagen-makes-racing-history-with-record-breaking-electric-
race-car/. Accessed 1 Oct. 2018.
12 "Volkswagen Group - Annual Report 2009 - Strategy 2018."
http://annualreport2009.volkswagenag.com/managementreport/reportonexpecteddevelopments/strategy/
strategy2018.html. Accessed 15 Sep. 2018.
13 "Volkswagen XL1 | Volkswagen UK." https://www.volkswagen.co.uk/about-us/concept-cars/xl1. Accessed 7
Oct. 2018.
14 "Volkswagen Targets Sales Of 2-3 Million EVs Annually By 2025, 30 All ...." 16 Jun. 2016,
https://insideevs.com/volkswagen-group-targets-sales-of-1-million-electric-cars-annually-by-2025/. Accessed 7
Oct. 2018.
15 "Volkswagen Group will electrify all 12 brands by 2030 ... - Ars Technica." 11 Sep. 2017,
https://arstechnica.com/cars/2017/09/volkswagen-group-will-electrify-all-12-brands-by-2030-needs-
gigafactories/. Accessed 7 Oct. 2018.
, Unit 1 – Learning aim A and B
people investing in the VW Group and possibly adding value to their products as they can charge higher
prices because they are prestigious.
Disadvantage
Whereas, the disadvantages of owning a Public Limited company for the organisation is that it has the
potential of a takeover and equally possible to lose command of the company. This is because the VW
Group's risks are scattered out. As a result, this a bad for the organisation as shareholders may
correspond to a bid to take down the VW group by having the rights to vote which leads the VW Group
to have a limited amount of control of their business.
As well as, a Public limited company comes with more regulations as VW Group are listed on the Stock
Exchange. This impacts the organisation to meet up with standards of keeping up to date with important
information on a daily basis. Thus, affecting the organisation to take a lot of time and effort to update
files every time. Furthermore, impacting the VW Group to have a limited amount of privacy as their
financial details are available for people to see.
Lastly, it might be hard for the VW Group to establish their ownership as PLC involves a substantial
worth of legal terms and endless supervisory expenses. Thus, making it harder for the organisation to
run as they can't take any shortcuts. 16
Liability
The liability of the VW Group is limited. This is where the CEO of the organisation: Matthias Müller and
the VW Group has separate legal entities. Therefore, the organisation’s finances are separate from the
owner’s personal wealth. This means shareholders are the owners of the VW Group who are the Qatar
Investment Authority and Porsche SE. These two shareholders have limited liability which implies they
are not responsible for the company’s debts as they can only lose the money that they have invested in
the business in the form of shares.
Size
Alternatively, the illustration of the VW Group being an International scope emphasise that they can
attract new customers worldwide. We know
this as the bar charts inform us that the
revenue, they made during the two years
shows: Europe made +7.7 %, Asian Pacific
gained +11.04%, North America obtained
+9.7%, South America lost -1.6%.17
16 "Setting up a Public Limited Company: Advantages and Disadvantages." 12 Apr. 2018,
https://rsaccountancy.co.uk/2018/04/12/setting-public-limited-company-advantages-disadvantages/. Accessed 16
Sep. 2018.
17 "• Volkswagen - revenue by region 2017 | Statistic - Statista."
https://www.statista.com/statistics/260805/revenue-of-volkswagen/. Accessed 7 Oct. 2018.
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