Strategic Appraisal of Bmw

Topics: Strategic management, BMW, Automotive industry Pages: 12 (3157 words) Published: March 19, 2011
Napier University Edinburgh|
Strategic Appraisal Assessment

Word Count:

Strategic Appraisal
BMW Case Study


Bayerische Motoren Werke AG now known as BMW was founded in Germany in 1916. The BMW group began as a manufacturer of engines. In the present day now also manufactures automobiles, motorcycles, software and offers financial services. The case study ‘Exploring Corporate Strategy’ prominently deals with the automobile side of The BMW Group. Within this market BMW trade under three different brands BWM, MINI and Rolls Royce. BMW experienced a failure to gain and grow market share in the early twenty first century the group then embraced an imperative strategy of organic growth.

This report will deliver a strategic appraisal based on the question ‘Conduct a strategic appraisal of BMW and asses the implications for the strategy of the company.’ This report will use the analysis of both the external environment and internal resource capabilities through the use of a PESTEL framework, Porter’s Five Forces Model along with carrying out a resource audit on the BMW group and using a breakdown of the value chain in relation to the strategy in which BMW have chosen to adopt. After this information has been delivered the report will then outline a SWOT analysis of the organisation to distinguish The BMW group’s strengths, opportunities, threats and weaknesses that will become apparent from analysing the information gained from the completed models and frameworks.

External Environment

When looking at the external environment of any organisation the importance of this analysis has to be considered. Managers have very little or no control over external factors within the macro-environment therefore an organisation has to have a wide knowledge of the factors they face and how they may significantly affect their business. The analysis of the external environment has to be carried out thoroughly and entirely. If this task is carried out correctly an organisation can outline the key drivers that will impact on their organisation. There are two alternate ways of analysing the macro-environment these are through a PESTEL framework and Porter’s Five Forces Model. The PESTEL analysis outlines the factors from wider environment surrounding the organisation. Porter’s Five Force Model then breaks down the competitive issues that the organisation faces. In this report both types of analysis will be applies to The BMW group case study in order to achieve a strategic appraisal of this organisation.

The BMW Group PESTEL Analysis

This PESTEL will outline the political, economical, social, technological, environmental and legal factors that have and will cause implications for The BMW group. The full explanation of this framework and the PESTEL of The BMW Group can be found in appendix 1.1 and 1.2. On reflection of this analysis the following will outline the key factors which influence change within this organisation.

All of the factors outlined in the PESTEL have an effect on The BMW Group and help drive change and aid in the decision making process however certain factors deem to be more influential than others.

Social factors appear to be a large driver for change within The BMW Group. This organisation survives through the sales of automobiles and the only way to be successful in the manufacturing of cars is to satisfy the wants and needs of you target market. The BMW learnt this n the mid twenty first century. They faced problems due to changes in the needs and wants of their consumers. Previously quality had been a key factor in the manufacturing and sales of automobiles however it had now become apparent that consumers could find quality in most if not all models. Consumers now wanted a fashionable car that held brand appeal. BMW began to face this issue and adopted design as the main force in their efforts to gain competitive advantage. This change in...
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