Question

FOR CAR BRAND VOLKWAGEN

1) Explain the key social issues facing the firm (whether generic, value chain or competitive context). 2) Explain how the firm is managing them via responsive and/or strategic strategies. 3) Provide an assessment of the seriousness of these isses (how central they are to firm's core activities) and the effectiveness of the firm's strategies.

Answer 1

Solution 1:

Volkswagen is facing biggest issue of ethics where it recently was found in scandal where its cars were emitting 40 times more nitrogen dioxide abive allowed limits. It is also facing dieselGate orobkem where customers have complained emissions of diesel at excessive pace.

Solution 2:

Firm has been indulged heavily in adopting ethics and audit committe and hired best PR firms to create image makeover. Company has accepted responsibility for mistake and is actively participating in CSR activities. It has also recalled cars which has cost them 18billion euro impairment. Firm is trying to fix and repair existing cars to retain loyal customers.

Solution 3

The issues are extremely serious and have moral hazards and has caused great deal of environmental pollution and has violated norms. Firms strategies are effective enough although more work needs to be done by ensuring SOx audit, High quality checks, environmental and ethics regulation compliance to effectively navigate issue. Bettter advertising too is needed.