Volkswagen Acquisition of Skoda
Question Paper Integrated Case Studies - II (MB3J2): October 2008
Case Study∗ (100 Marks)
• This section consists of questions with serial number 1 - 5. • Answer all questions.
• Marks are indicated against each question.
Read the case carefully and answer the following questions:
1.
“The greater the level of involvement of a company in foreign markets, the greater the need for it to monitor the political climate of the business.” In relation to the effect of a country’s political environment on a company’s performance, analyze how the political environment of Czechoslovakia impacted Skoda? ( 18 marks)
2.
“In the early 1990s, Volkswagen’s (VW) sales in the US were declining, making it imperative for the company to start looking for new markets to safeguard its long term interests leading to its acquisition of Skoda.” Examine the various reasons for companies to adopt cross-border merger and acquisition. Also, discuss the benefits derived by Volkswagen and Skoda with this acquisition. ( 22 marks) “Known over the world for its quality engineering, Volkswagen’s task was to transform the poor image and socialistic policies of Skoda into a customer-oriented, market-focused organization.” In this context, analyze the various Human Resource (HR) issues that companies face at the time of an acquisition and the way VW has tackled these issues. Also, examine how VW has improved the production and quality in the manufacturing plants of Skoda? ( 20 marks) In the light of the rise in brand consciousness among customers, analyze the importance of brand building. Discuss the various brand building initiatives adopted by VW to improve Skoda’s image. ( 20 marks) “Volkswagen embarked on its multi-brand strategy in an effort to rationalize its brands. It had 4 vehicle brands – Audi, VW, SEAT and Skoda, with each brand maintaining its distinct identity.” Discuss the advantages and disadvantages of a multi branding strategy in competitive markets. How far is the
Case Study∗ (100 Marks)
• This section consists of questions with serial number 1 - 5. • Answer all questions.
• Marks are indicated against each question.
Read the case carefully and answer the following questions:
1.
“The greater the level of involvement of a company in foreign markets, the greater the need for it to monitor the political climate of the business.” In relation to the effect of a country’s political environment on a company’s performance, analyze how the political environment of Czechoslovakia impacted Skoda? ( 18 marks)
2.
“In the early 1990s, Volkswagen’s (VW) sales in the US were declining, making it imperative for the company to start looking for new markets to safeguard its long term interests leading to its acquisition of Skoda.” Examine the various reasons for companies to adopt cross-border merger and acquisition. Also, discuss the benefits derived by Volkswagen and Skoda with this acquisition. ( 22 marks) “Known over the world for its quality engineering, Volkswagen’s task was to transform the poor image and socialistic policies of Skoda into a customer-oriented, market-focused organization.” In this context, analyze the various Human Resource (HR) issues that companies face at the time of an acquisition and the way VW has tackled these issues. Also, examine how VW has improved the production and quality in the manufacturing plants of Skoda? ( 20 marks) In the light of the rise in brand consciousness among customers, analyze the importance of brand building. Discuss the various brand building initiatives adopted by VW to improve Skoda’s image. ( 20 marks) “Volkswagen embarked on its multi-brand strategy in an effort to rationalize its brands. It had 4 vehicle brands – Audi, VW, SEAT and Skoda, with each brand maintaining its distinct identity.” Discuss the advantages and disadvantages of a multi branding strategy in competitive markets. How far is the