Introduction Tesla, Inc (or previously known as Tesla Motors) is anautomotive and energy storage company which is based in the United States ofAmerica. It was first founded in 2003 by Martin Eberhard and Marc Tarpenningwho were later joined by Elon Musk, JB Straubel and Ian Wright as co-founders.
The company’s main focus is electric cars, lithium-ion energy storage andresidential panels (through a subsidiary company called SolarCity). Someadditional products that Tesla, Inc sells include Tesla Power-wall, Power-packbatteries, solar panels and solar roof tiles. The CEO of the company envisions Tesla as a technologycompany which is also a fully independent automaker that is aimed at offeringaffordable electric cars to the average consumer. We chose this company due tothe fact that it is a company with a very broad market and audience and an ideathat is not so common in our day which would make the research even moreeducational to us as a team. Tesla’s mission, according to the chairman and CEO: ElonMusk, is the same mission they had when they first created the brand which is”to accelerate the advent of sustainable transport by bringing compelling massmarket electric to market.” According to panmore.com, in 2016, the companychanged their mission from “to accelerate the worlds transition to sustainabletransport” to “to accelerate the world transition to sustainable energy.” Theupdate in the mission statement tells us that there is a significant shift inthe company’s business which is to now market opportunities for renewableenergy.
Tesla’s statement now has the three main components: · Acceleration: emphasizes on Tesla’s role increating a more diverse automotive industry towards more advanced technologiesfor renewable energy. · The worlds transition: Tesla indicatesexpectations of complete dominance in the “global market for electricautomobiles” according to panmore.com in which they also stated the directrelation of the worlds transition and the impact they want to have on the overall global market. · Sustainableenergy: the growing demand for renewable energy is now reflected on Tesla’sbusiness scope which is to cover products such as batteries and otherprofitable renewable energy in the future. Elon Musk recognizes that in order to get the end goal, bigmeasures must be taken and big leaps in technology are required whichautomatically means a high level of scrutiny. Musk also believe that regardlessof the fact that new technology should be held to a higher standard, reasonablelimits to how high the standards should be should be established in order to besuccessful. Moving on to Tesla’s vision which states that it is: “tocreate the most compelling car company of the 21st century bydriving the worlds transition to electric vehicles.” The company’s visionstatement focuses on four components and these are: · Most compelling: emphasizing the companies focuson leadership and excellence within their industry.
It indicates that theirmain approach which aims to integrate advanced technology in its electricautomobiles and related products. · Car company: focuses on the company’s effort ondesigning and manufacturing cars. · 21st century: satisfies Tesla’sleadership in electric vehicle design and production, it also implies the firmsuse of technology to solve current concerns. · The world’s transition to electric vehicles:talks about the company’s global goals. A global company centralizes its management and otherdecisions in the home country, meaning activities of the business are plannedon a global basis, operating with international benefits from savings or economieson activities. Tesla, Inc is a global company due to the fact that mostbusiness decisions and operations take place in the headquarters and homecountry. Tesla’s vehicles and most of their products are produced in Californiabut they do continue to expand and make products more accessible and affordableto customers all around the world.
External Environment Tesla changed the automobile industry with the first eversemi-autonomous technology offered in a commercial vehicle. The Model S and Xhave become the most successful models, as well as Tesla’s stock valuation of$56 billion, served as a notable step in the industry, making Tesla an inspirationto other companies to follow their foot steps. Five years ago the Model Slaunched and there are still very few cars on sale today capable of deliveringOTA firmware updates. Tesla is, without a doubt, one of the most attractiveelectric cars on the market which also sets the standard for aesthetic when itcomes to environmentally friendly cars. Tesla, Inc operates in a highly competitive market. Theintensities of the external factors responsible for the force of completionare: 1.Small number of firms operating 2.
Aggressiveness of other companies 3.Lack of switching costs. The small number of significant firms operating in theautomotive market limits the effect of competition on companies like Tesla,Inc. However, these firms are aggressive in innovating and promoting theirproducts.
The low impediments for customers to buy cars from othermanufacturers (low switching costs) further strengthen competition. This aspectposes as a high-priority strategic consideration in the automotive industryenvironment. Tesla’s customers are the biggest factor that determines thecompany’s sales revenues. Some external factors determine the bargaining powerof Tesla’s customers such as; low switching costs, moderate substituteavailability, low volume of purchases. Therefore, due to the fact thatsubstitution availability is moderate, there become a limit customers’bargaining power against Tesla, but low switching costs reduce barriers inTesla customers’ tendency to purchase cars from other providers, this factorimposes a strong force against the company and other competitors in theautomotive industry environment. The low volume of purchases reduces theinfluence of customers on Tesla. Thus, Tesla considers the bargaining power ofcustomers a second-level strategic priority, based on the intensities of thecorresponding external factors. Suppliers shape the industry environment by influencing theavailability of materials that firms need and that is why Tesla’s businesspartly depends on the reliability of its suppliers.
Factors such as: moderateforward integration, moderate size of suppliers and moderate supply determinethe supplier’s bargaining power. Tesla’s suppliers have a low level of forward integration,which means suppliers have limited control in the distribution and sale oftheir product. In addition, these suppliers do not have much of an influence onthe automotive industry environment due to their moderate size. The suppliers’moderate amount of supply has the ability to affect Tesla, but to a limiteddegree only, thus, Tesla indicates the bargaining power of suppliers as asecondary strategic priority. Organizational Culture Move Fast. Speedaffects Tesla’s competitive advantage, thus employees are expected to be ableto respond rapidly to trends and changes in the market as well as having aspeedy response to current issues and challenges in the automotive industry. Do the Impossible.
In developing cutting-edge products, Tesla must ensure that its corporateculture encourages employees to think outside the box. Tesla embraces new ideasand solutions, while also emphasizes the benefits of considering unconventionalways. Constantly Innovate.Innovation is important for a company such as Tesla because it helps developcutting-edge electric cars and related products.
Tesla rewards constantinnovation. For a company such as Tesla that has made a huge impact onthe automobile industry, there’s pressure to stay at the top with the need toconstantly come up with ways to better the industry as well as move it forward.Its important for Tesla employees to adapt to its culture so that the companymaintains its position.
Employees reflect the company no matter how small of ajob they have, much like cars even if a nail is not up to par the quality ofthe car as a whole would decrease. Personally, I believe Tesla’s cultural organization fits itsimage well and sets standards for the type of employees they’re looking tohire, after reading a few employees reviews I can confidently say Tesla treatstheir employees with respect and encourages free-flow of information “There is a very open culture and speakingto the management teams is very relaxed and easy going.” According to thereviews I’ve read the organizational culture is being followed by employees.
As stated on the main Tesla website homepage Tesla’s missionis to accelerate the world’s transition to sustainable energy, and I believewith the organizational culture being practiced Tesla’s mission without a doubtwill be met in time. SWOT Analysis A company like Tesla Inc has a unique SWOT analysis due tothe fact that it is not a very common kind of car (running on electricity andnot gasoline.) Strengths:-Safest and fastest car (Model X was announced the safestand fastest sport utility vehicle according to gotabout.info)-Efficient energy (due to the fact that it uses renewableenergy, it has become the most energy efficient car with gasoline fueledengines convert only 19% of the energy, electric cars convert up to 62% of theenergy) -Investors and partners (the company acquired stronginvestors partners in the past couple of years with names as big as Google,Daimler, Toyota and Panasonic) Weaknesses:-Limited manufacturing capacity (time-consuming to make adelivery which usually takes up to one year) -Lack of variety of choices -Negative cash flow (Tesla has a big portion of debt with anegative $455 million in its financial statement putting it in a vulnerableplace) Opportunities:-Self-driving features (Tesla has been developing theinvention of full self-driving upgrade options, though its not a 100%self-driven, it is still expected that the new upgrades will be exciting to thepublic according to Musk)-Demand (the demand of environmentally friendly cars isincreasing daily due to the fact that it is cheaper to maintain an electriccar)-Concern (people are becoming more careful with theenvironmental pollution and using carbon producing cars therefore are slowlyconverting to more environmentally friendly cars)Threats:-Price (prices are not attainable for most middle classAmericans despite Tesla’s efforts to become a more affordable and less nichecompany)-Competitors (more and more companies are now producingelectronic cars, which results in an increasing in the number of newcompetitors, e.g: Volkswagen and other close alternatives)-Opposition (big companies expose a lot of threats to Tesladue to their strong capabilities to be competent in the manufacturing anddistribution industries) ConclusionSo as wesaid Tesla was founded in 2003 by a group of engineers who wanted to prove thatpeople didn’t need to compromise to drive electric – that electric vehicles canbe better, quicker and more fun to drive than gasoline cars.
Today, Teslabuilds not only all-electric vehicles but also infinitely scalable clean energygeneration and storage products. Tesla believes the faster the world stopsrelying on petrol and moves towards a zero-emission future, which is better. Ond one of the successful producttesla have made is the Model S – which has become the best car in its class inevery category. Also Model S thesafest the quickest and Model 3 a low-priced, high-volume electric vehicle thatbegan production in 2017. This isjust the beginning. With Tesla building its most affordable car yet, Teslacontinues to make products accessible and affordable to more and more people,ultimately accelerating the advent of clean transport and clean energyproduction.
I reallywould like to work in this company and be part of it because they are going torevolutionize the auto industry, plain and simple. Working for Tesla would meanworking with a company that is going to have a significant impact on the worldand that is something I really want to be part of. Not only that, but gettingto work towards a common goal with some of the most talented people on theplanet would just make the experience a million times better. REFRENCE LIST: 1) https://www.tesla.com/en_AE/about2) http://panmore.com/tesla-motors-inc-vision-statement-mission-statement-analysis3) https://www.tesla.com/en_AE/blog/mission-tesla?redirect=no4) http://www.gotabout.info/swot-analysis-of-tesla-motors/5) https://www.slideshare.net/joseangeldf/darden-school-of-business-tesla-strategic-analysis6) http://panmore.com/tesla-motors-inc-organizational-culture-characteristics-analysis7) https://www.indeed.com/cmp/Tesla-Motors/reviews?fcountry=ALL=culture8) https://www.theverge.com/2017/7/28/16059954/tesla-model-3-2017-auto-industry-influence-elon-musk 9) http://www.businessinsider.com/tesla-and-the-history-of-electric-cars-2013-8#1896-the-hartford-electric-company-sets-up-electric-car-charging-infrastructure-1 10) https://en.wikipedia.org/wiki/Tesla,_Inc.