Tesla: Discovering Strengths and Weakness

Tesla: Discovering Strengths and Weakness Christian Wheeler MGT 498 December 17, 2014 Sheri Wang Tesla: Discovering Strengths and Weakness Every business has one common goal, to become successful. Management takes the time to analyze the status of their company and their success not just in the present but the future as well. With doing so, management will have to take a close look in order to adapt especially in a market that is constantly changing worldwide. Each company must have a strategic management plan that will give them the direction they need to be heading towards in relation to internal and external forces. The Environmental scan is essentially the beginning of this process. In order to illustrate this process and how it can help a company, we will look into Tesla Motors. Brief History of Tesla Motors Tesla Motors is a newly innovated technology that has revolutionized the electric car. The goal for Tesla is to commercialize electric vehicles that are more efficient and attractive. Elon Musk, CEO of Tesla Motors took the company from near financial loss and rebuilt it into a success. He believed that the auto industry was too highly dependent on traditional fuel consuming engines, that the world was ready for something more. While electric cars have been around for some time, they were extremely unattractive. Musk and his team believe they could jump start the electric car era with cars that were more desirable. Environmental Scan The beginning of any strategic management process starts with an environmental scan. The process involves monitoring, evaluating, and disseminating of the data from both external and internal environments (Wheelen & Hunger, 2019). What management teams want to see is specific factors that will help the company in the future. A SWOT analysis gives the company the information needed by determining the strengths and weaknesses, opportunities and threats. This is the most effective way for the company to target the strategic factors. The market is constantly changing and businesses need to adapt in order to stay competitive. Environmental scans help to assess the market and the company’s performance and not to mention, competition. Once the SWOT analysis is complete, management can review and evaluate in order to determine areas the company can sustain productivity and stay on top of competition. The company must set measurement guidelines in order to assess how effective are in measuring strategic effectiveness. According to Wheelen and Hunger (2011), “a comprehensive environmental scan includes: Forecasting business trends, conducting internal and external scans, describing the current workforce and projecting workforce supply and demand” (Wheelen and Hunger, 2011). Internal and External Environments Environmental scans and the process involve will give the company a healthy insight on what is affecting the company internally and what may affect the company through external forces. The process is beneficial and the information is at hand for managers to increase the long-term efficiency and develop strategic plans that will affect the company presently and project future success. The environment for which the company exists can be separated into two separate divisions. The first is the internal environment, compiled of factors that directly involve within the company itself, and would include managers, employees, and stakeholders. The external environment is factors that forces that the company cannot control. They are political, economical, sociological, technological, ecological and legal factors. All of which reside beyond the company and for which the company must deal with when affected with any of these forces. Tesla Motors Tesla is a new motor company that has transformed the electric car into a sleeker and high performance vehicle. The following are some of the strategies that Tesla has come up with to distinguish themselves from other companies within the same market. Tesla Motors provide ecological solutions where products are both attractive and efficient. They give customer control in custom designing their own features. They perform extensive research and understand what the consumers are looking for and from this design the cars to reflect high customer satisfaction. During its startup, they design a new battery pack that would revolutionize the electric car industry. They sold these to Chevrolet that used it in its Volt cars (Davis 2010). The new technology, would make millions for Tesla, but could externally damage the company by leaving them behind and out of competition. While the culture of Tesla is motivated bout building high performance and sedan electric cars, they are loyal to the visions and inspiration from CEO Musk. By Tesla selling their battery technology to other motor companies, they assure themselves the financial keepsake of building Tesla’s own cars. They obtain a loan given by the U.S. federal government as part of the Advance Technology Vehicles Manufacturing Loan Program (Davis 2010). This assures Tesla to produce the vehicles needed in order to stay competitive. Conclusion Tesla uses measurement guidelines in order to analyze their strengths and weaknesses so they can adjust their strategic plans and meet current and future market needs. Measurement guidelines assist Tesla to know their standing and what needs to be done in order to stay competitive. References Davis, Joshua, September, 2010, How Elon Musk turned Tesla into the car company of the future, http://www.wired.com/2010/09/ff_tesla/all/ Wheelen, T.L & Hunger J.D. (2011). Concepts in Strategic Management and Business Policy: Achieving Sustainability, 12th Edition. Retrieve from University of Phoenix online (Davis 2010) TESLA: DISCOVERING STRENGTHS AND WEAKNESS 5 Running head: TESLA: DISCOVERING STRENGTHS AND WEAKNESS 2