Tesla Business Strategy

TESLA BUSINESS STRATEGY

According to Weigl, a strategy as the determination of the essential long-term goals and objectives of an organisation, and adoption of courses of action and distribution of resources required for carrying out those goals. He also that it is the plan or pattern that integrates an enterprise's major policies, actions and goals sequence into a cohesive whole.  A well-formulated strategy assists to rationalise and allocate an enterprise's resources into a viable and unique posture based on its relative internal shortcomings and competencies, anticipated changes in the business environment, and contingent moves by intelligent opponents (Weigl, 2008).

This paper analyses the strategy of Tesla Motors compares how its business model differs with Auto Makers, resources and capabilities of Tesla compared to Auto Makers in the area of plug-in electric vehicles and a rationale for Tesla’s strategy.

Tesla is an electronics and electrical company that specials in the production of vehicle electronic components. Additionally, this company provides other sales services to their customers. Products offered include charging adaptors, wheels and tires, apparels such as shirts, and kids’ collection.  

Tesla business model comparison with Auto makers

Business model refers to the conceptual structure supporting the viability of a business enterprise. It comprises of business goals, its purpose and its ongoing plans for accomplishing them. Additionally, it defines the source of revenue resources, products, customer base and financing details. Tesla model is analysed as follows:

Scope: Tesla operates within vehicle industry specialising selling vehicle and vehicular electronic parts.

The source of revenue and other resources: Ellen Musk; the proprietor of Tesla business; is the source all resources to Tesla company.

Goal: achieve sustainable energy economy. (Musk, 2016)

Comparison with Auto Makers

Whereas Tesla Company is a sole proprietorship owned and being financed by Musk, Auto Makers is a partnership company administratively managed by a board of directors.

While Tesla mixes its scope operation by extending its service provision i.e. it sells shirts which are outside vehicle industry, Auto Makers have concentrated on motor vehicle industry.

Whereas Tesla Company focuses on service delivery in America, Auto Makers is globally based.  

In the market for plug-in electric vehicles, in terms capabilities and resource provision, Tesla Company has a smaller market share as compared to Auto Makers.

Tesla Company chose to a single proprietorship because of fear of risking partnered resources. Musk says, "I thought our chances of success were so low". However, Tesla made it and are flourishing. It is a time that Tesla should utilise its strength of having favour in the electric vehicle industry to get established. The major weakness that Tesla faces is the low capital base. Tesla management should devise a way of sourcing capital to fund its flourishing business.

As per theories, a technique as the assurance of the basic long run objectives and destinations of an association, and selection of blueprints and conveyance of assets required for doing those objectives. He likewise that it is the arrangement or example that incorporates a venture's significant strategies, activities and objectives succession into a durable entirety. A very much figured system helps to justify and designate a venture's assets into a suitable and exceptional stance in light of its relative inner weaknesses and abilities, foreseen changes in the business condition, and unforeseen moves by astute adversaries.