The Tesla management system
Management concepts, either developed or gained through learning, play an essential role in technological advancement. A strategic management system not only propagates a company’s development, but it also makes a company able to identify opportunities rarely identified by other companies and the public in general. Due to these reasons, innovative companies play an essential role in bringing solutions to the world. Moreover, a company may wish to share its creative strategy idea to its competitors and the general public to either gain more from this interaction or propagate the overall global innovative advancement; or with a different unknown reason. Whichever the case, technological advancement in a company relies heavily on its management. How has the management strategy affected the overall performance of the Tesla Company?
In July 2017, Tesla launched its first zero-emission: Model 3, an electric-powered car. The electric car and the conventional internal combustion cars both share similarities with some slight differences.
The technology used in the electric vehicle production industry is different from the technology used in the internal combustion production industry. The engine development and configuration of electric cars are different from that of internal combustion engines in that electric cars deriver strong torques compared to internal combustion engines. This reason means that electric vehicles have a wide range of engine speeds (cite 1), making acceleration achievement easy.
In most cases, the internal combustion production industry is demand-oriented in that it follows the needs of its clients. In contrast, the electric powered industry is innovatively oriented: its production intends to bring together ideas to come up with something better. Elon Musk, Tesla’s CEO, points out that Tesla aims to accelerate the world’s transitions to sustainable energy (cite 1). This reason points out that the electric vehicle (EV) production industry (specifically Tesla) is to propagate the world towards using clean energy.
The supply chain of these two industries is also different. Whereas the internal combustion industry depends on independent dealers, the electric propulsion industry delivers its products directly to the consumers (pp. 506 – 507). This franchising interface makes EV gain popularity due to the trustworthiness.
The electric industry differs from the internal combustion vehicle technology industry by investing in developing a system to gather usage statistics, which was initially unheard. These statistics get used in future development and also assist in getting user feedback and customer satisfaction data. (p. 507)
Tesla uses the slogan “Friends and not competitors.” Tesla decides to share its innovative strategy with its competitors. When more brains are put together, more significant achievements get realized. To some extent, Tesla’s decision to make its production open-source may be very beneficial to Tesla itself and the global production industry. Collaboration with other similar production industries may make Tesla gain more innovative ideas from these companies by involving them in its designing and innovation process (Jiang & Lu, 2018). This collaboration also, through pooling ideas together, may enhance global production. Instead of creating unnecessary competitions, these companies, through working together, apart from eliminating the cost of the extreme competing, will facilitate innovators to generate productive, informed ideas that will ultimately improve the overall production and usage of electric vehicles.
The Tesla decision is risky too. Human beings are diverse minded. Most companies may decide to use the Tesla open source technology for their benefit. However, Feng Lu disagrees with this statement stating that Chinese companies would not replicate Tesla’s success (Jiang & Lu, 2018). Feng bases the argument that China is an industrial giant and has shifted from competing with the internal combustion engine (ICE) companies (p .1). According to Lu, The collaboration initiated by Tesla will see China’s EV industry growing and usher in a global industrial transformation in favor of EV. Lu agitates the Chinese government to chip in and assist local automobile manufacturers in developing innovation capabilities. Lu also urges advanced companies to forget about dominance and collaborate and local manufactures when ushering in the EV era. A critical analysis shows that intercompany collaboration will benefit the innovation industry despite the challenges and uncertainties at hand. Therefore, Tesla made a wise decision by initializing the non-competitive inter-company cooperation.
Tesla’s strategy is a long term play aimed and revolutionalizing the automobile industry. This company fights towards harnessing the will wind of innovation. Apart from production, Tesla’s business model incorporates five main elements: supply chain management strategy, growth strategy, production management strategy, and cost-aware invention strategy (Bilbeisi & Kesse, 2017).
Tesla does most of its EVs supply itself. Despite the challenges faced in some states in the USA, Tesla has successfully run its showrooms in most parts of the world (cite 1). Tesla is also development-oriented and invests in its production stations. Tesla uses different ways to pool together innovative ideas and tracks its products’ progress, both market-wise and performance-wise. Tesla also aims at developing cheaper but advanced EV machines (Bilbeisi & Kesse, 2017).
All the above strategies point to innovation as the master of realization of Tesla’s dream. For instance, for Tesla to achieve its goal of developing cheap, useful EVs, it must go down to innovation and create a concept and design of making a better car using less expensive resources.
A company’s strategy can make it superior to other competing companies. Tesla gains the advantage by basing on mobility and technology, mindful of climate change (Khan & Ahmed, 2019). People must always be traveling, and technology is dynamic. But with an increase in mobility and technology, climate suffers. Tesla’s concept using climate-friendly technology hits the international goal for sustainable development goals(Direction, 2018). Apart from gain favor from different governmental legislations, Tesla’s radical innovation concept accentuates a revolutionary technology that is both sustainable and realistic and achievable. The open-source Tesla ideology also compels other companies to join hands with Tesla, making it the most significant EV producer worldwide and the master minder of all EV technology inventions.
Tesla’s management strategy proves to be realistic and working; it can be better if it incorporates some small changes. Tesla needs to change its supply chain process. Although Tesla can still supply its operation, it can do better if it outsources the supply to another company or independent agencies. By so doing, Tesla will have a better chance of performing better by focusing only on production.
Conclusion
The Tesla management system has not only helped this company to grow into a world-class EV production company, but it has also changed the viewpoint of other companies who view companies producing similar products as competitors. Tesla has enlightened the world that these companies can decide to work together to better the future. Tesla has also proved successful in bringing new sustainable ideas and strategically penetrating the markets to emerge as one f the spectacular companies worldwide, all thanks to its management strategy.