Cbep literature review topics 2022 2023 analysis of teslas global strategy

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CBEP Literature Review Topics 2022/2023 Analysis of Tesla's Global Strategy

Learning Journal (Component A)

Section 1: Tutorial Notes

Section 2: Article Review (based on the reading you will complete in your tutorials) Section 3: Supervision Notes

Section 4: Reflective Essay

Literature Review (Component B)

Executive summary

1 Introduction

Managers, consultants, and academics are all aware that it has become standardpractice in the era of globalization to investigate businesses, organizational structures, andstrategies globally Being able to successfully compete in global marketplaces determineswhether a corporation succeeds or fails in the twenty-first century The way a companycompetes on the international stage is known as its global strategy, and it is a key factor indetermining how well it does there Management of multinational corporations must adapt

to the interconnectedness of global marketplaces, where competition no longer takes place

on a market-by-market basis, by developing a worldwide strategy A global plan must notonly include a broad strategic direction but also include the worldwide coordinationrequirements for operations like procurement, R&D, production, and marketing Marketingstrategy is possibly the most crucial element of a company's worldwide strategy since itassumes the function of direct engagement with consumers and rivals in the market

The process of determining an organization's core mission, vision, and long-termobjectives is known as strategic management Internationalization of organizations addsnew elements to this strategic process In order to manage their increasingly complexoperations in a globally changing environment, MNCs like Tesla, among others, needstrategic management The process of Tesla's global business expansion, including in China,Europe, and Asia, is rapidly accelerating The worldwide market for electric vehicles stillfaces severe competition and is beginning to develop a strong sales force and win marketshare, despite the fact that the demand for automobiles there is declining This firm'sstrategic planning is centered on selecting the ideal financing and price options for aprecisely defined market segment Tesla is specifically attempting to lower monthlypayments to enable consumers to purchase new cars and to encourage pricing competition

Companies with a worldwide strategy built on cost leadership, differentiation, andsegmentation, like Tesla, concentrate on pressing economic requirements The majority ofthe added value in the items Tesla generally sells is found in upstream operations in the

industry's value chain Corporate management may apply a consistent global strategy acrosscountries since automotive goods are fundamentally distinct and do not need to be adapted

to satisfy the demands of a certain nation When a product is viewed as a generic good anddoes not need to be marketed based on brand, trademark, or support services, this tactic isalso employed Initially controlled by well-known businesses, the car sector has nowexpanded to several emerging nations Retail brands in each country gradually increasedtheir presence in terms of sales value

in global strategy and organization has increased in academics There are several ways toapproach the issue, and consequently, numerous solutions for companies dealing withinternational competitiveness These viewpoints have, on the one hand, improved people'scomprehension of the complexity of international competitiveness (Asmussen and Foss,2022)

The definition of a global strategy, however, as well as the reasons why acorporation selects a global strategy and the repercussions of that choice, are all subject to

a great deal of ambiguity and uncertainty due to the difference of opinion Without aconsistent framework to incorporate these many viewpoints, there will likely continue to beambiguity and uncertainty, which will result in competing theories and discourage theapplication of knowledge to practice Consumers throughout the world are becoming more

and more likely to desire the same goods and have comparable tastes The achievement ofthe economies of scale that global markets provide is the strategic necessity forinternationally competitive enterprises in this new century As a result, global firms that sellstandardized items in the same way everywhere in the globe will likely replace multinationalcorporations that treat each country's market independently (Glowik, 2017)

The role global Strategy to the companies

Instead of relying on a single technique, such product standardization, an effectiveglobal strategy must have a toolbox Utilizing economies of scale through global volume,setting priorities through quick and significant capital expenditures, and controllinginterdependencies to produce synergies across many operations in diverse industries are afew of these The global strategic imperative is to alter the extent and breadth ofcompetition by taking advantage of competitive advantages among interconnected nationalmarkets To be able to share investments in technology, branding, and distributionchannels, a global approach requires a variety of product categories (Everett, 2014) Cross-subsidization between product lines and markets, global brand dominance, and a robustglobal distribution infrastructure are the three key components of the global strategicimperative Due to the fact that customers throughout the world are willing to set asidetheir preferences for high-quality goods, this capacity to make goods at the lowest possiblecost has emerged as the primary source of competitive advantage high but inexpensive.Manufacturing a single, uniform product and promoting it using a single, standardizedmarketing program is the best worldwide strategy (Godiwalla, 2018)

2.2 Review of related studies

According to Brannen and Voisey (2012), companies develop their global strategiesbased on what they have learnt from their own experiences and from studying others, usingthe logic of comparison We suggest three forms of comparative learning for developingglobal strategies based on the literature and a thorough case study: seeking out bestpractices, revealing universals, and grounded strategizing Although sometimes implied,grounded strategizing as the method by which businesses learn from unexpected changes inthe way their own global strategies are implemented remains largely unexplored and could

be the most beneficial source of knowledge Godiwalla (2018) emphasizes the significance

of strategic management in multinational corporations Global businesses may gain a lot

from long-term, strategic advantages provided they are properly created and planned.Global businesses succeed by exercising strategic leadership and taking advantage ofnational distinctions Establishing classifications of main strategic focuses will provide clarity

in the construction of the global strategy mosaic of the global company Develop parallels instrategic and operational conditions among international subsidiaries This allows for theutilization of identical core strategy patterns among groups of overseas subsidiaries withcomparable strategic and operational contexts (Virzi, 2018)

The creation of an organizational culture that prioritizes cooperative partnerships, inwhich the head office and overseas subsidiaries pursue mutual respect, trust, andconfidence among organizations, as well as unrestricted vertical and horizontal sharing ofinformation, problem-solving experiences, industry knowledge, and national wisdom Theprimary focus of the global organization should be on establishing moral, strategicleadership at all levels and making investments in human capital Global corporations mustregularly and holistically assess the environments of their international subsidiaries andmake plans for future expansion and competitiveness (Topcu and Duygun, 2015) It ispossible to research the differences between nations based on their infrastructure, humanresources, political, legal, and economic systems, as well as their natural resources,distinctive or unique characteristics, and marketplaces Mohiuddin (2017) argued that aglobal organization would be more effective in its utilization of its resources as it successfullyseeks to achieve its organizational goals if it understood and applied the comparativeadvantages among its countries of operations A global firm becomes more competitive byutilizing the resource profiles of the various nations and then basing its strategic andoperational decisions on them The contingency frameworks show various organizationaland infrastructural conditions that would require various key templates of strategies for thesubsidiaries to operate well in them (Saritas and Penez, 2017)

Global Strategy of Apple

Apple's global strategy emphasizes that simplicity is the pinnacle of sophistication Ittakes a lot of effort to accomplish something straightforward, to fully comprehend thepossible difficulties, and to develop delicate answers Digging into the depths of intricacydemands more than simply simplicity or the lack of clutter (Dębińska, 2022) To be able toeliminate extraneous components, Apple implements a procedure that involves analysis and

a thorough examination of the nature of the product Apple uses differentiation to produceservices that are customized for a particular overseas market and stand out from globalcompetitors (Jamali, Shuxratovna and Kamolova, 2022) The business was able to build asignificant global footprint thanks to this tactic In this talk, Apple will discuss how thecompany's tagline, "making technology so easy that everyone can be a part of the future,"paves the way for the next wave of consumer technology The Apple company has done afantastic job incorporating the idea of simplicity throughout their narrative They alsoutilized it to direct how they approached the purchasing process They work hard to ensurethat customers get the greatest experience possible (Fámúwàgún, 2021).

Global strategy of Microsoft

Microsoft is divided into five main divisions: Windows & Live Windows Group, ServerSoftware, Online Services, Microsoft Business, and Entertainment and Devices Each divisionfocuses on a different product or service Each of these divisions had its own customerservice department, research department, and sales division up until 2013 Because of thisdivisional structure, Microsoft did not have a unified global strategy in place across all fivebusinesses until 2013 While most multinational corporations have strategic diversityinitiatives, Microsoft's Global Diversity Initiative is the overarching strategy that includes allothers (Lozupone, 2018) This is one key distinction between Microsoft's diversity initiativesand what may appear to be comparable initiatives at other multinational corporations Arecent business mission statement referred to all other efforts as components of GDI (Chaoand Kavadias, 2017) Microsoft highlights on its website the need of staying in tune with themarket in a world where markets are becoming more varied, partially out of concerns foreconomic fairness and more out of a need to survive The corporation talks about GDI inthree areas: inclusivity, which it defines as a way of fostering an engaged workplace;representation, which it characterizes as a way of developing a pipeline of future leaders;and innovation, which it summarizes as a method of fostering market excellence Microsoftviews diversity and inclusion as a strategy to better match with local markets, whichaccelerates market penetration (Chao and Kavadias, 2021)

3 Methodology

This study was conducted to analyze Tesla's global strategy in the current period

The primary method used in this study was based on secondary sources of information;including SWOT model of Tesla, Triple Bottom Line Balanced Scorecard of Tesla, Ratioanalysis of key financial measures and the perspective of shareholders, Employeeperspective of Tesla, CSR perspective of Tesla; and Analysis of Tesla's Global Strategy Thedata sources are collected from reliable secondary information sources The main analyticalmethod is business environment analysis and business analysis is carried out.

The SWOT Model is a method of strategic analysis that aids in identifying strengths,weaknesses, opportunities, and threats in the market competition as well as in the process

of creating a content strategy for a market project SWOT analysis is a tool that businessesmay use to define investment goals and pinpoint objective and subjective elements thatmay influence how those goals are attained (Sammut and Galea, 2015) One of theprocesses in developing a company's business strategy is a SWOT Matrix study This strategy

is helpful for businesses in developing local business strategies, but it also plays a significantrole in developing global business plans to fulfill the demands of businesses (Fahmideh andRamsin, 2015) SWOT analysis is a crucial phase in the process of developing a businessstrategy for an organization if it wants to establish and steadily grow its reputation andbrand identity Using a SWOT structure that is simple to comprehend, present, and discuss,SWOT analysis assesses facts in a subjective manner and may be used in any decision-making process The resources and capabilities of the company and the competitiveenvironment in which it works may be connected with the help of the SWOT analysisprocedure (Teece, 2017)

Nowadays, a lot of businesses are aiming for triple bottom line performance in terms

of financial, environmental, and societal criteria Successful methods for such performance,however, typically call for new connections across a variety of participants in a variety ofindustries within a company's talent and supply chain For triple bottom line performance,the Balanced Scorecard (BSC), which was first created to explain and implement a singleorganization's strategy, has to be modified (Sukkar, 2017) The Customer perspective ischanged to "Stakeholders" to reflect the interests of the various ecosystem participants, theFinancial perspective is changed to "Outcomes" to include financial, environmental, andsocietal metrics, and Learning & Growth is changed to "Enablers" to reflect the newcapabilities for collaboration and alignment Businesses are increasingly expected by society

to contribute to the reduction of poverty, inequality, and environmental damage The task

of making business a better partner with the state and civil society has been taken up by anumber of business executives (Neri et al., 2020) In essence, business is not good at fixingsociety issues, and trying to do so would hinder its ability to generate wealth and revenuethrough its own private profit-maximizing endeavors The straightforward design of theBalanced Scorecard has been the standard foundation for business strategy execution andmanagement-by-objectives systems for three decades These potent tools will continue tosupport firms and their strategy execution methods for decades to come by expanding theviewpoints of the Balanced Scorecard and Strategy Map to reflect the larger role forbusiness in society in the modern era (Barbosa, Castañeda-Ayarza and Ferreira, 2020).

4 Analysis and evaluation

4.1 About Tesla

Tesla, Inc is an enterprise headquartered in Palo Alto, California, United Statesestablished in 2003 Tesla is engaged in the manufacturing and distribution of electric cars,electronic components and other vehicles The Tesla Roadster was the first Tesla product to

be produced As of 2012, Tesla has sold over 2000 Tesla Tesla Roadster vehicles in more

than 30 different regions Then Tesla launched other vehicles; such as “Model Y, Model X, Model 3, Model S, Cyber Truck or Tesla Semi” (Tiwari, 2017)

Currently, Tesla is expanding its strategic business with industries such asmaintenance of energy systems for electric cars, solar energy, installation, replacement andproduction of auto components (Matsika, 2019) Tesla's strategic markets are in the US,China and Germany Tesla has a strategy and plans to expand operations in many otherregions such as Europe, Asia Pacific and the Americas (Li, Lin and Xu, 2021) For

stakeholders, financial and non-financial information is extremely important to underpinvarious economic decisions In particular, important information provided in this reportincludes Triple Bottom Line Balanced Scorecard, Ratio analysis of key financial measuresand the perspective of shareholders, Customer perspective and CSR perspective Tesla'sstrategy is to provide consumers with electric products; as well as the goal of entering theworldwide car market with a line of cars aimed at affluent buyers After capturing a certainmarket share in the high-end product segment, Tesla offers lower-priced product lines in theaffordable segment to increase competitiveness in the industry and market coverage(Tiwari, 2017)

4.2 Analysis of Tesla's business environment

4.2.1 SWOT model of Tesla

Tesla’s Strengths: Any business's employees determine how successful it is It is one

of the key components in Tesla Inc.'s incredible financial success The culture that celebratesdiversity and fosters creativity at Tesla, has helped the company become a top employer(Thoma and Maine, 2019) Tesla nonetheless sold 936,172 vehicles to consumers in thefiscal year 2021, bringing in $53.8 billion in sales Due to the jump in deliveries and its $5.6Billion profit, which exceeded that of the top five automakers combined, the company'smarket valuation soared to almost $1 Trillion (Toyota, Volkswagen, Daimler, Ford, andGeneral Motor)

In the race for the greatest electric cars, Tesla has surpassed every othermanufacturer When measured by their range, Tesla's electric cars have shown to be thebest at covering the most ground A recent research places Tesla among the top three forrange The Tesla Model S can go up to 600 kilometers on a single battery charge The closest

vehicle from a different manufacturer is the 520-kilometer-range Opel Ampera.

Tesla’s Weaknesses: As innovation standards rise, mechanical complexity and

manufacturing risk will rise as well Launches of new cars and products, as well asmanufacturing and production ramp-up, are all consistently delayed by Tesla (Cheong, Songand Hu, 2016) Due to its significant experimentation and intricate procedures, Tesla maysuffer an uneven supply and demand in the future and be unable to keep up with theproduction ramp Tesla admits to being a "one-man show." Unfortunately, in order to givethe business what it needs, Elon Musk has a lot on his plate Other projects within TheBoring Company and Space Exploration Technologies Corporation, such as those involvingspace launch vehicles, are also extensively supported by Musk (Aslan, 2021)

Tesla’s Opportunities: The company's biggest current potential is the underserved

Asian market, which is currently in the automobile and renewable energy industries,especially given that Tesla intends to increase the size of its global market in order to boostboth its market presence and financial stability (Kim, 2020) Tesla is expensive because of itsparticular reliance on innovation, which requires the most financial support to consider newtechnologies Tesla wants to manufacture its own battery cells Since the decision will allowthe company to increase production rates while reducing prices, it might totally change theindustry Currently, their primary source for batteries is Panasonic (Han, 2021)

Tesla’s Threats: The corporation worries that one of the largest financial hits may

come from product liability lawsuits, which are common in the automobile sector inparticular Despite Tesla's excellent quality control and rigorous production standards, thisspecific sector is used to dealing with such accusations Tesla, Inc faces intense competitionfrom hybrid, plug-in hybrid, and fully electric vehicles as well as autonomous drivingtechnology Many manufacturers, including Volvo, Toyota, Ford, General Motors, andMercedes-Benz in the luxury and economy categories, as well as BMW, Audi, Lexus,Mercedes, and BMW in the premium market, are ready for fierce competition Theextraordinarily difficult engineering needed for new cars has repeatedly resulted in seriousissues with Tesla's autos and other energy products Design flaws, manufacturing flaws, andother defects are frequently present in the faulty goods, and these might permanentlyaffect the brand recognition of the firm US residents still feel uneasy strolling aroundautonomous vehicles (Bohunčák, 2022) Adults over the age of 55 make up the bulk of thosewho are scared of being around self-driving automobiles

4.2.2 Triple Bottom Line Balanced Scorecard of Tesla

Many companies strive for performance that meets the triple bottom line offinancial, environmental, and societal standards However, effective strategies for suchperformance frequently need forging new ties across a range of players in a range of sectorsinside a company's talent and supply chain The Balanced Scorecard, which was firstdeveloped to describe and implement a single organization's strategy, must be changed inorder to depict such multi-stakeholder strategies for triple bottom line success

Triple Bottom Line Balanced Scorecard of Tesla:

Measures Targets Initiatives

Tesla earnings set a 50%

growth target in 2022

Increase revenues

Increase sales policy, increase marketing strategy andpromote customer satisfaction

Tesla pushes to sell 3

million vehicle units in

2022; up 59.8%

year-on-year when factories in

China come into

operation

Increase car sale

Dominate the mass marketWith 365,923 vehicles produced during the third quarter, Tesla delivered 343,830 vehicles worldwide According to Forbes' financial calculations and these auto and delivery statistics, Tesla makes an estimated

$51,726 per vehicle before taxes on average

Tesla stock price

continues to grow

towards target around

$300

Share price

Expand business opportunities and raise investor expectations

Boost battery efficiency

and increase mining

output 25 kWh per 100

miles

Car efficiency

The most efficient EV in 2022 will be the drive, standard-range Tesla Model 3, which has a rated energy usage of 25 kWh per 100 miles

independent producer of production materials; agreement with GM for a long-term partnership

Boost the mileage the car

can use with a single

battery charge > 156 Wh/

km

Energy efficiency

In the EPA Combined cycle, it is 237 Wh/mi (147 Wh/km) efficient It is 253 Wh/mi (157 Wh/km) on the highway The second option is the 251 Wh/mi (156 Wh/km) Tesla Model 3 Long Range AWD

Vision of Tesla: The goal of Tesla is to hasten the global switch to renewable energy.

As long as those brands are willing to cooperate with Tesla to speed up this process, Tesla'smarketing strategy can be used with any company

Enablers: GM and Tesla have signed a cooperation contract to repair Tesla's electric

vehicles on a mass basis from 2021 GM dealers have repaired more than 11,000 Teslaelectric vehicles in the US market Tesla does not have its own dealer network, although itsown service centers are open; The number of dealers cannot match that of othercompetitors' systems that have developed over many years in the US (David, 2022) As aresult, customer wait times have been substantially reduced when Tesla partnered with GM.Tesla aims to do everything from production, design to vehicle maintenance Similarly, Teslarecently made several deals with lithium and graphite miners; like signing a contract withVale (Brazil) to buy nickel.Additionally, Tesla directly purchases from nine separate miningfirms throughout the world the majority of its lithium, more than half of its cobalt, andapproximately a third of its nickel, instead of buying on the U.S commodity market asbefore Tesla also gradually manufactures its own powertrain components, making its ownengines and many electronics, allowing Tesla to better control costs In recent times, Teslastill designs semiconductor products, while also maintaining a closer relationship with thechip supplier Tesla software engineers created a centralized computing architecture to run

on those chips, ensuring smooth integration with the hardware Musk even switched from adealership model to opening his own store (Sudhakaran and Uygun, 2020)

Process: Tesla offers free charging services in many regions in the countries where

the company's product line operates Tesla's battery charging services include Charge at

Home services, Global Superchargers with nearly 35,000 different locations; WallConnectors at Destination Charging Sites with over 35,000 locations Tesla is building itsentry into the mainstream market at a lower price point Especially in the Indian marketwhen Tesla entered the previous stage Tesla built a domestic factory in India and consumed

a huge investment (Gupta, 2020) If not exempt, India's import tax makes the Tesla Model 3,which starts at $44,000 in the US, costs $80,000 in India if the company wants to make aprofit Therefore, Tesla has localized electric cars in this market Meanwhile, Tesla with theTesla Model 3 has been Europe's best-selling model with a sales volume of nearly 30,000vehicles in 2021 at a competitive price Tesla is also boosting customer service by increasingits electric vehicle maintenance and parts replacement requirements Tesla vehicles offerspecific self-maintenance instructions and a regular customer service call center, enablingcustomers to repair their vehicles on their own instead of having to go to the workshop Inaddition, Tesla also offers a Maintenance Plan at any time to receive a refund Tesla offers acomprehensive online app for quick customer acquisition and response (Lang, Reber andAldori, 2021) Another problem with electric vehicles is battery life Tesla offers a batterycalled Gemini that allows the Tesla Model S to travel further than any other vehicle, even agas car, and for a single refueling A Tesla vehicle equipped with this new generation ofbattery technology can travel more than 1,200 km on a single charge (Jeff, 2022)

Stakeholder management: By monitoring and exposing the consequences of its

operations and products, placing a strong focus on consumer safety and responsiblesourcing, and putting its employees first to foster a healthy workplace culture, Tesla's CSRstrategy takes into consideration the interests of all parties concerned Early money frominvestors was crucial to Tesla's development The capitalisation of the company issignificantly influenced by these stakeholders Investors and shareholders have a vestedinterest in the development and success of the business Tesla workers are entitled tocomprehensive medical coverage, a 401(k), and an abundance of paid vacation days Wemake investments in our employees through equity awards, stock discounts, and otherrewards to help them do their best work The company's legal actions and compliance as astakeholder group worry governments Such government goals are suitably satisfied byTesla's strong track record and strategic aspirations for global development

Outcomes: Tesla's business goal in the next phase is still to ensure an increase in

market share, thereby increasing revenue Currently, the quality of Tesla products isshowing an important position when there have been many problems with the quality ofservice According to Reuters, Tesla now accounts for 75% of the share in 2021 and 79% in

2020 Tesla's long-term goal is to maintain car sales growth of 50% per year in the followingyears to fully account for the electric vehicle market in the world (Mark, 2022)