Globalization of Operations Strategy Executive Summary

Tesla is a unique company that is focused on bringing products that support a sustainable environment to market. Its electric powered vehicles and its solar panel powerwalls help reduce the need of communities for fossil-fuels and provide consumers looking for green products with new approaches to old ideas. Tesla’s goal is to bring forward the future of green technology to the here and now, and so far it is succeeding very well. Its strategic thrusts include diversifying its product line—from cars to freight trucks to roadsters to solar panels to battery technology to network charge stations and infrastructure, Tesla is spreading out in terms of what it has to offer to green consumers. It is also actively acquiring firms and just recently acquired Solar City to help in the diversification of its business. Its multinational strategic options include standardizing, localizing, regionalizing, centralizing and using subsidiaries to help move supply. Its corporate social responsibility policy is pro-environment and oriented towards helping the community, employees, investors and governments to take part in the green revolution. Its Board of Directors provides a pro-active approach to governance overseeing every aspect of the company’s initiatives, and sources of competitive advantage include the company’s visionary leadership under Elon Musk, its innovative product line, and its brand which has a stellar reputation among both green consumers and tech-savvy consumers. In short, Tesla is set for the next generation to be a top-tier company providing next generation level products to help build a sustainable environment.

Mission

The mission of Tesla is to bring mass market electric cars to consumers to support the overall development across the globe of a sustainable environment.

Vision

The vision statement of Tesla is: “to create the most compelling car company of the 21st century by driving the world’s transition to electric vehicles” (Rowland, 2018). Tesla’s vision is to be part of the expansion of a new infrastructure that focuses on renewable energy (such as solar power with its solar and powerwall services) and non-fossil fuel burning cars (electric automobiles). As Koppelaar and Middlekoop (2017) report, Tesla is leading the electric power revolution that is seeing many nations convert their old infrastructure from fossil-fuel-based to green energy-based. Agar and Renner (2016) have examined whether 100% renewable energy is possible in urban areas and found that where collaboration between government leaders and industry leaders exist, it is very much possible.

Goals

According to Musk (2013), the goals of Tesla are the same today as they were when the company was launched ten years ago: “to accelerate the advent of sustainable transport by bringing compelling mass market electric cars to market as soon as possible.”  Because of the revolutionary nature of the goals that Tesla holds for itself, the company has admitted that “in order to get to that end goal, big leaps in technology are required, which naturally invites a high level of scrutiny. That is fair, as new technology should be held to a higher standard than what has come before” (Musk, 2013). Some of the problems that Tesla has encountered in terms of reaching its goals regard the safety of its products and the advancement of its technology in order to achieve the long term objectives.

Strategic Thrusts

Tesla’s strategic thrusts are based on diversifying its assets and acquiring related businesses like Solar City, which is the largest solar panel installer...

(AP, 2016) and which is focused on the renewable energy aspects of the vision. Tesla is now engaged not only in producing electric-powered vehicles but also in providing solar powered panels and the powerwall, a unique Tesla product that uses solar power storage to help homes cut power costs.
Multinational Strategies

Tesla’s multinational strategic options include: 1) standardizing products and distribution channels so that operations can flow smoothly and effectively especially with regard to supply chain management, which will help to reduce costs and decrease the need for on-site personnel; 2) localizing operations so that worksites in various countries are in conformity with local laws and customs while respectful of international standards especially with regard to human rights issues; 3) regionalizing standards so that products are universally recognized as representing the same brand quality no matter where they originate; 4) centralizing operations through the use of a station headquarters that oversees all work flow around the planet and accomplishes marketing with minimal expense; and 5) using subsidiaries to execute various work flow operations, including production, distribution and marketing in particular geographic areas of the planet for maximum cost efficiency.

Corporate Social Responsibility

Tesla’s corporate social responsibility (CSR) policy is oriented towards satisfying communities, customers, employees, governments and investors. Tesla’s CSR policy for communities focuses on maintaining a high quality brand image that promotes concern for the natural environment. As Greenspan (2017) notes, “communities are satisfied with the fact that [Tesla] products are environmentally friendly because of zero emissions. Tesla also satisfies communities in terms of this stakeholder group’s interest in benefiting from advanced technologies. For example, in 2014, CEO Elon Musk announced that the company would allow other individuals and organizations to use its patents. This corporate social responsibility strategy directly benefits communities interested in using or developing technologies, emphasizing Tesla’s mission and vision statements.” In terms of addressing customer concerns, Tesla’s CSR policy is committed towards developing the lowest-costing battery on the market, expanding its charging station network so that more drivers can plug in anywhere from the road, and providing consumers with an overall experience that is focused on convenience and high satisfaction.

Employees also benefit from Tesla’s CSR policy through collaborative programs with partner firms that allow workers to develop new skills and broaden their experiences (Greenspan, 2017). Investors stand to benefit from the company’s focus on environmental concerns that are currently important to consumers who are embracing the green energy phenomenon, thus making “the sustainability and environmental friendliness ideals of the company in line with current socio-cultural trends [and] thereby supporting business growth” (Greenspan, 2017). Governments stand to benefit from Tesla’s CSR policies by way of the company’s focus on environmental solutions to problems affecting the planet and people’s safety—which is why some governments offer incentives to consumers for purchasing battery-powered vehicles as opposed to fossil-fuel burning cars.

Governance

Tesla’s corporate governance guidelines state that its Board’s duty is to: “exercise their business judgment to act in what they reasonably believe to be the best interests of Tesla and its stockholders. It is the duty of the Board to…