A Note On Tesla 's Value Chain Essay

The series of activities that are enacted by a firm that add value to a product beyond the cost of the production are referred to as the value chain. Harley Davidson offers a combination of superior performance and unique attributes within its value chain that promotes their core competencies and provides them with a competitive advantage.

I enjoyed reading your post. You raised an important point that differentiates Tesla from other electric car manufacturers. The application of vertical integration where Tesla controls its battery production instead of outsourcing to external producers would help in reducing supply chain costs as well as enable to produce high-efficiency cars.

Tesla’s mission statement is “to accelerate the world’s transition to sustainable transport.” A fairly young company whose products are electric cars through a lithium ion battery. Tesla’s vision is to bring electric cars to the market and provide a sustainable alternative to gasoline-powered cars. They also strive to increase the safety of the vehicle and most importantly the passenger by eliminating the amount of gasoline car fires with this alternative. Tesla is publically traded company with approximately 12,000 employees and with more than 50,000 vehicles currently on the road worldwide.

Develop a business model for Tesla, indicating future sales and profitability; what is your assessment of Tesla’s long-term success?

Tesla Motor, Inc. is an American automaker focused on selling electrically powered vehicles without compromising quality of transportation. The company began selling cars in 2008 with the Roadster and became publicly traded in 2010. Today, there are many players within the automobile industry. The company was, “founded in 2003 by a group of engineers in Silicon Valley who wanted to prove that electric cars could be better than gasoline-powered cars. With instant torque, incredible power, and zero emissions” (Tesla). They are a company that offers 100 percent electric cars, lithium batteries and charging stations. Tesla 's mission statement is, “to accelerate the world’s transition to sustainable transport” (Tesla). Tesla believes that, “ it is not just an automaker, but also a technology and design company with a focus on energy innovation.”

It is evident that the practices of modeling, simulation and prototyping produce optimal results and saves a lot of resources and time however, these practices should not be overused to produce results. They can sometimes produce results related to incorrectly defined problem and overconfidence on these results can be catastrophic. It is necessary to properly understand the boundaries of a defined system and or a problem statement that will permit the use of the techniques, as well as limitation of the accuracy that such techniques provide. While practicing this technique in systems architecting, it should be realized that an assumption that “original statement of the problem is the best”[6] might prove wrong. “It might not necessary be the best or even the right one”[6]. Also overuse of these techniques might prove costly and a time-consuming investment to extent that it is not present in the systems architecting process. It is important that all the necessary factors are appropriately accounted for and avoid the pitfalls in the system.

Scientist and engineers believed that current technology was not advanced enough to produce a lithium-ion battery powered car. That technology was still years away from developing a functional and cost efficient car that could be used regularly in a person’s everyday life. Tesla motors is challenging this notion and have already made huge strides in advancing lithium-ion technology. They currently have released a few different models and are on now working on making an affordable and luxuries car that will produce an alternative to the gasoline powered car. They are not focusing on hybrid cars but rather on fully powered cars relying solely on electricity for its source of energy. The technology being used to power and design these

Healy states that primary activities include: inbound logistics, operations; outbound logistics and marketing and sales. Secondary activities include: firm infrastructure, human resource management and technology developments. Below one primary and secondary activity will be discussed in relation to the Tilba Cheese case study.

Outbound Logistics includes the activities that store and distribute products to buyers (e.g. warehousing, delivery vehicle operations, order processing, etc.).

The concept of Value Chain was introduced by Michael Porter which involves a process of adding value to a product or service at every stage. A value chain may exist within one firm or may extend over an expanded supply chain that includes various firms. It enables to identify the Primary and Secondary activities which can increase the value to end customers and thus facilitate business organisations to gain a margin over input cost.

A value chain is about how to make or create value around your product for the customer.

The business world today is a competitive one. All the companies are trying their best to get ahead in the game. Because that is how they will improve and be the best at what they do. To achieve this the companies have to constantly strive hard and try to be ahead of their competitors or at least in step with them. This is where value chain comes in. Value chain deals with adding value to your product so that the company might gain a competitive edge over their rivals.

The value chain of a company is the entire product flow of a company beginning from its suppliers to the customers as well as managing the flow of information so that both the customers derives maximum satisfaction while at the

Value chain analysis relies on the basic economic principle of advantage — companies are best served by operating in sectors where they have a relative productive advantage compared to their competitors. Simultaneously, companies should ask themselves where they can deliver the best value to their customers.

Whether selling a product or producing a service, companies have to find and establish a set of competitive advantages (Gertner, 2013). These advantages should be advantageous to the customer and also be sustainable to the company (Gertner, 2013). The value chain is a tool that companies can use to analyze the steps they need to take to provide the highest level of service to its customers and create a competitive advantage (Blocher, Stout, Juras, & Cokins, 2016). The value chain analysis tool can be taken to the next level when companies utilize it to help them assess where they can reduce costs, which processes are not competitive or productive, and if there are any steps that can be outsourced (Blocher, et