Business Strategy - Tesla Assignment Sample

Business strategy

Table of Contents
INTRODUCTION...........................................................................................................................1
Task 1...............................................................................................................................................1
P1 Appropriate framework analyse the impact and influence of the macro environment..........1
Task 2...............................................................................................................................................4
P2 Analyse of internal environment and capabilities of the organisation...................................4
Task 3...............................................................................................................................................6
P3 Evaluation and application of competitive forces by using Porter's five force model...........6
Task 4...............................................................................................................................................7
P4 Application of models, concepts and theories that help to make strategic planning for given
company......................................................................................................................................7
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Business strategy is the main management function that help to run a business
successfully in market place. A business concern should have good strategy or planning which is
used to understand the changes and implement them within organisation in order to attract the
customers. In other words, it is a master plan which is prepare by managers for carrying out
operations and administration functions in order to achieve goals and objectives (Chang, 2016).
For understanding the importance of business strategy Tesla has been selected which was formed
in the year 2003 by Martin Eberhard, Elon Musk, J.B. Straubel and Marc Tarpenning. It is
loacted in Palo Alto, United state and Califoria. It manufacture electric car through SolorCity,
gasoline cars with Solar panel in order to attract customers. The report discusses about impact
and influences with macro environment, internal environment capabilities of selected
organisation and outcomes of an analysis using porter's five forces model to a given market
sector. Moreover, report will cover models, theories and concepts that help to make a strategic
direction within organisation.
Task 1
P1 Appropriate framework analyse the impact and influence of the macro environment
Macro environment considers external factors that are uncontrollable that affects the
manager's decision within business entity. This is the condition that exists in economy as a whole
rather than specific sector or region. In general, it contains trend in gross domestic product,
inflation, spending, inflation, monetary, employment and fiscal polity that affects a business
positively or negatively. To analysing such environment PESTLE analysis is used by managers
within business entity. Such as manager of Tesla uses PESTLE analysis to know the impact of
external factors. It includes different factor such as political, economic, social, technological and
environmental which impacts on Tesla's business (Grant, 2016). The description of such analysis
are defined as:
Political: This includes political stability, government stability, trade agreements,
government policies, legislation and administrative policies which influences business
organisation and its strategies. Such as government play a key role to provide incentives to Tesla
for development and further growth of business.
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 Positive impact: By UK's government stability Tesla make strong business
strategy that help to purchase raw material and car parts from other country. It
impacts business strategy such as Tesla can increase the productivity and
profitability within organisation by following the UK's government trade policy.
 Negative impact: If UK's government change the trade policy and tax rate then it
impacts on Tesla's business strategy such as it has to pay more money in order to
purchase raw material and tax amount. As result, Tesla has to face to low
productivity because of changing business strategy (Khanagha, Volberda and
Oshri, 2014).
Economical: It considers inflation rate, currency exchange, interest rate and trade levels
which influences business strategy of Tesla organisation. The impacts are defined as:
 Positive impact: Tesla manufacture electric and gasoline cars by following the
inflation rate. Decline in inflation rate of UK help Tesla to manufacture car at low
cost that help to maximize the production so it is beneficial for Tesla's that it can
manufacture more products.
 Negative impact: If inflation rate UK is increased then it impacts on Tesla's
strategy such as it can not achieve it target as it decided because customer will
switch the product after increasing the inflation rate.
Social: This factor considers income level, buying behaviour, cultural, experience and
taste of people that affects business organisation. It impacts business strategy such as Tesla make
plans to introduce new product according to customer taste and income level that influence
customers in United Kingdom or other place by focusing on customer preference.
 Positive impact: Tesla focuses on customer's taste and preference that help to
generate more profits by selling the electronic or gasoline car. Additionally, it
consider income level as manufacture cars at reasonable cost that increases the
number of customers.
 Negative impact: Changes in customer taste and preference impacts negatively
strategy of Tesla such as it has to spent high amount to research the market and
manufacture products as customer wants. As result reduction in profitability.
Technological: It contains technology advancement, capabilities and new technology
which impacts on strategy as well as business organisation. Tesla introduce from new features in
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