Tesla Inc Operations: Demand Effect on Planning and Control Methods

This report examines Tesla Inc's operations control strategies and the impact of demand on its planning and control processes. It highlights the crucial role of production, research, design of goods and services, quality management, and process design in managing demand effectively. The analysis covers Tesla's approach to research and development, focusing on innovation in artificial intelligence and driverless cars, as well as its efforts to align product design with market demand. Furthermore, the report discusses Tesla's quality management initiatives, including continuous improvement and in-house parts manufacturing, and its process design strategies involving automation and location-based logistics. The use of both push and pull supply chain strategies and market-based scheduling are also explored, demonstrating how Tesla aims to optimize resource utilization and gain a competitive edge through innovative technologies. Desklib offers a variety of similar reports and solved assignments for students.

OPERATIONS

1
Contents
INTRODUCTION.....................................................................................................................................1
Operations control and effect of demand on planning and control......................................................1
Productions.......................................................................................................................................1
Research............................................................................................................................................2
Design of goods and services.............................................................................................................2
Quality management.........................................................................................................................2
Process design...................................................................................................................................2
Conclusion.............................................................................................................................................3
REFERENCES......................................................................................................................................3

2
INTRODUCTION
Operations control is very much essential in the modern day business and hence it has
become crucial for the management to ensure that they have applied the best of measures to
improve their operations. Every company has to deal with the demands of the company
(Mangram, 2012). Planning and controlling has crucial role in the reducing the effect of
demand. Similarly demands of the offerings have an impact on the planning and controlling
of Tesla Inc.
Operations control and effect of demand on planning and control
Productions
Productions have a very critical role in managing the demands of the company. The first
effect of effect of demand for any company is that if the company is not able to fulfil the
requirements of the people it brings frustration in the minds of the people. Presently,
company has not been able to deliver the amount of electric cars demanded in the industry
(Das, 2015). Since the demand of solar panels and electric cars is going to increase in the
market hence a more planned approach with proper control methods will have to be
implemented within Tesla Inc.
Research
Research is a very crucial part of their operations as the company heavily relies on the
innovations in their products. For bringing control in the research, company has been hiring
people having long records in innovations. Company has also provided regular funds in their
research projects. Recently, the technology in which company has invested in high number is
artificial intelligence and driverless cars (MacCarthy, Blome, Olhager, Srai & Zhao, 2016).
According to Musk, they would reorganise their research projects so as to make it more
towards fulfilling the demands of the people that too in the coming future. For fastening up
the research process, they have linked their decision area with generic and intensive
strategies. By doing this they have been emphasising on making product differentiation and
product development so as to realign their approach towards business development. Their
theory of operations management is also focused on innovation and manufacture of electric
automobile where they have optimised their organisational capacity.
Design of goods and services
Design of goods and services according to the market demand has been their priority. This is
also applicable in ensuring productivity at manufacturing of advanced electric vehicles. They

3
have made continuous innovations in their supply chain management so as to ensure that their
products have been reaching to the markets regularly (Thompson, 2018).
Quality management
Quality management has become a crucial part of the modern day business. Tesla has
addressed this issue with the help of implementing continuous improvement initiatives,
regular quality checks as well as research on the ways quality will be improved. Quality
reviews is done regularly on the productivity of the company. In order to improve quality
Elon Musk has shifted the firm towards making their own vehicle parts rather than depending
on their partners or suppliers (He, 2015). This has increased the workload of management but
has improved the overall quality of products and hence this control has added into its
strengths.
Process design
Process design is another area where the company has focused in the last few years and this is
the major reason why the company has moved towards automation. For instance company is
automating its manufacturing processes combined with human intervention. In order to
reduce the effect of their demands they have worked towards using location strategy.
Nearness to the market and logistics along with suppliers and resources are considered so as
to bring more control in the logistics and supply chain management (The Guardian, 2018).
For distribution they have owned galleries and stores in the high density areas which help in
achieving higher sales. They have been using networking and computing technologies for
improving their internal communication. This is very essential in the case of reducing the
issues in the supply chain management. For bringing more control in supply chain
management, they have been using pull and push strategy. For the products that are in lower
demands but has higher scope in future is controlled by the company by using push based
supply chain strategy. On the other hand for the products that are of high demand uncertainty
having low importance of economy of scale can be controlled through pull based supply
chain strategy.
They have gained competitive edge over the market in terms of innovative technologies as
they have focused more on the push based production while their competitors have focused
towards pull based supply chain (Galal, 2018). The theory of just-in-time inventory has
helped them in reaching to the customers at the same time when the demand is generated. In
terms of planning they have used the theories of scheduling so as to improve the resource

4
utilisation. They have used market based scheduling, where company focuses on the actual
demand being generated in the market and uses the resulting information for scheduling
automation production. Apart from this, in order to manage the effect of demands, they have
been supporting scheduling activities with automation to minimise delays and errors and
hence enhancing productivity of the firm.
Conclusion
From the above based report, it can be concluded that operations control has a very effective
role in the modern day business. Productions, Research, Design of goods and services
according to the market, Quality management and Process design are some of the areas in
which Tesla has improved planning and control for reducing the effect of demand.

5
REFERENCES
Das, A. (2015). An Introduction to operations management: The joy of operations.
Routledge.
Galal, A. 2018. PUSH VS. PULL SUPPLY CHAIN FOR ELECTRIC VEHICLES:
COMPARATIVE STUDY BETWEEN TOYOTA AND TESLA. Retrieved From:
https://atlascorps.org/push-vs-pull-supply-chain-electric-vehicles-comparative-study-
toyota-tesla/
He, Y. (2015). Acquisition pricing and remanufacturing decisions in a closed-loop supply
chain. International Journal of Production Economics, 163, 48-60.
MacCarthy, B. L., Blome, C., Olhager, J., Srai, J. S., & Zhao, X. (2016). Supply chain
evolution–theory, concepts and science. International Journal of Operations &
Production Management, 36(12), 1696-1718
Mangram, M. E. (2012). The Emperor's New Clothes: A Framework for Market-Based
Management at Tesla Motors. Journal of Strategic Management Education, 8(3).
The Guardian, (2018) Elon Musk says Tesla planning 'thorough reorganization'. Retrieved
from: https://www.theguardian.com/technology/2018/may/14/elon-musk-tesla-
reorganization
Thompson, A. (2018) Tesla, Inc.’s Operations Management: 10 Decisions, Productivity.
Retrieved from: http://panmore.com/tesla-motors-inc-operations-management-10-
decisions-areas-productivity