Strategic Management Plan: Tesla's Business Development Analysis

This report provides a comprehensive strategic management plan analysis for Tesla, a leading automotive and energy company. It begins with an introduction to strategic planning and its importance for organizational goals. The report then delves into a PESTLE analysis to examine the macro-environment factors impacting Tesla, including political, economic, social, technological, environmental, and legal considerations. An internal analysis using SWOT analysis is presented to evaluate Tesla's strengths, weaknesses, opportunities, and threats. The report also applies Porter's Five Forces model to assess the competitive landscape and profitability within the automotive market. Furthermore, it examines the value chain analysis to understand Tesla's internal activities and how they contribute to value creation. Finally, the report concludes with a discussion of strategic planning theories and their application to Tesla's business development.

Strategic management plan

Table of Contents
Introduction .....................................................................................................................................3
LO1..................................................................................................................................................4
P1 Framework analysis that impact or influence macro environment. ......................................4
LO2..................................................................................................................................................6
P2 Internal analysis and capabilities...........................................................................................6
LO3..................................................................................................................................................8
P3 Porter's five forces model ......................................................................................................8
LO4................................................................................................................................................10
P4 Range of theories to devise strategic planning ...................................................................10
Conclusion ....................................................................................................................................12
References .....................................................................................................................................13

Introduction
Strategic management plan helps organization to achieve their objectives and goals and
require for development of business at a large scale. Plan helps to communicate within an
organization about their goals and objectives. Strategic planning provides the vision, mission and
objectives for organization. Planning requires for improving the performance of an organization.
Needs to analyse the resources are used effectively in development and achievement of
organization goals. Helps organization to know that employees are working effectively and
requirement of stakeholders for completion of the task. Report shows Tesla needs to develop
their business and for that they prepare a strategic plan to analyse the macro as well internal
environment and their effects on working of an organization. Apply porters five forces for
development of organization. Needs to apply models, theories and concepts for development of
business.
LO1
P1 Framework analysis that impact or influence macro environment.
TESLA is one of the leading automotive and energy company mainly focuses on
manufacturing electric cars. Organizations needs to develop at large scale for that company
needs to understand market that have a ability to influence their overall working and have an
impact on the effective utilization of resources(Rothaermel, 2017.). Business needs to develop at
a large scale for that they needs to use different framework for their company.
PESTLE analysis
PESTLE in done to analyse the external environment for an organization. For smooth
working of business company needs to analyse the impact of macro environment on working of
an organization.
Political
Whenever Tesla going to develop their business in a new territory they needs to know the
impact of government on smooth working of an organization. For developing their business at a
large scale they need to know the political stability in territory, government rules and regulation
that effects their products and services and tax rates by government on the auto mobile
companies. Restrictions by government on trading some material or products for development of

their business. The political factors needs to analyse the overall government intervention in
smooth working of an organization.
Economic factors
Company needs to analyse interest rates prevailing in the market where they are going to
market their product(Eskerod and Jepsen, 2016. ). Business needs to analyse the income level
and occupation of their consumers to know that they are able to buy their products and services.
Analysing income helps them to set prices of their products and know the ability of people to
spend on their products. Exchange rates needs to be analysed to know the effectiveness of
company on those territories.
Social factors
Tesla needs to understand the culture, beliefs and values of their customers to use their
resources effectively and helps organization to achieve their goals and objectives. Culture of
people needs to be analysed before marketing products and need to analyse both positive and
negative impact of culture. Company have an ability to understand their customers like
personality, attitudes, age of consumers and their preference towards the product.
Technological factors
Tesla needs to analyse the technology available in a market where they are going to
establish their product. Tesla is one of the leading auto mobile company which means they need
an effective technology in a territory for development of their product. Company need to know
the ways they are using to produce goods. Tesla needs to analyse the availability of suppliers in
those territory to distribute their products. Technology needs to be effective so that company is
able to establish effective communication with their consumers.
Environmental factors
Tesla needs to analyse the environmental factors to develop their sustainability in a
market. Environmental factors means climate change and their ability to impact consumer
preference. Large number of issues marketers are facing to develop their business in a new
territory. Company needs to know the availability of raw material and their impact on overall
working of an organization. The pollution and wastage from their products and services need to
be analysed. Tesla is an auto mobile company and for that they need to know the impact of their
products on pollution of that territory.
Legal factors

Company needs to know the legal rules and regulations prevailing in the market of
territory(Cook, 2015. ). Tesla needs to know the effectiveness of their products to provide safety
to their consumers. Company needs to know the laws related to consumers. Rights and laws of
labours in that territory.
Stakeholders analysis
When Tesla going to market their product in a new territory they need to communicate it
with the stakeholders of the business to know their participation and interest towards the working
of organization. Stakeholder analysis is required to get help from important people in an
organization. Analysis helps Tesla to minimize issues and conflicts in their organization.
Determine your stakeholders
Tesla needs to prepare a list of their stakeholders to know the key people required for
their project. Stakeholders may be sales department, marketing, production, finance, operations,
executive staff. All of them required is analyse to know their effectiveness for completion of task
that helps organization to achieve their objectives and goals.
Group and prioritize stakeholders
After analysing the stakeholders Tesla needs to group them on their efficiency to
participate and their influence on overall working of an organization. Grouping of the
stakeholders help Tesla to know the impact of power of their stakeholders on the success of
organization.
Figure out to communicate with them
After grouping key people Tesla needs to know the ways in which their company is able
to communicate those stakeholders. Needs to know the ways in which they are able to motivate
their stakeholders, ensure about the priorities of stakeholders, and their views on the project in
they have negative review then try to know the reason for the review.
LO2
P2 Internal analysis and capabilities
Internal analysis helps organizations to know the overall working of their organization
and their impact on smooth working of an organization. Internal analysis helps organizations to
prepare plans for development of organization.
SWOT analysis

Strength
Tesla is one of the leading company in auto mobile sectors have a large number of
customers who are ready to buy their products and services(Steiss, 2019. ). Employees are one of
the most important factors for development of business at a large scale and Tesla is a company
who gives priorities to their employees take proper care of them try to solve their problems
effectively. Tesla provides opportunities to their employees to bring innovation and creativity for
development of a new product. Tesla have ability to engage young employees in overall working
of their organization. Tesla is one of the leading company and and have an ability to develop
brand awareness. They provide effective products like electric cars that have an ability to
influence customers to buy their products. Tesla is always trying to bring innovation in their
products and services. Innovation helps them to develop their business at a large scale.
Weakness
Damage or decrease in overall performance of organization due to internal factors are
weaknesses for an organization. If company brings innovation in overall development of
products and services for the organization and due to that if any complication or damage may
arises. If products are not able to satisfy the wants of customers. Shortage in raw materials like
batteries effects overall success of an organization because they are not able to increase their
production and meet wants of their consumers. If employees are not able to work effectively
towards the achievement of the goals of an organization then it reduces overall profitability of
Tesla.
Opportunities
Opportunities are like future growth for development of business. Opportunities help
company to achieve their objectives and improve performance of the organization. Tesla needs to
develop their products in the new market where to increase their global presence and develop
their business at a large scale. Company needs to provide their products and services at less
prices so that they are able to convince their customers to buy their products and services. Due to
shortage of batteries the business of electric cars are affected Tesla needs to develop an in house
battery production for their organization it helps them to save money as well increase their
profitability.
Threats

Threats are those which stops Tesla to achieve their objectives and develop their business
at a large scale(Morden, 2016.). Due to some reasons if a company is not able to use the
advantage of all the working in their organization then it effects their success at a large scale.
Due to increase in competition in auto mobile sector overall working of development of business
is effected. Many big brands like BMW, Audi, Toyota effects overall development of Tesla.
They provide electric cars and chances of problems and defects in their products is normal and it
effects overall success of a business. Customers adaptation means company is providing
products like electric cars in which customers willingness is important to buy products.
Value chain analysis
Tesla use value chain analysis which helps them to know the activities that helps to
provide value to their products and services. Chain is used to internal activities of business.
Company is trying to complete its internal activities with minimum cost.
Primary activities
Inbound logistics
Tesla needs to maintain an effective relations with their suppliers as they are the main
source for development of their business at a large scale. To maintain the raw materials for
development of products for business. Company needs to maintain raw materials for
development of electric cars. Building strong relations with suppliers is important for
development of Tesla.
Operations
Tesla needs to maintain their operations for development of their business and products.
Company needs to prepare design and develop products to increase sales for their products. Tesla
is a company who also generates energy company needs to generate as well as prepare proper
storage for their energy.
Outbound logistics
Preparing delivery of their products to the customers is outbound logistics. Tesla needs to
deliver their products and services directly to their customers if they use dealers for delivery of
their products then it will increase the prices of their products and services.
Marketing and sales
Marketing is one of the essential function that helps organization to engage large number
of customers with their products and services. Tesla is big name so it becomes easy for them to

attract media and improve their brand awareness(Ginter, Duncan and Swayne, 2018.). Effective
marketing of product helps them to increase sales of their product.
Services
Company needs to provide regular services to their customers so that they are able to buy
products and services. After services like if customer faces any problems like default in their
products or they have to wait for repairing of their products. Company needs to provide proper
services to their customers so that they are able to convince them towards working of an
organization.
LO3
P3 Porter's five forces model
Five forces model helps to analyse the competition in the market for Tesla and their
ability to overcome those challenges. If provides all over profitability of an organization. Factor
shows the level of competition in company. If company is able to manage their business without
any barriers then it effects overall success of an business in that territory. If company has low
competition and have to face many barriers in entering a new market than the looks attractive to
the customers.
Threat of new entrants
Tesla is a leading company in auto mobile sector. If a new company enters in their
market then they need to develop brand awareness, needs costs for their business. Entering in the
Tesla market is not easy for new entrants because it needs cost for development of their business.
And affecting a brand image of Tesla is not easy.
Bargaining power of suppliers
Suppliers is one of the main factors that helps development of business at a large scale
and effects overall development of organization. If there are few suppliers of products then they
an strong bargaining power. If witching from suppliers also increases the cost of raw materials.
Tesla needs to develop their business and for that have to provide opportunities to large number
of suppliers(Stark, 2015. ). Increase in number of suppliers decreases their bargaining powers. If
large number of suppliers are available then it become easy for Tesla to switch.
Bargaining power of buyers

Buyers are the main reason for development of business. Buyers always want lower
prices for their products and they always try to bargain at low prices that effects overall growth
of a business. Tesla needs to reduce their competition in a market if no substitution for their
products are available in a market then bargaining power of buyers also reduces.
Threat of substitutes
If there are any substitute for products are available in the market then it becomes tough
for a company to develop their products. It becomes easy for customers to switch from one
product to another. Tesla is a leading company in providing electric car and substitution threat is
also low for the company. Because preparing product like them require high cost and technology
and it is not easy to start a company. Substitutes needs to bring innovation and creativity in their
products.
Rivalry among existing competitors
Competitors are those who effects the profitability of an organization and in auto mobile
sector the competition is very high and it becomes tough for them to establish their business.
Where Tesla is preparing a products like electric cars which reduces their competition in a
market. But if large number of competitors are available for their products then it effects
customer loyalty. Growth of the industry also decreases at a large scale.
LO4
P4 Range of theories to devise strategic planning
Porters Generic strategies
Tesla needs to use this strategies that helps them to develop their business and gain
competitive advantage over their competitors. Company needs to prepare strategies that helps
them to develop their business at a large scale(Desmidt and Meyfroodt, 2018. ). Competitive
advantage helps Tesla to increase their profitability and develop value for their organization in a
large scale.
Cost leadership
Tesla needs to use this theory to become one of the leading auto mobile company in the
market that helps organization to achieve their objectives at a large scale. Tesla needs to reduce
the prices of their products and services to become cost leader in a market for that company
needs to increase their level of production, use effective technology that helps them to achieve

their objectives on time. Tesla needs to negotiate with their suppliers on the prices of raw
materials they use to decrease the price of their product. Company needs to minimize the
wastage for development of their business at a large scale.
Cost focus
Company needs to focus on the price of their products that helps them to compete with
their competitors. If a competitor selling same product at higher price then it helps company to
engage large number of customers.
Differentiation focus
Company needs to provide products that are different from their competitors and have the
ability to satisfy the wants of their customers. Differentiation helps business to attract large
number of customers(Burtonshaw-Gunn, 2017. ). Differentiation comes with innovation in
products and services. Tesla is already providing electric cars which have no close substitutes
and ability to influence their customers. Differentiation helps Tesla to achieve their target market
that helps them to achieve their objectives.
Differentiation leadership
Strategy is prepared by Tesla to analyse the consumers in a market. Company needs to
provide products with low prices and have an ability to influence their customers and helps in
increasing overall productivity of an organization. Company needs to provide quality products.
Needs to develop a brand image, proper marketing and advertising is required to influence
customers.
Vision Tesla have a vision to become one of the
leading company to automobile sector by
satisfying the wants and desires of their
customers. Company wants provide products
with effective technology to their customers.
Mission Company mission is to gain an competitive
advantage over their competitors and to
develop their business at a large scale. Wants
to bring innovation in their products and

services.
Objectives Companies objective is to establish their
business at all over the globe. Objective is to
increase the profitability for their business by
satisfying the wants of their customers.
Strategies Company needs to prepare strategies for their
products to make them effective and develop
their business at a large scale. Company needs
to use market analyze that helps them to know
the needs of their customers. Strategies helps
to achieve competitive advantage in a market.
Tactics Company needs to prepare effective prices, and
needs to use promotion of their products that
helps them to develop a brand image, needs to
decide the place where there are going to
market their product. Needs to analyze the
people for whom they are preparing products.
Implementation Company needs to use resources effectively to
minimize wastage and increase their
profitability. Company needs to manage their
employees to get effective work done from
them which helps organization in their overall
success.
Evaluation All the important strategies and vision,
mission, objectives are required to develop a
business at a large scale and helps organization
to achieve their objectives(Kerzner, 2019.).
Strategies are required to develop business at a
large scale and helps organization to achieve

their objectives.
Conclusion
Report shows Tesla needs to use pestle analysis to know the effectiveness of external
environment to influence overall working of an organization. External environment needs to be
analysed effectively because it effects the profitability of organization, stack holders analysis
also required to know their views on the planning of projects. Swot analysis is required to know
the internal working of business and value chain helps to increase effectiveness of an
organization. Porters five forces model helps business to develop at large scale and helps Tesla to
gain competitive advantage over their competitors.

References
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