MGMT20132: Assessment 1 - Smart Connected Devices in Tesla Motors

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MGMT20132: Innovation and sustainable business development
Assessment 1
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Contents
Executive Summary.........................................................................................................................3
Introduction......................................................................................................................................4
Problems to be solved......................................................................................................................4
Problem Insight................................................................................................................................4
Portfolio of the solutions.................................................................................................................4
Solution selection Analysis..............................................................................................................5
Value proposition.............................................................................................................................5
Strategic fit.......................................................................................................................................6
3. Customers’ acquisition................................................................................................................6
Critical assumptions and uncertainties............................................................................................7
Innovation tools for Tesla Motors...................................................................................................7
Recommendations to Tesla Motors.................................................................................................9
Critical Reflection..........................................................................................................................10
Conclusion.....................................................................................................................................10
References......................................................................................................................................11
Appendix........................................................................................................................................13
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Executive Summary
There is a great influence of the technology on the business operations and it not only provides
tangible benefits but non-tangible benefits are also provided through this. In today’s global world
numerous technological trends are emerging and it is very significant for the business
organization to adapt with such trends in order to be competitive in the global markets and gain a
competitive advantage. “Smart connected devices” are the technological trend that has been
chosen for this project report.
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Introduction
Tesla motors are the American Company which is energy and automotive-based company
headquartered in Palo Alto, California. The company is specialized in manufacturing of electric
cars and through solar city subsidiary; it is engaged in solar panel manufacturing. All the
vehicles of tesla motors are manufactured at its factory situated in Fremont, California. Here
various components of the vehicle are also made. The focus of the project is on analyzing and
evaluating if the increase in the smart connected device will be advantageous or not for Tesla
Motors. Smart connected devices are also known as the smart connected products which are the
assets, products or other things that are embedded with sensors, processors, connectivity and
software and allow for the exchange of data between manufacturer, products, its environment,
user and other systems and products (Mohelska, & Sokolova, 2016).
Problems to be solved
Tesla Motors is suffering problems in the gathering of data as it takes much time in data
gathering and monitoring and there is a lack of connection between the products. Due to this, the
management functions of the company is impacting to a great extent (Foos, 2015).
Problem Insight
The productivity of Tesla Motors has been impacted due to the time-consuming data gathering
and monitoring. Due to the increased human intervention, no proper communication can be made
which is leading to the slow and time-consuming output.
Portfolio of the solutions
Tesla Motors can adopt any of the following solutions for resolving its problem-
 Artificial Intelligence
 Smart-connected devices
 Robots
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 5G networks
Solution selection Analysis
Among all the portfolio solution the increasing use of the smart-connected device is considered
to be the best solution for Tesla Motors. Through its use, Tesla Company will be able to be
connected with the world. The processors and sensors that are embedded in the products can be
traced easily and the collected data can be easily transmitted wirelessly. Better decisions can be
made by having more information. The safety measures can be improved by monitoring of
products (He, et. al, 2018).
Value proposition
The value proposition that will be offered by the company through the adoption of the smart-
connected devices have been described below-
1. Key partners- It includes government loans, research, and development (Panasonic and Dana
Holding), component suppliers, OEM alliances, and battery manufacturers.
2. Key activities- the key activities of the Tesla includes manufacturing of cars, car design and its
development, software development, innovational leap, and maintain ace and building of
networks of charging stations.
3. Key resources- it includes electric vehicles, inverter, effective cooling, engineering and
automation, battery system, car performance data, Elon musk, and supercharger network.
4. Value proposition- sustainable transport, premium electric self- driving cars. Solar energy
systems, advanced electric technology of the vehicle
5. Customer relationship – for maintaining the relationship the company remote cars upgrades,
sales and service centers, Free or low-cost charging network of the station, brand, and reputation,
customer service experience.
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6. Channels- sales and conference events, self-service online stores, retail stores and partner
channel galleries (Wang, et. al, 2014).
7. customer segments- Technology fans and environmentalist, green community, autopilot, Elon
Musk followers, High-end luxury (Sedan), commercial vehicles targeted towards shipping
business and transportation, Tesla followers, and fast sports car enthusiast.
8. Cost structure- the cost of research and development, restructuring cost, taxes, and interest
expense, manufacturing overhead, cost of material and labor, general, selling and administrative
cost, and manufacturing and assembly plants.
9. Revenue stream- storage segment, energy generation, automotive revenue segment, car sales,
and its servicing are the areas from where Tesla Company generate the revenue
Strategic fit
This includes the disciplined entrepreneurship canvas some elements-
1. The Raison d’etre element includes the mission of Tesla which is accelerating the transition of
world into sustainable energy by bringing mass electric cars into the market as soon as possible.
2. Competitive advantage
Due to the connection of the physical objects and digital controlling of the same with the
wireless infrastructure a large amount of control and automation in the workings can be achieved
through the use of SCD. There will be timely and faster output because of effective
communication. Tesla will be able to gain a competitive advantage due to this from its
competitors and will cover a large market share in the international global market. Tesla is
positioned strategically in the market of an electric vehicle as a high-end dealer and
manufacturer.
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3. Customers’ acquisition
The target customers of Tesla for smart connected devices will be the tech-savvy people who are
keen and have a huge interest in technology and its advancements. The company will target the
customers of all the income groups including luxury, and middle class. The customers are
acquired through marketing by retail stores, online, apps, events, and public relations.
4. Overall economics
Estimated research and development expenses of Tesla are 1500 million dollars. The products of
Tesla make a huge amount of revenues for the company by which a large amount of profitability
is earned by the company.
Critical assumptions and uncertainties
 Customer desirability- Introducing smart connected device in the Tesla Company will be
a desirable move through which a large number of customers will get attach to the
company as they will have a great experience with SCD embedded full of sensors, and
processors through wireless infrastructure. Company will be able to target a large number
of customers by which more revenue will be generated.
 Technical feasibility- SCD is technically feasible and is a very good technical trend with
which the company will earn a competitive advantage and capture more market share.
 Financial viability- It requires huge investment amount by the tesla company for
implementing increased use of SCD as there will be required by the company to provide
regular training to its employees so that the effective use of this technological trend can
be made and through which large revenue amount can be generated by the proper
functioning and operations of the company (Brackley, & York, 2019).
Innovation tools for Tesla Motors
1. Benchmarking- This tool will help Tesla motors in making a comparison of the practices of
business and performance metrics for Tesla with the best practices of other companies after SCD
increased implementation. It will also help in measuring time, cost and quality of Tesla's
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products. The specific indicator is used in the benchmarking tool for measuring the performance
that results in performance metrics which is then compared to other (Smart device partnership,
2016).
2. Internet of things- This tool is most effective for the SCD implementation as this tool is the
interrelation of computing device system, objects, digital and mechanism machines, people. It
consists of all web-enabled devices that focus on collecting, sending, and acting on the data
which is acquired from the surrounding environment by making use of embedded sensors,
communication hardware, and processors. This will enable Tesla Motors for automation and
control, effective monitoring, time savings, money savings. Daily tasks automation can lead to
the device monitoring which will allow for the avoidance of intervention of human.
3. Price optimization model- Price optimization model refers to the mathematical programs that
will help Tesla Motors in calculating the varies of demand at the different levels of prices of
products. The same data will be then combined with information related to inventory levels and
costs for the recommended prices by which the improvements in the profits will be made by the
company. Results will be monitored and data input will be upgraded for the continuous
improvement in the modeling accuracy.
4. Zero-based budgeting- This tool is the method in which the budgeting of all the expenses is
justified for each new period. It starts from the base of zero and functions of the Tesla will be
analyzed within the organization for the costs and needs. The resources allocation can be made
effectively through this tool as it is based on benefits and needs. The managers of Tesla will be a
drive for finding cost-effective ways for improving the activities. The inflated budget for the
SCD implementation can be detected easily through this (Neil, et. al, 2018).
5. Core competencies- This tool will help Tesla Company in multiple skills and resources’
harmonized combination that will distinguish Tesla from other competitors in the global
marketplace. The long term competitive advantage can be gained by Tesla through this tool so
that the SCD increased implementation can prove successful for the company and generate
revenue for Tesla. With this trend of technology, the effective data gathering and information
management can be made by the company resulting in making smooth operations of the
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company. The diversity is increased through this and Makes Corporation enables for reaching to
their full capacity.
6. Total quality management- With the use of this tool, Tesla can regularly monitor the quality
procedures and policy of Tesla that will help in strengthening the competitive position of
company, the productivity of company will also increase through SCD use which will enhance
the market image of Tesla (Carson, et. al, 2018). The focus of the company on the customers and
their improved satisfaction level can be made in an effective manner through this. SCD is the
innovative and improved process which with the help of TQM can be implemented successfully
by which the employee’s morale will also increase as the work quality will increase through this.
7. Digital transformation- This tool will help Tesla in the remodeling of the strategies of
business and to be customer-centric, innovative and agile at their core. The bottlenecks can be
removed through this tool that will exist in the current process of implementing the SCD and can
harm the company’s efficiency and its flexibility for changing with the demands of the change.
The existing processes and infrastructure of Tesla can be evolved with the cutting edge
technology through which seamless integration with the company’s data and systems can be
done (Manyika, et.al, 2013).
8. Customer relationship management- This tool will help Tesla in managing the data of its
customers effectively through the SCD use and will allow employees to be more productive and
customers will be easily tracked and their history. The growing database of the company can be
managed through this and the growth process can speed up. Good customer relations can be
established and maintained by Tesla which will allow the company to attract more and more
customers resulting in increased customer loyalty that will benefit the company by an increase in
its sales turnover.
Recommendations to Tesla Motors
Tesla Motors should implement the smart-connected device in the company very carefully and
should keep regular monitoring on its security issues as such IoT devices can be easily hacked
which can cause huge loss to the company as if the huge amount of data will be leaked then it
can be used negatively against the company causing harm to the goodwill and growth of
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company. SC devices should be put on their own monitored network and firewalled. Password
should be kept on updated by using the multi-factor authentication which will prove very useful
for Tesla. Incoming traffic should be blocked which its possible open ports should be watching
out if it is not possible (McKinsey Global Institute, 2018).
Critical Reflection
Through this business report, I got to learn a lot about various technological trends that are
emerging in the today's global world and how much they are important for being competitive and
capturing the marketplace in the global world. I also get the knowledge about the smart-
connected devices and their use and implementation requirement. I also aware of my weaknesses
and strengths and I find that I have good communication and team spirit skills but lacks in time-
management which is very essential for the completion of tasks. I also lack leadership skills
which I will improve through attending such classes and seminars so that I can learn about skills.
I will also try to grasp knowledge from my lecturers and seniors. Various innovation practices
have been developed through this report. For identifying the best technological trend that can
work effective for the problem solution of Tesla I prepare the portfolio of solutions.
Conclusion
Hence, it can be concluded from the whole report that there is the great significance of
technological innovation and trend implementation in company and the smart-connected device
will prove very beneficial for Tesla for data gathering and monitoring as it is embedded with the
processors and sensors. The productivity will get improve through this, and the assets and
resources of the company can be utilized effectively. There are various tools that if used can
make the effective utilization of the technological trend in the company.
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References
 Brackley, A., & York, B. (2019). What's next for sustainable business? Retrieved from
https://trends.sustainability.com/ Carson, B., Giulio Romanelli, Walsh, P., & Zhumaev, A. (2018). Blockchain beyond the
hype: What is the strategic business value? Retrieved from
https://www.mckinsey.com/business-functions/digitalmckinsey/our-insights/blockchain-
beyond-the-hype-what-is-the-strategic-business-value
 Foos, S. (2015). Last meter to the Internet of things. Control Engineering, 62(3), 38-39.
https://go-gale-com.ezproxy.cqu.edu.au/ps/i.do?id=GALE
%7CA410506577&v=2.1&u=cqu&it=r&p=AONE&sw=w
 He, Qingsu, Xu, Yu, Liu, Zhoubin, He, Jinhong, Sun, You, & Zhang, Rui. (2018). A
privacy-preserving Internet of Things device management scheme based on
blockchain. International Journal of Distributed Sensor Networks, 14(11), International
Journal of Distributed Sensor Networks, November 2018, Vol.14(11).
DOI: 10.1177/1550147718808750
 Manyika, J., Chui, M., Bughin, J., Dobbs, R., Bisson, P., & Marrs, a. A. (2013).
Disruptive technologies: Advances that will transform life, business, and the global
economy. Retrieved from https://www.mckinsey.com/business-functions/digital-
mckinsey/our-insights/disruptive-technologies
 McKinsey Global Institute. (2018, June). AI, automation, and the future of work: Ten
things to solve for. McKinsey Quarterly. Retrieved from
https://www.mckinsey.com/featured-insights/future-of-organizationsand- work/ai-
automation-and-the-future-of-work-ten-things-to-solve-for
 Mohelska, H., & Sokolova, M. (2016). Smart, connected products change a company’s
business strategy orientation. Applied Economics, 48(47), 4502-4509.
DOI: 10.1080/00036846.2016.1158924
 Neil, W., Zipp, G., Nemeth, G., Russo, M., & Nirschl, D. (2018). End-to-End Sample
Tracking in the Laboratory Using a Custom Internet of Things Device. SLAS
Technology,23(5), 412-422. DOI: 10.1177/2472630318783979
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