Case Study : Supply Chain Management of TESLA Company

Supply Chain Management

SCM (Supply chain management) has become an important element of any company's

ability to grow and retain competitiveness and customer satisfaction over time. Supply chain

efficiency, as well as the design and implementation of initiatives for boosting performance and

accuracy, are critical for today's enterprises. The Tesla supply chain approach has earned a lot

of attention. Some of it is positive, while others are negative. The positive comes from Elon

Musk's revolutionary vision for his firm and the prospects of a full network of suppliers; the

consequences come from Tesla's failure to fulfill its expectations and the well-publicized

manufacturing delays caused by a supply chain meltdown. Into something an efficient supply

chain plan may make all the difference in any business, but notably in the automobile industry.

This is particularly true for Tesla Inc., an American manufacturer situated in California that lacks

the necessary connections with its small supply base. As a consequence, Tesla would gain

greatly from a more efficient supply chain in terms of reaching production objectives and

producing expected profits. Tesla was founded in 2003 with the mission of inventing,

constructing, and marketing all-electric automobiles. Tesla's CEO, Elon Musk, intends to create

500,000 cars per year by 2018 and one million cars per year by 2020 as part of the product and

service program.The Firm is developing its assembly line tactics through its corporate structure

and global activities in order to meet sales goals.

Tesla’s Mission Statement

There are three parts to Tesla's mission statement. "To expedite the advent of

sustainable transport by bringing appealing bulk electric cars to markets as quickly as possible,"
Tesla founder Elon Musk said when the firm was founded. Tesla's effective industry is built

around this aim.

Tesla is a disruptive innovator and forerunner in the field of electric vehicle manufacturing. In the

transportation sector, the corporation is accelerating technological and operational

transformation. Its unique smartphone-style updates enable the corporation to quickly debut

technology with defects and continuously improve it through upgrades. This strategy enables for

quick expansion. Tesla is a global force in the field of electric vehicle technology, and it leads

other automakers from the front. Tesla is transforming the global transportation sector and the

world's energy sources from dirty combustion engines to sustainable and environmentally

beneficial alternatives. Its competitive advantage is bolstered by its energy-efficient electric

vehicles and global network of Superchargers and Destination Chargers. Tesla demonstrates its

dominance in the automobile manufacturing industry in this section. Tesla's business strategy is

based on persuading other manufacturers to comprehend the concept of electric vehicles and

appreciate the benefits of green energy in the twenty-first century. As a result, Tesla devotes all

of its resources and ingenuity to bringing this to fruition. Tesla has a global ambition to persuade

the world to embrace electric vehicles. In fact, the company's growing patterns demonstrate

how dedicated it is to realizing its objective of globalizing electric automobiles. Tesla, for

example, has established manufacturing facilities in a variety of locations throughout the world.

[1]

Goals

Operations managers concentrate on how the company's goods affect costs, quality

goals, and resources in this strategic decision area. Tesla Inc. handles this risk in this company

study case by continuous discovery, which entails concurrent invention in several sections of
the car, battery, and solar panel industries. Tesla's operations management is also focused on

electric vehicle research and production, such as through maximizing organizational capacity for

developing electric vehicles and parts. Operations management is concerned with achieving

optimum resource and data flows in this critical decision area. In the case of Tesla, patterns are

created to maximize the capacity of facilities, particularly those utilized to manufacture electric

vehicles. Additionally, for internal memos, the corporation uses advanced computing and

networking technologies. These methods help Tesla's operations become more productive. In

its production activities, the corporation also reduces the distances between middle processes.

Operations managers concentrate on enough supply and a well-functioning supply chain in this

strategic decision area. Tesla maintains a global supply chain to support its production facilities.

[4] [2]

Tesla’s Operational Unit Method

The operational goal of Tesla reflects the company's vision and strategy. It emphasizes

the company's commitment to renewable energy and can aid in the company's mission. Tesla's

business vision, encapsulated in its objective statement, reaffirms the company's dedication to

producing high-quality electric vehicles. It will use 21st-century technologies to create the best

and safest vehicle company in the world while also facilitating the global adoption of renewable

and sustainable energy. Tesla has a detailed operational strategy in place to reach this goal.

Tesla's goal is to become the best car manufacturer in the world. It is dedicated to

creating the greatest items for its clients all around the world. Tesla's employees are also bound

by this pledge. After 90 days of ownership, the study unofficially polled 87,282 new automobile

buyers and ranked them based on their responses. Tesla built robust testing procedures to

handle product concerns in order to build the best automobile company. Its global rollout of
standardized reporting and trending for all plants, assembly lines, and factories, resulting in

better visibility of corrective measures. Tesla's enhanced market in the Energy APEAL Study,

which takes both objective and subjective factors into account. Tesla involves its employees and

other stakeholders in the implementation of mission-critical procedures in order to construct the

world's best auto company. Employees at Fremont Factory and other sites can help spot

problems and make recommendations through the company's early symptom intervention

programme. However, ensuring perfection while meeting tight deadlines is difficult. Tesla places

a premium on safety and is constantly improving its manufacturing procedures based on

knowledge gained from prior models. The automaker uses cutting-edge techniques to develop

life-saving risk management solutions, such as its latest "Find It-Fix It" program. The

organization has previously struggled with quality difficulties, ranking worst in the J.D. Power

Initial Quality Study in 2020.

In the past, Tesla has tried to do things a little differently, but it hasn't always succeeded.

Tesla avoids traditional manufacturing phases by using a vertically integrated supply chain to

design, build, sell, and repair its cars. Tesla's specialized supply chain is working to reorganize

its Fremont Factory so that high levels of robotics automation can be included into different

methods. Tesla's key source of value creation is its significant use of automated robots and a

well integrated supply chain. The joint development robot will allow Tesla to include smaller,

normally outsourced subsystems into their manufacturing process, enabling for faster

turnaround and shorter product improvement cycles.

Tesla's mission and vision statements have evolved to reflect the company's plan of

transitioning to the production of electric vehicles rather than gasoline-powered vehicles. The

mission statement defines the planned operations to enable the organization to attain its goals,

whereas the corporate goals statement simply presents the firm's future roadmap. Tesla's

mission statement outlines what the organization would do to improve the efficacy of the firm
and its advertising, while its aim statement suggests that it intends to lead other vehicle makers

into the electric model future. [3]

Conclusion

The Tesla industry employs productivity metrics derived from the manufacture of autos,

batteries, and solar panels. For its services and corporate office operations management, the

corporation also applies productivity criteria. These criteria or indicators are used to evaluate

performance and strategic effectiveness in international businesses. Tesla's operations

management automates large portions of the supply chain as a carmaker that focuses on

manufacturing in the United States, while also looking for strategic partners in the sector.

Quality-oriented activities management techniques are used to make inventory decisions at

Tesla. The goals of this strategic decision area of operations management are material

efficiency and higher productivity. Because of its diversification, the company can quickly ramp

up production in response to rising market demand for electric vehicles. Thanks to these

operations management approaches, Tesla's productivity is resilient and adaptable. Tesla, in a

sentence, owns everything. To meet the customer's requirements.

References

[1] David, F. R., & David, F. R. (2003). It’s time to redraft your mission statement.
Journal of Business Strategy, 24(1), 11-14.

[2] Mangram, M. E. (2012). The globalization of Tesla Motors: a strategic marketing plan
analysis. Journal of Strategic Marketing, 20(4), 289-312.

[3] Swink, M., Melnyk, S. A., Hartley, J. L., & Cooper, M. B. (2017). Managing
operations across the supply chain. McGraw-Hill Education.

[4] Holweg, M., Davies, J., De Meyer, A., & Schmenner, R. (2018). Process Theory: The
Principles of Operations Management. Oxford University Press.