Tesla Motors DRC (TSLA34) SWOT Analysis / TOWS Matrix / MBA Resources
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Strategy / MBA Resources
Introduction to SWOT Analysis
SWOT Analysis / TOWS Matrix for Tesla Motors DRC (Brazil)
Based on various researches at Oak Spring University , Tesla Motors DRC is operating in a macro-environment that has been destablized by – customer relationship management is fast transforming because of increasing concerns over data privacy, competitive advantages are harder to sustain because of technology dispersion, there is backlash against globalization, supply chains are disrupted by pandemic , challanges to central banks by blockchain based private currencies, cloud computing is disrupting traditional business models, increasing transportation and logistics costs,
banking and financial system is disrupted by Bitcoin and other crypto currencies, wage bills are increasing, etc
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University, we believe that Tesla Motors DRC can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Tesla Motors DRC, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Tesla Motors DRC operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Tesla Motors DRC can be done for the following purposes –
1. Strategic planning of Tesla Motors DRC
2. Improving business portfolio management of Tesla Motors DRC
3. Assessing feasibility of the new initiative in Brazil
4. Making a NA sector specific business decision
5. Set goals for the organization
6. Organizational restructuring of Tesla Motors DRC
Strengths of Tesla Motors DRC | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Tesla Motors DRC are -
Ability to lead change in NA
– Tesla Motors DRC is one of the leading players in the NA industry in Brazil. Over the years it has not only transformed the business landscape in the NA industry in Brazil but also across the existing markets. The ability to lead change has enabled Tesla Motors DRC in – penetrating new markets, reaching out to new customers, and providing different value propositions to different customers in the international markets.
Ability to recruit top talent
– Tesla Motors DRC is one of the leading players in the NA industry in Brazil. It is in a position to attract the best talent available in Brazil. The firm has a robust talent identification program that helps in identifying the brightest.
Analytics focus
– Tesla Motors DRC is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the NA industry. The technology infrastructure of Brazil is also helping it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Strong track record of project management in the NA industry
– Tesla Motors DRC is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Highly skilled collaborators
– Tesla Motors DRC has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive NA industry. Secondly the value chain collaborators of Tesla Motors DRC have helped the firm to develop new products and bring them quickly to the marketplace.
Superior customer experience
– The customer experience strategy of Tesla Motors DRC in NA industry is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Training and development
– Tesla Motors DRC has one of the best training and development program in NA industry. The effectiveness of the training programs can be measured in – employees retention, in-house promotion, loyalty, new venture initiation, lack of conflict, and high level of both employees and customer engagement.
Digital Transformation in NA industry
- digital transformation varies from industry to industry. For Tesla Motors DRC digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Tesla Motors DRC has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Organizational Resilience of Tesla Motors DRC
– The covid-19 pandemic has put organizational resilience at the centre of everthing Tesla Motors DRC does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Innovation driven organization
– Tesla Motors DRC is one of the most innovative firm in NA sector.
Learning organization
- Tesla Motors DRC is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Tesla Motors DRC is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders at Tesla Motors DRC emphasize – knowledge, initiative, and innovation.
High brand equity
– Tesla Motors DRC has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Tesla Motors DRC to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Weaknesses of Tesla Motors DRC | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Tesla Motors DRC are -
High dependence on Tesla Motors DRC ‘s star products
– The top 2 products and services of Tesla Motors DRC still accounts for major business revenue. This dependence on star products in NA industry has resulted into insufficient focus on developing new products, even though Tesla Motors DRC has relatively successful track record of launching new products.
Slow to strategic competitive environment developments
– As Tesla Motors DRC is one of the leading players in the NA industry, it takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the NA industry in last five years.
Aligning sales with marketing
– From the outside it seems that Tesla Motors DRC needs to have more collaboration between its sales team and marketing team. Sales professionals in the NA industry have deep experience in developing customer relationships. Marketing department at Tesla Motors DRC can leverage the sales team experience to cultivate customer relationships as Tesla Motors DRC is planning to shift buying processes online.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Tesla Motors DRC supply chain. Even after few cautionary changes, Tesla Motors DRC is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Tesla Motors DRC vulnerable to further global disruptions in South East Asia.
Workers concerns about automation
– As automation is fast increasing in the NA industry, Tesla Motors DRC needs to come up with a strategy to reduce the workers concern regarding automation. Without a clear strategy, it could lead to disruption and uncertainty within the organization.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Tesla Motors DRC is slow explore the new channels of communication. These new channels of communication can help Tesla Motors DRC to provide better information regarding NA products and services. It can also build an online community to further reach out to potential customers.
Capital Spending Reduction
– Even during the low interest decade, Tesla Motors DRC has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the NA industry using digital technology.
No frontier risks strategy
– From the 10K / annual statement of Tesla Motors DRC, it seems that company is thinking out the frontier risks that can impact NA industry. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Low market penetration in new markets
– Outside its home market of Brazil, Tesla Motors DRC needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
High operating costs
– Compare to the competitors, Tesla Motors DRC has high operating costs in the NA industry. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Tesla Motors DRC lucrative customers.
Lack of clear differentiation of Tesla Motors DRC products
– To increase the profitability and margins on the products, Tesla Motors DRC needs to provide more differentiated products than what it is currently offering in the marketplace.
Tesla Motors DRC Opportunities | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities of Tesla Motors DRC are -
Lowering marketing communication costs
– 5G expansion will open new opportunities for Tesla Motors DRC in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the NA industry, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Tesla Motors DRC to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Tesla Motors DRC to hire the very best people irrespective of their geographical location.
Use of Bitcoin and other crypto currencies for transactions in NA industry
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Tesla Motors DRC in the NA industry. Now Tesla Motors DRC can target international markets with far fewer capital restrictions requirements than the existing system.
Developing new processes and practices
– Tesla Motors DRC can develop new processes and procedures in NA industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Buying journey improvements
– Tesla Motors DRC can improve the customer journey of consumers in the NA industry by using analytics and artificial intelligence. It can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Changes in consumer behavior post Covid-19
– consumer behavior has changed in the NA industry because of Covid-19 restrictions. Some of this behavior will stay once things get back to normal. Tesla Motors DRC can take advantage of these changes in consumer behavior to build a far more efficient business model. For example consumer regular ordering of products can reduce both last mile delivery costs and market penetration costs. Tesla Motors DRC can further use this consumer data to build better customer loyalty, provide better products and service collection, and improve the value proposition in inflationary times.
Using analytics as competitive advantage
– Tesla Motors DRC has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in NA sector. This continuous investment in analytics has enabled Tesla Motors DRC to build a competitive advantage using analytics. The analytics driven competitive advantage can help Tesla Motors DRC to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Tesla Motors DRC can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Manufacturing automation
– Tesla Motors DRC can use the latest technology developments to improve its manufacturing and designing process in NA sector. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Tesla Motors DRC to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Finding new ways to collaborate
– Covid-19 has not only transformed business models of companies in NA industry, but it has also influenced the consumer preferences. Tesla Motors DRC can tie-up with other value chain partners to explore new opportunities regarding meeting customer demands and building a rewarding and engaging relationship.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Tesla Motors DRC can use these opportunities to build new business models that can help the communities that Tesla Motors DRC operates in. Secondly it can use opportunities from government spending in NA sector.
Loyalty marketing
– Tesla Motors DRC has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Threats Tesla Motors DRC External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats of Tesla Motors DRC are -
New competition
– After the dotcom bust of 2001, financial crisis of 2008-09, the business formation in US economy had declined. But in 2020 alone, there are more than 1.5 million new business applications in United States. This can lead to greater competition for Tesla Motors DRC in the NA sector and impact the bottomline of the organization.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
High level of anxiety and lack of motivation
– the Great Resignation in United States is the sign of broader dissatisfaction among the workforce in United States. Tesla Motors DRC needs to understand the core reasons impacting the NA industry. This will help it in building a better workplace.
Barriers of entry lowering
– As technology is more democratized, the barriers to entry to NA industry are lowering. It can presents Tesla Motors DRC with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the NA sector.
Easy access to finance
– Easy access to finance in NA industry will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Tesla Motors DRC can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, Tesla Motors DRC may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of NA sector.
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Stagnating economy with rate increase
– Tesla Motors DRC can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the NA industry.
Technology acceleration in Forth Industrial Revolution
– Tesla Motors DRC has witnessed rapid integration of technology during Covid-19 in the NA industry. As one of the leading players in the industry, Tesla Motors DRC needs to keep up with the evolution of technology in the NA sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Environmental challenges
– Tesla Motors DRC needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Tesla Motors DRC can take advantage of this fund but it will also bring new competitors in the NA industry.
Trade war between China and United States
– The trade war between two of the biggest economies can hugely impact the opportunities for Tesla Motors DRC in NA industry. The NA industry is already at various protected from local competition in China, with the rise of trade war the protection levels may go up. This presents a clear threat of current business model in Chinese market.
Capital market disruption
– During the Covid-19, Dow Jones has touched record high. The valuations of a number of companies are way beyond their existing business model potential. This can lead to capital market correction which can put a number of suppliers, collaborators, value chain partners in great financial difficulty. It will directly impact the business of Tesla Motors DRC.
Shortening product life cycle
– it is one of the major threat that Tesla Motors DRC is facing in NA sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Weighted SWOT Analysis of Tesla Motors DRC Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers at Tesla Motors DRC needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of Tesla Motors DRC is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of Tesla Motors DRC is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Tesla Motors DRC to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Tesla Motors DRC needs to make to build a sustainable competitive advantage.