Tesla vs The World: Revolutionizing The Car Buying Experience

Showroom

It’s beginning to look like Tesla Motors’ CEO Elon Musk’s vision of becoming the world’s first mainstream electric car manufacturer is coming to fruition.  “Tesla” has been the top buzz-word in the news covering financial markets for the past few weeks now, and it has not been losing any steam, especially following a 99% rating by Consumer Reports on its Model S.  Tesla stock has already soared by nearly 175% this year.  Due to Tesla’s successes, both investors and consumers are gaining more faith in Tesla and its products.  Along side its stock price, Tesla has also been experiencing increases in sales after winning Motor Trend’s Car of the Year Award, and introducing its own financing program in a partnership with Wells Fargo.

The successes of Telsa Motors is proving to be too much pressure for the conventional car dealership, indicated by a proposed North Carolina bill to ban Tesla Motors galleries in the state.  Unlike car dealerships that make their profits by purchasing their cars at wholesale prices from the manufacturer, and then marking up the prices for the ultimate consumer, Tesla uses a direct-sales method to get their consumers behind the wheel of their machines.  The bill, which has just passed the state Senate, would ban manufacturers from selling their cars without going through a dealer.  Now, if you want to purchase a Tesla car, you can go to their gallery showroom, meet with a representative, choose your configurations, and make the purchase on-site through their website. There are many reasons why these dealers might be pushing for the Governor’s signature on this bill, but I am confident that it has nothing to do with simply playing by the same rules that other dealers are playing by.  Currently, in North Carolina, it is already illegal for an automobile manufacturer to sell their cars without doing so through a dealer, so what would this bill change?  Under current legislation, Tesla still has the criteria of being considered as a car dealership.  The bill would declassify Tesla as a dealer, since it prohibits manufacturers from making sales “using a computer or other communications facilities, hardware, or equipment”.  Tesla is the only manufacturer that uses this as their sole method of selling cars.

Tesla’s products aren’t the only revolutionary aspect of their business.  This buying experience eliminates the need to sit at a dealership for hours, trying to get the price of a car down to a reasonable number, while the salesperson makes multiple runs to the coffee machine, AKA “the manager” during negotiations.  Instead, you go to the showroom, sit in the car, choose your options, and place your order.  Whatever price you pay at the showroom, is the lowest price you’re going to get. No haggling necessary. Is this simply an effort by conventional dealerships to rid Tesla of its competitive advantage, or is it a sign of their hope to have Tesla models in their own lots, and cash in on their growing successes?

Source: http://gma.yahoo.com/teslas-direct-sales-business-model-targteted-n-c-170402561–abc-news-money.html
Image:  http://global.networldalliance.com/new/images/article/tesla_2.jpg

 

 

Project Managers vs Workers

During our first class, we got to do our first exercise. This exercise was making the paper puppets. Though I was not involved with the workers or even the timer guys. I was observing the whole operation. The teacher acted like the project manager, and 5 class colleagues were doing the assembly line workers job.

During this exercise, each worker was given a task to be done. The teacher was putting pressure on them as she was acting like the project manager. As a result, they were trying hard to finish as much paper puppets as possible. I was observing the behavior of each worker, since the last three workers were sitting idle until the second worker finishes her job. Her task was a longer task than the rest, thus she was a bottleneck. The class was fun and we have learned a lot.

Some of what we have learned from this class was:

  • The way you layout the operations space, is going to influence the production and product quality, it even influences the communication between the workers. During our exercise, though they were close to each other, each worker was only talking to the one right next to him/her.
  • During the exercise, the first worker tried to optimize the way he worked but the project manager which is the teacher told him to follow the process. This teaches us that if we ever want to  re-engineer a process, we need to talk to the workers. They see the obstacles, they most probably know how to optimize their work.
  • During the exercise, the workers found defected paper, but due to the pressure, they passed it on just to finish the process. What we could learn from this, when project managers or management puts so much pressure on workers, workers will have ethical issues and lead to high rate of defected products.
  • After we were done with the exercise, the teacher asked the workers how did they feel about their work load. Some said they were doing so much work, others said they didn’t have to do much. It is probably one of most faced issue with operation workers. Work isn’t divided equally among workers.
  • We also have discussed what we could have done to help our second worker which she had more complicated work to do, we have came with so many solutions which seemed to help, like hiring one more worker with her. Or distributing the work among other workers too.
Here are some pictures that I took during class while we were doing the exercise: (Note: Some faces are blurred because they asked me to blur their faces). Edit: One more colleague asked for her picture to be blurred., so I re-uploaded the images.