Mission, Vision, and Stakeholders of Better Place - Essay Example

? Better Place Lecturer: Mission The mission of the Better Place is to promote personal transportation as sustainableservices, aiming at ending or reducing dependency on oil. Vision The vision is to stabilize individual mobility through availing affordable and sustainable power alternatives such as the electric-vehicle networks that are powered by renewable energy sources. Stakeholders The intended stakeholders included General motors, Ford and Chrysler, also known as the ‘Detroit three’. Based on its perception that it could add value to utilities, Better Place was working closely with utilities to develop long term investment plans in renewable and clean energy. Israel, for example, had set a goal to have 10 percent of its electricity sourced from solar power and renewable energy by 2020. Israel Electric Corporation established a committee led by the senior vice president of engineering projects, Yakov Hain, to facilitate ongoing conversations between IEC and Better Place. Hawaii Electric Company announced a non-exclusive agreement with Better Place to invest in renewable energy and establish a recharging network connected to the grid, yet the utility noted its open-mindedness to engaging with similar companies. In Toronto, Canada, Better Place held talks with Bullfrog Power, an electricity provider that provided 100 percent renewable and clean energy sources. Spain and Portugal were also prospective locations as Better Place projected a demand for 50,000 plug-in electric cars in the region by 2011. As of early 2010, the company had begun establishing partnerships and carrying out market research to assess the feasibility of entry into regions with fewer boundaries and more factors inhibiting the transition to Electronic vehicles. Industry Analysis and Scenarios Better Place put up its first exhibition centre in Israel, February 2010. It was constructed in the interior of industrial oil storage tanks, which had one and a half kilometer test tracks for the available electric cars. The trade fair centers provided peculiar podiums through which the institution’s ambitious strategies of the industry would be presented, thus bringing to a halt, the domination in the automobile manufacturing industries. The most remarkable and an up to date highlight in the industry’s proofs is the invention of a bazaar, all the way through which it had entered into partnerships with Israel’s nationalized electric venture resources’ firms, services, car manufacturers, battery companies, corporate consumers and the Israeli government to make steady the electric automobiles’ networks nationwide (Better Place, 2010). Better Place organization also made pronouncements beforehand to initiate partnership with Denmark, the United States, and Canada, Australia, and Japan administrations and make proficient engagements in discussions with twenty five other different governments all over the world. In 2007, Better Place, as an organization make a realization of an enterprise-investment-endowments of approximately two hundred million US Dollars in its principal encompassing of businesses, and three hundred and fifty in 2010. These achievements were based on 1.25 billion dollars valuations and made it the second largest get underway in history. As already in the earlier statement, this organization’s mission was thus focused on drastically reducing and eventually eliminating the custom and sole dependency of automobile industries on oil (Global Progress, 2010). As a mean of forging ahead, Better Place envisaged that its shoppers would be presented with three tiers of services’ fixed monthly payments, which include: plans–all–you–can-drive, and pay–as–you-go. Within this aspect, Better Place had think about automobile drivers being in a position to in most instances prefer service plans with an ERGO in which electricity is virtually put up for sale in miles as opposed to in kilowatt hours. At this rate, it is determined that ERGOs would be in the best position to effectively make available menus of services and their plans to their consumers, and equivalence to those provided by the mobile telephony machinists (http://www.japanfs.org/en/pages/029696.html). Based on the conceptualized study and analysis that this company’s market research where approximately the top 25% of drivers guzzled 66% of gasoline in the United States of America, and further considered this quotient to be largely accurate as main in the case of other marked market regions. A number of drivers would hence be best set to programs of some fixed monthly fees that are additionally founded on locked - in prices, for approximately 4-years contracts. comparable to cell phone organizations, drivers with preferences on signing up for the pinnacle tier service plans, calculated to be approximately five hundred US dollar monthly, would in most instances be in prime positions to achieve reimbursements from the Better Place organization, potentially counterbalancing the entire capital costs of automobiles (Cars, 2008). The next tier to be held out by the Better Place Company was the pay-as-you-go plans, for less frequent drivers, although with the intension of controlling and projecting better frameworks for the new entrants’ threats, and having better buyer power grip. The key advantages of these strategies were to enable drivers to be in good positions to effectively procure miles in smaller quantities, comparable to calling cards. However, the drawback was that, unlike the other two plans, these drivers would be exposed to fluctuating electricity prices. For medium-range drivers that were able to predict their yearly driving range, Better Place created the fixed monthly fee plan, which allocated the driver a pre-determined amount of miles. Resources and Capabilities Better Place’s management plans to completely make over personal transportation has been depicted as a revolutionary, and naysayers encountered with some little complicatedness in unearthing potential flaws in their business models. These hurdles included technological obstacles, such as standardization of battery size and location in vehicles, necessary for automated battery switching. Others called into question the freedom of movement that Better Place customers would really enjoy, citing the high costs of roaming that often characterized mobile telephony. Yet others cautioned that widespread adoption of Electronic vehicles would place unbearable loads on the electric grid, causing large scale power failures. More fundamentally, critics questioned whether Better Place could actually turn a profit, and the extent to which it required subsidization from governments and utilities. By piloting the concept in several small regions, Better Place hoped to iron out the wrinkles that would undoubtedly surface as the first cars were deployed. However, as the launch in Israel loomed near, the main questions the company needed to answer were its capacity to create value and its capacity to capture it, especially over the long term. Peering into the future, Electronic vehicles could offer additional value as a way to capture and store renewable energy. One of the greatest barriers with renewable energy was that wind and solar energy are intermittent; therefore, to fully capture these sources, utility companies needed large batteries to store excess energy for use when production was low (night- time and windless periods). Denmark for example, already produced 20 percent of its energy from renewable sources but was required to export electrons when production exceeded demand, due to lack of adequate storage capacity. Since the typical vehicle is parked for 90 percent of the day, it constituted a potentially ideal source of renewable energy storage for utility companies. By partnering with an ERGO, a utility would not be required to jettison excess production, because capacity could be stored in car batteries, assuming car owners were given an incentive to provide storage services. And indeed, “smart grid technology”, which utilities had started developing, would allow drivers to buy energy from the grid when their car required recharging and sell to the grid when the battery was full (LaMonica, 2010). The Better Place organization combined the in-house analysis of phenomena within other collaborating companies a fixation of quite a number of management experts since its initiation with the external analysis of the industry and the aggressive environment, the fundamental focus of earlier strategy approaches. As a consequence the resource-based observations continue to put up, although with no intentions of replacing, the two previous expansive approaches to strategies by bringing together both the internal and external points of view (Baron, & Gedalyahu, 2008). With a visionary management, Better Place derives its business strength from its managerial strategic abilities to make clear reasons as to why its competitors are in the forefront and more profitable, how to cope with the idea of core competences into practice, and how to build up diversification strategies that are sensible. (http://www.etsap.org/E-techDS/EB/EB_T02_Adv_diesel_eng_gs-gct%20_TP_.pdf) Business and Corporation Strategies Being a profit making business, Better Place strategized to identify and initially concentrate on the precise regions with immensely high consumer consciousness and identifiably stronger demands for the electronic vehicles; and these included Israel of which 57% of the interviewed drivers expressed their interests and willingness to acquire Electronic vehicles as their next vehicle. Other regions included countries like Australia 39 percent, Denmark 40 percent, Canada 35 percent, and the United States 30 percent. However, other regions were never left out totally. The Better Place organization further selected other several small countries and islands as strategic points of rolling out their business model and technology in the best congenial settings available. Reasons for these selections were distinct. (http://australia.betterplace.com/assets/pdf/Better_Place_Australia_Consumer_Research_Release.pd.) Islands, in the first place, were conceptualized by the company in their business and corporation strategies as regions with some high population densities and limited traffic to off-island destinations. Israel’s population, for example, is concentrated within roughly 10,000 square kilometers. Ninety percent of drivers commute less than 70 kilometers each day and urban centers are generally less than 150 kilometers apart. Vehicle travel outside the country’s borders is negligible. Denmark was expected to become the second Better Place Island in early 2011. In Denmark, DONG energy was expanding its renewable energy mix while the government had committed to EV incentive programs (Bailey, 2010). The CEO of Better Place Denmark, Jens Moberg, had already announced the company’s plans for rolling-out its charging infrastructure in the capital, Copenhagen. Better Place had engaged with other islands as well, including Hawaii and the San Francisco Bay Area. Hawaii was importing oil to meet 90 percent of its energy needs and had the highest gasoline prices of any US state. The state had launched its Hawaii Clean Energy Initiative (HCEI) to work with the US Department of Energy to develop clean energy alternatives for meeting 70 percent of the state’s energy needs by 2030. Australia, the largest island in the world, was also attractive for Better Place, which perceived it to contain three major urban centers connected by a single freeway, making it particularly suitable for the Better Place model. Better Place envisioned that utility companies would play a key role in mainstreaming Electronic vehicles and provide much needed support by laying underground electric cables, providing lighting fixtures, and installing other infrastructure. In order for ERGOs and utilities to reap the greatest benefit from the model, ERGO software would need to be synchronized with utility software, allowing the local grid to determine optimal allocation of energy to vehicles during peak and off-peak hours. Better Place had begun developing software to track data, communicate with the grid and dispense electricity as demand fluctuated, thus minimizing costly spikes in electricity demand (Barkat, 2010). In order to manage this data flow process, the cars’ onboard computers would be linked to a data system that would recognize when a car was hooked up to the grid. By establishing communication, the ERGO would have the capacity to complement the grid so that the bulk of recharging could take place during off peak hours (Khal, 2010). Bibliography “Advanced Diesel Technologies.” Energy Technology System Analysis Program, Jun. 2009. Bailey, D. (2010). “Nissan: electric cars could shed government aid in 4 years”. Planet Ark, 28 May, 2010 Barkat, A. (2010). “Israel Corp to Triple Electricity Production to 1200MW.” Globes, 23 Feb. 2010 Baron, L. & Gedalyahu, D. (2008). “IEC in Better Place Talks.” Globes, 26 Aug. 2008 Better Place research reveals Australian interest in Electric Vehicles in response to climate change concerns. Better Place, 23 Jul. 2009 http://australia.betterplace.com/assets/pdf/Better_Place_Australia_Consumer_Research_Release.pd Better Place drives through $83m. Globes, 25 Mar. 2010 http://archive.globes.co.il/searchgl/Better%20Place%20drives%20through%20$83m_h_hd_2L34oC3CrCbmnC30mDJGvE34rBcXqRMm0.html “Cars.” World watch Institute. Washington, 2008. http://www.worldwatch.org/node/1480 Global Progress: Israel. “Better Place opens first electric vehicle demonstration center.” Better Place, 11 Feb. 2010 < http://www.betterplace.com/global-progress/israel/> Khal, M. (2010). “Mass market electric vehicles: there is much to be done.”Automotive World, 31 Mar. 2010 LaMonica, M. (2010). “Better Place raises $350 million, first projects on track.” Cnet News, 25 Jan. 2010 http://news.cnet.com/8301-11128_3-10440341-54.html Renault Nissan Alliance Signs Partnership with Saitama City to Promote Electric Vehicles.” Japan for Sustainability, 9 Feb. 2010 http://www.japanfs.org/en/pages/029696.html Read More