Strategic Management Analysis of Better Place - Report Example

Strategic Management Analysis Strategic Management Analysis of Better Place Introduction Better Place is a service provider in EV mobility. Better Place sells and distributes kilometres by resources of electricity, providing mobility to consumers via their charging locations and battery exchange spots infrastructure. The company has the intentions of purchasing electricity from the renewable energy resources or Carbon dioxide neutral sources such as windmills. The company has moreover established a software system to be integrated in the EVs to correspond with the network of infrastructure as well as register the consumption in kWh. The software is linked with a GPS, which gives room for the consumer to seek the battery exchange spots and the charging stations. This case study offers a strategic analysis of Better Place Company with specific considerations of the mission, vision and stakeholder’s analysis, industry and scenario analysis, resources and capabilities analysis and lastly the business and corporation strategies. Mission, vision and stakeholders Mission statement The company’s mission statement is “To end or reduce dependence on oil, by delivering personal transportation as sustainable services.” Vision statement The vision of the company is “to ensure a green alternative to gasoline-powered cars; electric-vehicle networks that are powered by renewable energy sources to provide consumers with affordable and sustainable power alternatives for individual mobility.” Stakeholders’ analysis The intention of this process is to enhance a better understanding by the students, learners as well as customers of the community and environment in which the organization operates. Better Place has instigated various projects by collaborating with states such as Australia, Israel, California, Hawaii and Denmark. This is for the intention of ensuring that its stated purposes are achieved. The stakeholders of Better Place can be mapped on a two grid matrix with the major focus on the level of interest and power held by the stakeholders. The intended stakeholders of Better Place constitute of the big three auto manufacturers in Detroit which comprise of Chrysler, General Motors and Ford. Source: (https://www.dropbox.com/sh/ocdmt4t21e4srel/W0PJOYZfvB page 1) The fourth quadrant (Key players) The big three auto manufacturers are the key stakeholders in the operations of the company in that they fall in the fourth quadrant where their level of interest is high as well as their power to control the company’s operations. The big three auto makers’ interest rests on the fact that the companies depends highly on the company for the EVs mobility. The executives and top management also fall in this class of stakeholders. The third quadrant (Keep satisfied) In addition, the customers and clients of the company fall in the third quadrant where their power in the company is very high but with less interest into the company. They normally keep satisfied with the company’s operations and products as long as they meet their needs as well as preferences. The second quadrant (Keep informed) Moreover, the employees of the company beginning from the departmental managers and the subordinates fall under the second quadrant of the grid. This is because they have high interests in the company in that they rely on the company for source of livelihood. Without the company they will have no source of income. Their power over the company depends on the collective efforts by labour unions hence individually they have less power in the company. The first quadrant (Minimal effort) The community or the society falls in the first quadrant in that the community has less interests and power over the company. The community’s interests into the company depend on whether the company implements its corporate social responsibilities which also culminates into the power of the community over the company. Industry Analysis and Scenarios Better Place created its first ever exhibition centre in Israel in February 2010. This was established in the interior of a refurbished storage tanks for industrial oil with 1.5 kilometres examination trail allowing more room for customers and visitors to steer the electric cars available. The centre for demonstration depicted the company’s grand strategy in efficiently exigent status quo in the multifaceted and unyielding industries (Agassi, 2010; page 1). It is incredible that Better Place made a decision to open market was the latest landmark in the three year history of the organization. Through this the company set up joint investments with the nationalized electric investment capital firms in Israel as well as car manufacturers, utility firms, corporate clients and battery firms to set up nationwide network of electric vehicles. Moreover, the organisation has of late declared its strategies in regard to partnerships with other companies and states in Australia, Denmark, United States, Japan and Canada. Besides, the organization has also initiated in talks with 25 other states globally. In due course the organization accumulated US $200 million in its initial round of business ventures in the year 2007, US$ 350 in the subsequent round in 2010 which was found on the valuation approximated at US$ 1.25 billion. This made the organization the second best start-up enterprise globally (Baron, & Gedalyahu, 2008; pg 3). Better Place pictured that the drivers would register for service strategy with an ERGO where electric power will be merchandized in mileage compared to the KWh. Ergo would eventually offer a menu of service strategy to their clients, similar to those provided by the operators of mobile phones. The organization also estimated that its customers would be provided three service plan tiers inclusive of fixed monthly fee, pay-as-you-go and all-you-can-drive The market research conducted by the organization established that the zenith 25% of motor drivers used up to 66% of gasoline in the United States which was believed to be real in other target states. Normal drivers would then be better placed to a program with a constant monthly charge found on the locked-in-price. This means that they would not charge higher in case the power is spiked for approximately 4 year agreement. Analogous to the mobile telephone firms, the drivers who opt to register for the top tier service scheme, tier estimate was to be $ 500 on monthly basis. This would probably help the company get a rebate for possibly clearing the capital cost for the automotive (Better Place, 2010; page 1). The medium range automotive drivers that are in a position to estimate the driving range for a year, the organization established a constant monthly scheme which assigned the predetermined amount in miles for the driver. Under the third tier, Better Place could provide the Pay-as-you-go scheme for less regular drivers. The main benefit of this scheme was that drivers would be better placed to buy mileage in small amounts same to calling cards. The main limitation was that the rest of the schemes would expose the drivers to unstable electricity prices. Resources and Capabilities At the unit level of the business of the organization the technological change and the speed of knots automotive for world rivalry is an aspect that made managers to fight in maintaining it. As markets change faster, the managers have the ability to raise their protests in regard to the strategic plans which are rather to stiff and sluggish. Schemes have also turn out to be highly problematic at the corporate phase. It has been veracity that companies have regularly experienced destruction of value by recurring tenure of the particular differences that was perceived to perfectly fit in their growth pictures. Endangered by the less categorical and smaller rivals, some company stalwarts either experienced a unique revolutionary plan or underwent a disheartening slowdown and internal deplaning (Better Place Australia, 2014; pg 2). A structure with a good potential to navigate through most of this perplexity has efficiently risen from the strategic plans. The strategies are stranded in money matters which gives an explanation of the ways in which the organization resources are in the lead of driving its operations in the increasingly evolving, diverse and rivalry setting. Therefore, the universal concept of the scholars applied to explain this scheme as the resource based perception of the firms. The organization merged the in-house evaluation of events within other partnership firms which is a fascination of considerable number of management expertise after their launch. They were launched with external evaluation of the industry and the belligerent background, the critical focus of the original strategic approach. As a result, the resource based view proceed to tolerate, even though with no particular focus of substituting the two earlier liberal view to schemes by merging together the internal and external view points. With a management that is visionary, the organization gets its business power from the managerial potential to establish transparent rationalities as to why rivals are in the lead and more beneficial. This also entails of ways of coping with the concept of fundamental ideas into empirical use and the manner in which they can be established to diversify the plans that makes sense to the organization. Features that make Better Place inventions resource helpful Source: Agassi, 2010; page 5) The competitive edge and their origin eventually can be attested to the precise ownership of worthy resources that help the organizational products to have efficient performance. These are also easily affordable, friendly to the ecological system, cost-effective in comparison with the rivals. In this case analysis, for example, the organization owns a wide range of resources that picture a way for its rivalry edge in the intended point of sale such as Australia, US, Israel and Hawaii. This is very empirical at the unit business level and at the corporate level. This is because the worthy resources may be in line with the intended or specific roles like company research functions and progress. The exceptional functions will thus be found on the growing competitive different group of resources and utilizing them in an efficiently planned scheme (Better Place in Japan, 2010; Page 1) Business and Corporation Strategies As a profit based organization, Better Place made strategies to recognize and originally focus on the actual locations with highly consumer sensitive and recognizable strong preferences for the EVs. These comprise of Israel with 57% of contacted drivers, 35% in Canada, 30% in US, 40% in Denmark and 39% in Australia (Barron, 2008; page 47). The organization also picked other small states as well as Islands as point of focus for running their programs and business strategies and technologies in the affable background found. Reasons for the selections Islands were visualized by the firm in their operations and corporate plans as places with high population number and constrained traffic congestions. The Israel’s customers for instance are concentrated with approximately 10,000sq. Kilometres. This region has over 85% of the drivers commuting not more than 70km every day and urban areas with not more than 150km between them. The automotives over the nation’s boundaries can be ignored. Denmark on the other hand was anticipated to be the next location for the organization in 2011. The DONG energy in Denmark was also growing its renewable power blend whilst the state had devoted to incentives on EVs programs. This was already declared by the CEO of the company in Copenhagen during the conference on climatic change. The organization devoted with other regions also like San Francisco and Hawaii islands. Hawaii is making consideration to import oil to satisfy its 90% energy consumption and the premier gasoline prices amongst the US states. Therefore the state launched the Hawaii Clean Energy Initiative (HCEI) to operate with the department of Energy of US in developing clean energy options for satisfying the 70% of the energy needs by the state by the year 2030 (Better Place Global, 2010; page 5). Furthermore, Better Place has created ERGO software to harvest better returns from the synchronization of the utility software which gives room for domestic grid to establish the average assignment of energy to automotives in the course of rush hour and off peak hours. The organization has also started creating software to monitor information, converse with the grid and distribute the electric power as the demand goes down hence reducing the costs of spikes in the demand for the energy (LaMonica, 2010; page 41). Found on its view that it could potentially add valuable utilities, the organization is working in collaboration with utilities to establish a lasting venture schemes in the clean energy and renewable energy (Voelcker, 2009; page 13). For instance Israel has devoted to have 10% of its electric energy extracted from the solar energy by the year 2020. The Electric Corporation of Israel set up a committee which is headed by the vice president of the engineering programs to supervise and promote the current communication amid the IEC and Better Place Company. Toronto in Canada has had the organization hold discussion with Bullfrog Power as a provider of electric power to offer total renewable and clean energy (Barron and Gedalyahu, 2008; Page 17). Bibliography Agassi, S. (2010). “Why Electric Vehicles Work.” http://www.thomascrampton.com/china/shai-agassi-electric/ Baron, L. & Gedalyahu, D. (2008). “IEC in Better Place Talks.” Globes, 3rd Jan. 2014 Barron, R. (2008). Better Place Yet to Close Hawaii Electric Car Deal. Greentech Media, 3rd Jan. 2014 http://www.greentechmedia.com/articles/read/better-place-yet-to-close-hawaii-electric-car-deal-1538/ Better Place Australia, (2014) Better Place research reveals Australian interest in Electric Vehicles in response to climate change concerns. Better Place, 3rd Jan. 2014 http://australia.betterplace.com/assets/pdf/Better_Place_Australia_Consumer_Research_Release.pd Better Global, (2010)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 Better Place Israel (2014), Global Progress: Israel. “Better Place opens first electric vehicle demonstration centre.” Better Place, 3rd Jan. 2014 < http://www.betterplace.com/global-progress/israel/> 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 Better Place Japan (2010) Renault Nissan Alliance Signs Partnership with Saitama City to Promote Electric Vehicles.” Japan for Sustainability, 3rd Jan. 2014 http://www.japanfs.org/en/pages/029696.html Voelcker, J. (2009). “Driving Electric To Cost No More Than Using Gas, Says Better Place.” Green Car Reports, 3rd Jan. 2014 http://www.greencarreports.com/blog/1035839_driving-electric-to-cost-no-more-than-using-gas-says-better-place Read More