Learning from Tesla’s Strategy
A simple, strong strategy statement
Dear Strategist,
What does a great strategy look like?
I know... Elon Musk has been discussed a lot lately, but still… here’s one of my favorite (public) strategy examples: Tesla. Their 2016 strategic “Master Plan, Part Deux” – in short - read like this:
“Create stunning solar roofs with seamlessly integrated battery storage
Expand the electric vehicle product line to address all major segments
Develop a self-driving capability that is 10X safer than manual via massive fleet learning
Enable your car to make money for you when you aren’t using it”
I hear you saying: “Is this already a strategy?” and you are probably right. It’s a very condensed version of a strategy. I like it because it illustrates several characteristics of a good strategy.
It’s clearly ambitious (”stunning”, “seamless”, “10x safer”, “car to make money for you”) - to motivate high performance.
It conveys a clear focus on “where to play” (solar roofs, electric vehicles in all major segments) and “how to win” (“stunning”, “seamlessly integrated”, “10x safer than manual”, “make money for you”). The clear priority of safe autonomous driving is particularly fascinating.
It clarifies Tesla’s differentiation: No mention of horsepower, car design, comfort or even price like other carmakers.
It has a strong strategic logic (“expand” fleet to enable “massive fleet learning” to enable “10x safer” self-driving capability to enable customers “to make money”). Employees will know why they are relentlessly work on certain projects and features. (How solar roofs really fit in, remains unclear.)
Tesla’s strategy is surprisingly simple. Just four one-line sentences. The simplicity makes it amazingly strong and powerful.
Practical strategy nugget to take away: If you can’t articulate your strategy in 4-5 compelling sentences - are you already clear enough? Pro top: Challenge yourself - try prose, not bullets.
Let me know your thoughts and reactions,
Sebastian