Reference no: EM131689340

Response 1:

The five forces include rivalry, savvy customers, suppliers, new entrants, and substitutes. The biggest thing that I see coming in the car industry is the increasing use of car sharing as a substitute. Coupled with autonomous vehicles it is looking likely that in the future we will not necessarily own cars, but order an autonomous vehicle to bring us where we need to go, when we need to go. This means that Tesla and all car manufacturers will need to have a strategy that either takes advantage of this, or reduces the risk. My recommendation for Elon Musk would be to ensure that he is working on a model that not only accounts for car ownership, but ride sharing. His customer might end up being a company that owns a fleet of cars, versus a consumer. The US car industry was built in the Midwest, specifically the Detroit area.

Thus, the car supplier industry has predominantly built itself in this area. Detroit itself has become an ecosystem of car manufacturing. From companies that develop software to companies that make hubcaps. Detroit was is also in close proximity to steel and metal fabrication. I see this a supplier advantage for Tesla's rivals like GM and Ford. My recommendation for Elon Musk would be to carefully analyze its supplier base and ensure that potential unforeseen risks associated with supply are accounted for and plans are created to understand and mitigate this risk.

California is also known for automotive technology, but what does this mean for the car industry that is not have a combustion engine. Are their weaknesses, risks, or even the risk of backward integration. That is the question I would ask and answer if I were Musk. Ride and car sharing is going to change the who the rivalries are and is going to change the entire car supply chain.

If people don't need cars do we need dealership? Probably not. However, someone is going to have to own, operate, maintain, and fuel these electric autonomous cars. What I foresee happening is a consolidation of the industry where GM, Ford, and others will have locations where these cars will parked, maintained, and fueled when not in use. So rather than car manufacturing the core rivals of Tesla might end up being fleet management systems and they might even end up being GM and Ford through backward industry integration. If this is the case Musk needs to look into the future and determine who the future rivals will be and on what basis will the compete.

In the fleet management business, we will certainly have companies that will compete on price and will have lower end, fewer thrill vehicles. Conversely, there almost certainly will be a luxury service with more amenities and comforts in the vehicles. Because Tesla is a higher end car Musk should plan to stick with his core competency of differentiation, have luxury cars, versus low end price driven cars. I may be crazy, but I really think that this is where the car industry will be in years to come.

Response 2:

Hello Class, Globalization has made massive changes to the competitive landscape for every business. As countries open their boarder to international trade and even improve the conditions for trade and allow organizations to establish operations in those countries the opportunities for expansion and challenges are endless and as more changes are done to the political and economical landscapes internationally globalization will continue to change how organizations do business (Hitt & He, 2008). As globalization becomes the norm and companies need to expand to stay competitive the same goes for WalMart. WalMart has been able to source new and different products from around the world in an effort to give their customers more options.

Another side effect of globalization as a whole gives WalMart more products on their shelves. For example, I live in a college town where many exchange students, for a few semesters stay at the college or full-time foreign students make residence, has forced local businesses including WalMart to start stocking foreign cuisine to cater to the needs of those students and their families. An added benefit for those like myself, who love Japanese for example, benefits greatly from the increased food selections if I didn't want to order the products online. Another great example of how WalMart is positively impacting the international scene is through it's distribution methods being deployed in countries who are not used to advanced supply-chain and distribution methods.

Some of the factors WalMart faces that negatively impact the organization is the increased HR responsibilities and legalities in having stores internationally including adopting to local customs and expectations. Some of the problems and gains that may even fall with using local suppliers is using ethical sources and giving local business an opportunity to sell their products to WalMart where WalMart would have shut them down had they not restructured their strategy with produce or local merchandise that are popular in the area. For example, I watched a video on WalMarts in China that adopted to the local custom of having baskets of fresh locally caught fish delivered to the store daily. This is a great benefit to WalMart establishing themselves internationally.

Another negative impact from globalization WalMart has had to face is the global ecommerce. WalMart for many years was reluctant to look outside the competitors they could see; such as Target and Kmart. In this weeks lessons we learned that one of the biggest mistakes is to not look at the disruptor's that could be lurking in the shadows known as oblique competition (WK 3 Lecture 1) and that happened to be Amazon and the powerhouse Amazon became. WalMart was late to the ecommerce game and paid dearly for this. Ecommerce shorterned the globalization distance even more than before.

There were no boundaries between counties anymore; consumers could sit at home anywhere in the world and buy almost anything from anywhere and have it delivered to their home. WalMart is still catching up to the disruption Amazon has caused, but the impact still negatively impacted WalMart and created a negative stir that looked like the giant was going to be de-throned.