Value Innovations launches iTRANSFORM™

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iTRANSFORM will focus on transformation of global businesses

The launch of iTRANSFORM was stimulated by the work of a 12-person team of Value Innovation experts studying the global automotive industry.  The team’s goal was to understand the changes and dynamics of disruptions in play.

Using tried and tested scenario planning tools the team found it needed a new toolset to understand and manage the complex issues shaping the auto industry.

The team stopped using “Disruption”, “Disruptor”, “Axes of Certainty” and “Axes of Uncertainty” and moved to using “Transformation” and “Transformation Axes.”  It moved away from considering all the key players who would be impacted by a transformation from the internal combustion engine to the electric motor as a power source for cars and trucks, e.g., oil companies and utilities.  Focus on transformations led the team over a period of four months to identify and define Six Transformation Axes.

As we have progressed the Six Transformation Axes have withstood the test of time and recognized subject matter experts in the field are confirming our selections.

For each Transformation, the end state is clear. What’s not clear are:

  • Timing – When will we reach the end state?
  • Path forward – How will we reach the end state?

Auto manufacturers, auto dealers and Tier 1/2 parts suppliers have no control over the Six Transformations but with careful planning, they can manage through them, and will survive and thrive.

For more on the 6 Transformation Axes, view our 6.5′ video

iTRANSFORM is a Value Innovations, Inc. trademark.

iTRANSFORM overview of Tesla Motors and its BEVs

We started to follow Tesla Motors in 2010.  At that time they were producing the Roadster to demonstrate that Electric Vehicles looked great and were very exciting to drive.  They were far more than golf carts.

Production of the Roadster ended in 2010 to allow for the re-tooling of the Fremont, CA plant to produce the S Sedan.  The total number of Roadsters manufactured was approx. 2,300.

The first S Sedans came off the Fremont line on June 22, 2012.  Today the S Sedan is rated:

  • #1 in Customer Satisfaction by Consumer Reports
  • The safest car ever tested by NHTSA.

The S and X models were the best selling #BEVs in the US in 2017 followed by the Chevrolet Bolt, Nissan Leaf and BMW i3:

Source: CleanTechnica

With the S Sedan and X SUV, Tesla has now captured 33% of the US luxury car market.

At the time we published this blog, 2017 European BEV sales by model were not available.  2016 results are provided below.

Source: CarSalesBase.com website

 

The Tesla Model S was #3 behind the Renault Zoe and the Nissan Leaf.

Today there are >300,000 Tesla EVs are in the hands of consumers around the world and by the end of 2018, it is likely this number will rise to 550,000 units.

The final number will be highly influenced by Tesla’s ability to resolve its Model 3 production problems during 2018.

Source: Tesla website

iTRANSFORM overview of Tesla Motors’ detractors

Many key decision makers see Elon Musk as Satan and his company as the “Evil Empire.”  It goes far beyond emotion,  These players are convinced that Tesla will run out of cash and be forced to close its doors. Many are short sellers of #TSLA stock and just in 2018, they’ve lost $1B.

Many owners of the 17,000 auto dealerships in the US see Tesla’s new approach to selling their products directly to consumers in violation of State Law.  With strong lobbying efforts in many States and auto dealers have been successful in banning Tesla sales in 14 states and the competition continues.

Detractors generally have an automotive background, either from a manufacturer or dealership.  They consider Tesla to be a car maker and by doing so, miss the point.  Tesla’s purpose is not to make and sell cars, it’s to eliminate the use of fossil fuels.

What’s important to an auto manufacturer or dealership maybe far less important to Tesla.  Here are two examples:  1. Repeatedly missing forecasts (e.g. 1, the X SUV was finally released months late) and 2.  Inability to diagnose and resolve manufacturing challenges (e.g. 1., The falcon doors on the X SUV; e.g. 2,  Manufacturing problems with the Model 3).  Tesla has shared the primary problem with the Model 3 is hand assembly of the battery pack at the Sparks, NV facility.

We have difficulty understanding why battery assembly is a hand operation and believe the problems lie with EV assembly in Fremont, CA.  Tesla has recently adjusted its Model 3 production forecasts:  5,000 units/week by the end of 1Q, 2018 and 10,000 units/week at the end of 2Q, 2018.  If these numbers are not met, the detractors will continue to beat their drums and rightfully so.

If Tesla can meet its latest 2018 1Q and 2Q production goals, 150,000 to 200,000 Model 3 s will be delivered in 2018 and Tesla will have delivered a total of 550,000 to 600,000 units, making it the world’s largest producer of BEVs.

 

Want to up your innovation game? Want to up your organization’s innovation game? Attending one of our Mastering Value Innovation Workshops is a great place to start. In 2016 we are going to change our approach. We will work with you to develop your own custom workshop that addresses your problems and you define the length and location. More information can be found in the Workshop Brochure.