{"id":752,"date":"2015-09-14T00:25:41","date_gmt":"2015-09-14T04:25:41","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-digit\/submission\/tesla-more-than-just-ludicrous-mode\/"},"modified":"2015-09-14T00:31:09","modified_gmt":"2015-09-14T04:31:09","slug":"tesla-more-than-just-ludicrous-mode","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-digit\/submission\/tesla-more-than-just-ludicrous-mode\/","title":{"rendered":"Tesla \u2013 More Than Just Ludicrous Mode"},"content":{"rendered":"

When people read about Tesla Motors these days, it\u2019s usually about some new performance milestone or automotive accolade. Most recently, \u201cLudicrous\u201d mode was introduced as a $10,000 upgrade that reduces the Model S 0-60 time to 2.8 seconds. Before that, it was all-wheel-drive and \u201cInsane\u201d mode. These are amazing achievements and definitely help mainstream consumers see electric vehicles as more than just glorified golf carts. However, it takes way more than a few successful drag races to achieve the customer loyalty that Tesla enjoys. Among current owners, 85% plan to purchase a Tesla as their next vehicle [1].<\/p>\n

So what makes the difference? Tesla creates value for the consumer across nearly all of the major pain points of traditional vehicle ownership. Dealers? Forget that! You can just order your car on the website and follow it along as it\u2019s custom-made in the factory. As for range anxiety, the Achilles heel of the EV world, Tesla has built a wildly popular, free Supercharger network for road trips.<\/p>\n

A perhaps less well-known reason for Tesla\u2019s unprecedented customer satisfaction, however, is the company\u2019s approach to the software development lifecycle that enables the Model S to resemble a high-end smartphone \u00a0more than a vehicle. Traditional OEMs usually assign only one software version to each model year for a particular vehicle, and it is never updated unless you buy a new car or if there is a recall and you take the vehicle into the dealership. In a Model S, however, your persistent cellular data connection enables frequent over-the-air (OTA) updates. In this way, Tesla has managed to reinvent the fairly rigid product lifecycle practices of Detroit using the latest ideas of continuous integration from Silicon Valley. And customers receive all of the benefits.<\/p>\n

In January 2015, Tesla released an OTA update for the drive inverter (motor) that shaved 0.1 seconds off the 0-60 mph time for existing <\/em>owners [2]. \u00a0Another update contained new traffic-routing maps applications, enhancements to the UI, and scores of customer-pleasing enhancements that are chronicled throughout online forums [3]. The key point here is that vehicles have always been modeled as quickly depreciating assets. However, in Tesla vehicles, the ownership experience will actually improve<\/em> over time, a completely foreign concept in the automotive world.<\/p>\n

Additionally, Tesla has one of the most advanced diagnostics and fleet management capabilities in the industry. By logging performance data over the cellular connection [4], problems can be identified proactively and customer service issues can be handled quickly and precisely. Tesla will also be able to leverage advanced data mining and machine learning as its fleet size scales, using performance metrics to ensure vehicle reliability and reducing the iteration time for vehicle improvements.<\/p>\n

In some ways, it seems strange for Tesla to give away free Supercharging and OTA software updates, especially since many customers would likely pay for them. However, Tesla is clearly taking a long-term view, valuing customer loyalty and word-of-mouth referrals over immediate profit maximization. After all, value is captured for each generation of Tesla car that a customer purchases as well as through positive referrals.<\/p>\n

Ultimately, it will be fascinating to see where Tesla goes with the upcoming release of the Model X and Model 3 in a couple of years. The challenge will be for it to maintain its standards and innovative development practices as the company grows and production escalates above 100,000 cars per year. Also, everyone wants to know what\u00a0comes after \u201cLudicrous\u201d speed [5].<\/p>\n

[1] http:\/\/www.greencarreports.com\/news\/1098970_tesla-model-s-owner-loyalty-probably-unparalleled-in-industry<\/a><\/p>\n

[2] http:\/\/www.roadandtrack.com\/new-cars\/car-technology\/news\/a24885\/a-software-update-will-make-the-tesla-model-s-p85d-even-faster\/<\/a><\/p>\n

[3] http:\/\/www.teslamotorsclub.com\/<\/a><\/p>\n

[4] https:\/\/www.schneier.com\/blog\/archives\/2013\/02\/automobile_data.html<\/a><\/p>\n

[5]\u00a0Featured image.\u00a0http:\/\/i.stack.imgur.com\/mNA4dm.jpg<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"

Tesla has introduced game changing software development lifecycle practices to the automotive industry, and customers love the results.<\/p>\n","protected":false},"author":66,"featured_media":756,"comment_status":"open","ping_status":"closed","template":"","categories":[330,331,329],"class_list":["post-752","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-electric-vehicles","category-ludicrous","category-tesla"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-digit\/assignment\/digital-winners-and-losers\/","yoast_head":"\nTesla \u2013 More Than Just Ludicrous Mode - Digital Innovation and Transformation<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/d3.harvard.edu\/platform-digit\/submission\/tesla-more-than-just-ludicrous-mode\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Tesla \u2013 More Than Just Ludicrous Mode - 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