One of the prominent Swiss business leaders who has had a significant impact on my professional development once stated that he consistently employed a strategic approach, even when he initiated his operations in Russia during the mid-1990s. At a minimum, for a period of 10 to 15 years. This was in the 1990s. At that time, planning was generally viewed as an unproductive exercise due to the rapid pace of change in the country. Moreover, the majority of Russian entrepreneurs remain unconvinced by this approach. This is due to the fact that the technology in question is no longer in use.
As previously stated, international companies only transfer executive functions to Russia, whereas strategic planning is a management function. Consequently, this knowledge is not shared at the local level, and in general, it does not extend beyond the head office in the West. Furthermore, Russian technologies were effectively buried under the remains of the former Soviet Union and its Gosplan. First, the significance of the country and its five-year plans was diminished, and subsequently, essential abilities and expertise in long-term goal-setting were neglected. At one time, for instance, these contributed to the nation’s advancement in space exploration or facilitated a breakthrough in nuclear power. The fact that we have forgotten how to do it does not mean that it is impossible to relearn.
As a first step, I suggest familiarizing yourself with foresight technology. For your information, Google employs this method to describe scenarios for the next 50 years. As an example of strategic planning, we can look to the approach taken by Ilon Musk. I recall that in 2015, few people were aware of his reputation. That’s when I had a conversation at the Higher School of Economics, where I was pursuing my MBA, and such conversations were relevant. I was promoting the idea that Tesla’s core business is not cars. It’s about a high-end takeover of the entire automobile market and expansion into other markets, even those that are not directly related. In summary, the key takeaway is that.
Lesson from Ilon Mask
The internal combustion engine has a relatively low efficiency rating of less than 25%. The physics curriculum in our educational institution. The most efficient electric motors achieve 90—95% efficiency. Furthermore, the use of an electric motor obviates the necessity for a gearbox. Furthermore, this is a highly complex and costly component in the overall design. In summary, electric motors offer a more efficient, cost-effective, and straightforward solution for automotive applications. Therefore, 99% of the automotive industry as a whole is eliminated. The results show that the top performers are not the industry incumbents.
The next item on the agenda is Artificial intelligence technologies, which were initially perceived as ambitious but which Google was already actively developing, eventually resulted in the advent of autonomous vehicles that do not require a human driver. From a technical standpoint, this has already been achieved. It is common knowledge that Tesla has developed an autopilot system and that Yandex has made significant advances in this field. The vehicle is therefore capable of driving itself.
This is where my expertise in financial matters becomes relevant. Therefore, the vehicle purchased and situated in close proximity to your residence, rather than being utilized on the road and generating revenue for you, is merely idling and incurring losses due to depreciation, taxes, inflation, and the cost of capital if the vehicle is financed. The vehicle could be operational on a 24/7 basis. This is why Tesla designed models with cameras pointed into the cabin. Ultimately, it is the passenger rating and other cab chips of the future. We bid you a warm welcome to the world of social ratings.
The next item on the agenda is… It is essential that cars be charged. It would be prudent to consider whether it is necessary to outsource this significant and valuable source of power. Let us consider generating our own electricity. Traditional methods are dominated by government-owned entities, and then Tesla Powerwall and Solar Roof products emerge as competitive alternatives. These products afford customers the ability to charge their vehicles, utilize electricity for their homes, and also sell excess electricity generated to the general grid. The subject of energy efficiency is a vast and ever-evolving field.
The next item on the agenda is… The smart car will serve as an active initiator of Internet traffic. That is a market segment that Tesla is keen to retain for itself. However, they have taken this a step further. We offer worldwide coverage. From any location on Earth. Starlink is currently in development. The ability to do so is at your fingertips, with no restrictions in place.
The next item on the agenda is… It is essential to understand that the Starlink satellites cannot be launched without human intervention. Why not retain ownership of this piece? Roscosmos? In the early 2000s, Mr. Musk approached Russia with a request to purchase a rocket. Any type of rocket would be suitable. However, they declined his proposal and sent him away. He ultimately founded SpaceX and pioneered the development of reusable rockets. Until recently, there were even jokes about delivering astronauts via trampolines. However, SpaceX ultimately emerged as the dominant player in this field. A review of SpaceX’s cost of delivering cargo to space is instructive. We will not be discussing the interaction with the Pentagon at this time. There were no actual prototypes produced. The distinction between ideas and technologies on paper and those that are embodied in an organizational structure and a product is a crucial one.
The next item on the agenda is… The construction of spacecraft requires a comprehensive understanding of materials science. As my instructor in materials science and technology of structural materials used to inquire on all examinations: “Please define eutectic.” If you are unsure, please do not hesitate to ask. This is to certify that the answer is F. It is likely that the Cyber track case will not be painted, but will be made of space metal instead. It would appear that the extensive research into material wear and tear, and the creation of demand for highly technological materials within the company, has not been as fruitful as anticipated.
What is the final outcome? The production of a single Tesla electric car has prompted the company to expand into a number of new areas. Furthermore, industry leaders such as Mercedes, BMW, and even Roscosmos have already established themselves as competitors in this field. This was the inaugural segment of the strategic planning master class led by Ilon Musk. Please see Part 2, which will address the topic of humanoid robots and their impact on the labor market.
Intangible and non-obvious
Let me elaborate further on this point, as I believe it is crucial for you to understand that the planning horizon is of paramount importance. Long-term planning enables an organization to navigate through challenging circumstances and reach its objectives.
Historical data demonstrates that truly outstanding results can only be achieved through long-range planning. Let us examine the age of the wealthiest individuals in the world.
This list does not include those who have recently become wealthy and/or well-known bloggers. It is not merely the matter of income and the amounts involved that are of consequence; time is of even greater importance. It is challenging to reach the pinnacle of success, but it is even more difficult to maintain that position.
Bernard Arnault, the richest man according to Forbes in 2023 and head of the French holding company LVMH, which includes more than 70 premium brands – from Christian Dior and Louis Vuitton to Chandon and Dom Perignon – has the following to say: “When we discuss a brand, I always consider what it will be like in five or ten years’ time, rather than focusing on its profits in the next six months.” Consider, for instance, Louis Vuitton, the global leader in luxury goods. My focus is not on the immediate profitability of the venture, but on maintaining its esteem and success over the long term.
However, it would be prudent to avoid attempting to immediately transition to the Premier League. Let us consider an everyday example to gain an understanding