Here is an excerpt from an article written by Brian L. Halla for Harvard Business Review and the HBR Blog Network. To read the complete article, check out the wealth of free resources, obtain subscription information, and receive HBR email alerts, please click here.

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These days, Tesla is the darling of the automotive world. But many of its strategic moves — A factory in Nevada that will crank out many times more batteries than the company can use? Turning over its patents to competitors? — can still seem quixotic, if not self-destructive.

As a former owner of the Tesla Roadster and now an owner of the Model S (and the former chairman/CEO of a large semiconductor company) I have enjoyed the cars but wondered at some of these major “moves” the company has made. But recently I had an epiphany – or at least, got an email. A message sent out by the company suddenly made Tesla’s long-term strategy clear to me. And that strategy is so stunning that it may revolutionize ground transportation and, if the company can pull it off, make Tesla one of the most valuable corporations in the world.

Let me explain. From the start, the mass-market acceptance of battery-powered cars has faced four great obstacles:

o The limited range of the batteries;
o The time it takes to charge the battery packs;
o The need to emplace a sufficient number of battery stations;
o The requirement for owners to replace the battery pack, at huge cost, after several years of use and corresponding degradation.

These four challenges have seemed insurmountable — at least in the near term — and consigned electric cars to the status of a boutique industry selling to local commuters.

The email I received from Tesla couldn’t have been more unassuming. It simply invited me and my Model S to participate in a “pilot” battery swap program at Harris Ranch, Calif. The cost? “Less than a full tank of gas for a large sedan.” The time for the swap? “Three minutes.” But as I considered the offer I realized, with a lightning bolt of clarity, how everything could now unfold to Tesla’s great advantage.

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Halla then reviews several of Tesla’s strategic moves.

Here is a direct link to the complete article.

Brian L. Halla served as the Chief Executive Officer of National Semiconductor Corp. from May 3, 1996 to 2009 and as its President from May 3, 1996 to May 20, 2005. During which time, Mr. Halla sharpened National’s strategic focus to capitalize on its strength in energy efficiency. Mr. Halla joined National Semiconductor Corp., in May 1996. He served as the Executive Vice President of LSI Logic Products at LSI Logic Corporation and also served as its Senior Vice President, General Manager of Microprocessor & DSP Products Group, Vice President and General Manager of Microprocessor Products Group. He was responsible for the development of all LSI Logic product lines.

Here is a direct link to information about Nikola Tesla.