Tesla Motors has proven that it can build the most modern cars in the world. And apparently Elon Musk insisted they build their own IT systems and e-commerce platform, too.
Most all of Tesla’s IT is homegrown, said CIO Jay Vijayan, appearing onstage at the Constellation Research Connected Enterprise event today. The reason: the traditional enterprise resource planning (ERP) systems did not cut it, and the company has a vertically integrated operation that required a custom environment.
The speed and agility Tesla needed in an ERP environment could not be found in the market, Vijayan said. SAP’s ERP tech was clearly not working for other car manufacturers and Vijayan knew what it would take to implement and update the SAP environment. “Elon said this is not going to cut it,” Vijayan said.
In four months, Vijayan and his team of more than 250 built the ERP system, which serves as the foundation of the electric carmaker’s operations. Now every department is using the same system without the need for making custom connectors, so different systems can work together.
The company also built a world-class e-commerce system that is designed to help people buy cars as seamlessly as possible.
Tesla needed to build its own IT and its own e-commerce system due to the fundamental difference in its business model. For decades, auto manufacturers have sold their cars through local dealers, a fixture of every town in America. But Tesla sells its cars directly to customers. All the materials, the processes and the features need an operation that is uniquely designed so Tesla can sell its cars online.
Tesla is another example of how much tech is being reinvented by young companies that have to build things themselves for their business models to work.