Organizational​ ​Dynamics TESLA

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July 4, 2019
Based on what you’ve read, do you think Tesla is worth its high valuation, or is it simply priced too high because it is considered new and trendy?
July 4, 2019

Organizational​ ​Dynamics TESLA

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IndM​ ​4260:​ ​Organizational​ ​Dynamics TESLA Prof.​ ​ ​MariEtta​ ​Joleen​ ​Byerline Group​ ​Project Hamza​ ​Baghdadi Srinath​ ​Boorla Tyler​ ​Hansen Due​ ​Date: Mon,​ ​6th​ ​ ​ ​November​ ​2017 IndM​ ​4260​ ​Organizational​ ​Dynamics Group​ ​Project Due:​ ​Mon,​ ​6th​ ​ ​ ​Nov​ ​2017 1 Table​ ​of​ ​Contents Cover​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​X Table​ ​of​ ​Contents​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​1 Tesla​ ​Introduction​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​2 Organizational​ ​Structure​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​4 Global​ ​Hierarchy​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​5 Global​ ​Centralization​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​5 Minimal​ ​Regional​ ​Divisions​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​5 Advantages​ ​&​ ​Disadvantages​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​6 Management​ ​&​ ​Leadership​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​7 Contemporary​ ​Issues​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​11 Conclusion​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​15 References​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​16 IndM​ ​4260​ ​Organizational​ ​Dynamics Group​ ​Project Due:​ ​Mon,​ ​6th​ ​ ​ ​Nov​ ​2017 2 TESLA An American company, Tesla Motors, Inc. was established by an innovative engineers’ group in 2003 from Silicon Valley, CA. Along with designing, producing, and marketing the electric cars, they also offer cutting-edge power components of the electric vehicle to other vehicle manufacturers comprising Toyota and Daimler. In Palo Alto, CA, the headquarters of Tesla is located, and in Asia, Europe, and North America, it has its individual exclusively owned subsidiaries​ ​(​Vance,​ ​2015).​ ​ ​Currently,​ ​Tesla​ ​has​ ​more​ ​than​ ​33,000​ ​workers. The mission statement of Tesla is “To accelerate the advent of sustainable transport by bringing compelling mass electric cars to the market as soon as possible.” (​Van den Steen, 2015). The goal of Tesla is to provide high-performance, high-end electric automobiles with the affordable prices that could be enjoyed by every consumer. Tesla has a wide range of products. Tesla, in 2008, introduced its first exclusively electrical sports car, the Tesla Roadster. Tesla, in 2008, then presented luxury sedan, a zero emission, the Model S. The organization kept on to developing​ ​newer​ ​models​ ​that​ ​the​ ​organization​ ​will​ ​introduce​ ​in​ ​the​ ​near​ ​future​ ​(​Vance,​ ​2015). Financially, massive cash investments are required by Tesla needed. Each charging station of Tesla amounted up to $250,000, while hundreds of millions are invested by Tesla in research and development. Over the history of the organization, significant losses are suffered by Tesla suffered, but Tesla posted in 2013 its first quarter of revenues, earning $15 million in a single quarter​ ​(​Vance,​ ​2015). IndM​ ​4260​ ​Organizational​ ​Dynamics Group​ ​Project Due:​ ​Mon,​ ​6th​ ​ ​ ​Nov​ ​2017 3 Tesla has access to large amounts of investment capital, namely from wealthy corporate CEOs and the US government. Tesla also has the competitive edge of being the first organization for introducing a luxury series of totally electric automobiles, and by patent protecting its intellectual​ ​property,​ ​making​ ​it​ ​hard​ ​to​ ​copy. Tesla Motors, Inc. has a corporate level strategy that utilizes market penetration and global outreach. Tesla intends to enhance its influence on the current markets with their current products. In addition, they market their electric powertrain components to other automakers to increase revenues. By designing a car that uses 100% electricity with a modern luxurious, and sporty look, Tesla is able to advertise for virtually no cost, allowing them to capture more of the global​ ​market​ ​while​ ​still​ ​growing​ ​profits​ ​steadily. Tesla Motors, Inc. supports a focused differentiation strategy because its customers are mainly from middle and upper-income levels. Tesla’s main focus is to provide high performance and creative electric cars, which will then benefit the world both environmentally and economically. By continuing to innovate and create new and more efficient ways of transportation, Tesla will continue to grow and increase its global outreach (​Rothaermel, & KING,​ ​2015). Tesla has built a company structure of creating and utilizing the newest technology to create affordable, 100% electric vehicles for the general consumer. Since its inception, Tesla has focused heavily on investing into its R&D to continue to develop new innovative products and to make its vehicles available to almost anyone. The organization believes that its automobiles will market and sell themselves. Therefore, the organization does not spend any money on IndM​ ​4260​ ​Organizational​ ​Dynamics Group​ ​Project Due:​ ​Mon,​ ​6th​ ​ ​ ​Nov​ ​2017 4 advertisement, and they wait solely for the car to attain publicity along with for spreading via word of mouth. Though Tesla still is an impartially newer car manufacturer; it has many controls setup for protecting its technology and processes, greatly using patent protection, holding over 450 government-issued patents. While its current vehicles are more expensive, Tesla is also investing in manufacturing more inexpensive models with the intention that the brand of Tesla can​ ​be​ ​enjoyed​ ​by​ ​those​ ​who​ ​are​ ​seeking​ ​less​ ​costly​ ​substitutes​ ​(​Rothaermel,​ ​&​ ​KING,​ ​2015). Organizational​ ​Structure Organizational Structure is “the typically hierarchical arrangement of lines of authority, communications, rights and duties of an organization. Organizational structure determines how the roles, power and responsibilities are assigned, controlled, and coordinated, and how information flows between the different levels of management (BusinessDictionary.com).” In other words, the corporation’s patterns and interaction are defined by it. Since Tesla is very limited in its production, where it only produces a number of vehicles and only has 3 models, it’s business structure takes on a conventional form which is a centralized structure.​ ​Basically,​ ​more​ ​authority​ ​is​ ​given​ ​to​ ​the​ ​higher​ ​ups. Tesla’s Organizational structure pursues a functional form. It is the main defining factor in comparison with other attributes and components, which are present but not as significant. There​ ​are​ ​three​ ​major​ ​components​ ​in​ ​Tesla’s​ ​structure: IndM​ ​4260​ ​Organizational​ ​Dynamics Group​ ​Project Due:​ ​Mon,​ ​6th​ ​ ​ ​Nov​ ​2017 5 Global​ ​Hierarchy In Tesla’s Organizational structure, Global hierarchy is the most important aspect. It contains commissions and offices where processes and services are monitored and controlled. There​ ​are​ ​11​ ​immediate​ ​offices​ ​that​ ​are​ ​part​ ​of​ ​Tesla’s​ ​global​ ​hierarchy​ ​(Meyer). Global​ ​Centralization A central committee and group of people in Tesla control all its operations. they are the decision making committee where their decisions are absolute to the organization. Even for international offices, the committee which is located at Tesla’s headquarters are responsible for all their opera