Dynamic Strategy

This report discusses stakeholder analysis and strategic development in the context of Tesla Motors. It explores the needs and interests of various stakeholders and recommends strategic programs for their satisfaction. The report highlights Tesla's strong relationship with stakeholders and its impact on the company's success.

Running Head: DYNAMIC STRATEGY
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Dynamic Strategy
12/19/2018

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Executive Summary
Tesla Motors has been efficient in addressing the needs and interests of various stakeholders,
such as employees, customers, suppliers, investors, and shareholders in an effective manner.
The needs and interests of various stakeholders are addressed through a corporate social
responsibility strategy which focuses on the sustainability and ecological balance in the
environment. Thus, the report has discussed about all these aspects, such as stakeholder
identification and strategic programs to manage and satisfy their expectations. This indicates
about the strong relationship of the company with various stakeholders and benefits received
by the company which boost the corporate image of Tesla in the automotive industry and
leads to higher success in the future.

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Contents
Introduction...........................................................................................................................................3
Company Overview...............................................................................................................................3
Tesla Stakeholder view of the Organisation..........................................................................................4
Stakeholder Analysis for four selected stakeholder groups...................................................................6
Stakeholder category identification and generic programs for stakeholders..........................................7
Recommended strategic program for the four selected stakeholder groups with the reasons.................8
Conclusion...........................................................................................................................................10

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Introduction
The report brings about the discussion on the stakeholder analysis and strategic development
of the organisations in the contemporary business environment. Stakeholder analysis and the
concepts of strategic development will be explored on the company Tesla Motors.
Stakeholder analysis refers to the process of assessing a system and potential changes that is
relevant to the key interested parties in the organisation. Stakeholder analysis is considered as
the part of stakeholder management. In an organisation, manager must perform the activity of
stakeholder analysis, as it is significant to identify all the important stakeholders and their
varying needs and interests (Wandebori, Steenhuis and Groen, 2018). Proper or effective
identification of the stakeholders of an organisation helps in attaining the vision or goals of
the organisation. Therefore, this report will identify four major groups of stakeholders in the
company and generic strategic programs for each of these groups will also be stated in the
following report. In addition, the reasons will be stated for the programs recommended for
each stakeholder group of the organisation.
Company Overview
Tesla Inc. (formerly Tesla Motors) is an American Automotive company located in Palo
Alto, California. The company was founded in the year 2003 by Martin Eberhard and Marc
Tarpenning. Tesla specializes in the manufacturing of electric cars and solar panel
manufacturing through the use of solar city.
Tesla Motors was joined by Elon Musk, J.B. Straubel, Lan wright are collectively called as
the co-founders of the company. The former founder, Elon Musk is the current Chief
executive officer of the corporation has visualized Tesla to be the technology company, and
an independent automaker in the industry. The aim or the objective of this independent
automaker was to ultimately provide their offerings at reasonable rates to the customers.
Apart from the manufacturing work of electric cars or vehicles and the energy storage
systems, the company has been making investments in the installation of solar and energy
storage products. However, the company has acquired wide recognition for their high
performing electric vehicles in the industry (Grant, 2016).
Mission & Vision statement of the company

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Tesla’s mission and vision statement highlights about their prominent electric automobile
manufacturing and the related operations within business. The mission statement of the
company is to accelerate the transition of the world towards sustainable energy. The
statement emphasizes on the fact that the electric cars can serve better than the gasoline
powered ones. Thus, it states that the company aims to work towards reducing the
dependency of people on the carbon fuels and shift towards the energy systems. The mission
statement of the company is a socially responsible mission, as it focuses on using innovation
for the betterment of the world (David, David and David, 2016). On the other hand, the
vision of the Tesla is “To create the most compelling car of the 21st century by driving the
world’s transition to electric vehicles”. The vision statement is related to the future growth
and development of the company, thus it focuses on two things, first is the brand image and
product which creates value (Bohnsack, Pinkse and Kolk, 2014).
Tesla vehicles has undergone recent developments in the past five years, and the development
has been observed regarding the software up gradation in many of the models which does not
require much human interaction. Along with the development in the vehicle lines, the
company has been also working in the products into energy space, and improving their
infrastructure. However, there have been certain challenges faced by the company, as Tesla
need to fill orders, and maintain good relationships with their workforce, and need to focus
on increasing their profits level in the industry (Blomgren, 2017).
Tesla Stakeholder view of the Organisation
The stakeholder theory in any organisation refers to the theory of organisational management
and business ethics which addresses about the morals and values of any organisation.
Stakeholders view model or theory has been designed to define the purpose of business
organisations, i.e. to create value for the stakeholders along with the shareholders.
Stakeholders refer to the individuals or groups whose interest is affected by the organisation
actions or activities or who influence the performance of the organisation (Zerfass and
Wiesenberg, 2016).
There are two types of stakeholders in any organisation, internal and external and internal
stakeholders include the individuals from the management, i.e. within the business entity.
These are the employees, owners or board members, shareholders, and the external
stakeholders in any organisation consist of the customers, employees, suppliers, contractors,

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communities, and other shareholders. Thus, stakeholder theory in any organisation suggests
the managers or founders that they must consider the interests and expectations of their
stakeholders in order to gain success and competitive advantage in the long-run (Hoang and
Rothaermel, 2016).
INTERNAL STAKEHOLDERS EXTERNAL STAKEHOLDERS
From the above diagram or stakeholder view model in context to the company Tesla, it has
been clearly understood that amongst these two groups, Tesla has worked efficiently to
satisfy both the groups of stakeholders. To discuss in detail about the aspects, importance and
key contribution of the internal stakeholders it can be stated that they belong to the
organisation and have a direct and major impact on the organisation. As they serve to the
organisation, Tesla has a primary responsibility towards satisfying their interests and
expectations. In the absence of internal stakeholders, the organisation would not be able to
survive and ensure growth for a longer period in the automotive industry (Akpinar and
Vincze, 2016).
Internal stakeholders of the firm
Employees- These refer to the group of people who receive remuneration or compensation
for their work in the company.
TESLA
MOTORS
SocietySuppliers
Government
Creditors
ShareholdersCustomers
Employees
Manager
Owners

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Owners- These refer to the individuals or the group who own the organisation, and these can
be the partners or shareholders.
Board of Directors- The individuals or group who assure strong governance of the
organisation, and they are elected from a common vote of the members of the organisation, in
the Annual General Meeting (AGM).
Managers- These refer to the individuals who are responsible to maintain or manage different
departments of the organisation such as sales manager, production manager, general manager
and others.
Investors- Investors are those who make investments in the organisation.
To discuss about the stakeholders of the company, Tesla Motors it can be stated that it has an
effective corporate social responsibility strategy which considers and concerns the interests of
all the key stakeholders of the company. Tesla’s stakeholders are prioritized in accordance to
the CSR strategy, such as communities, customers, employees, investors, shareholders and
government (Mukerjee, 2016).
Stakeholder Analysis for four selected stakeholder groups
From the above analysis of key stakeholders of the company Tesla motors, it has been
understood that stakeholders contribute to the organisational growth and reputation of the
business to a major extent. Thus, the following discussion will choose four key stakeholders
from the group and their interests, behaviour, or motives will be analysed, and these include
employees, customers, shareholders, and suppliers (Rahdari, Sepasi and Moradi, 2016).
Communities – Tesla Motors operates an automotive business which is influenced by the
communities as they are crucial to design the corporate image of company. One of the main
expectations of the community being an important significant for Tesla is to ensure protection
of environment, thus the company concerns it as an important aspect. For this, the cars
introduced by Tesla have effectively satisfied community by providing zero emission
products. In addition, the company has also allowed the use of company’s patents by other

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organisations as well which benefits the communities in an indirect manner (Niederman et
al., 2017).
Customers- These are considered as the major elements or stakeholders in the model as they
determine the wealth or income of Tesla. To meet the rising demand of the customers, the
company has reduced the costs of batteries used in the cars, and widen the charging station
networks which will benefit the customers in the long-term (Smith, 2017).
Employees – Employees act as the crucial part and valuable asset for any organisation’s
performance forming the base of stakeholder analysis. Thus, Tesla accommodates their
employees by offering competitive compensation strategies and effective HR programmes
with the objective to enhance their ability for the professional growth. In addition, the
company organises new training programmes as a part of their CSR activities which
indirectly provides opportunities to the workforce and understand the world through a
broader outlook (Fernandez-Feijoo et al., 2014).
Investors/Shareholders – It has been analysed from the research on the success on Tesla in
the automotive industry, Tesla has been highly independent on their investors in the early
years of their business as they invest in the capital and determine the cash flow of the
company. Tesla has focused devising long-term strategies to fulfil the interests (high
profitability and growth) of the investors, and other shareholders. In addition, the concern of
the company towards enhancing the ecological sustainability of the business also acts as a
major factor towards reaching out to the investors. As it builds a positive image of the
company which in turn attract and fulfils the interests of the investors. Thus, in this fashion
the company can be growing and stay focused on producing and selling their products to
other, and increasing their profit margins and satisfying their investors as a part of the
stakeholder group (Aguinis and Bradley, 2015).
Stakeholder category identification and generic programs for stakeholders
It has been analysed from the research findings on the aspect of stakeholders theory that the
stakeholders contribute to the significant success and higher productivity of the organisation.
Thus, there are four categories established in context to the stakeholder analysis of the
company, these categories include users, governance, influencers, and providers.

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The four key stakeholders in the above analysis chosen were employees as internal
stakeholders and customers, suppliers and shareholders, as external stakeholders. Thus, these
different stakeholders can be allocated in the above mentioned categories of the stakeholders
(Zavyalova et al., 2016).
Customers are found to be present under the category of users as they are assumed to use the
products of the project or programme introduced by the company they are referred to be the
beneficiaries of the output. The best example for this is the customers. Another example can
be the sales team, where they are performing the role of delivering a new software package
for the sales team. Thus, the category of user includes two types of stakeholder i.e.
employees and customers within the organisation (Bourne, 2016).
On the other hand, discussing about other two stakeholders in the company, Tesla suppliers
and shareholders, these are categorised as ‘providers’ as they are considered to have the
ability to change the direction of the project or programme. The category of the stakeholders
are providers is a wider category as it consists of other key stakeholders of the company also
such as business partners, contractors or other who provide resources for the completion of
the project or programme.
Tesla has been putting efforts to manage their customers, and higher their satisfaction and
experience such as expansion of the network station for the customers helps in enhancing the
accessibility of customers. This shows the effective CSR practices of the company to manage
their customers as stakeholders. Similarly for the employees working in the organisation,
Tesla provides them higher compensation and better career opportunities which ensures they
are happy to work in the organisation, and easily managed. Tesla ensures a harmony and
synchronised organisational culture to ensure health safety and enhanced quality life of all the
key stakeholders (Chen and Perez, 2018).
Recommended strategic program for the four selected stakeholder groups with
the reasons
The generic strategies for the effective stakeholder management have been divided into four
categories, such as swing, defensive, offensive and hold. It has been a fact that supportive
stakeholders of any firm possess low potential threat, but high cooperate potential, which
includes managers, employees, suppliers, and customers. Thus, a firm must focus on adopting

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a strategy which is beneficial for the competitiveness and which enhances cooperates
potential. These are the strategies available in the organisation to manage customers,
employees, suppliers, and shareholders.
Swing strategies are applicable to the cases when the stakeholder group has relatively high
cooperative potential and competitive threat. It includes some examples, as changes made in
the rules, the decision forum and transaction process. Thus, it can be effectively used for the
employees working in the company, Tesla. On the other hand, hold strategies can be adopted
in the case when the stakeholder groups such as suppliers, in this case have low cooperate
potential and low competitive threat to continue their current stakeholder programs and
activities and maintain their current position amongst other stakeholders (Moritz et al.,
2015).
Offensive strategic program in the organisation are applicable to the group who have high
cooperative potential and relatively low threat of competitors in order to enhance their
cooperate potential. An example of offensive strategy can be the attempts which are made to
change the perspectives of stakeholders or to link the program to others, which the
stakeholders considerable more favourable. The offensive strategy can be effective to manage
customers in an effective manner within organisation (Grant, 2016).
Defensive strategy found in the cases where there is a situation of high competitive threat and
low cooperate potential within stakeholders. The strategy can be applied to the case for the
management of shareholders, where there is an increasing threat from the other investors as
well.
It has been recommended that these strategies can be applied by Tesla in a more effective
way, as the customers in the organisation has no preference to shift to other competitors, also
they have low cooperative potential as they are already satisfied with the company offerings
and products. Thus, appropriate strategy for these customers can be hold strategy
Similarly discussing about the employees working in Tesla motors satisfied with the
organisation’s strategy to provide higher compensation and healthy work environment and
several other benefits. Thus, in this case where the cooperative potential and competitive
threat are both low, hold strategy can be applied effectively.

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The reason behind choosing these strategies is that it has been defined and understood as the
most effective and appropriate strategy for the mixed stakeholders in the organisation.
According to perspective of Johnson and Schoels (2012) , the strategy has proved as one of
the best to improve the stakeholder management and relationships in the organisation.
Conclusion
To conclude the above discussion it has been analysed that Tesla Motors has achieved greater
success over the past few years and continue to attain higher growth. Tesla’s automotive
directly influence their stakeholders, employees, customers, government, shareholders, and
others, and maintain effective relationship with them. Sound relationship with the people or
stakeholders in the organisation indicates about the significance of corporate social
responsibility in the company. Thus, the above report has discussed all the relevant aspects
related to the company, and has illustrated well the stakeholder analysis and management and
caters to their varied nature of interests and expectations. Hence, the report has implemented
effective strategies for managing stakeholders within organisation and managing change
within their position, which acts as the stepping stones of success.

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