Organizational Behavior: Tesla's Structure, Culture, and Leadership

This essay critically analyzes Tesla's organizational culture, structure, and leadership approach to determine their effectiveness in achieving business goals. It identifies Tesla's functional and centralized organizational structure, which enables managerial control and leverages employee expertise. The innovative problem-solving organizational culture promotes coordination, efficiency, and employee engagement. The compatibility between Tesla's structure and culture reinforces employee satisfaction and productivity. The leadership style, influenced by Elon Musk's transformational leadership, is flexible but faces challenges due to overdependence on Musk. Despite some limitations, Tesla's internal elements contribute to its overall competitiveness. Desklib provides students with access to similar solved assignments and study resources.

Running head: ORGANIZATIONAL BEHAVIOR
Organizational behavior
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Introduction
In the current business state of affairs, organizational culture, structure and the leadership
approach determines the effectiveness and competiveness of the organizations. This is due to the
reason that these characteristics help the business organizations in having the internal
competitiveness to face the external difficulties. Thus, it is well applicable for Tesla also due to
the fact that they are operating in highly competitive industry with the challenge of continuous
process of innovation and technological advancements (Young and Ghoshal 2016). Tesla is one
of the late entrants in the global automotive market but has made a mark due to their distinctive
product offerings. In addition, Tesla is also known for their distinctive business approach
different from what the conventional automakers follow.
This essay will discuss about the effectiveness of the organizational structure and culture
of Tesla and how their leadership approach is helping in attaining their business goals. In
addition, the strengths and weaknesses of the leadership style of Tesla will also be discussed in
this essay.
Appropriateness of organizational structure of Tesla
It is reported that Tesla is having favorable approach of organizational structure in place
with having their major concentration towards business growth. It is also being reported that
organizational structure of Tesla is enabling them in having strong and effective managerial
control over the business. According to Tran and Tian (2013), one of the major characteristics of
the organizational structure of Tesla is functional structure. This is enabling them to have
hierarchies based on different organizational functions. Thus, employees having expertise sales
and marketing profile are working in the respective departments. It is helping Tesla in leveraging

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the skills and expertise of the employees to the fullest. On the other hand, the objective of Tesla
of maintaining the satisfaction level of the employees can also be maintained.
It is also being stated that organizational structure of Tesla is highly centralized in nature
in regards to their global business. According to O’Reilly and Tushman (2013), centralization of
the organizational structure of Tesla is helping them in having the major control with the top
level management over their global business. As per the authors, Tesla is relatively small
company compared to other automakers and they are still in nascent stage. Thus, they need strict
control and involvement of the top level management over the business operation, which can be
achieved by means of centralization. The business objective of Tesla of achieving organizational
excellence can be achieved by means of unified control of the top level management. Thus, from
the above evaluation, it can be concluded that organizational structure of Tesla is appropriate and
is helping in achieving the business objectives of them.
Appropriateness of organizational culture of Tesla
It is identified that Tesla follows innovative problem solving organizational culture in
their internal management. According to Basadur, Gelade and Basadur (2014), the major
elements of the organizational culture of Tesla are promoting innovation, coordination and
efficiency. The authors have also stated that with the help of this approach of organizational
culture of Tesla, their level of emergence of innovative ideas is also more. As discussed earlier,
the innovative concentration of Tesla is getting achieved by the means of this cultural approach.
In addition, the elements of coordination and cooperation in their organizational culture are also
enabling Tesla to have the highest level of productivity from the side of the internal stakeholders.

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In addition, it is also identified that one of the major business objectives of Tesla is to
have employees with highest level of engagement, loyalty and organizational citizenship in the
workplace. In accordance to that, employees are being motivated to think as the owner of the
company. According to Ghorbanhosseini (2013), this approach of organizational culture of Tesla
is helping them in having the highest level of engagement from the side of the employees. This is
due to the reason that if the employees can be motivated to think as an owner rather than as an
employee, then they will have more organizational citizenship in their workplace. In addition, the
employees will try to come up with more innovative ideas, which is further enhancing the
competencies of Tesla.
However, on the other hand, there are some drawbacks also being detected in the
organizational culture of Tesla. As per Buschgens, Bausch and Balkin (2013), one of the major
drawbacks for organizational culture of Tesla is pressure on the employees. This is due to the
fact that the organizational culture of Tesla is more focused on the emergence of innovation from
the side of the employees and thus they are expected to continuously come up with innovative
ideas. This is creating added pressure on the employees. In addition, the authors have also stated
that this will affect the organizational objective of Tesla of having engaged and satisfied
customers in the workplace.
Compatibility of organizational structure and culture
Compatibility between the organizational structure and culture is important for Tesla as
well as other organizations. This is due to the reason that effectiveness of organizational culture
will determine the efficiency of structure in the organization. According to Janicijevic (2013),
organizational structure of Tesla is designed in the way that it will have employees with right

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skills and expertise in the right departments. On the other hand, organizational culture of Tesla is
concentrating on engaging the employees. Thus, both the elements are helping in increasing the
satisfaction and productivity level of the employees. Thus, it can be concluded that both the
organizational culture and structure of Tesla are reinforcing each other.
On the other hand, it is stated by Wiewiora et al. (2013) that organizational structure of
Tesla is unified and centralized in nature and flexible culture is being maintained. Hence, the
flexible organizational culture is helping Tesla in having employees with independency and
expertise to solve problems by own. This is further eliminating the need for having any middle
level managers as intermediaries and complementing the centralized structure in the
organization. In addition, it is stated by Denison, Nieminen and Kotrba (2014) that the objectives
of the organizational structure and culture of Tesla are same and similar. This is due to the fact
that organizational structure of Tesla is concentrated towards achieving the highest efficiency
from the side of the employees and so does their organizational culture. It is also being stated by
the authors that innovation is also the common objective of both the organizational culture and
structure of Tesla. This is denoting that both these factors are quite compatible with the business
and strategic objectives of Tesla and they both are reinforcing and complementing each other.
Evaluation of the leadership of Tesla
Leadership principles of Tesla are highly influences by the personal charisma of their
CEO Elon Musk. This is mainly due to the transformational style of leadership by Musk.
However, still it should be noted that the leadership approach of Tesla is not consists of Musk
only but the entire top level management (Anderson and November 2013). It is identified that
leadership approach or style being followed in the company is more flexible and casual

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compared to what is being followed in other global firms. It is identified that leadership
management of Tesla does not believes in holding corporate meetings citing bureaucracy and
rigidity. However, it should also be noted that even though the leadership approach of Tesla is
praised worldwide and draws huge attention, still there are number of limitations being
identified. One of the major weaknesses of leadership of Tesla is overdependence on Elon Musk
(Gloor 2017). It can be identified in various instances that Musk is only getting the limelight
with other board members are kept in dark. This denotes an autocratic approach in the
organization and among the external stakeholders. In addition, it is also being identified that in
major cases, principles set by Musk are being accepted as the organizational principles of Tesla.
Thus, the coordination in the top level management is less.
However, still there are few advantages also being identified for the leadership of Tesla.
One of the major advantages is flexibility. This is helping Tesla in having their innovative
approach running. On the other hand, the flexibility in the leadership approach of Tesla is also
helping the top level managers in involving with the employees directly. This is resolving the
internal issues effectively (Setili 2015). On the other hand, employees are also engaged and
motivated in their workplace due to the flexible attitude of the leadership role of Tesla.
Conclusion
Thus, this can be concluded that organizational culture, structure and leadership approach
of Tesla are well effective and efficient. In this essay, all these factors are being critically
analyzed. It is identified that organizational culture and structure of Tesla are compatible to each
other and they are helping in achieving the organizational objectives of them. In addition, the
effectiveness of the leadership roles in Tesla is also being critically analyzed along with

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identifying the positive and negative factors of it. This can also be concluded that Tesla is having
effective and ideal internal elements, which are further helping them in gaining competencies.

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Reference
Anderson, C. and November, F., 2013. The shared genius of Elon Musk and Steve Jobs. Fortune,
December, 9.
Basadur, M., Gelade, G. and Basadur, T., 2014. Creative problem-solving process styles,
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