Stakeholder Analysis & Strategy Development Report: Tesla Motors

This report delves into the stakeholder management strategies of Tesla Motors, a leading innovator in the electric vehicle industry. It identifies key internal and external stakeholders, including employees, customers, shareholders, and the government, and analyzes their respective motives and behaviors. The report highlights the challenges Tesla faces, such as financial instability, limited market presence, and infrastructure limitations, while also acknowledging favorable industry trends like increasing government support for electric mobility. Strategic programs are recommended for each stakeholder group to enhance engagement and involvement, including cost leadership for customers, improved communication for employees, stakeholder mapping for shareholders, and proactive issue management for the government. The overarching goal is to improve organizational productivity and effectiveness through better stakeholder relations. Desklib provides access to similar solved assignments and past papers for students.

Running head: STAKEHOLDER MANAGEMENT
Stakeholder management
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Executive summary
The aim of this report is to discuss about the relevance of the internal and external stakeholders
for Tesla motors. In doing so, this report discussed about the different relevant stakeholder
groups of Tesla and identified that employee, customers, government and shareholders are the
major groups of stakeholders. In addition, this report also evaluated the motive and behavior of
these stakeholders and how they can be managed. Different strategic programs are being
recommended for each of the identified stakeholders, which will help in enhancing the
involvement and engagement of the stakeholders.

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Table of Contents
Introduction......................................................................................................................................3
Relevant challenges for Tesla Motors.........................................................................................4
Identification of the industry trends.............................................................................................4
Stakeholder view of Tesla Motors...................................................................................................5
Stakeholder analysis........................................................................................................................6
Identification of the stakeholder category.......................................................................................7
Recommended strategic program....................................................................................................9
Customers....................................................................................................................................9
Employees..................................................................................................................................10
Shareholders..............................................................................................................................10
Government...............................................................................................................................11
Conclusion.....................................................................................................................................11
Reference.......................................................................................................................................13

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Introduction
Determination of the stakeholders is important for the contemporary business
organizations due to the reason that diverse range of internal and external stakeholders is relevant
in the current business scenario. The more effective will be the management of the stakeholders,
the more will be the organizational competitiveness in the long term. However, it should also be
noted that strategic approach should also be different for different sets of stakeholders as their
requirements and interests from the business will be different and diverse (Missonier and
Loufrani-Fedida 2014). Among the latest organizations known for their innovations and
disruptions in the market, Tesla is one of the leading names. They are offering high performance
electric mobility solutions with disrupting the existing global automobile market trends.
The mission statement of Tesla Motors states about their objective of meeting the current
environmental needs by providing sustainable solution. In addition, the mission statement of
Tesla Motors also states about providing solutions with maximum utility to the customers. This
refers to the fact that electric mobility is being considered as the less practical compared to the
gas combustion mobility (Hardman, Shiu and Steinberger-Wilckens 2015). Thus, the mission
statement of Tesla Motors is acting as a differentiated approach in the industry. On the other
hand, the vision statement of them states about their goal of changing the entire automobile
industry and mainstreaming the electric mobility solutions with more game changing and one of
the kind products. Therefore, given their goals and objectives, it is important for Tesla Motors to
manage their stakeholders effectively and have maximum desired outcome (Stringham, Miller
and Clark 2015).

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This report will discuss about the major challenges being faced by Tesla Motors along
with the recent major trends in the industry. In addition, the major stakeholders will also be
identified and their interest will be evaluated. This report will also recommend a few
recommended generic strategic programs for each of the identified stakeholders.
Relevant challenges for Tesla Motors
One of the major challenges identified for Tesla Motors is financial instability. This is
due to the reason that even though Tesla Motors have disrupted and created a stir in the global
automobile market but still they can be considered as startup considered to the global automotive
giants. Thus, they are facing financial challenge to fund their operations. This is evident in
delayed introduction of Model S. Furthermore, it is also identified that Tesla Motors is having
limited exposure and presence in the market and their manufacturing unit is present only in the
United States (Chen and Perez 2018). Thus, they are facing the challenges of competing with the
global auto giants worldwide. Lack of infrastructure for electric mobility across the world is also
a major challenge for Tesla Motors due to the reason that it is hampering their sales potentiality
in the global market. In addition, Tesla is also facing the challenges in marketing their products
in the developing markets due to the reason that developing markets are witnessing the
maximum growth rate in the current time but these markers are not ideal for the premium
offerings (Moritz et al. 2015).
Identification of the industry trends
It is identified that even though Tesla Motors is facing a few challenges in their business
operations but the industry trends are more favorable for them. This is due to the reason that with
the increasing level of vehicular pollution, governments of different countries are initiating

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Tesla Motors
GovernmentCustomers
SuppliersEmployees
ManagersShareholders
electric mobility to replace the existing trends. Thus, the more will be the promotion of the
electric mobility, the more will be the opportunities for Tesla Motors in terms of their car sales
(Cherubini, Lasevoli and Michelini 215). However, on the other hand, with the change in the
market trends, existing brands are also introducing electric cars to tap the growing markets.
Thus, the competitive scenario is becoming more challenging for Tesla Motors with the increase
in the competition. Moreover, mass market and affordable mobility solutions are gaining more
traction in the global market due to their more acceptances, which is not the strong point for
Tesla as they are having only premium offerings (Propfe et al. 2013).
Stakeholder view of Tesla Motors
It is identified that the major relevant stakeholder groups identified for Tesla are users,
governance, influencers and providers. This is due to the reason that Tesla is operating in highly
competitive automobile market, which involves a good number of internal as well as external
stakeholders. It is also identified that in terms of users, consumers are the most important
stakeholder for Tesla due to the fact that customers are the primary user of their cars being sold
by them (Solaimani, Guldemond and Bouwman 2013). In addition, in terms of influencers, upper

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level managers and other employees are being included who are having the power and influence
in determining the internal effectiveness. On the other hand, shareholders can also be considered
as the influencers. This is due to the reason that they are one who has invested capital in the
business and thus having influencing power in the management. In terms of governance,
government bodies, authorities and board of directors are included. This is due to the fact that
they are responsible for governing the business operations and create the long term business
strategic intent (Hovav and Gray 2014). Lastly, in terms of providers, suppliers, partners,
customers and investors can be included. This is due to the reason that each of these stakeholders
are the providing supports such as providence of raw materials by the suppliers, providence of
revenue by the customers and providence of capital by the shareholders.
Stakeholder analysis
From the above identification of the stakeholders, the major four relevant stakeholders
are customers, government, shareholders and employees. These four are being selected due to the
reason that each of them is having different sets of influence and interest in the business of Tesla.
The following table will discuss about the behavior and motive of each of these four identified
stakeholders.
Customers Customers are the most variable stakeholder among all the stakeholder groups
for Tesla. This is due to the reason that taste and preference pattern of the
customers is changing rapidly. In the case of Tesla, customers preferring the
products of Tesla will opt for competitors if superior products are being offered
by them (Eskerod and Huemann 2013). Their major motive is to gain maximum
value proposition from the products.

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Employees Employees are the major internal stakeholders for Tesla due to the reason that
skills and expertise of them along with their productivity determine the
organizational competitiveness of Tesla. Behavior of the employees can be
determined by the human resource management process by the managers. The
more effective will be the working environment, the more positive behavior will
be possessed by the employees (Vidaver-Cohen and Bronn 2015). On the other
hand, their major motive is to gain the monetary benefits for their services along
with getting recognized in the organization.
Shareholders Shareholders are also important due to the reason that they are the major
sources of capital for Tesla. They will invest only when the long term
potentiality will be favorable and positive return on investments. Thus, it is
important for Tesla to ensure their long term potentiality to attract more
investment bids (Weninger et al. 2013). On the other hand, the motive of
shareholders is to gain maximum return from their investments and accordingly
they expect to have favorable business practices accordingly.
Government In the current business scenario, government should be considered as one of the
major stakeholders due to the reason that business operations are being
influenced by their policies (Payne and Calton 2017). The major motive of
government is to ensure the social approach of the business and to ensure the
ethical and lawful standards for the business organizations.
Identification of the stakeholder category

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Among the four stakeholders being identified in the above section, customers are from
users category, government is from governance category, employees are from users category and
shareholders are from providers and governance categories. It should also be noted that different
generic strategies should be considered in managing the different stakeholders due to the reason
that strategies should be different based on the motives and interests of the stakeholders
(Harrison and Wicks 2013). One of the major strategies being identified is the involvement of the
stakeholders. Stakeholders should be involved in their interests due to the reason the more
involvement will ensure that their interests are being fulfilled and they are also providing the
maximum value for the organization. In terms of employees, stakeholder involvement strategies
will be effective due to the reason that ensuring the involvement of the employees will help to
improve their productivity and effectiveness (Jensen 2017). Moreover, employees can also be
managed effectively by having good communication strategies due to the reason good
communication strategies will help in determining the needs and requirements of the employees
and can be fulfilled.
There are number of generic strategies can be initiated for managing customers with one
of the major strategies being stakeholder mapping. This will help in evaluating all the relevant
elements related to customers and identify the major factors. This should be noted that with the
help of the stakeholder mapping, customer trend can be identified and they can be managed
accordingly (Jones, Wicks and Freeman 2017). This strategy is also applicable for the
shareholders due to the reason that this will help in evaluating the objectives and expectations of
the investors and design the organizational processes accordingly. Moreover, initiation of the
cost leadership strategy can also be an effective approach for managing the customers. This is
due to the fact that initiation of the cost leadership strategy will help Tesla motors in offering

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their products in competitive pricing, which will attract more customers along with maximizing
their value proposition. In the terms of government, identifying the potential triggers of
emergence of issues will be effective in managing them. This is due to the reason that
maintaining the ethical standards and lawful activities will help in aligning with the government
rules and regulations (Bridoux and Stoealhorst 2014). Moreover, effective management of the
customers and employees will also help in aligning with the government standards.
Recommended strategic program
It should be noted be the overall objective of Tesla in view to their stakeholder
management program should be ensuring their higher set of involvement and engagement in the
process. This is due to the reason that involvement and engagement of the stakeholders will
ensure that organizational productivity and effectiveness will be more. The following sections
will discuss about the specific strategies for all the four stakeholder groups, which will ensure the
better involvement and engagement of them.
Customers
It is recommended that cost leadership strategy will be effective and ideal for involving
and engaging the customers. It is identified that the current product portfolio of Tesla consists of
cars with having premium price tags. Even though the latest Model 3 is positioned as n
affordable offering but still it is considerably pricier to its competitors. Thus, the market
potentiality and presence is limited for Tesla and this is also restricting involvement of more
customer sections. Thus, it is recommended that cost leadership strategy will help in reducing the
cost of operation and offer the final products in more competitive price. The more competitive
will be the final pricing, the more will be the attractiveness of the products among the larger

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segments. Moreover, customers will be able to have better value from their given price, which
will meet their interests and enhance the involvement.
Employees
In order to ensure the involvement and engagement of the employees, it is recommended
that consensus in the decision making process should be ensured. This will help in increasing the
representation of the employees in the decision making process along with the managers.
Employees will be able to communicate their issues and decision process can be initiated
accordingly. Moreover, it should also be noted that building consensus in the decision making
process will also help in increasing the involvement of them in the workplace. In the case of
Tesla, involvement of the employees will help in identifying different inputs from them and it
will benefit Tesla in the long term. With the effective management of employees of Tesla,
probability of emergence of innovative ideas will be more. Therefore, Tesla will have more
effective and productive internal management and they can stay ahead in the competition in
terms of innovation.
Shareholders
In view to the strategic intent discussed above, it is recommended that mapping should be
done in managing the shareholders. This is due to the reason that it is not a viable option to
involve all the shareholders in the decision making process, which will cause more complexities
and difficulties in the process. Thus, mapping should be done in evaluating the trends and
preference pattern of the shareholders and initiating the organizational process accordingly. In
the case of Tesla, it is recommended that shareholder mapping should be done in identifying the
expectations of them and to what extent the organizational process of Tesla is aligning with it.

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The more effective will be the fulfillment of the expectations of the shareholders, the more will
be their involvement in the organizational affairs of Tesla. This will also ensure the long term
investment viability in the business.
Government
It is recommended that ethical decision making process will be beneficial in managing
the governmental stakeholders. This is due to the reason that government is not having any profit
maximizing motive from the business operation of Tesla rather they are more concerned with
law full activities of the firms. Thus, if Tesla can ensure ethical decision making process, then
the probability of generation of unethical practices and lawsuits will be less. This should also be
noted that with the help of the ethical decision making process, other stakeholders including the
employees and customers will also be benefited, which will promote more holistic process of
stakeholder management. If the standards and regulations of the government can be followed and
adhered, then the required assistance will also be more from the side of the government. Thus,
the involvement level will get increased.
Conclusion
Thus it can be concluded that Tesla is having number of different stakeholder both
internal and external and it is important to manage them effectively. In this report, the business
scenario of Tesla is being discussed and how the stakeholders are having influence in their
business process. Four major stakeholders are being identified with having major relevancy for
Tesla and these are employees, customers, government and shareholders. All the stakeholders are
being further evaluated in identifying their motives and behavior along identifying their
categories. Based on the identified factors, generic strategic programs are being recommended