Tesla Case Study: Strategy, Factors, and Impact on Decision Making

This case study provides a comprehensive analysis of Tesla's strategic management, examining the impact of its strategies on decision-making and business activities. It utilizes the Ansoff Matrix and Porter's Generic Strategies to evaluate Tesla's market penetration, product development, and diversification efforts. The study also explores internal and external factors through SWOT and PESTEL analyses, highlighting Tesla's strengths, weaknesses, opportunities, threats, and the influence of political, economic, social, technological, environmental, and legal factors. The analysis underscores the importance of strategic adaptation in response to competitive pressures and market dynamics, ultimately affecting Tesla's performance and goal attainment. Desklib provides this case study along with a wide range of resources including past papers and solved assignments to support students' academic needs.

Case study Tesla

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Evaluate how strategy adopted by Tesla impacts the company decision and activities..............1
Analyse the external and internal factors of Tesla and how the company responses to them.....3
Reflective View...............................................................................................................................6
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Strategic management can be describe as the practices of business that is effective for
successfully and correctly functioning business task. It is essential that organisation is analysing
and evaluating different factors in order to take right and accurate business strategies. It has been
analysed that effective strategic management practices will lead to have positive impact on
accomplishment of desired goals of organisation (Keding, 2021). This report is based on Tesla
company. This organisation is conducting its practices in automotive industry and providing high
quality products and services in order to successfully meet with the requirements of customers.
Tesla organisation was developed in year 2003 and founder of this organisation is See and
Founding. Head office of Tesla company is located in Palo Alto, California, United States and
this company is offering its products and services to large market area all around the world. This
report will includes impact of strategy adopted by Tesla in its decision making as well as
activities. it includes internal and external factors that influence company responses. Apart from
this reflective view have been included in this report which will outline how organisational
strategy assist in strategy evaluation.
MAIN BODY
Evaluate how strategy adopted by Tesla impacts the company decision and activities.
Ansoff matrix – This
 Market penetration – This strategy refer as when company is conducting its business
practices in current market area through current products or services of business. Market
Penetration is the strategy recommended by the Ansoff matrix to the organizations. The
strategy urges the company to expand the deals of the current product in the current
market. This strategy helps in expanding the market portion of the business. Besides,
organizations can select this strategy as it is least risky (Fedushko and et.al, 2021). Tesla
Motors embrace this strategy as it includes in forceful marketing, which points the
company to sell and carry out a greater amount of electric vehicles in United States. This
is consider as one of the easies strategy for Tesla company and this will help in increasing
sales and profitability of business. These helps the company in amplifying the incomes
from the markets it is as of now working.
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 Market development – This strategy can be explain as when organisation is planning to
extend its business practices in new market area by offering current products and
services. Market development is the strategy proposed by Ansoff matrix to the
organizations who favor growing in new markets with current products. This is
additionally called market expansion for the company. The company in the market grow
either geographically or demographically. Market development is the strategy proposed
by Ansoff matrix to the organizations who lean toward extending in new markets with
current products (Valeri, 2021). In this Tesla company needs to focus on conducting its
business practices in different market area that has need and want of products offered by
Tesla company. This is likewise called market expansion for the company. The company
in the market grow either geographically or demographically.
 Product development – This can be describe as the business strategy that includes
development of new product and services in current market area. Product Development is
the strategy centers around the companys new product dispatch for the current market it
is serving to. This is likewise a product expansion strategy as new products are being
included product portfolio. The new dispatch of product either could be an alternate
product or diverse variant of same products. In this strategy respective organisation needs
to develop high quality and differentiate product which is according to the needs or wants
of customers. Company typically take on limited time procedures to acquire market
consideration. Tesla Motors apply this strategy by utilizing cutting edge innovation
products for least effect on environment.
 Diversification – This is consider as one of the most risky strategy for Tesla business and
in this respective company is planning to conduct its business practices in new market
area by offering new products and services in market area (Yan, Hong, and Warren,
2021). This strategy urges the company to present new product in the new market. The
diversification can be connected or totally random in new industry. Tesla Motor
presented its battery products as a diversification strategy for non-automotive products.
Porters generic model – This is one of the effective and efficient model that helps organisation to
take right and accurate strategy for successfully and effectively conducting business practices.
Porters generic model includes cost leadership, differentiation and focus strategy that helps in
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taking right decision for business and accomplishing desired goals. This model is mention below
in context of Tesla company -
 Cost leadership – This can be describe as the business strategy in which company is
focusing on developing products and services at lower cost in order to gain advantage
over other rival company. Through this strategy Tesla company needs to sell its products
and services in lower cost as compare to other rival companies. In a cost leadership
strategy, the goal is to turn into the most minimal cost maker. This is accomplished
through huge scope production, where organizations can take advantage of economies of
scale.
 Differentiation – This can be explain as the strategy of organisation in which it is
focusing on creating and developing new or unique products. a company products or
administrations are differentiated from that of its competitors. Differentiation is one of
the effective strategy in order to attract more and more customers towards business and
attain desired goals (Arun and Ozmutlu, 2021). This should be possible by conveying
excellent products or administrations to clients or innovating products or administrations.
 Focus – This strategy can be consider by organisation when it is focusing on niche
market area. A company centers around a narrow target market portion. Tesla company is
conducting its practices in large market area so this strategy will not be significant for
organisation in order to accomplish desired goals. This strategy is effective in case the
company can effectively make products/benefits that can oblige these clients.
Analyse the external and internal factors of Tesla and how the company responses to them.
There are different internal or external factors of Tesla company that will lead to have major
impact on overall performance or productivity of business. It is essential that Tesla company is
correctly or accurately analysing internal or external factors of business in order to take right
decision and enhance business practices. Internal factors include capabilities or weakness of
respective company that affect business performance level as well as influence accomplishment
of desired goals. External factors consist of all those elements which can not be control or
managed by organisation and directly or indirectly affect performance of business. it is crucial
that Tesla company is correctly responding over the internal and external factors of business with
the motive of increasing business performance and attaining desired goals. Analysis of internal
and external factors of Tesla company is mention below in detail –
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SWOT analysis
This stand for strength, weakness, opportunity and threat associated to respective business
that is Tesla. It is crucial that this company is analysing and evaluating these factors in
appropriate manner with the motive of accomplishing desired goals. SWOT analysis in context
of Tesla company is mention below in detail –
Strength – Tesla is one of the largest company that is providing its products and service
Automotive industry. The major strength of respective organisation is that is has developed trust
of customers by offering high quality products and services. This is consider as the most valuable
automotive company that is able to successfully meet with the needs or wants of customers.
Telsa has developed strong brand image in market area by becoming the best in class electric
cars. This is one of the top company which is providing electric cars and has been proven to be
the best covering maximum distances. It has been analysed that employees of Tesla company are
its crucial strength as they have right skills and potential to enhancing business practices.
Through effectiveness of its employees Tesla company is able to create innovation encouraging
culture and develop high quality products.
Weakness – There are some weakness of Tesla company that is affecting its performance
and productivity level (Greve, 2021). It is essential for respective company to analyse its
weakness in order to overcome it and improve business practices. The major weakness of Tesla
company is its manufacturing complications. It has been identified that due to high standards of
innovation Tesla company is facing issues issue to deal with advance technology. Due to this
mechanical complications and production risk increases.
Opportunity – There are different opportunities that is available for Tesla company that will
lead to enhance its performance and productivity level. Tesla company have opportunity to sale
less expensive cars so that they can attract more and more customers towards business. Currently
Tesla is selling luxury cars that could be purchased by high income group customers. so by
developing and selling less expensive cars this company will be able to influence middle income
group customers as well. Tesla organisation has opportunity to perform its business practices and
sales products in untapped market area. This is effective opportunity for overall growth and
development of respective business.
Threat – There are different threat factors which are associated with Tesla company which
will lead to influence organisational decision making and practices. Extensive competition is one
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of the major threat for Tesla company that will lead to affect its business performance and
productivity. Tesla organisation is dealing in highly competitive market area and there are
several companies such as Toyota, Ford and so on which is ready for a fierce competition.
Effective and strong strategies of rival company will lead to directly influence performance of
respective company.
PESTEL analysis
This is one of the effective tool that will assist company to analyse and evaluate different
factors of external market area. It is essential that Tesla company is considering different
elements of external environment so that right and accurate decision could be taken. PESTEL
includes political, economical, social, technological, environmental and legal factors. All of these
factors are mention below in context of Tesla company.
 Political factor – This can be explain as the rules and policies developed by government
for providing guidance and direction to business. Political factor includes policies,
taxation, trade and tariffs and so on. All of these are crucial factor that will lead to
directly affect functioning and performance of respective company (Graebner, 2021). It
has been determined that Tesla company is following rules and guidelines that is set by
government party to perform business practices dealing automotive sector. Due to this
Tesla is able to successfully conducting business practices.
 Economic factor – This is one of the crucial factor that needs to be consider by
organisation while taking important business decisions. It includes several elements such
as economic rates, GDP rates, inflation rates, unemployment rate and so on. all of these
are significant and essential factors that needs to be consider by Tesla in order to take
right business decision. UK country has strong economic condition that is significant for
enhancing overall performance level of business as well as assist in attaining desired
goals. Through strong economic rates Tesla company is able to successfully conducted
business practices in appropriate manner as well as increasing sales of business (Lin and
et.al., 2021).
 Social factor – Social factors consist of different aspects such as beliefs, culture, attitude
and perception of customers. It has been determined that Tesla company is identifying
different needs or wants of customers in order to develop accurate products and services
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which is able to meet with the demand of customers. It has been identified that potential
customers of Tesla company wants high quality electronic cars that is significantly able
to meet different types of requirements of customers. through this Tesla company has
developed strong brand image in market area that lead to influence business practices and
help in accomplishment of set goals.
 Technological factor – This factor consist of new and advance technology that helps in
developing high quality products or services for business. It has been identified that UK
market area has one of the advance technology in this world that helps Tesla company to
develop appropriate luxury products and services. Through effective technology Tesla
company performance and productivity will be successfully enhanced and it will assist in
meet with desired goals of business. Through strong and appropriate technology in
organisation its practices will be significantly increased and lead to effective performance
of business.
 Environmental factor – Environmental factor includes several aspects such as pollution,
waste management, water pollution, air pollution and so on. Tesla company is dealing in
automotive sector and developing high quality luxury car products. It has been analysed
that this company is focusing on maintaining different environmental factors such as air
pollution and so on (McGee and Channon, 2021). this company is using right and
accurate machines and system that helps in protecting environment from several issues
as well as help in conducting business practices successfully.
 Legal factor – This factor of external business environment includes different legal laws
and legislation that is helpful for successfully and effectively conducting business
practices. it has been identified that there are different legal factors which will lead to
have positive and negative impact on business as well as influence decision making of
organisation. This consist of wages and salary act, employment act, anti discrimination
act and so on. It is crucial for Tesla company to analyse and evaluate these factors so that
it is able to effectively conduct business task.
Reflective View
While conducting this report I have analyse and evaluated different aspects related to
strategic management practices of business. I have identified that it is very important for an
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organisation to successfully and correctly analyse different factors related to business that will
lead to affect organisational performance and productivity. It is essential for an organisation to
evaluate different aspects related to business so that right decision could be taken by
organisation. This will lead to have impact over the way company is performing its practices as
well as capability of organisation to attain desired goals. Strategy is a move that chiefs make to
accomplish at least one of the associations objectives. Strategy can likewise be characterized as
An overall direction set for the company and its different parts to accomplish an ideal state later
on. A strategy is tied in with coordinating authoritative exercises and using and distributing the
scant resources inside the hierarchical environment in order to meet the current targets. I have
determined that while arranging a strategy it is fundamental to consider that choices are not taken
in a vaccum and that any demonstration taken by a firm is probably going to be met by a
response from those impacted, competitors, clients, workers or providers. Vital assessment
comprises the last phase of vital administration and is viewed as one of the most fundamental
stages all the while (Duhaime, and et.al., 2021). I have identified that strategies play crucial and
significant role in organisation as this will help in taking accurate decision that leads to overall
growth and development of business. I module is very learning experience for me as through this
I was able to gain information about the significant of strategy for organisation as well as its
impact on business practices. I have analysed that strategy assessment is the interaction by which
the administration surveys how well a picked strategy has been carried out and how fruitful or in
any case the strategy is. the implementation of the strategy isn't occurring as arranged, say
because of the limitations in the strategy that are impeding the accomplishment of authoritative
objectives, essential remedial activities ought to be distinguished and applied. Through this I
have identified that different types of strategies that could be consider by organisation in order to
improve business performance as well as its impact on accomplishment of desired goals. While
conducting this module I have identified that organisational strategies will assist company is its
strategy evaluation and through this respective company will be able to improve its potential to
conduct business task. The period of strategy assessment guarantees that the implementation of
the specific strategy will assist the association with accomplishing its destinations. Without this
progression in the strategy the board cycle, it would demonstrate hard to recognize whether the
strategy executed is creating the ideal impact. It has been determined that it is important that
company is performing its practices in such as manner that it will lead to assist in gaining
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competitive advantage over other rival companies. I have determined that competitive advantage
can be describe as the those factors of business which allow organisation to develop goods or
services better than other rival companies. Through this it will be able to gain edge over other
rival companies as well as successfully attract more customers towards respective organisation.
Through this module I have gained information about the Tesla company as well as its practices
that is effective for accomplishing for meeting with the goals business. It has been identified that
there are different activities that task of business that will assist in gaining competitive edge over
other rival companies. it is essential for Tesla company to focus on creating effective strategies
so that its sales and profitability could be increased successfully. I have identified that strategy
can be describe as the actions which is significant for accomplishing long terms goals and
objectives. I have determined that in order to develop effective and efficient strategy Tesla
company will be able to determine different factors and elements that needs to be correctly and
accurately analysed by organisation in order to successfully accomplish desired goals. In this
module I have gained information about the different aspects or elements which need to be
determined that Tesla organisation so that right strategies could be developed. There are different
factors related to internal and external market area which will lead to have direct impact on
overall performance and productivity of business. I have determined that internal factors includes
organisational strengths and weakness which will lead to impact over decision making practices
of organisation. Where as external factors includes all those elements of business that which are
outer factors and can not be control by organisation. It is crucial that internal and external factors
of organisation could be correctly and accurately analysed by the respective company so that
appropriate strategies could be significantly developed. It has been identified that internal
strategies and capabilities of respective company will help in improving performance level of
business. It is important that different factors has been analysed in order to take right decision for
growth and development of business. business strategies will lead to have major impact on
overall enhancing business practices and timely accomplishment of desired goals. It has been
identified that Tesla is one of the largest company that is developing high quality car products in
order to successfully meet with the requirements of customers. This company has positive and
strong brand image in market area that will lead to enhance overall sales and performance of
business. Through this I have analysed that brand image of organisation is one of the strongest
strength that will lead to positively affect organisational practices. This is consider as the most
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valuable automotive company that is able to successfully meet with the needs or wants of
customers. Telsa has developed strong brand image in market area by becoming the best in class
electric cars. The major weakness of Tesla company is its manufacturing complications. It has
been identified that due to high standards of innovation Tesla company is facing issues issue to
deal with advance technology. There are different external factors which will lead to affect
organisational practices of business. Political factor is one of the crucial factors that will lead to
affect business performance. It has been determined that Tesla company is following all rules
and regulation that is set by government and political party so this will help in successfully and
correctly functioning of business. I have determined that due to Covid 19 pandemic economic
factors has been influencing and it will affect decision making practices of organisation. It is
crucial that Tesla company is focusing on identification of customers needs and wants so that it
is able to meet with the different requirements of customers. There are several crucial factors of
external environment due to which respective company is able to gain edge over other rival
companies. A competitive advantage is a trait that empowers a company to outflank its
competitors. This permits a company to accomplish better edges looked at than its competition
and produces an incentive for the company and its shareholders. A competitive advantage should
be troublesome, if certainly feasible, to copy. I have identified that technology used by Tesla
company is very advance and innovative that will affect the way business is conducting its
practices. high technology and creative strategies of respective company will lead to enhance
overall performance level of business as well as assist in gaining competitive edge over other
rival companies as well as assist in timely meeting desired goals of business. Through this
module I have understand the importance of developing effective strategies for business that will
assist improving performance level of organisation over other rival companies along with this
right and accurate action plan could be determined that will lead to enhance business and its
practices. Assuming it is effectively duplicated or imitated, it isn't viewed as a competitive
advantage. Competitive advantages produce more noteworthy incentive for a firm and its
shareholders on account of specific qualities or conditions. The more sustainable the competitive
advantage, the more troublesome it is for competitors to negatively impact the advantage. I have
identified that Tesla company is offering unique and luxury products which is according to the
desired or wants of potential customers. This will help in developing strong and positive image
of company in market area. Through the support of differentiation of products and services Tesla
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company is able to successfully gain edge over other rival companies along with this desired
objectives of respective business could be timely accomplished.
CONCLUSION
From the above report it can be concluded that strategy management is one of the crucial factor
for organisation that will lead to enhance business performance and productivity. It has been
analysed that effective strategic management practices will lead to have positive impact on
accomplishment of desired goals of organisation. It is crucial that this company is analysing and
evaluating these factors in appropriate manner with the motive of accomplishing desired goals.
PESTEL includes political, economical, social, technological, environmental and legal factors.
There are different internal or external factors of company that will lead to have major impact on
overall performance or productivity of business. It is essential that Tesla company is correctly or
accurately analysing internal or external factors of business in order to take right decision and
enhance business practices.
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