CUEGIS: Change, Culture, Ethics, Globalization, Innovation and Strategy

Introduction:
Tesla is an American electric vehicle and clean energy company, established in 2003 by group engineers. Tesla is a non-
government private limited company. Its market share rose to 3.66 percent in 2020. The current CEO of Tesla is Elon
Musk. Tesla ranked as the most valuable automotive brand worldwide in 2021. With a growth rate over 157 percent in
2021, Tesla is the fastest growing brand worldwide. The founders of Tesla wanted to prove people that electric vehicles
can be better, quicker, than gasoline cars. While keeping their main aim in mind of being eco-friendly sustainable while
having high quality electric cars which are affordable. The number of people employed full-time by Tesla came to 70,757
at the end of 2020.
• Change is the adaptation of the organization to accommodate for the external business environment, e.g.
organizations need to adapt what they do in relation to new technologies, social and cultural factors, changing
demographics, different government laws, economic trends and globalization.
• Culture describes an organization’s traditions and norms, i.e. the way in which things are done within the
organization. Culture can also refer to the customs and norms within a certain area, region or country, which can
have a direct impact on all aspects of an organization’s operations.
• Ethics are a set of moral values and guiding principles that influence how individuals, organizations and societies
behave. Different stakeholders may have different perspectives on what is considered ethical business behaviour.
• Globalization is the ongoing process of interaction and integration between people, firms and organizations trade
is conducted over widening geographical boundaries, offering opportunities and threats.
• Innovation refers to the incremental or radical process of improving business, such as introducing new or adapting
existing technologies to supply improved goods or services.
• Strategy is the long term plan and decisions which allow an organization to achieve a particular organizational
goal.
Globalization:
Globalization refers to opening local perspectives to a broader outlook of an interconnected world with transfer of
capital and goods and services
Globalization has played huge role in the decision making of the However, the risk operating internationally
company. With the help of globalization tesla opened a car would be higher than operating locally. The
production factory in shanghai. The car manufacturing highly factory would cause more pollution in the area
increased with the help of Chinas evolving and advanced and would raise concerns for the shanghai
technologies that will increase its sales. Providing job population. The cultural changes could also
opportunities to the local citizen of China would create good affect Tesla’s traditional operation process.
relationship with Chinas government. opportunity cost --> expensive to build factory
Tesla opens dealerships in 25 countries within 24 months. Tesla
management set a tight global expansion timeline to meet
growing demand.
Tesla opened new service centers for car maintenance in Consumers: monopoly --> depended on Tesla --
European and Asian markets due to the increasing demand in > .prices can go up
Europe and Asia for electric cars in their attempt to diversify
revenue streams. Customers enjoy post-purchase services. 163
centers for car maintenance in North America and West Europe.
promotes accessibility to European customers

Tesla has created a global presence in technological developments, branding, and market adoption (Mangram,
2012). For instance, Tesla has developed innovative products aligned with a technology hub strategy, where Tesla
products function as a technology hub for its other product lines (Mangram, 2012). More so, Tesla has a unique
global marketing approach that emphasizes the optimization of technology and the development of a compelling
product compared to predominant business models that favor mass production (Mangram, 2012). Due to the
environmental damage caused by the transportation sector, international policymakers are encouraging electric
vehicle adoption as an alternative source of transportation
Culture:
the norms of an organization, a country, or other social grouping. Culture shapes the values, beliefs, and customs of
people. (Internal and External sections of the organization)
Do the impossible: develop cutting-edge products. “Think Employees: pressure to constantly innovate --> no
out of the box” rest, internal competition
Company: able to develop high-technology products -->
attracts customers
Constantly innovate rewards for innovation
Think like owners: encourage employees to take
responsibility in their jones and have a ownership mind set.
Customer: support for rapid response and problem solving
--> updated with technologies + making product effective +
relevant for customers' needs and preferences
Tesla perfectly aligns the organization's culture with social However, since Tesla's culture is so focused on the
responsibilities based on the organizational vision and organization's vision, there appears to be disconnect
strategies employed by the company.  on what truly matters within the organization: the
employees.
Since Tesla is an international organization, there are
various cultures with which the organization is associated.
Thus, intercultural knowledge can be an effective strategy
to help develop adequate communication skills among
various cultures. Intercultural knowledge will also assist
Tesla in minimizing cultural barriers due to ineffective
communication tactics.
Broad spans of control: Employees aren’t restricted and
confined by rules at Tesla. Every employee is encouraged
to do their jobs how they deem fit, as long as it yields
positive results. By endorsing employees’ freedom, Tesla
allows them to get innovative and creative to take actions
that are contributory to the company’s growth.
Innovation:
Innovation refers to the introduction and implementation of new and improved product, process, and ideas.
Innovation is at the heart of Tesla, Inc. This feature of the organizational culture However, disadvantage to its
focuses on the continuous nature of innovation at the company. For example, the employees for constant
corporation continuously researches and develops solutions that improve current pressure to innovate, puts
energy storage product designs strain on HR.
Continuous innovation maintains the competitive advantage necessary to
address the strong force of industry competition. The company addresses this
need through a corporate culture that rewards constant innovation. Managers
motivate employees to contribute to constant innovation in business processes
and output.

stakeholder interest through CSR strategy that focuses on sustainable and

environmental friendliness of the cars that benefits the stakeholders and boosting
the company’s corporate and brand image. Tesla categorize the community as
their highest priority, the company would strive to obtain something with the
community s best interest. The community would be able to benefit from Tesla
such as lower carbon emission by providing electric energy consumed vehicles
for the community. The community would be at ease if the realize that they are
supporting an ethical company. The community can also contribute to the society
by using the products of Tesla. As for the customer if they would be satisfied with
their purchase of Tesla's product if the company cater to their needs by providing
their demands. As the customers are the second prioritize stakeholders aside
community by Tesla the company is trying to satisfy their customers all around
the world.
Cybertruck aren’t really about making money; they are about getting attention
and proving that Tesla is one of the world’s most innovative companies,
specifically for the purpose of building Tesla’s ability to win support from
stakeholders — what we call innovation capital.
Strategy:
devising plans to achieve the long-term goals of an organization
Tesla has followed the strategy of starting from the high-end market and working its
way down to lower end of the market. Elon explained this strategy himself saying the
strategy is “Build sports car. Use that money to build an affordable car. Use that money
to build an even more affordable car”
Tesla focuses on word-of-mouth advertising, and referrals. Essentially, Tesla markets
to its customers by not directly marketing to them. It encourages others, namely
customers, to do the selling for them.

Going public : With this movement, they give the company the opportunity to globalize
itself and change their strategy, they opened at $17 a share and raised $226 million in
its IPO.

Direct selling: more personal relationship with consumers --> increase brand loyalty expensive --> need to
Consumers: technical knowledge control everything
Company: no intermediaries --> full control over the product (employee training,
Company: luxury position in the market shipment, facilities,
machinery)
Customers: less access
to the product
Tesla’s strategy offers enduring lessons for any innovator, especially in terms of how to
win support for an idea and how to bring new technologies to market. To understand
Tesla’s strategy, one must separate its two primary pillars: headline-grabbing moves
like launching the Cybertruck or the Roadster 2.0 and the big bets it is making on its
core vehicles, the models S, X, 3, and Y
Cybertruck aren’t really about making money; they are about getting attention and
proving that Tesla is one of the world’s most innovative companies, specifically for the
purpose of building Tesla’s ability to win support from stakeholders — what we
call innovation capital.
What makes this part of the strategy truly unique is not just that Tesla produces electric
vehicles, but that it introduced a new hardware and software architecture 
 a ‘new technology’-based approach to marketing management is central to Tesla's
current and future growth.
Ethics:
The socially accepted moral principles that guide decision making, based on the collective belief of what is right and
what is wrong.
they create an entirely electric car, and by that time it was an
innovative idea that reflected the environmental ethics of the
company. Tesla expands their production with new innovations
and confirms the image of the company, being environmental
ethical.
We are all in unifies the employees into a team to improve
productivity helps minimize conflicts through teamwork.
Employees: specifically for people working around machines -->
Maslow --> safety needs
Employees: people have to follow safety and health rules -->
report to HR --> reassuring that they are safe
Consumers: satisfied and more likely to consume the product
One thing about Tesla is that they are not apart of auto union.
The purpose of an auto union is basically to give the employees
the opportunity to earn a fair wage, be treated fairly, and protect
them if they were to get fired. Tesla already treating its
Production: process = bad for the environment
Production: electricity for cars --> comes from
coal fires plants
Employees: focus on innovation --> employees
died while experimenting product --> hurts
brand image and employee loyalty
=> In March, Tesla driver killed while test-driving
autopilot Model-X
 Consumers: danger --> two teenagers killed-->
battery caught fire
- Consumers/employees: safety in workspace vs
safety of cars --> concerns/impacts on:
consumers, government, brand image, supplies,
employees
This is a controversial topic thought as there are
some people who think that a auto union is
important and necessary.
 employees fairly and giving them the fair wage, as they should
be doing, then there is no need for a union.

Change:
Driving forces and restraining forces creates change in a business so that they can move forward and remain
competitive.
Innovating and coming up with different models that are
more affordable and improved quality to have wider
custombers
When Daimler bought 10% stake of tesla, they were
able to fund around 450 million dollars to develop
battery and electric drive system that meant a step
forward to expand their company.
While Tesla had built strong markets in these two
countries, it was still lagging in Europe and elsewhere.
In January 2021, Tesla was planning to build a new
factory in Berlin and enter the Indian market
aggressively.