ITM CASE 3: Introduction to Management

ITM CASE 3: Introduction to Management 150 150 Affordable Capstone Projects Written from Scratch

Case 3
Tesla Model 3
2018 /2019 Block 1
Amsterdam School of International Business
© 2018, Hogeschool van Amsterdam
Tesla’s Model 3 Is Now America’s Best-Selling
Electric Car
Retrieved from:
Tesla Inc. released its production numbers for the first quarter 2018 on Tuesday. The company delivered
8,180 Model 3s in the first three months of the year. That compares with 6,468 deliveries for Toyota
Motor Corp.’s Prius Prime plug-in hybrid and 4,375 for General Motors Co.’s Chevy Bolt.
Coming out on top is no small feat for a company that’s been manufacturing vehicles for barely a decade.
However, huge hurdles remain as Palo Alto, California-based Tesla tries to turn the page on one of the
most difficult chapters in its short history.
Earlier this year, Bloomberg launched an experimental model to track Model 3 production using vehicle
identification numbers (VINs). Our final estimate came in just 5 percent less than Tesla’s reported
numbers, arguably validating the methodology. That’s not great news for Tesla fans, because our model
suggests the company may have exaggerated its production capabilities at the end of last year. In the
coming weeks, Tesla will need to prove that it can sustain and build upon the peak weekly production
rates it just announced.
Wall Street was pleased with the production numbers but hardly elated: “Good enough,” wrote Robert
W. Baird & Co. analyst Ben Kallo. KeyBanc Capital Markets Inc.’s Brad Erickson said the numbers
were “better than feared.” Consumer Edge Research LLC analyst James Albertine, who remains bullish
even after Model 3 production missed his estimates, said, “Our hope is that subsequent ramps in
production may be easier.”
Tesla Rises to the Top
There’s reason for such scepticism. If we go back to Tesla’s fourth-quarter numbers, released in January,
the carmaker said it had made 793 Model 3s “in the last seven working days” and achieved a production
rate of 1,000 a week in the last few days of the quarter. At the time, those extrapolated weekly rates
were the only positive news during an otherwise miserable start to production.
However, our model showed that Tesla didn’t sustain 793 cars a week until mid-February and didn’t hit
1,000 cars a week until mid-March. So what are investors to believe of Tesla’s latest pronouncement
that it’s now broken the 2,000-per-week barrier—itself lower than Tesla’s 2,500-per-week forecast—on
the way to 5,000 per week in the next three months?
Amsterdam School of International Business
© 2018, Hogeschool van Amsterdam
Bloomberg’s weekly estimates are averaged over time and wouldn’t register a sudden end-of-quarter production
blitz. The Trend feature is a better indicator after a big swing in the production rate but is subject to sudden revision
if production rates aren’t sustained. Source: Bloomberg
Looking at Tesla’s weekly rate is a bit like asking a marathon runner the fastest they can run a mile. It
might be interesting, but when they have to go back to running marathons, how much bearing does it
have on their endurance rate?
On Tuesday, Tesla tried to allay fears of sustainability—given its last minute-push to 2,020 cars during
the final seven days of March—by saying it will produce 2,000 this coming week as well.
Even if you believe that Tesla is closer to getting back on track with Model 3 production, the automaker
isn’t out of what Chief Executive Officer Elon Musk calls “production hell” just yet. He said on Twitter on
Monday that he’s “back to sleeping at the factory” while trying to fix production delays with the Model
3. That’s not the way a CEO typically celebrates a successful quarter.
That said, two weeks of production above 2,000 per week would at least suggest that Tesla’s biggest
bottleneck—at its battery factory in Nevada—may be over. Early in the quarter, the company was
struggling to make 500 battery packs a week, according to the Bloomberg tracker. Tesla reported in
February that a battery production line had been built at its Grohmann Automation labs in Germany and
was scheduled to be installed last month.
If Musk, 46, is instead camping out at his Fremont, California, assembly line that suggests his attention
has shifted from batteries to the next bottleneck in car assembly. “Car biz is hell,” he said.
Amsterdam School of International Business
© 2018, Hogeschool van Amsterdam
1. The purpose of the case assignment.
The importance of a case assignment is to test whether you are able to relate the knowledge perceived
from the textbook and lectures, to real, and day to day events in the business environment
(understanding theories and application of theory)
2. Case assignment group and report.
Case assignments are executed in groups of 5 students. Together with your group members you answer
questions about a variety of topics in management.
Important is to maintain alignment between the different parts (introduction, body and conclusion) of
the report. (See Reporting Guidelines for detailed information) Separate research and analysis (in the
body part) from the conclusions that can be drawn from your research and analysis (in the conclusion
part). Always use arguments to substantiate your answers. You are allowed to use additional credible
sources to substantiate your answers. In all cases do not forget to mention all sources used in the
3. Case assignment assessment criteria and grading.
See chapter 7: Assessment Form Case Assignment for assessment criteria and grading
4. Reporting guidelines and deadline for uploading
Write a report according to the Reporting guidelines 2018-2019. (Available on Brightspace)
The report has a maximum of 3000 words – use word-count –
This maximum is excluding cover sheet, bibliography and appendices, but including executive
summary, table of contents, introduction, body and conclusion. Preface and recommendation parts
can be left out.
The report (1 report per group) shall be uploaded in Word-format to the drop box that is available in
the week 8 file in Brightspace before Friday November 2nd, 2018 17.00 hrs.
5. Case questions
1. Introduce the case stating the most relevant issues from the case. (15 points).
2. What are the turbulent forces that are affecting Tesla today? Apply relevant theories from the
ITM book and lectures. (10 points). Similar to question1 in case1.
3. What are the (historical) management perspectives that have particular relevance to Tesla’s
approach to clean energy? Again be sure to link the discussion to the case, the ITM theory and
external sourcing. (10 points). Similar to case1 question 3.
4. Execute a SWOT analysis for Tesla. Apply ITM theory, information from the case and external
Amsterdam School of International Business
© 2018, Hogeschool van Amsterdam
sourcing. Be sure to do some proper research. (20 points). Similar to Case2, questions 2 and 3.
5. Apply theories of Leadership to determine Elon Musk’s style of leadership. (10 points). Use
external sourcing in addition to the ITM theory.
6. Discuss if Elon Musk’s leadership style as CEO of Tesla is effective? What are the weak
and strong point of this person? How can Tesla invest in human capital the best? (15
7. Based on the findings from Question 4, discuss and develop an overall strategy for Tesla
for the next coming 10 years? Do not just give your opinion but rather base your ideas
on the actual SWOT results and what is going on in the news. (15 points).
8. In conclusion, summarise this case by paying attention to the main points coming from
all the questions and the case itself. (5 points).
6. Assessment of ILO’s
Case 3 assignment links to the following learning goals:
# Description
2 Discuss the development of management from a historical perspective.
3 Classify and apply the different elements of the external environment and its relevance for environmental
4 Discuss and apply various components of strategic management process including SWOT analysis, multiple
levels of strategies, goals and plans as well as different tools used for strategy formulation and
implementation in a fast-changing environment.
7 Explain the meaning and importance of leadership and identify and apply leadership theories in a case study.
8 Describe strategic role of HRM in the organisation including determining future staffing needs, developing
and maintaining effective workforce.
Amsterdam School of International Business
© 2018, Hogeschool van Amsterdam
7. Assessment Form Case Assignment
Performance Rating
Introduction 11 – 15 points 6 – 10 points 0 – 5 points score
15 points
The introduction provides a clear
and accurate situational
background. The relevance of the
article is identified thoroughly. Key
issues in question are compelling
and insightful. The introduction
demonstrates an excellent grasp of
the case principle issues to be
The introduction provides a brief,
yet sufficient situational
background. The relevance of the
article is identified but may miss a
few minor points.
With a few exceptions, key issues
in question are outlined. The
introduction demonstrates an
acceptable understanding of the
case principal issues to be
The introduction does not
provide a clear situational
background; no clearly
expressed relevance of the
article is identified; no key issues
in question are outlined, or
those are scarce/vague or
formulated simplistically, or
cannot be understood. The
Demonstrates a mediocre
understanding of the case
principal issues to be answered.
Body 37 – 50 points 16 – 36 points 0 – 15 points score
50 points
Presents a balanced, in-depth, and
critical assessment of the issues in
the case in light of relevant theory
discussed in the course book and
research data from credible
Presents an acceptable analysis
of most of the issues in the case; in
most instances, the analysis is
adequately supported by relevant
theory discussed in the course
book, with few if any additional
research data from credible
Case analysis makes little or no
connection between the issues
in the case and relevant theory
supported in the course book or
justified by other credible
sources, or the connections
identified are weak or inaccurate
in many respects; shows no
critical examination of case
Conclusion 25 – 35 points 13 – 24 points 0 – 12 points score
35 points
Answers effectively weigh and
assess courses of action central to
the case; answers are realistic and
contain thorough and wellreasoned
Conclusion is largely based on
findings collected in the body of
the report
Answers demonstrate acceptable
analysis of proposed action with a
few minor exceptions; in most
instances, proposed actions are
feasible, and based on relatively
sound theory and evidence.
Conclusion is partly based on
findings collected in the body of
the report
Answers have difficulty
identifying appropriate courses
of action;
Infeasible solutions are
proposed to the issues in the
case study.
Conclusion is insufficiently based on findings collected in the body of the report
The assignment is written in clear, concise and correct Business English
Layout &
According to the IBS Guidelines described in the document ‘Reporting – Guidelines for Writing and Styling
Business Reports’