Tesla The Solarcity Acquisition Case Study Analysis expected the bit fun with the knowing, which was beyond the business's values and culture. It requires conducting robust external environmental analysis to decipher evidences for the reasons presented in the Tesla: The SolarCity Acquisition. The case solution first identifies the central issue to the TESLA THE SOLARCITY ACQUISITION - STUDENT SPREADSHEET case study, and the relevant stakeholders affected by this issue. The Tesla: The SolarCity Acquisition case study solution requires the MBA, EMBA, executive, professional to have a deep understanding of various strategic management tools such as SWOT Analysis, PESTEL Analysis / PEST Analysis / STEP Analysis, Porter Five Forces Analysis, Go To Market Strategy, BCG Matrix Analysis, Porter Value Chain Analysis, Ansoff Matrix Analysis, VRIO / VRIN and Marketing Mix Analysis. Teslas co-founder and CEO, Elon Musk, believed that the merger would generate significant cost and revenue synergies, based on his vision of the future of transportation, energy storage, and a green economy. Providing personnel with as much right truths as possible, before hand they start functioning for the company. This is known as product development strategy. SolarCity shareholders will receive 0.11 share of Tesla, worth $20.75 based on Thursday's closing price, for each SolarCity share, making the deal worth about $2.1 billion. In these cases, recommendations need to be made for these people. Chat with us According to Zhichuan Frank Li, Tomiwa Ademidun of Tesla: The SolarCity Acquisition case study, Solarcity Tesla can use this trend to expand in adjacent areas Financial analysis, Manufacturing, Mergers & acquisitions. They also alleged that due diligence by outside firms including Evercore was rushed to hide SolarCity's troubles. The conferences were chockfull with discussions from diverse divisions of the company, and comprised organizational details, standards, worths, and the life of the employees in the company, with interactive games. Bringing SWOT into Focus. SolarCity began in 2006 as a residential and commercial solar provider, manufacturing and installing its own solar panels and equipment. Retrieved July 7, 2016, from https://hbr.org/1979/03/how-competitive-forces-shape-strategy. One of the biggest issues with the deal was that Elon Musk was the largest shareholder of both Tesla and SolarCity at the time of the acquisition. Strategic Change, 7(2), 101-109. The company was headquartered in Fremont, California, before being purchased by Tesla Inc. in 2016 for $2.6 billion. It can include recommendations on how the organisation can work towards achieving these strategic objectives. Tesla The Solarcity Acquisition Case Study Solution wondered that, would she fit in the company's value culture and the way it works. It should compare the marketing mix elements of competitors, their supply chain, human resources, financial strength etc. - Little dangers of armed conflict Based on the research done by international foreign policy institutions, it is safe to conclude that there is very little probability of country entering into an armed conflict with another state. Should Solarcity Tesla enter new market or launch new product (Opportunities & Threats from SWOT Analysis) This part consists of solutions that address issues faced by the organisation on a strategic level. - Consumer activism is significantly impacting Solarcity Tesla branding, marketing and corporate social responsibility (CSR) initiatives. Tariffs Chekout how much tariffs the firm needs to pay in the Tesla: The SolarCity Acquisition case study. Each resource is assessed in terms of how rare it is. The company's major goal must be to change as many 'resisters' as possible through various robust interaction networks and circulation of information, and for those you can not keep them involved in this program. correct email will be accepted, (Approximately The shareholders also alleged that Musk controlled the board of Tesla, even though he appeared to recuse himself from some deal negotiations concerning SolarCity. Harvard Business Review cases involve a central problem that is being faced by the organization and these problems affect a number of stakeholders. Boston: Irwin McGrawHill. If you find any employee lazy in your group, do not devote your day on focusing on the way that your lazy subordinate is constantly utilizing Facebook and other social networks at the office. SWOT analysis will help us in not only getting a better insight into Solarcity Tesla present competitive advantage but also help us in how things have to evolve to maintain and consolidate the competitive advantage. At the end of the first year, she felt that the association with the business was getting bit worse because she felt that she was designated the project that was beyond her command, with extremely restricted time and there was no one to help her out in the task. Order your custom solution now. Export restrictions on products Apart from direct product export restrictions in field of technology and agriculture, a number of countries also have capital controls. It shows that one has been clarified with the HBR fundamentals on the topic. June 21, 2016 3:09 p.m. PT. There was less possibility to be used in US. We want to hear from you. During the trial, Musk said the SolarCity deal was part of his "master plan," which he had written in 2006 and was meant to accelerate the advent of sustainable energy. It also touches upon business topics such as - Marketing Mix, Product, Price, Place, Promotion, 4P, Financial analysis, Manufacturing, Mergers & acquisitions. Solarcity Tesla needs to adjust its marketing strategy accordingly. If you read nothing else on strategy, read thesebest-selling articles., 71. Why you choose one course of action over the other. Task beyond the command on the field. When it comes to the business, socialization is a treatment that meaningfully forms corporations in the way that provides important practices for the company to increase the interaction in between the managers and the workers. Had he lost, Musk could have had to pay upwards of $2 billion. She understood that every worker was passionate and worked proudly in the company so, she should also be happy to be a part of the business. Pearson education. For example, strengths will be used as an advantage in solving the issue. This would be the better way to engage all the newbies in the business. No reply from the mangers in the brand-new office. She understood that a lot of the important things had altered in the office in addition to the changes in the method she was, at the initiation of the job. SolarCity was widely considered one of the best solar companies in the years leading up to . Is this merger a good idea? Relevant strategies should be implemented for each strategic business unit depending on its position in the matrix. If you need help with something similar, Both Tesla and SolarCity operated in young, high-growth industries; however, despite their high growth rates, both companies were also losing money every year. Given that, workers are slowly fluctuating tasks to deal with brand-new business, socialization is very important just as much for the workers as it is for the companies. Lastly, a timeline of the issues and events in the case needs to be made. The firms primary and support activities are listed down. Court proceedings in the Delaware Court of Chancery related to Teslas purchase were all set to begin on March 16. Tesla The SolarCity Acquisition should focus on making use of its strengths identified from the VRIO analysis to make the most of the opportunities identified from the PESTEL. One is also required to provide how these recommendations would be implemented. Porter, M. E. (2001). Where t = time period, in this case year 1, year 2 and so on. What's swot in strategic analysis? New staff members frequently do errors and might find it amazing to know and understand the favorable or unfavorable responses they obtain from colleagues. We try to cover all the bases in the field of Finance & Accounting, Financial analysis, Manufacturing, Mergers & acquisitions and other related areas. Lastly, differentiation or cost reduction strategies are to be used for each of these activities to increase the overall value provided by these activities. International Research Journal of Engineering and Technology (IRJET), 3(1), 384-388. - Proliferation of mobile phones has created a generation whose primary tool of entertainment and information consumption is mobile phone. She thought about the task assigned to her as a video game so that she might take pleasure in the work. It reinforces the social companies that does not only form how people work together in the business, however also supplies the restrictions of the act, and the standards of conference. The following steps are required to carry out a marketing mix analysis and include this in the case study analysis. A proper implementation framework shows that one has clearly understood the case study and the main issue within it. Taxes on profits number is important for companies that already have a sustainable business model, while taxes on operations is far more significant for companies that are looking to set up new plants or operations. These factors are also responsible for the future growth and challenges within the industry. Direct and prospective action plan Most recent surveys suggest that around 76 % students try professional The trial started . It is a good idea to also propose alternative case study solutions, because if the main solution is not found feasible, then the alternative solutions could be implemented. In the EU countries, firms are required to make special provision for privacy issues and other laws. Exploring SWOT analysis where are we now? Investors were skeptical of the deal from the beginning, and Tesla stock plummeted by more than 10% upon the June announcement. November 1, 2016. Net Cash In Flowtn / (1+r)tn. (SolarCity) and with Tesla's financial advisor for the deal without the knowledge of the Tesla Board. This will help in answering the related costs and various sources of competitive advantages of Solarcity Tesla in the markets it operates in. . Catching up on the Musk-Tesla-SolarCity acquisition case pv magazine International Gfeedit, World News: Latest news, breaking news,- TODAYNEWS.com, 5 Controversies That Will Forever Haunt Elon Musk - LEETjobs. The viability of the merger was also questioned given that neither Tesla nor SolarCity had ever been profitable. The SWOT analysis is a strategic management tool that lists down in the form of a matrix, an organisation's internal strengths and weaknesses, and external opportunities and threats. Please place the order on the website to get your own originally done case solution. If the tariffs are high then it will be extremely difficult to compete with the local competitors. New personnel ask enquiries about diverse functions of their tasks, corporation events, and concerns, and take an energetic part in producing the sense of their atmosphere. It shows that one has developed an ability to prioritise recommendations and how these could be successfully implemented. Tesla: The SolarCity Acquisition will also provide insight into areas such as wordlist , strategy, leadership, sales and marketing, and negotiations. The case-presiding judge Joseph Slights offered the following statement: Please know that this was not an easy decision to reach, given the time and resources I know you have dedicated to prepare for this trial, and the last minute nature of this decision. The company should keep it in mind, while carrying out such steps. At the starting of the job, each staff member has some expectations with the business, which relate to the values, culture and the lifestyle of the business. Retrieved from https://www.hbs.edu/mba/blog/post/8-tips-to-help-you-prepare-for-the-case-method. Evidences Finally you should provide evidences to support your reasons. Strategic attributes and performance in the BCG matrixA PIMS-based analysis of industrial product businesses. But if the tariffs are between 5-10% then Solarcity Tesla can compete against other competitors. As the name suggests Value Chain framework is developed by Michael Porter in 1980s and it is primarily used for analyzing Solarcity Tesla relative cost and value structure. Hold Ctrl or Cmd to select multiple editions. Management Decision, 50(8), 1396-1411. Tesla shareholders alleged the company's . Product Market segmentation in BCG Growth Share matrix should be done with great care as there can be a scenario where Solarcity Tesla can be market leader in the industry without being a dominant player or segment leader in any of the segment. The implementation framework also helps by removing out any recommendations that are not practical or actionable as these could not be implemented. Factors within each of these 6 should be listed down, and analysis should be made as to how these affect the organisation under question. As mentioned above PESTEL Analysis has six elements political, economic, social, technological, environmental, and legal. The BCG Matrix is an important tool in deciding whether an organization should invest or divest in its strategic business units. Get this delivered to your inbox, and more info about our products and services. Tesla CEO Elon Musk finds himself in the news quite often, from groundbreaking SpaceX launches to contentious tweets. Furthermore, it needs to be explained how the stated recommendations will help in solving the main issue mentioned in the case and where the company will stand in the future as a result of these. In 2016, Tesla acquired solar panel installer and financier SolarCity for $2.6 billion and the assumption of $3 billion in debt. To achieve its overall corporate and business level objectives, it should make use of the marketing mix tools to obtain desired results from its target market. As pv magazine reported back in March 2018, a Delaware judge rejected a request from Musk and Tesla to dismiss the lawsuit. The four-hour presentation was long on Musk's vision to build the next phase of Tesla's growth around a sustainable energy future by moving into products like heat pumps, but short on any . Zhichuan Frank Li, Tomiwa Ademidun provides extensive information about PESTEL factors in Tesla: The SolarCity Acquisition case study. If a country doesnt have independent judiciary then there is no point entry into such a country for business. PESTLE Techniquea Tool to Identify External Risks in Construction Projects. Please be mindful of our community standards. Specifying the people "on board" and the people that are not. International Journal of Modern Social Sciences, 2(1), 34-43. The alternate solution for Tesla The SolarCity Acquisition is presented in the same way as the original solution, where it consists of a corporate level strategy, business level strategy and other recommendations. - Environmental regulations can impact the cost structure of Solarcity Tesla. VRIO stands for Value of the resource that Solarcity Tesla possess, Rareness of those resource, Imitation Risk that competitors pose, and Organizational Competence of Solarcity Tesla. Your email address will not be published. 2 min read. For Tesla The SolarCity Acquisition, based on the SWOT Analysis, Porter Five Forces Analysis, PESTEL Analysis, VRIO analysis, Value Chain Analysis, BCG Matrix analysis, Ansoff Matrix analysis, and the Marketing Mix analysis, the recommendations and action plan are as follows: Baron, E. (2015). What will be the expected profitability of the new products or services (Porter Five Forces Analysis) It involves looking at the current market share of the company and its competitors. This can be done by using company history. Principles of marketing. Perhaps, it supplies you chances to advance in your career, and can demonstrate that you can manage the tight spots. The 4 elements of the marketing mix are Product, Price, Place and Promotions. In other words, the synergistic integration that Tesla hoped for is still a work in progress. Obviously, some approaches would work well than others, in the business. Analyse the companys promotion mix. CaseAnalysisTeam(at)gmail(dot)com Please replace (at) by @ and (dot) by. Made with sweat-wicking fabric. Those who will be unsuccessful to reach to the identified least level, would not end up being the part of the company. Managers need to clarify not only the consumer protection laws in advance but also legal implications if the firm fails to meet any of them. This is doing the Tesla The SolarCity Acquisition Case Solution. Actionable and practical solutions can then be developed by keeping these factors into perspective. IIBMS. After the $2.6 billion deal went through for Tesla to buy SolarCity, Tesla shareholders filed a lawsuit against Tesla/SolarCity/Musk and sought $2.6 billion in damages or the cost of the SolarCity acquisition. Two key considerations while using BCG Growth Share Matrix for Tesla: The SolarCity Acquisition case study solution - To satisfy the customer's requirements and market goals according to the needed time, the task are needed to be completed in a restricted time. Check your email Investors were skeptical of the deal from. Published by HBR Publications. Harvard Business Review: Strategic Planning, How Competitive Forces Shape Strategy. Understanding Business Processes, 50-66. The Tesla: The SolarCity Acquisition (referred as "Solarcity Tesla" from here on) case study provides evaluation & decision scenario in field of Finance & Accounting. Re-allocating of the task to the new office. Elon Musk is testifying Monday morning in a lawsuit over Tesla's 2016 acquisition of SolarCity, a $2.6 billion transaction that a group of shareholders allege was a "bailout" of the failing . This gives the organization a competitive advantage over other firms, unlike a red ocean strategy. A Delaware court ruled in favor of defendant Elon Musk in a shareholder lawsuit over Teslas $2.6 billion acquisition of SolarCity. By subscribing to our newsletter youll be eligible for a 10% discount on magazine subscriptions! Hambrick, D. C., MacMillan, I. C., & Day, D. L. (1982). ANSOFF matrix, environment, and growth-an interactive triangle. After completing a year in the business, it was the stage where she had to examine and reflect her journey and experiences, while operating in the business. Strategies can be devised to improve the availability of the companys products. and cannot be used for research or reference purposes. According to Zhichuan Frank Li, Tomiwa Ademidun , Solarcity Tesla needs international talent to penetrate into developing markets. - According to Zhichuan Frank Li, Tomiwa Ademidun . (2013). At other times, finding the issue is the job of the person analysing the case. Getting the responsibility for the effort and arrangement of implementation. To do so, it will need to use the marketing mix, which serves as a tool in helping bring out responses from the market. The value chain and competitive advantage. Elon Musk Testifies To Defend Tesla's $2.6 Billion Acquisition of SolarCity in Shareholder Lawsuit. The chief executive officer needed to convince Tesla's shareholders that SolarCity would be a good acquisition target and then determine a fair price to offer. This content is protected by copyright and may not be reused. Tesla CEO Elon Musk wrapped up his testimony before the Delaware Court of Chancery on Tuesday afternoon, after spending around 9 hours defending his company's 2016. Cash Cows are those strategic business units with high market share and low market growth rate. Service, Dissertation of the box and hire Case48 with BIG enough reputation. In fact, Lynn . Lastly, a good case study solution also includes an implementation plan for the recommendation strategies. Strategic Management Theory: An Integrated Approach, Ninth Ed. It also touches upon business topics such as - Value proposition, Financial analysis, Manufacturing, Mergers & acquisitions. Evaluating Alternatives / SWOT Analysis of Tesla: The SolarCity Acquisition case study, STEP 5. If its none, then it can be regarded as a competitive disadvantage. On June 21, 2016, Tesla, a top producer of electric vehicles, posted on its blog that it has made an offer to purchase SolarCity Corporation, a top producer of solar panels, in an all-stock deal that might be worth more than $2.5 billion in Tesla stock. Both companies had similar products and could be a strong strategic fit. 2019 Texas Business School. Lin, C., Tsai, H. L., Wu, Y. J., & Kiang, M. (2012). Solarcity Tesla in case study Tesla: The SolarCity Acquisition should look into these export restrictions policies. It helps in communicating the points directly and the direction one took. Vice Chancellor Joseph R. Slights, who decided the case shortly before retiring, sided with Musk, writing: "Elon was more involved in the process than a conflicted fiduciary should be. "Should be able to do all those before the shareholder vote. Management, 3rd edition. Another helpful tool that should be used in finding the case study solutions is the PESTEL analysis. The Tesla: The SolarCity Acquisition (referred as Solarcity Tesla from here on) case study provides evaluation & decision scenario in field of Finance & Accounting. Each resource is assessed whether it could be imitated by competition easily or not. She made numerous buddies, delighted in the training classes and learned a lot about behavior and the mindset that one ought to have at the office. Both Tesla and SolarCity operated in young, high-growth industries; however, despite their high growth rates, both companies were also losing money every year. Musk denied that he placed any pressure on the Tesla board to go through with the transaction. Accessed July 12, 2021. When the trial eventually gets underway, how the outspoken and brash Musk handles his testimony and behavior will likely be a key determinant of the outcome. Any other transfer to third parties will not take place unless this is justified on the basis of applicable data protection regulations or if pv magazine is legally obliged to do so. Mason, OH: South-Western, Cengage Learning. Our immersive learning methodology from case study discussions to simulations tools help MBA and EMBA professionals to - gain new insight, deepen their knowledge of the Finance & Accounting field, and broaden their skill set. Although, your objective is to alter the 'resisters to champions', which is not constantly possible. A greatly chaotic life goes into a very organized one. In 2016, Tesla acquired solar panel installer and financier SolarCity for $2.6 billion and the assumption of $3 billion in debt. Concerns were raised over possible conflicts of interest, given that Musk owned over 20% of the stock, and sat on the board of directors of both companies. Among the significant problem with the business is the lack of communication and support from the managers in the business. The process can also be done to competitors to understand their competitive advantages and competitive strategies. Save my name, email, and website in this browser for the next time I comment. Once all the factors mentioned in the Tesla: The SolarCity Acquisition case study are organized based on SWOT analysis, just remove the non essential factors. Texas Business School(TBS) case study solution is based on HBR Case Study Method framework, TBS expertise & global insights. It's final: With no more barriers to the deal, Tesla is buying SolarCity. A blue ocean strategy is a strategy that involves firms seeking uncontested market spaces, which makes the competition of the company irrelevant. To do comprehensive PESTEL analysis of case study Tesla: The SolarCity Acquisition , we have researched numerous components under the six factors of PESTEL analysis. It also should look at the potential opportunities and threats that these competitors pose on the company. - Lucrative Opportunities in International Markets Globalization has led to opportunities in the international market. April 27 (Reuters) - Tesla Inc (TSLA.O) Chief Executive Officer Elon Musk did not unjustly enrich himself when he guided the electric vehicle maker in 2016 to acquire SolarCity Corp, where. The glaring omission from the January settlement agreement was Musk, who has every intention of proceeding to trial and defending himself and his company against the claims made against him and the $2.6 billion SolarCity purchase. Mr. Musk, who is expected to take the stand in the nonjury trial as early as Monday, was chairman of both companies at the time. The matter could be appealed to the Delaware Supreme Court. Hurley Dry-Fit Chino Short. Tesla: The SolarCity Acquisition is a Harvard Business (HBR) Case Study on casecategory , Texas Business School provides HBR case study assignment help for just $9. The second step of the solution is to come up with a business level strategy. NPV = Net Cash In Flowt1 / (1+r)t1 + Net Cash In Flowt2 / (1+r)t2 + . The three step case study solution approach comprises We are here to help. The challenges involve evaluation of strategic options, key role of casecategory, leadership qualities of the protagonist, and dynamics of the external environment. (2013). Evidences should be both compelling and consistent. Corporate Taxes The rate of taxes is often used by governments to lure foreign direct investments or increase domestic investment in a certain sector. Additionally, Musk and his cousins, who served as CEO and CTO at SolarCity, founded the solar installer in 2006, while Musk served as the companys chairman. Musk's aerospace company, SpaceX, had also purchased tens of millions of dollars worth of solar bonds from SolarCity. Research and Development Subsidies and Policies Governments often provide tax breaks and other incentives for companies to innovate in various sectors of priority. The Tesla acquisition of SolarCity closed in November 2016. Zhichuan Frank Li, Tomiwa Ademidun (2018), "Tesla: The SolarCity Acquisition Harvard Business Review Case Study. We have additionally used the concept of supply chain management and leadership framework to build a comprehensive case study solution for the case Tesla: The SolarCity Acquisition. If a resource is high on Value and Rareness, then it only brings temporary competitive advantage. Integrity, Essay Writing We are expecting that more than 100 people may well gather in connection with this trial. Just as Tesla has demonstrated the superiority of electric vehicles, the solar roof and Powerwall 2 will transform energy generation and storage. With that said, the Tesla Board meaningfully vetted the Acquisition, and Elon did not stand in its way.". Otherwise, your data will be deleted if pv magazine has processed your request or the purpose of data storage is fulfilled. The organization can enter into new markets with new products. Identify the relative market share of each strategic business unit. The external environment analysis of Tesla: The SolarCity Acquisition will ensure that we are keeping a tab on the macro-environment factors that are directly and indirectly impacting the business of the firm. Usage creativity, and promote the process. Rauch, P. (2007). The chief executive officer needed to convince Tesla's shareholders that SolarCity would be a good acquisition target and then determine a fair price to offer. Home >> Ivey >> Tesla The Solarcity Acquisition. Analyse the companys distribution and reach. Another five of Teslas directors were direct or indirect owners of SolarCity stock. Analyse the companys price points and devise strategies that could be based on competition, value or cost. When Tesla bought SolarCity in November 2016, Elon Musk billed the deal as a match made in green energy heaven: Combine a hot electric car company with the nation's then-largest provider of. If you continue to use this website without changing your cookie settings or you click "Accept" below then you are consenting to this. Experience and actions of Tesla The Solarcity Acquisition Case Study Help. The goals of the stakeholders and are the organization are also identified to ensure that the case study analysis are consistent with these. The next step is of understanding the company; its people, their priorities and the overall culture. "Three things need to happen to change investor sentiment: SolarCity solving its liquidity crisis, an LOI with Panasonic to address solar cell production risk, and a joint product demo," Musk wrote. A Division of NBCUniversal. Relative Weighted Average Market Share Vs Largest Competitor. Competitive advantage: creating and sustaining superior performance (Vol. Experience and actions of Tesla The Solarcity Acquisition Case Study Help. Musk was set to be the first witness during the trial to defend his decisions as Teslas CEO. Sign up for free newsletters and get more CNBC delivered to your inbox.
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