Case 3 Tesla Elon Musk is a man of visions and has crafted the purpose behind many modern ventures. He comes with a marked humility letting subordinates run the course and share credit after initial success is achieved. A founder of PayPal and SpaceX, a rocket-maker

Case1: Japanese Animated Films

Japanese animated films, featuring cute images with improbably big eyes and cuddly creatures with squeaky voices, used to be scoffed at as a cultural curiosity whose appeal in the west was limited to children and cartoon junkies. But in recent years the market for anime has found a wider audience, becoming one of the country’s most valuable exports.

There are about 430 anime production companies in Japan. They employ large numbers of people to create hundreds of detailed drawings that the films require.  It takes 100 people about three to three-and-a-half months to complete a 21-minute program for a typical TV slot. If the program becomes a big hit, the profits are shared by the TV broadcaster, the advertising agency, and the financial backers who invest in the projects. The studio that created the anime is paid costs but is excluded from profit sharing. Programs cost on average about Y13m to make, and the production company on average receives about Y9m to Y10m from TV broadcasters. Some anime production companies generate additional revenues through toys, T-shirts, and other merchandizing if they retain rights to drawings of popular programs, but most have to forgo the rights to the original drawings in order to pay overheads and finance the production of the projects.

1. Analyze the above description of the Japanese animation industry using Porter’s Five Forces model. Show depth of analysis that will affect the attractiveness of the industry, draw a conclusion on each part – high/ low, etc

2a. How can the widespread availability of high-speed broadband internet influence the industry’s structure and competitive conditions?

2b. And; in continuation, why and what strategies can be adopted for superior business performance by a typical mid-sized production company?. 2a and 2b is based on own/ research/ opinions, no need to follow and models

Case 3: Tesla

Elon Musk is a man of visions and has crafted the purpose behind many modern ventures. He comes with a marked humility letting subordinates run the course and share credit after initial success is achieved. A founder of PayPal and SpaceX, a rocket-maker Mr. Musk’s long-term aim is to help colonize Mars and die peacefully there.

In the meantime on earth, he is also the CEO of Tesla Motors a manufacturer of electric cars that have built up a reputation of doing things differently. Recently the Economist magazine noted: “It [Tesla Motors] produces many key parts in-house, from the battery packs to the slick touch-screen control panels. It is setting up a network of free fast-recharging points for its customers to top up their batteries on the road. It is battling America’s powerful car-dealership lobby so it can set up its own retail outlets.

And it is aiming to get its products from the drawing board to the assembly line at the speed of Silicon Valley tech firms rather than the statelier pace of Detroit’s car giants. Tesla’s manufacturing chief, Gilbert Passin, says the Model S moved from first design to production in just over two years, something he reckons would take a traditional carmaker five or six years.” While Tesla Motors has made some early gains in a market where many have perished and growth is still slow, the article goes on to highlight that it is still early days. For instance: “Established carmakers could decide to fight Tesla head-on—indeed BMW’s new “i” range of electric and hybrid cars seems to be aimed at similar buyers. In the longer-term other technologies, such as biofuels, might develop faster than the electric battery.”

At the onset of 2019, Elon Musk, Tesla’s CEO, notified employees that the company needed to improve its profitability to become a “viable company.” This meant a 7% reduction in hourly and salaried staff, the elimination of its sales referral program, and an increase in its Supercharging pricing. But despite changes, Tesla has a record of costly and capital-intensive decisions, in part because the company prides itself on doing things differently. For example, Tesla opted to build commoditized components, such as seats, in-house, rather than relying on global seat suppliers that can produce more efficiently. Tesla also assumed that automation would reduce labor costs and speed up production, but as the legacy auto industry already knew, robots cannot yet replace human hands for every function.

1. Based on the limited case information, evaluate Elon Musk’s leadership style. You need to also draw and apply a perspective using images of leadership (Senge)

2a. Classify the nature /type of innovation the electric car industry is marked by in contemporary times (as in the case)? (10 marks)– This will either be closed or open innovation and would need to explain how the electric car is using the innovation

2b. What is the type of innovation (Satell) or innovation mixes that may help Tesla propel the electric car industry and retain its strong position in the industry? Choose and talk about the innovation from the Satell model that Tesla is using, explain and backed with research


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