Due Week 9 and worth 330 pointsAs you have explored in this course, ongoing challenges in the business environment are mostly attributed to unethical business practices, failure to embrace technology

Assignment 1: Social Performance of Organization

Business and Society (BUS 475)

Dr. Afraa Albahrani

Social Performance of Organization

In 2003, Tesla Motors turned into Tesla Inc. that is a manufacturing company and has the specialization in producing electric vehicles (Cars) and lithium-ion batteries. The electric Roadster was the first product that Tesla Inc produced as the first product of the company. Tesla Inc. believed in product differentiation and instead of producing mass products it produced something unique, innovative, and attractive. In 2008, Tesla Inc. presented its ever first Roadster in the market which became popular due to its price which was over a hundred thousand dollars. A purchasing perk was levied on this new innovative Roadster containing $7,500 as a federal tax credit. The fuel efficiency of the car was amazing since it had the facility of completing 135 miles in a gallon as compared to a vehicle running through gasoline power. Another specialty of the Roadster was free of the internal-combustion engine since the vehicle had neither test deduced nor tailpipe emissions. Since innovation and passion to do something different is the prime object of Tesla Inc., it introduced Sedan (Model S) and quit the manufacturing of Roadster in 2012, and since then it has been focusing on the new product. The release of Tesla Semi a vehicle that is equal to a truck and Model X an SUV labeled vehicle made the brand more competitive (Schreiber & Gregersen, 2019). Some of the other products that Tesla Inc. sells include clean energy storage, panels, and roofing.

The company is no doubt competes in the market with innovation and technology, and this is the reason, it is a fully operational business company that has been thriving in economies worldwide. Tesla Inc. has its customers both local and international, and the uniqueness of the product sets precedence in the mind of customers that keep them not only happy and satisfied but also motivated for returning customer and referral. Additionally, the manufacturing of Roadster made the company a pioneer of the electric car in the world.

The influence of stakeholders both internal and external is significant in the proper functioning of a business. There are multiple stakes involved with the operation of a business, and only an ethically responsible company can meet the requirements and address the stakes of relevant authorities. Ethics in business means a lot that not only requires a company to follow the standards internally but also externally to keep the community, customers, and the environment safe. Sometimes organizations divert from their primary responsibility to perform ethically, and it is the pressure of stakeholders (Internal & External) such as employees, vendors, customers, legal agencies, trade unions that compels the company to maintain its overall reputation by keeping its competitive edge in the market. Navickas and Kontautience (2012) imply that the influence of stakeholder in the decision-making process of an organization is intensive since they have access to all information and they require the organization to follow ethical and social protocols strictly.

The production of a company directly depends upon the material suppliers and employees' unions. Employees' unions always strike for their rights; sometimes their demands are genuine, and sometimes they attempt to exploit their employer through additional demands. Same is the case with the material suppliers since they can increase the price of their materials any time before informing the company. The vendors working within the company on different projects have the potential to increase the project cost by making productive material waste, delaying the project, etc. The profit of a company mainly depends upon the performance of its employees especially when there is a matter of manufacturing concern. The recruitment of such employees who have the ambition to follow the vision of the company can take the company to the pinnacle of success and vice versa. When the performance of employees is appropriate, and resources are properly utilized it will help the company save cost in terms of new hiring, training and development, material purchase, and legal issues.

Ethics plays a critical role in the performance of business particularly when there is a matter of public/community. The decisions of companies which have a thorough view of their communities always go in their favor. The organizations engaging them in social activities such as local events and philanthropy work are considered ethically responsible companies and are in more chances of gaining public support. Customers are the most influential factor that can make or break the reputation of an organization and have the strength to ensure the organization’s stability in both financial and social terms. From the viewpoint of external stakeholders, the customers are the major contributor to the growth and success of any organization (Christensen, Mackey & Whetten, 2014). When the frequency and fluency of desired products are catered to the customers promptly a business may reap the benefits of its products and services. The social performance of an organization requires to keep its customers on top priority, and Tesla Inc. has been focusing on this that not only helps the company manage them properly but also keep them satisfied and happy in various ways.

The concerns of large companies or multinational groups in terms of ethical behavior are at their peak. Technology and advancement have made the business world more competitive where information circulates from one location to another location in seconds. In the past, when there was no presence of social media, the public information relating to the overall reputation of a company was minimal; due to this, the attention of companies on social aspects was low. Today, the organizations are more concerned about portraying them as ethically and socially responsible since they know physical appearance matters what is happening under the table is not a matter for the public. Stakeholders of a company keenly observe the issues associated with the company such as firm's diversity, the safety of the product, health and safety of employees, worker's compensation, public health, environmental pollution, and financial transparency (Christensen, Mackey & Whetten, 2014).

The overall performance of Tesla Inc. in terms of corporate social responsibility is outstanding, but in the recent past, the company had to face some legal investigations over safety concerns. In 2018, the production of Model 3 mass-market electric cars caused critical injuries which were earlier undisclosed by the company. When it was highlighted by media and the California Occupational Safety and Health Administration investigated the matter the company was accused of violating safety protocols that caused major injuries. The company failed to provide legally mandated reports on critical injuries relating to workers (Shoot, 2018). The situation caused a transition in the production process that delayed the delivery of ready vehicles to customers who had already paid for those cars that caused a stuck of billions of dollars of the company in the production process.

The pressure of health and safety agency compelled Tesla Inc. to initiate an investigation on the causes that resulted in critical injuries. The company made assurance to government officials that such safety concerns would be addressed in a proper manner associated with proper worker's log book. The supplier code of conduct at Tesla Inc. ensures that the company is more cautious on issues related to the health and safety of workers. The safety standards with protocols help highlight safety violation, and the company immediately attempts to prevent such violations. Tesla Inc. also confirms from time to time that it's business partners and dealers keenly follow the company's code of conduct to make the organization more responsible in terms of social and ethics. It is true that Tesla Inc. is a responsible company that ensures social performance in every course of business including workers, customers, and the environment.

References

Christensen, L., Mackey, A., & Whetten, D. (2014). Taking Responsibility for Corporate Social Responsibility: The Role of Leaders in Creating, Implementing, Sustaining, or Avoiding Socially Responsible Firm Behaviors. Academy Of Management Perspectives, 28(2), 164-178. doi: 10.5465/amp.2012.0047

Navickas, V., & Kontautiene, R. (2012). The Influence of Stakeholder-Company Relationship on Competitiveness of Company. Economics And Management, 17(3). doi: 10.5755/j01.em.17.3.2111

Shoot, B. (2018). Tesla Is Under Investigation After 2 More Factory Accidents. Retrieved from http://fortune.com/2018/09/14/tesla-factory-safety-inspections-california-osha/

Schreiber, B., & Gregersen, E. (2019). Tesla, Inc. | History, Cars, Elon Musk, & Facts. Retrieved from https://www.britannica.com/topic/Tesla-Motors