Please read the following case and answer the question: What is your evaluation of Musks approach for solving the problem?

Management in Action What Musk did not put on hold were his expecta- tions for production. Tesla committed to increasing production from 5,000 to 6,000 cars a week by June 2018, according to USA Today. The investor commu- nity is skeptical of this lofty goal, especially since Musk has a history of failing to deliver. For example, he said in 2017 that Tesla would churn out 5.000 Model 3s by year's end but only delivered 2,700." Musk plans to get to 6,000 cars a week by producing them day and night. Tesla is adding another production shift at its manufacturing plant, transitioning to 24/7 operations. The company is hiring 400 workers a week for several weeks in order to cover this new shift.196 Some analysts don't think this is a wise move as most U.S. auto plants at established automakers only oper- ate two cight-hour shifts. This is because supplying a plant with parts and keeping the equipment in peak operation is difficult when running around the clock. "There's diminishing returns when running 24/7," said an executive analyst with CNNMoney. Running an addi- tional shift also has financial implications for Tesla. The additional hires will surely put more pressure on its finances.197 Musk's response is to tighten the purse strings else- where. He is planning an audit to save expenses where possible, says The Detroit News. "I have asked the Tesla finance team to comb through every expense world- wide, no matter how small, and cut everything that doesn't have a strong value justification," he wrote in a 2018 e- mail to Tesla employees. "All capital or other expenditures above a million dollars, or where a set of related expenses may accumulate to a million dollars over the next 12 months, should be considered on hold until explicitly approved by me," said the CEO.19 Can Musk get Tesla under control before it runs out of cash? Is Tesla Out of Control? Tesla started in 2003 and specializes in electric cars, bat- tery energy storage, and solar panels. The company had more than 37,000 employees and revenues of over $11 billion in 2017.172 Tesla revolutionized the electric car in- dustry when it introduced the fully electric, plug-in Model S sports sedan in 2013. The Model S was named "Car of the Century" by Car and Driver magazine in 2015.173 Tesla's Model S started at well over $70,000, with some models costing more than $100,000.174 Tesla added a more affordable Model 3 at around $35,000 to its lineup in 2017. 175 Tesla's finances struggled since introducing the Model 3. The company's net losses grew from $773 million in 2016 to $2.24 billion in 2017.176 Moody's downgraded the company's credit rating based on fears that it could run out of money by the end of 2018.177 What happened? its robots. This does not even take into account the expense associated with redoing assembly that robots couldn't get right in the first place. 184 Model 3s coming off the production line were defec- tive. According to the LA Times. "Online Tesla forums are rife with comments from some of those lucky enough to have the car in hand. They're griping about dead batteries, leaking tail lamps, protruding head- lights, door rattles, and body panels that don't line up- and in many cases, they've got photos to back it up." The delays and poor production quality are creating a cash problem for Tesla. It can't sell cars it hasn't pro- duced, yet Bloomberg reported that the company spent nearly half a million dollars every hour of 2017. -Whether (Tesla) can last another 10 months or a year, [Musk] needs money, and quickly," said Kevin Tynan, a senior analyst with Bloomberg Intelligence. Tynan esti- mated Tesla will be required to raise at least $2 billion in fresh capital by mid-2018.6 Musk disagreed, tweeting "Tesla will be profitable & cash flow positive in Q3 & Q4 [2018], so obviously no need to raise money.*187 Musk's ambition has been praised in the past, but Tesla's worsening financial position is raising more and more questions. The company has lost $4.6 billion since going public in 2010. MUSK IS TRYING TO TAKE CONTROL Tesla's plan is to take greater control of its manufactur- ing line in order to increase production and reduce ex- penses. Musk admitted in 2018 that Tesla overly relied on robots in production telling CBS, "...excessive auto- mation at Tesla was a mistake. To be precise, my mis- take. Humans are underrated." Musk believes more humans need to oversee vehicle assembly, starting with him. The CEO is spending day and night at the Tesla factory (even sleeping in the conference room) so he can realize errors in production and solve them in real time. 9 Tesla employees may not be too thrilled. Musk describes himself not only as micromanager, but as a "nano-manager" (micro-means a thousandth of some- thing, while nano- means a billionth). "I have [obses- sive-compulsive disorder] OCD on product-related issues," he told The Wall Street Journal. "I always see what's... wrong... I never see what's right."190 Musk says that direct oversight has allowed him to unlock some of the critical things that were holding [Tesla] back. -1 His first move was to temporarily shut down the entire Model 3 production line in April 2018. Tesla's spokesperson termed the shutdown as "planned downtime" to "improve automation and systemically address bottlenecks in order to increase production rates. *192 Critics believed Musk was wrong to put the line on hold. "Periodic shutdowns of hours or a day are not uncommon during pre-launch pilot build. They are unheard of in regular production, where [Musk] suppos- edly is," said a former General Motors vice chairman.193 a former GM/Toyota joint venture plant in California with a capacity to produce 400,000 cars annually. Tesla could barely get a quarter of that production in 2017 as it resorted to pulling cars off the production line and finishing them by hand. 179 Tesla's production line is suffering from too much automation, according to Business Insider. Most car manufacturers automate stamping, painting, and weld- ing, but Musk decided to automate even more.180 He directed that final vehicle assembly, including putting parts inside the vehicle, be completed by robots. "It's remarkable how much can be done by just beating up robots ... adding additional robots at choke points and just making lines go really, really fast," he said in 2017.181 To his surprise, automation actually slowed production. "Automation in final assembly doesn't work," said a Wall Street analyst. For example, Japanese carmakers actually limit automation because it is costly and negatively impacts quality. 182 Tesla experienced this firsthand. Musk's robots couldn't get the final assembly sequencing right, delaying assembly and prompting manual refinishes. 183 The robots also haven't saved the company any money. Tesla was able to reduce the number of workers on its production line due to automation, but it had to hire more expensive engineers to manage and program FOR DISCUSSION Problem Solving Perspective What is the underlying problem in this case from the perspective of CEO Elon Musk? 2. What are the causes of the problem? 3. What is your evaluation of Musk's approach for solv- ing the problem? TESLA'S MANUFACTURING PROBLEMS Manufacturing of the Model 3 has been "hell, accord- ing to Musk. 178 The vehicle is taking too long to make, and it has a high defect rate. Tesla's production line couldn't keep up with the demand for approximately 400,000 Model 3s between 2017 and 2018.