Tesla's performance management system has shifted from an engagement-focused model to a traditional annual review process, assessing promotions and terminations based on performance. This change reflects Tesla's increasing emphasis on production and efficiency, leading to criticism for its harsh and competitive environment. The document suggests a return to the previous engagement-based approach for better employee support and performance monitoring.

1. PERFORMANCE MANAGEMENT SYSTEM OF TESLA
GROUP NUMBER -1
LANKA NAGA DURGA SAI RAM
DUMPALA NIKHIL
K SAI KRISHNA
VIMAL
BHARATH SIMHA REDDY

2. TESLA.
Tesla. Inc is one of
renowned and leader in
EV vehicle worldwide.
It is known for its
efficient EV vehicles,
batteries and
rooftop solar panels
It is lead by one of
most influential
personality Elon
Musk who is known
for creativity and
innovative ideas and
strategies

4. LITERATURE REVIEW
Werner (2014) argues that PM is a research area that could bridge Human
Resource Management (HRM) and HRD given that appraising employees is a core
function of HRM and improving individual and organizational performance is key
for HRD.
HRD scholars advocate the use of coaching as an HRD intervention within the PM
context (Ellinger, 2014; Werner, 2017). The HRD professional plays a role in training
managers to be effective coaches and has the requisite interpersonal skills, and
also has a responsibility to create a climate that facilitates coaching (Werner, 2017).

5. TASK – 1 PERFORMANCE MANAGEMENT SYSTEM IN TESLA
Back in 2017, the
global automotive
company reportedly
fired hundreds of
staff with little or no
no warning
following annual
reviews.
Then, in 2018, Tesla
announced it
was planning to cut
another 9% of its
46,000-person
workforce,
Tesla stands out
amongst its tech
star peers for a less
cushy approach to
performance
management
process.
Back in 2016, when
Juliana Bednarski
was HR Business
Partner and Louis
Efron was Head of
Global Employee
Engagement, the
picture looked quite
different.

6. They
recognized the
importance of
engaged
employees and
their impact on
customer
engagement. In
response, they
created the
Tesla360
Summary.
This was
essentially a
staff survey that
used the
Maslow
Hierarchy of
Needs to guide
performance
management.
The survey was
a massive
success and
achieved an
impressive 91%
participation
rate.
So it's strange
that during the
tenure of Gaby
Toledano, the
Chief People
Officer who left
late last year,
Tesla appears to
have embraced
an entirely
different
approach.
Details are thin,
but it seems
that they've
gone back to
using a
traditional
annual review
to determine
promotions,
demotions and
firings.

7. CHANGES WHICH SHOULD BE MADE
We feel that Tesla should stick with employee engagement model which is more practical
wherein they can identify who are engaged in work and who are not
This rank and yank model is cruel and not practical because it is unfair to judge the
employee only once annually on the basis of their performance whole year.
We suggest performance monitoring should be done continuously and continuous
improvement should be done.
They should monitor the performance monthly and start taking measures to improve on
monthly basis.

8. FINDINGS AND SUGGESTIONS
 Tesla's performance management approach has changed dramatically over the years. In the past, they
used a more engagement-focused approach that aimed to help employees reach the top of the self-
actualization pyramid. However, in recent years, they have switched to a more traditional annual review
process that determines promotions, demotions, and firings. This change in approach is likely due to
Tesla's changing priorities.
 In the past, they were focused on employee engagement and creating a positive work environment.
However, in recent years, they have become more focused on production and efficiency. As a result,
they have adopted a more performance-oriented approach to management. Tesla's performance
management approach has been praised by some and criticized by others. Some people believe that
the new approach is necessary for Tesla to achieve its production goals.
 Others believe that the new approach is too harsh and that it creates a stressful and competitive work
environment. It is still too early to say what the long-term impact of Tesla's performance management
approach will be. However, it is clear that the company is committed to finding a system that works for
them.

9. Some of the key features of Tesla's performance management
approach include:
• Annual performance reviews
• Stack ranking
• Focus on production and efficiency
• Harsh consequences for low performers
It remains to be seen whether Tesla's performance management
approach will be successful in the long run. However, it is clear that
the company is willing to take a different approach than other tech
companies.

10. CONCLUSION
 It’s hard to say where Tesla's performance management process
will go from here. For a company with such high aspirations, it’s
clear that its employees hold the key to success. But how they
attract and nurture that talent seems to be a moveable feast.
 But what we feel is that Tesla should go back to engagement based
performance management model which was more practical.

11. THANK YOU