Management according to Elon Musk. Tesla, SpaceX and SolarCity

Tino Martí

Elon Musk is one of the trendiest entrepreneurs and undoubtedly the most controversial one at the moment. He is the leader of Tesla, SpaceX and SolarCity, three young, ambitious and dynamic companies that show how far they are willing to go to change the world through the internet, renewable energy and the race to Mars.

In 2018, he made it to the headlines for different reasons. First, proposing technical solutions to rescue children trapped in Thailand and end up insulting their monitor. Second, and probably the most popular, with the announcement via tweet to privatize Tesla for $420. In the American financial and stock market context, privatizing a publicly-traded company means repurchasing all its shares. The action elicited strong reactions, and the board of directors concluded his position. Shortly afterwards, Musk again announced problems in the production of Model 3 and wanted to assure the market that he is giving it everything by announcing his strenuous workday: 120 hours per week. To top it off, in a live radio interview, he accepted smoking marijuana. No one can say that he goes unnoticed, regardless of his apparent privacy.

In his authorized biography "Elon Musk: How the Billionaire CEO of SpaceX and Tesla is shaping our Future" (Virgin Books 2016), technology journalist Ashlee Vance travels through his life and offers us the grounds for his success and the most significant features of his personality. Top business leaders tend to become practical applications of new management. With the determination to scrutinize it, I began reading trying to find out what we can learn positively from his successes and failures. Here is a summary of good management, according to Musk condensed into six lessons:

1. Internally produce everything that can be done instead of outsourcing it. Thus, there is less dependence on external suppliers, what Musk sees as a weakness. Besides, internal production allows developing faster, at a lower cost and retaining the generated knowledge.

2. Make quick decisions regardless of their magnitude. This is only possible if you have a clear long term vision, you know the subject in-depth, and you are actively aware of the time limitations.

3. Structure organizations as flat and flexible as possible to allow rapid decision making and to modify the course based on the results.

4. Manage rolled up, hands-on style. The manager must be in the front line, working with his team, and must fight against the inert organizational tendency towards the bureaucracy.

5. Advance with suboptimal commitments. It would be the minimally viable version of the product that avoids perfectionism and paralysis by analysis.

6. Don’t give up and keep trying. Musk appreciates people who continue in their efforts even after having failed and whose companies are a clear example of their perseverance despite lack of guarantees for success.

Seen with perspective, it seems that Elon already lives on Mars. Here on Earth, things work differently. Maybe it's because we don't work in the context of innovation and competitiveness in which Musk operates or, perhaps, because, on Earth, we often play the reverse game. Instead of trying to win, we try not to lose. Instead of getting somewhere, we try not to move from where we are. And so, on Earth, we centrifuge production and responsibility, slow down decisions, complicate organizations, run away from the front line and, at the slightest hint of failure, let the project die.