Categorised in: Breaking Financial News
Published on April 21st, 2018 | by Kurt Lowder
April 21st, 2018 by Kurt Lowder
Tesla has released a secret weapon against the fat cats. To kick things off, here’s a Musk-watch video clip for the inner child in us:
The Tesla “secret weapon” is not some new technological innovation, but rather, it is a set of ideas proven effective by research and that can likely be found in a book titled something like: Building a Successful, Future-Oriented Company — For Dummies. No doubt, Musk has read extensive literature on the subject.
What is Tesla’s secret weapon? It is its CULTURE! Let’s go down a list of what this culture entails.
Tesla’s Culture of Hope
I have to admit when I first heard that Elon Musk was going launch one the earliest Tesla Roadsters into outer space I immediately thought, “what a waste!” In my mind, I imagined a young Indiana Jones saying, “it should be in a museum!” Next, I thought how it could be sold for big bucks and the money could be donated to some charity. Boy, was I wrong!
First, seeing that thing floating through outer space was beyond cool. Secondly, it was tremendous free advertising. It was an incredibly light-hearted, feel-good news story that we all need much more of. Thirdly, it was exactly the type of reward employees of Tesla (and SpaceX) needed, as they have selflessly worked so hard, for so long, for so little. This trifecta of benefits brought about by outside-the-box thinking is a prime example of Tesla’s culture.
The center console of the Tesla Roadster displayed the words “stay calm.” I never heard what the intention of those words meant. However, I immediately made up my own interpretation of their meaning, and I am sticking to this meaning just like when I imagine what some song means. I do not want to know the real meaning, but if you feel compelled to be a spoiler or contribute your own interpretation, then comment below. To me, it was an assurance that catastrophic climate change would be avoided by highly motivated, diligent, and magnanimous innovators.
From my perspective, far too many environmentalists are stuck in a negative news cycle. (I will have an upcoming article on this titled “Effective Environmental Advocacy”). I myself was there for many years. I have worn out all of my social media friends by the endless posting of doom and gloom climate change articles. It is my hypothesis that people are so overwhelmed by the enormity of the problem of climate change that they have given up on trying to make a difference. Tesla is so popular because it inspires a long lost hope.
This hope is a key reason Tesla received 500,000 applications for only 2,500 jobs despite that fact the Tesla does pay less than some of its competitors and often requires its employees to work longer hours.
Tesla’s Culture of “Work Hard, Play Hard”
One of the most frequently asked questions of Elon Musk is what advice he can give to entrepreneurs. Frequently, he responds with this most prosaic answer (paraphrased): “If you work 100 hours a week, you will get done in 4.5 months what someone working 40 hours a week would get done in a year.” To many, this answer is a huge letdown, especially to this democratic socialist who dreams of a 24 hour work week. We all want some magical secret shortcut, but for now, that may just be a unicorn. Perhaps one day we will have benevolent AI with which we have formed a symbiotic relationship. Until then, it seems even the best of the best have to work really hard.
So, you might ask how is working insanely long work weeks innovative? Isn’t it just a new form of slavery? Not exactly. Tesla’s innovation is how it makes the long hours fly by. Tesla has made being a geek more popular than being a jock. Whether its naming robots after Transformers, installing employee ice cream machines, or letting employees ride bikes through the factory, Tesla is always looking for ways to let their employees have some fun.
As previously discussed, Tesla employees are extremely motivated to save the world, but there are many more reasons why Tesla workers are highly motivated to work so hard.
Tesla’s Culture of Autonomy
Tesla pays its employees a livable wage, but probably below their market value. Research has indicated that workers will accept less provided they are given autonomy. Nobody likes their boss watching them like a hawk or micromanaging them. Nobody wants to commute during rush hour. A key to Tesla’s success seems to be that the company significantly trusts its employees. As a prime example, if Tesla employees are in a meeting and do not think they need to be there, they are expected to just walk out of the meeting, no questions asked. They should spend their time maximizing productivity elsewhere.
As a teacher, I hated staff meetings. I felt like they were a complete waste of time. They were mandatory and so many items on the agenda did not apply to the whole group. Often, meetings of more than 6 or 7 people can be counterproductive. For many things, more than a handful of people is just too many people; a majority of people will just be off in La-La land.
After unnecessary meetings, employees often go home tired, resentful, and unempowered. Thus, they decide to binge watch Netflix instead of letting their subconscious figure out some issue at work. Avoiding boring meetings is of immense value to Tesla employees. (Boring tweets, on the other hand, are a different subject)
Tesla’s Culture of Taking Risks
Tesla attracts creative individuals. Creative individuals thrive when they are allowed to take risks and try new, improved methods. Most organizations are conservative. They primarily only want to do what is proven to work. The problem with that is you stop innovating and so much becomes stagnant. Employees have to be encouraged to take risks and assured that failure will not be punished; otherwise, they will play it safe.
Being allowed to take risks goes along with autonomy. Employees are capable of working long hours when they can be creative and fearless. Humans are just animals and we want to avoid fear at all costs. When we become fearful, we go into fight or flight mode. In the workplace, flight is manifested as staring at the clock, dying to go home. In the workplace, fight is manifested as employees resenting and resisting one another.
Currently, Tesla is taking many risks with its Model 3 production. They are attempting to drastically increase automation and the speed at which the cars move through the assembly line. While it may not seem fast, their goal is to have the cars exit the factory as fast as a human can walk. Musk frequently jokes anything less is pathetic.
Despite his joking, this is no easy feat. This is something many Tesla critics just cannot understand. They think Tesla is a horrible manufacturer because they are not currently ramping up production at the speed of other legacy auto manufacturers. However, Tesla is sacrificing short-term production rates for much larger long-term production rates.
There will be mistakes made. For now, more people and fewer machines may be required than initially thought, but enough innovation will occur that progress is made. Every mistake produces valuable information. Do any of us doubt that one day factories will be almost completely automated, but to get there it is going to take experimentation?
In this process, Tesla has admittingly made many mistakes. To quote my favorite line from Batman Begins, “Why do we fall? So, we can learn to get up.” Every mistake has value when you learn from it.
Tesla’s Culture of Collaboration
To this point, we have already discussed the importance of autonomy and risk taking. The next key aspect of Tesla culture is collaboration. The old cliche “two heads are better than one” applies here, but let’s expand on that a little more. Humans are social beings, we thrive when working in groups. Enjoyable, productive collaboration is crucial to worker satisfaction.
In this arena, one of the most important things Tesla has done is have its designers work alongside the factory workers. In fact, their desks and offices are on the factory floor. Feedback occurs at an incredible rate. This dramatically increases worker
morale, as workers gain more of a sense of equality with designers. When workers feel important and valued, they are more productive.
Traditionally, the main duties of managers have been to rigidly enforce productivity. While there will always be a component of that, Tesla requires its managers to be a combination of teacher, servant, and student. When managers empower their subordinates (co-workers), trust them, teach them, learn from them, etc., productivity goes through the solar roof.
Tesla’s Culture of Constructive Criticism
Earlier, we discussed Musk’s advice about working hard. Frequently, with that answer, he will mention that seeking out constructive criticism is absolutely critical to success. It is a mentality that has to be constantly maintained. It requires sustained mental effort and reflection to keep one’s ego in check. Mistakes (falling short of this ideal), again, are inevitable. However, reflection, open-mindedness, and humility are critical growth, and Elon seems to encourage this in communications to staff and in the example he sets.
It is devastatingly easy to fall in love with an idea. Our ideas are our babies! They bring us immense joy! It is not easy to let them go even when evidence shows they are not particularly good. Tesla has fallen short of this ideal on occasions. However, long term,
the company seems to have learned from its mistakes. Elon has often admitted them candidly.
As an example of a mistake, originally, Elon and JB Straubel thought they could just take a Lotus and retrofit it to be electric. That was a major mistake. It turned out the whole car had to be designed around the massive battery pack required to power an electric car, or would just lead to headaches, delays, and inefficiencies. Thus, the skateboard design grew out of this first massive failure. Now, the battery lays flat along the entire length and width or the car. It provides an incredibly low center of gravity and makes the car extremely safe. Additionally, it allows for massive cargo room in the trunk and frunk of the car.
The skateboard design may prove to be a timeless principle just like the wheel, but you can be assured Tesla will never stop questioning if there is a better way.
Later on, with the Model X, Musk fell in love with the falcon-wing doors, which remind the consumer of the Back to the Future Delorean. This difficult design was certainly cool, but in the long run, it may not have been worth the hassle. Consequently, Tesla has applied this lesson to the Model 3 and presumably the Model Y. The Model 3 design is more — though, maybe not enough — about KISS (Keep It Simple Stupid).
Tesla’s Culture of Not Lying
Elon Musk many times has made the pithy remark that advertising is essentially lying. Accordingly, Tesla refuses to advertise. Instead, it spends that money on making an even better product. The end result is that word of mouth brings more business than stupid lies. Interestingly, many Tesla fans have made fan commercials. I enjoy blasting them out on social media and getting more likes and responses than I usually get with some angry, reactive political posts. Check out this recent Musk tribute:
The creator of this tribute has even designed an app so you can animate your own Elon Musk.
Okay, this article is clearly getting too long-winded. To be continued …
Comment below if you want your ideas to influence its summation. Especially if you have some newer, less mentioned examples of Tesla’s culture. Sorry if mine were stale.
For now, I will conclude by stating in this unapologetic FanMan’s opinion piece that Tesla’s culture is unparalleled in the business community. It is the reason this snowflake has joined the cult and has a kegerator filled with carbonated Kool-Aid (JK).
I am not some person who thinks Tesla can do no wrong. Tesla makes numerous mistakes. Why, then, does Tesla continue to survive when it makes more mistakes than most?
It takes more risks and thinks outside the box more. Thus, Tesla innovates more.