Problem$-$Solving Application Case$$Leadership Matters!

While Tesla CEO Elon Musk enjoys a reputation as one of the most successful entrepreneurs of all time, he has come under fire for a number of decisions and actions that have affected the growing electric car manufacturer negatively in various ways. This activity is important because it demonstrates the consequences of a leader$$s actions.

The goal of this activity is to critically evaluate Musk$$s various actions over time, and the positive and negative implications of each of them for Tesla and for Musk himself.

Read about Elon Musk$$s controversial actions as Tesla$$s CEO. Then, using the three$-$step problem$-$solving approach, answer the questions that follow.

Elon Musk is widely regarded as one of the most successful entrepreneurs in history$\mathrm{.}1$ He became a billionaire by age $31$ after founding and selling several successful startups$$most notably the company that would later be known as Paypal. In $2004$ Musk invested $$6\mathrm{.}3$ million into Tesla Motors and soon after became the company$$s CEO$\mathrm{.}2$

Musk has a keen ability to express ideas and get people excited about them and has garnered praise for his inspiring and visionary leadership$\mathrm{.}3$ Author Dale Buss argues that $...$ a huge part of Musk$$s motivational quiver is to come up with and continually express otherworldly goals that appeal to the passions of his employees as well as to his own ambitions.$4$ Todd Maron, Tesla$$s former general counsel, said Musk is $$someone who empowers you to be better than you think you can be$,$ adding that $$he has extraordinarily high standards, and so he pushes you to be your absolute best.$$ Another former employee described Musk as $$the smartest person I have ever met,$$ adding, $$I can$$t tell you how many times I prepared a report for him and he asked a question that made us realize we were looking at the problem completely wrong.$5$

Musk$$s Leadership Style and Behavior

Some have criticized Musk$$s aspirations to change the world as outlandish and his ideas as unachievable, but Musk doesn$$t believe in impossibilities. Says author Christopher Davenport, $$People are always telling him he can$$t do it$.$ But he doesn$$t like to hear it can$$t be done. He categorically rejects that. It$$s all about, $$How can we do it$?6$ A recent example of Musk$$s stubbornness is the production of the Model $3.$ After the company revealed the concept to the public and locked in production dates, Musk called a meeting to tell executives he had a dream that the entire production process had been fully automated. In other words, vehicle production would require no humans from start to finish. He wanted to make the dream a reality, he wanted to do it with the Model $3,$ and he wanted to begin production four months ahead of Tesla$$s original schedule. What followed were several months of what former executives and employees describe as a familiar pattern: executives told Musk his idea wasn$$t unachievable, he disagreed, and engineers resigned when they realized they couldn$$t reason with him$\mathrm{.}7$

Musk eventually conceded that his idea for fully automated production of the Model $3$ was a nonstarter, and he and his workers scrambled to get production back on track by working $80100$ hour weeks$\mathrm{.}8$ Customers waited months past delivery dates for their vehicles and took to social media to lambast the company. Further, many of the Model $3$s that were delivered needed costly and time$-$consuming repairs$\mathrm{.}9$ Musk would later refer to the ordeal as $$production hell.$10$

Some blame Musk$$s inability to delegate for Tesla$$s problems and for the recent exodus of more than $36$ VPs and other high$-$ranking executives$\mathrm{.}11$ Musk wants things done his way down to the tiniest detail and often rejects industry best practices along with advice from his senior leadership. For example, Musk once instituted a new workflow management method against the advice of his production workers. The employees secretly reverted to Toyota$$s Kanban method when Musk$$s technique ultimately slowed production$\mathrm{.}12$ Author Barry Enderwick believes Musk$$s micromanaging style $...$ displays a fundamental misunderstanding of what leadership means. No one person can do everything at a company.$13$

Others blame Musk$$s mental health for his downward spiral and describe him as emotionally unstable and fragile. Musk developed a reputation on the production floor for openly ridiculing, insulting, and bullying workers who fell short of performance targets. He appeared extremely sensitive to skeptics, often reassigning workers who questioned his ideas to new departments, uninviting them to important meetings, and even firing them. Musk also displayed frequent emotional reactions to isolated customer complaints on social media. As a former employee recalls, $$Some customer would tweet some random complaint, and then we would be ordered to drop everything and spend a week on some problem affecting one loudmouth in Pasadena, rather th