Background
Elon Musk is the current CEO at Tesla Inc. Tesla is an electric car manufacturer whose mission is “to accelerate the world’s transition to sustainable energy” (Tesla Inc.). Tesla began in 2003 for three engineers to demonstrate to the world that it is easy to drive an electric car without making compromises. The company aims at building scalable, sustainable energy production plus storage equipment. Its objective is to drive the world to zero-carbon emissions in the future. Tesla focuses on manufacturing electric cars through battery technology and electric powertrain. Currently, Tesla has produced Model S, X, and 3 and Tesla Semi between 2008 and 2017, and Cybertruck and Model Y in 2019 (Tesla Inc.). The company headquarter is situated in Fremont, California, and has a Gigafactory in Shanghai. The company also manufactures powerwall, powerpack, plus a solar roof to empower the world to embrace renewable energy generation, storage, as well as consumption (Tesla Inc.).
Elon Musk joined Tesla in 2003 as a co-founder and became its CEO in 2007. He took Tesla public in 2010. According to Biography (2021), Musk has only worked in the companies he founded or co-founded since 1995. In 1995, Musk co-founded Zip2 Corporation with his brother but later sold the company to Compaq Computer Corporation. In 1999, Musk and his brother used the money they got from selling Zip2 and founded Paypal, an online financial services company. eBay acquired Paypal in 2002, making Musk a billionaire. In 2002, Musk founded SpaceX to construct spacecraft for a business space voyage. In 2008, SpaceX earned a NASA deal to ship cargo to the international space station (Biography, 2021). As of December 2020, Musk was leading approximately 70,757 Tesla employees, with over 51,000 employees in California alone (Wagner, 2021). Musk has led Tesla to become a non-competitive player in electric car manufacturing.
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Musk’s Leadership Style
Elon Musk employs a transformational leadership style, coupled with his charismatic, visionary, and narcissist characters. Transformational leaders idealize influence, inspire motivation, stimulate intellectual behavior, and cares for individual employee's needs (Jiang et al., 2017). Tesla's mission of a sustainable future has different requirements compared to other organizations. Thus, the company has to retain its competitive edge by grooming employees to understand and share in the mission. Additionally, the company must keep on addressing employees' professional needs to have the capacity to offer quality services for its unique products and services. As a transformational leader, Musk focuses on empowering his workforce by training in the advanced skills unique to its production processes (Tesla, n.d). As a result, Tesla employees can participate in the company's vision to develop the highest possible level of vehicle craftsmanship globally. Musk does not take any chances when it comes to empowering employees. The company has on-the-job training programs and tracks daily performance to enhance problem identification and improvements. As a result, the company continues to improve safety rates as production increases.
Musk’s transformational leadership provides a mixed picture that results from his charismatic, visionary, and narcissistic character. Musk’s charismatic qualities are evident through his principled and audacious vision of driving the world to sustainable energy. He has engraved the company's mission in his employees through training and motivation and communicating the vision's implications to the world (Goldberg, 2017). Musk is highly optimistic and sets deadlines that seem challenging to achieve. To achieve his company's goals, he spends his personal wealth and time and leads from the front to power his employees towards the company goals to the point of working 100 hours a week (Gelles, 2018). According to Robbins and Judge (2013), transformational leaders with charismatic qualities have a higher regard for employees, teams, and overall organizational performance. However, when coupled with narcissistic qualities, transformational leaders may not always have the best interests at heart. Narcissistic characteristic allows a transformational leader to take risks with boldness and confidence and charisma to inspire employees to fall in line with the organization's mission. However, they have inadequate emotional competencies, like self-control and acting erratic, and may combine personal and organizational missions (Braun, 2017). For example, in August 2018, Musk posted a tweet on Twitter: "I am considering taking Tesla private at $420. Funding secured" (Salinas, 2018). The tweet caused confusion in the company, and the stocks fell drastically, with Security Exchange Commission suing Musk for misleading shareholders. In response, Musk resigned from his chairman post, and two Tesla executives resigned thereafter (Salinas, 2018).
The leadership style puts Tesla in a position to exploit Musk's positive side of his transformational charismatic and narcissistic leadership. The leadership style has enabled Musk to achieve Tesla's organizational outcomes. Musk has aligned his socially desirable goal in adopting sustainable energy to Tesla's goal in developing electric cars and sustainable energy solutions while applying his charismatic qualities to drive a sense of meaning to his employees. The achievement is evident through Tesla employees review on Glassdoor when one asserted that “working in Tesla is rewarding and provides an opportunity to change the world” and another commented that “working in Tesla gives me a mission to work towards, not just for a paycheck” giving Musk an 84% CEO approval (Glassdoor, n.d). The comments show that Musk's leadership style has transformed employees to embrace Tesla's vision and make it their own. The style has proven effective in improving employees' commitment by believing in its value and mission. Thus, working in Tesla is more like being a family member, and employees are likely to overcome any challenge under Musk's leadership.
As much as Musk is loved by his employees, he has constantly portrayed his inability to separate personal passions and to achieve Tesla's vision. Transformational narcissistic leaders drive organizations to develop an identity around them, making it difficult for the leaders to separate self-serving and company-serving actions (Fuller et al., 2018). The character has put Tesla in a difficult place as Musk tends to publicize overambitious targets that put the company under criticism when it fails to register success in the targets. The behavior may be originating from Musk's narcissistic desire to maintain his positive image as a creative, innovative, and revolutionary leader who sets ambitious goals and attains them (Fuller et al., 2018). Thus, Musk equates his personal vision to Tesla's, making him overwork and subjecting employees to stress levels from working for long hours to achieve Musk's overambitious targets. Thus, the leadership style negatively affects job satisfaction and employee morale, affecting work-life balance and gives Tesla an overall organization performance score of 3.4 (Glassdoor, n.d).
Leadership Theory Guiding Musk’s Leadership Style
Musk’s transformational leadership subscribes to the behavioral theory of leadership. According to the theory, leaders subscribes to specific traits and believe that employees should cultivate the same traits. Western Governors University (2020) explains that behavioral leaders focus more on action to trigger production, making them task-oriented. Actions define success. As a result, leaders easily learn and socialize specific actions to employees through training and development, making leaders flexible and adaptable. In case of problems in organizations, leaders adopt processes to empower employees to adjust strategies within their workflow, empowering employees to develop leadership qualities. Musk has a reputation for developing emotional connections with employees to drive task-oriented behavior through training and career development and with customers through sharing updates and opinions through Twitter to his millions of followers (Goleman, 2000).
The behavior impacts Musk's ability to have the self-control to keep off emotions and impulses. His inadequate self-control leads to oversensitivity in an organization, and the behavior has costly implications to organizational performance (Maccoby, 2004). For example, Tesla employees fear expressing their opinions of safety issues that increase injury rates since Musk is not concerned with the statistics rather than performance (Romburgh, 2018) and those who do end up losing their jobs. For example, Carlos Ramirez, a safety executive, and Watson, a physician assistant, were fired after approaching the management with safety concerns (Romburgh, 2018), hoping the company would address them. On Twitter, Musk shows a lack of self-control when he engages in individual criticism to followers who disagree with him. As a result, he contributes to stakeholder alienation, who believes he lacks integrity and leadership maturity (Graham, 2018). His behavior has attracted criticism against Tesla's leadership and its inability to control its CEO's behavior.
Tesla’s Organizational Culture
Tesla's organizational culture can be described as an innovative problem-solving culture since the company focuses on empowering employees through multi-day training programs when hired and continues providing on-the-job training regularly to enhance increased improvements (Tesla Inc.). The culture empowers employees to innovate profitable solutions to address emerging needs in the target market. For example, training employees ensure they develop advanced electric vehicles required to provide environmental solutions to problems emanating from engine combustion processes in automobiles. As a result, empowered employees produce fast cars characterized by safety, performance, and efficiency. Additionally, employees share in Musk’s “Secret Master Plan” in producing high-volume vehicles design to save customers money while giving them comfort and a sense of luxury (Tesla Inc.). As a result, the culture has given Tesla a competitive edge that may pose a danger to upcoming companies in the industry.
Musk has a significant impact on Tesla's culture since he is action-oriented and focuses on doing the impossible to achieve Tesla's goals. His behavior of working 100 hours a week drives employees to dedicate their time to develop innovative solutions against time. Musk guides managers to train employees beyond conventional limits to enhance creativity plus productivity in designing new designs and develop new solutions to address environmental and transport needs. As a result, Musk has influenced Tesla to increase business performance while positioning the company to influence energy solutions globally. For example, the company's desire for a sustainable world and Musk's controversial comments and stand towards environmental sustainability using technology gained him and the company's reputation during Trump's administration addressing issues in the tech world (Graham, 2018). Therefore, employees must measure up to achieve the standards necessary to empower Tesla to higher innovation levels.
Recommendations to Musk
Suppose Musk wants Tesla to have a sustainable future and withstand possible competition in the future. In that case, he should consider adopting checks and balances in the company to control dangers from negative aspects of his leadership style. It is clear that Tesla lacks checks and balances since the company depends on Musk in everything through personal and corporate power since he owns a 22.5% stake in the company (Coren, 2018). He amasses support from his followers due to his inspirational and charismatic appeal, leading to staff commitment in stressful working conditions (Robbins & Judge, 2014) to participate in improving humanity’s future. As a result, he has become un-substitutable. However, checks and balances would make Musk accountable in leading the company and engaging top executives in governing Tesla to achieve its vision holistically. Additionally, Musk should allow power distribution in the company to ensure that he is answerable to the board to put discipline and enhance self-control in his actions. According to Fuller et al. (2018), transformational charismatic and narcissistic leaders with too much power will always attract dependence from the organization. To control dependence, spreading the power and influence may improve leadership and performance in Tesla to greater levels.
Conclusion
Elon Musk has portrayed effective transformational leadership qualities that have propelled Tesla to success in delivering environmentally sustainable solutions to drive the world to a clean energy future. However, the leadership style is tainted by the narcissistic character that makes Tesla depend on him since he has too much power. If one was to focus on Musk as an example of an exemplary transformational leader, it could be misleading since he is more task-oriented and cares less about employee's wellbeing. His approaches are more of transform and benefit the organization without question. Although he empowers employees through training and motivation, he is overambitious, giving employees a tight schedule to achieve near deadlines while delivering quality solutions. The leadership style easily fits Tesla's innovative and problem-solving organizational culture that requires employees to remain relevant, innovative, and driven to drive Tesla to achieve its mission.
References
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