LEADERSHIP

The process, by which a person exerts influence over others and energizes, inspires,
motivates, and directs their activities to achieve group or organizational goals, is known as
Leadership (Kyle Bruce). In other words an organizational orchestrator, who controls all
the elements of an organization to achieve the desired goal.

In this essay we will define & evaluate the leadership style & behavior of the South African
(born) Canadian American business magnet Elon Musk who is the Chairman of the
Board, Product Architect and CEO of Tesla, Inc. We shall be doing the same by
understanding and applying the five main models, styles and perspectives, as below, of
leadership to Elon Musk and Tesla.

1. Transformational
2. Trait or Competency Spotting
3. Style Counselling
4. Context-fitting or Contingency
5. Golemans Six Leadership Styles

Transformational

A leadership perspective that explains how leaders change teams or organizations by

creating, communicating and modelling a vision for the organization or work unit and
inspiring employees to strive for that vision (Kyle Bruce).

Elon Musk invested in Tesla, founded in 2003 by Martin Eberhard and Marc Tarpenning, in
2004 and became the Chairman of the board. He then took the reins in his hands by
singularly deciding to be the CEO in 2008, firing the current CEO; who was also the co-
founder, and now he is even Teslas Product Architect. Since taking charge, partially even
before, Elon has been very articulate in creating, communicating and modelling Teslas
vision but hasnt been so successful in creating an atmosphere that builds commitment
towards the vision.

Lets understand the above argument better with the help of Table 1, where we shall
compare Elons behavior, actions and communication to the elements of Transformational
Leadership perspective.

Table 1 Elements of Transformational Leadership (Positive Green & Negative - Red)

Elements of Transformational Leadership Elon Musks Behavior, Actions and

Communication

1. Create a Strategic Vision The strategic vision of the company has

always been to make affordably priced
electric family cars, to move from
hydrocarbon economy towards a solar
electric economy. To enter with a premium
car (sports version) and target the high end
segment that is ready to pay the premium
and then get it down from there towards
making the technology available for the
mass market, as any new technology
initially has high unit cost before it can be
optimized and this was no less true for
electric cars.

2. Communicate the Vision Elon has always communicated very clearly

the strategic vision to stakeholders,
employees and customers. One of the best
 examples is his letter on Tesla website,
titled The Secret Tesla Motors Master Plan
(just between you and me) where he is
very articulate about his vision. He
concludes it by summing it up as following:
So, in short, the master plan is:
Build sports car
Use that money to build an
affordable car
Use that money to build an even
more affordable car
While doing above, also provide
zero emission electric power
generation options
Don't tell anyone

3. Model the Vision The journey of Tesla from 2004 till date has
been as below and its really great to see
how precisely the Vision has been modeled,
without any alteration.
1. Built a high priced sports car
Roadster
2. Invest further in the technology and
specially the battery
3. Opened up the battery technology
code to competitors to accelerate
innovation to further reduce cost
4. Built relatively low mid-priced cars
 Model S & Model X
5. Used the money from the high and
mid-priced car to build the largest
manufacturing plant in the world for
mass production
6. Built a low price car Model 3
Elon even Models the vision by personally
involving him-self in every aspect,
especially product design, that contributes
towards the realization of the vison and
that too with an hands-on approach. He is
known to be obsessed with detailing and
isnt shy about communicating the same.
Musk told the Wall Street Journal,
describing himself not as a mere
micromanager but as something far more
intensea nano-manager.
Also he has an approach of continuously
questioning current practices, not only at
industry level but at the company level too
and experimenting new ways, to develop
something better. The models succeeding
the roadster, which are relatively more
efficient and economical, are examples of
this approach.

4. Build Commitment to the Vision At one point he is seen as building the

commitment to the vison by aggressively
sticking to the strategic plan, gradually
achieving the strategic vison by being
dedicated, persistent and extremely hard-
working but at the same time he hasnt
been successful enough at employee
involvement in shaping the shared vision,
majorly because of his nano-managerial
style. He gives no autonomy at any level
and controls everything with his singular
mindset which creates dis-satisfaction
amongst the employees and they quit,
swearing never to work for him again!
 Representation of table 1 in the form of a diagram

CREATE A STRATEGIC VISION

Affordable priced and powerful
electric car
Start from low volume-high cost,
move to mid volume-mid cost and
then finally go to high volume -
low cost electric cars

COMMUNICATE THE VISON

BUILD COMMITMENTS TOWARDS
THE VISION
Dedicated, commited
and extremly hard-
working
Harsh behaviour towards
employees resluting to
dissatisfaction
Letter to stake holders
So, in short, the master plan is:
Build sports car
Elements of Use that money to build an affordable
Transformatinal car
Use that money to build an even more
Leadership affordable car
While doing above, also provide zero
emission electric power generation
options
Don't tell anyone

MODEL THE VISION

Precisely following the strategic
plan to achieve the strategic vison
without any major alterations
Absolute hands on approach with
high level of personal involvement
Contasntly questioning and looking
for feedback and geting the
product better

Trait or Competency Spotting

Personal characteristics that lead to superior performance in a leadership role (example

skills, knowledge, values). (Kyle Bruce). In Table 2 we shall understand the main Eight
leadership traits that our identified as key influencers on leadership potential and
predictors of effective leaders and we shall see how many of them apply to Mr. Musk as
Teslas leader and to what extent.
Table 2 - Leadership Traits (Positive Green & Negative - Red)

Leadership Traits Elon Musk

1. Personality Elon is a person who has always led by

example, inside and outside Tesla. He is
Majorly Extroversion & known to be dedicated towards excellence
Conscientiousness and precision in whatever he does and
thats one of the key reasons for Teslas
technology and products to succeed. He is
an outgoing, highly sociable and
flamboyant person, who loves to give
interviews, write articles and be at the
forefront of all the events to promote
Tesla and share his views & thoughts with
all his grit.

2. Self-Concept He ardently believes in himself and his

Positive self-evaluation
High self-esteem and self-efficacy
Internal locus of control
capabilities to achieve remotely possible
and impossible things and is never shy to
communicate the same. He is motivated
from within to make this world a better
place and eradicate mankinds dependence
on gasoline for travel. In fact he is so self-
confident that he takes things too far over
here sometimes, resulting into employees
dissatisfaction and higher labor turnover
but again thats what keeps things moving

3. Drive
Inner motivation to pursue goals
Inquisitiveness, action-oriented
4. Integrity
Truthfulness
Consistency in words and actions
forward at Tesla. Its like a blessing and a
curse!
Mr. Musks inner drive to achieve his goals
and commitments is so strong that it alone
pushes the whole staff to their full
potential or at times even beyond. He is
extremely action-oriented and believes in
having timely results. Also, he is always
inquisitive to learn where he could be
going wrong and how things can be made
better. The following two statement
speaks volumes about his drive:
"I think it's very important to have a
feedback loop, where you're constantly
thinking about what you've done and how
you could be doing it better. I think that's
the single best piece of advice: constantly
think about how you could be doing things
better and questioning yourself."
"I don't create companies for the sake of
creating companies, but to get things
done."
The fact that Tesla has stuck precisely and
aggressively to its strategic vision and plan
for over a decade now without any
alterations, come what may, and is still

5. Leadership motivation
6. Knowledge of the business
Understand external environment
Aid intuitive decision making
7. Cognitive/practical intelligence
Above average cognitive ability
Able to solve real-world problems
walking the same path with same sincerity,
passion and aggression, it lays an integrity
example for the business world.
Elon Musks strong influence on not only
customers, shareholders but also on
governments, to give them grants and
subsidies, making them change the way
they saw thing, to make them see what
we should do rather than what we can
do, shows how well he can motivate
others towards his vision.
Elon has advanced knowledge in the field
of Ultra-capacitors which is the technology
behind the efficient batteries at Tesla. Also
he is a sound and a seasoned businessman,
who believes in starting a venture if he
feels an idea is significant enough to work
on, even if there are only 50% chances of it
to succeed.
Elon Musks idea of an electric car sprouts
out from the dire need of mankind to
commute in a sustainable manner.
Mankinds dependence on natural
resources (gasoline) and the resulting
global warming due to the use of these
resources is the biggest of all problems in

8. Emotional Intelligence
Perceiving, assimilating,
understanding and regulating
emotions
our world today. Mr. Musk has the unique
ability to solve this issue by using
sustainable energy and products, Its a
unique ability because he doesnt have a
significant background into car making, he
learns on the go and makes things happen
by the way of lateral thinking and most
importantly his cognitive intelligence.
Well Elon surely lacks this trait of
leadership; he is so high on self-concept
that he doesnt regard anybody worthy
enough and treats people the wrong way.
To an extent that people feel used and
tossed to the curb like litter! Here are few
statements by his employees:
I try really hard to back away and put my
ego aside. Elon is incredibly difficult to
work for, but its mostly because hes so
passionate. He can be impatient and say,
God damn it! This is what we have to do!
and some people will get shell-shocked
and catatonic. It seems like people can get
afraid of him and paralyzed in a weird
way.
Elons worst trait by far, in my opinion, is
a complete lack of loyalty or human
connection. Many of us worked tirelessly
 for him for years and were tossed to the
curb like a piece of litter without a second
thought. Maybe it was calculated to keep
the rest of the workforce on their toes and
scared; maybe he was just able to detach
from human connection to a remarkable
degree. What was clear is that people who
worked for him were like ammunition:
used for a specific purpose until exhausted
and discarded.

So here we see how Elon has all the traits of being an effective leader but significantly lack
one of the most important traits of being emotionally intelligent and this could be one of
the reasons for Teslas success at a slower pace.

Style Counselling

This perspective of leadership pays attention to the behavior patterns of a leader rather
than their personality. It states that there are two kinds of leadership behavior, employee
centered and job centered; also it argues that the latter is less effective than the former.
Lets understand this better by defining the two and relating them to Mr. Musk at Tesla.

1. Employee Centered A pattern of leadership behavior that demonstrates

sensitivity to relationships and to the social needs of employees (consideration).
text book
2. Job Centered - A pattern of leadership behavior that emphasizes performance of
the work in hand and the achievement of product and service goals (initiating
structure) text book
Elon Musks leadership is 20% employee centered, as he at times does listen to
subordinates and allows participation but its 80% task oriented, as at the same time he is
not so friendly and easily approachable and doesnt at all involve himself in employee
problems. His whole focus is always on initiating structures, singularly deciding what will
happen, how it will happen and by when will it happen and then its his way or the high
way! Well this is again a blessing and a curse, because the work does get done but there
is a high labor turnover and employee dissatisfaction. The perfect term for Mr. Musks
leadership behavior is Benevolent-authoritative System 2 - Rensis Likert (1961).

Now lets see how this leadership behavior affects Tesla in Table 3.

Table 3

Initiating Structure - High

High Performance Achieving the distantly possible
Consideration - Low Many Grievances Employee dissatisfaction
High Labor Turnover -

The Style-Counselling perspective helps us to conclude how Elons leadership behavior is

not balanced which is impacting Tesla more in a negative way than positive.

Context Fitting or Contingency

A perspective of leadership that demonstrates that effective leaders chose the most
appropriate leadership style as per the contingencies like employee, the task and the
situation - to influence employee expectations about desired results and their positive
outcomes, originated with expectancy theory of motivation (Path {employee
expectancies} Goal {employee performance} Theory). (Kyle Bruce)
Path Goal Theory

A leadership style which proposes that effective leaders can motivate subordinates by
identifying the outcomes, rewarding the workers when the desired outcome is achieved,
clarifying the paths to achieve the outcome and expressing confidence in the ability of
workers. Now the same can be done with one or a balance of all four behaviors, as below,
depending upon the contingencies:

1. Directive Behavior set goals, assign tasks, show how to do things

2. Supportive Behavior - look out for workers best interests
3. Participative Behavior give subordinates a voice in matters that affect them
4. Achievement-oriented Behavior setting very high and challenging goals, believing
in workers ability.

Now, when it comes to Mr. Musk his leadership behavior is out and out Directive with a
light hint of Achievement-oriented. Elon does set very high and challenging goals,
delegates work, has an hands on approach - demonstrating how things need to be done
but when it comes to believing in workers ability and giving them voice and autonomy, he
lacks this sense of faith.

To understand whether Elons leadership behavior is appropriate in context to Tesla, lets

go through the Path-goal contingencies table - 4.
Table 4 - Path Goal Contingency Table/Matrix

Contingencies at Tesla Green

Elons leadership behavior Red

Directive Supportive Participative Achievement-

oriented
Employee Contingencies
Skill & Low Low High High
Experience
Locus of Control External External Internal Internal
Environmental Contingencies
Task Structure Non-routine Routine Non-routine
Team Dynamics Negative norms Low Cohesion Positive norms

In the above table we can clearly see how as per the employee and environment
contingencies the required leadership behavior is a blend of Participative and
Supportive but Elon is doing the complete opposite, and this is the very reason for
employee dissatisfaction at Tesla.

Now after looking into the above perspectives of leadership in relation to Elon at Tesla, we
can repeatedly see that Elon lacks majorly in aspects of leadership that are related to
employees. But, at the same time Tesla is still successful, not completely but partially yes,
they are heading positively towards success! So Elons leadership is somewhere working
pretty well, therefore lets understand or rather justify how Elons leadership style and
behavior is acceptable to a degree through Golemans Six Leadership Styles in table 5,
however here we shall focus only on the 3 that we have concluded in this Essay.
Table 5 - Golemans Leadership Styles

Style In Practice In a Competencie When to Our

Phras s use Justification
e

1. Coercive Demands Do Drive to In a crisis, Though

complianc what I achieve, self- with there are no
e tell control problem problem
you people people but
the
company is
surely in
crisis as they
have to
achieve the
distantly
possible in a
stipulated
amount of
time and
limited
financial
resources.

2. Authoritative Mobilizes Come Self- When The

people with confidence, new company
me change vision and continuousl
 catalyst direction y needs a
is needed new
direction to
achieve its
over
ambitious
vison. If one
thing fails
they have to
go the other
way and
keep on
going
various
ways till
they achieve
what they
have to!

3. Pacesetting Sets high Do as Initiative, To get As

standards I do, drive to fast mentioned
now achieve results earlier they
from a only limited
motivate time,
d team majorly in
relation to
the funds
 they have. If
they dont
achieve they
perish, so
having fast
results is the
key to
success at
Tesla.

Conclusion

We can convincingly conclude that Elon is a good leader but surely he is not the perfect
leader that Tesla requires. He lacks one of the most important leadership angles of being
employee oriented and having faith and empathy towards his team. Also, to an extent we
can agree that Mr. Musks leadership style and behavior is justified considering the
environment and conditions at Tesla (Golemans table). However, it would be better if
Elon Musk changes his approach, inculcates Golemans other three leadership styles too
and then establishes a good balance between all six.
References

1. https://www.tesla.com/en_AU/blog/secret-tesla-motors-master-plan-just-
between-you-and-me?redirect=no
2. http://www.monarch.edu.au/2016/08/teslas-management-strategy-
unique/#.WLZcC2-GPIU
3. http://fortune.com/2015/01/21/elon-musk-micromanagement-control/
4. http://www.businessinsider.com.au/working-with-elon-musk-tesla-2015-
5?r=US&IR=T
5. https://prezi.com/axwpck2ra0co/tesla-leadership-presentation/
6. https://theoutline.com/post/1069/tesla-worker-jose-moran-elon-musk
7. https://evannex.com/blogs/news/great-leadership-10-elon-musk-quotes-that-provide-a-
glimpse-into-the-dna-of-tesla
8. http://www.forbes.com/sites/simonmainwaring/2016/04/06/the-elon-musk-leadership-
model-3-key-steps-to-building-radical-brand-evangelism/#30b6033f24b7
9. http://www.boothco.com/360-feedback-resources/leadership-style-of-elon-musk/
10. https://sites.psu.edu/leadership/2014/11/30/power-and-influence-elon-musk/
11. http://www.biography.com/people/elon-musk-20837159#synopsis
12. https://www.wired.com/2009/06/eberhard/