Elon Musk’s challenge to management thinking


Elon musk’s takeover of Twitter raises questions of policy: is it right for the world’s richest man to own such an important forum for public debate? It raises issues of law: is his decision to get rid of so many workers within days of completing the acquisition above board? And it raises questions of strategy: can Twitter make money by moving from a business model based on advertising to one based on subscription? But it is also an extremely public test of a particular style of management. In the way he thinks about work, decision-making and the role of the CEO, Mr Musk is swimming against the tide.

His attitude to employees is an obvious example of his counter-cultural approach. For a futurist, Mr Musk is a very old-fashioned boss. He doesn’t like remote work: earlier this year he sent an email to employees at Tesla demanding that they come to the office for at least 40 hours a week. Anyone who thought this was antiquated could “pretend to work somewhere else”, he tweeted.

Whatever the legality of his decision to fire so many Twitter workers, his methods are brutal: people locked out of corporate IT accounts, careers ended with an impersonal email, half the workforce gone at a stroke. It’s as if Thanos had decided to try his hand at business. For those who remain, hard graft is the expectation; insiders say that one of Mr Musk’s first acts at the firm was to cancel monthly firm-wide “days of rest”. The template for the modern manager tends to be a low-ego, compassionate boss who gives people autonomy. Someone didn’t get the memo.

His critics have to accept that the my-way-or-the-highway approach has worked before. At his other firms, like Tesla and SpaceX, Mr Musk may not have offered empathy but has provided a planet-sized sense of purpose, from popularising electric vehicles to colonising Mars. Whether this can work for him at Twitter is less clear. His vision for the product as a “digital town square” where free speech flourishes is a typically grand one. This time, however, he is not taking on lumbering incumbents, but fixing an existing business where judgment and politics matter as much as engineering.

The way that Mr Musk takes decisions also cuts across consensus. Comparatively little research has been done on how CEOs make their choices, but a Harvard Business School working paper published in 2020 had a bash by asking 262 of the school’s own alumni how they went about making strategy.

The authors of the paper did discover a wide range of approaches, with some managers going on gut instinct and others using very formalised processes. But the researchers found that bosses who use more structured processes tend to lead bigger and faster-growing firms (which way causality runs is not clear). They also tend to make decisions more slowly. Mr Musk and his acolytes are in a different camp: fast, informal and aggressive. Reports are already surfacing of fired Twitter workers being asked to come back.

He is unorthodox in another way, too. Peter Drucker, a doyen among management thinkers, described the CEO as being the person in the organisation who bridges the outside world and the inner workings of the company. No one else in the firm is in a position to combine these perspectives, Mr Drucker wrote.

Mr Musk is not so much bridging this gap as making the distinction between the inside and outside of the company irrelevant. His personal brand and wealth are inextricably linked with the other firms he runs. At Twitter he is going even further, tossing out product ideas on his own Twitter feed, polling the audience for their views and offering real-time commentary on how things are going. And Twitter itself is a platform on which everyone—users, ex-employees, the people who founded the firm, policymakers and pundits—weighs in publicly to say how things are going. There is not much of an inside to talk of.

You might object that Mr Musk is a one-off, and so is this deal. When he first made his offer to buy Twitter, he explicitly said that it was not because of an economic rationale. He later tried to wriggle out of the transaction entirely. The story of a billionaire owner of a social-media platform has little in common with the challenges that preoccupy the salaried executives of most public firms. Maybe so, but if Mr Musk makes another success of his latest venture by being brutal to his workforce, skipping the PowerPoint sessions and managing through memes, the MBA will still need a bit of an update.

Read more from Bartleby, our columnist on management and work:
How to think about gamification (Nov 3rd)
The archaeology of the office (Oct 27th)
When bosses walk in employees’ shoes (Oct 20th)

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