elonology.com

Category: Strategy

  • What’s The Worst That Could Happen?

    What’s The Worst That Could Happen?

    From Oranges to Starships: A Strategy From Elon’s Startup

    When Elon was first starting out in business in the USA, he lived on $1 per day to alleviate some of the financial worry that comes with having a new business that is in the pre-profitability stage.

    He ate a lot of oranges and hot dogs during those days, he claims.

     “I figured if I could live off a dollar a day then, at least from a food stand point, it’s pretty easy to earn $30 a month.”

    Elon didn’t do it because he was poor. He did it to see if he had what it takes to lead life as an entrepreneur.

    Since he was successful with this experiment he knew that money wouldn’t be an issue if he could keep his budget tight.

    By experimenting with what it actually felt to be poor Elon realized he could do it if he had to.

    And this helped give him extra confidence so he could go all in and win.

    Note about the pic: Elon and Kanye are friends. Ye posted “When you go to your boys house and you’re both wearing orange.“

    Fun Fact: Elon owned etymology.com also features the Orange emoji.

    Alleviate Stress and Focus on Success

    By not having to worry about the cost of food Elon was able to pour more energy into his business without the burden of stress.

    In an interview with Engineering dot com Elon said:

    “It’s relatively easy to start a company, you just need to get a few like minded people with you and then focus on creating a prototype,a compelling prototype, as soon as possible…

    And then there’s a strong venture capital industry in this country that will give you funding to take things to the next level and that’s all there is to it…

    You may or may not succeed but sometimes I think people fear starting a company too much. You have to say really what’s the worst that could go wrong?

    You’re not going to starve to death, you’re not going to die of exposure, what’s the worst that could go wrong?“

    Business is not usually anywhere as risky as jumping out of a plane.

    Having a budget and tracking your inflow and outflow of capital will help you eliminate potential financial stressors and gain greater clarity around the important tasks you need to complete for your business to succeed.

    By evaluating the worst that could go wrong you can plan for the worst and find motivation to do the hard work needed to help ensure your outcome is positive.

  • Seek Out Constructive Criticism to Discover Powerful Truths

    Seek Out Constructive Criticism to Discover Powerful Truths

    Seek the Truth: Elon Musk’s Tips for Handling Constructive Criticism

    One success tip that many people likely avoid but contains plenty of power is: Seeking out constructive criticism.

    Noone likes hearing what they are potentially doing wrong but by seeking out this information from people you trust you gain valuable insight that you may be able to use to make improvements.

    “I think it’s important for people to pay close attention to negative feedback and rather than ignore negative feedback, you have to listen to it carefully.

    Ignore it if the underlying reason for the negative feedback doesn’t make sense but otherwise, people should adjust their behavior.

    I’m not perfect at it, for sure, but I do think it’s really important to solicit negative feedback, particularly from people who have your best interest in mind.“

    Truth can be harsh but truth is often powerful.  By seeking the harshest and hardest truths and learning from them you will ultimately become stronger.

    In a Milken Institute interview with his brother Kimbal, Elon was asked: “What are the key traits, skills, and circumstances that have enabled you to be so successful?”

    Elon Replied: Being tenacious, and being super focused on the truth is extremely important and looking for feedback from all sources.

    The more positive feedback you can generate the better your product will be. 

    Be willing to hear the hard truth…

    Then be willing to take the hard actions needed to fix your problems fast.

    And realize the feedback loop is a two way street:

    “Having that strong bidirectional feedback loop between engineering and production is really helpful for making the car better, finding efficiencies and lowering the cost.”

    An example of this is the machine learning system Tesla has been installing into all vehicles since October 2016. From that point on new vehicles come with the necessary sensors and computing hardware, known as hardware version 2 (HW2), which provide feedback for future Full Self-Driving.  This automated feedback data gives Tesla a distinct advantage over competitors.

    Barriers to feedback are barriers to innovation.  

    The better your system for turning feedback into innovation is the better off you and your business will be.

    Ignore The Competition

    When speaking at the InvestHK conference Elon said:

    “We don’t think too much about what competitors are doing because I think it’s important to be just focused on making the best possible products…

    It’s sort of analogous to what they say about you if you’re in a canoe if you’re in a race.  They say don’t worry about what the other runners are doing, just run.“

    Elon does not suggest ignoring competition altogether.  Competition can inspire innovation but obsessing over the competition distracts from obsessing over your own business.

    So be aware of your competition but don’t let it distract you from your main goal: Making your business and your life as awesome as possible.

    The grass will be greener on your side when you focus more energy on making your grass green and less time worrying about your neighbors grass.

  • Be Ready to Learn New Skills

    Be Ready to Learn New Skills

    Unlock Your Potential: Stop Limiting Yourself and Start Learning

    Don’t let what you don’t know stop you from tackling important endeavors and don’t be afraid to develop new skills.

    Elon never owned a car company before, but that didn’t stop him from joining the very early Tesla team and becoming a driving force.

    Elon was never a rocket scientist, but that didn’t stop him from starting SpaceX.

    There are plenty of books out there and there is more information readily available than ever before so set your sights high because there is a world of information available online and the potential to turn your wildest dreams into reality has never been greater.

    Never limit yourself.  

    Propel yourself to greatness and don’t let self-doubt stop you from realizing your most powerful potential.

  • Unlocking Talent: The Heart and Mind of Hiring

    Have an Open Mind When it Comes to Hiring

    Elon interviewed the first ~3,000 people who work for SpaceX personally.

    He says a mistake he has made in the past is hiring people for their brain and not taking their heart into consideration.

    A practical way to apply this strategy to your business is to think bigger with your hiring.

    If you can hire a location independent position, meaning your employee could work from anywhere, then you are doing yourself a disservice if you don’t source talent outside of your local area.

    Cast a wider net when you hire and you will give yourself a better chance of connecting with someone great.

    Look for evidence of exceptional ability and you will give yourself a better chance of working with exceptional people.

    Elon says to ask detailed questions about challenging problems the interviewee had to overcome.  If they were involved in the problem solving they will be able to describe the nuance needed to prevail above the problem.  This is how you can identify problem solvers and get them on your team.

  • Be Remarkable: Strategies from Elon Musk

    Be Remarkable: Strategies from Elon Musk

    Differentiate to make your company great.

    You can’t stand out by blending in.

    Elon is real and more often wears custom t-shirts than he wears a suit.  At the Axel Springer round table with a dozen other CEO’s, where Elon won the Axel Springer award, he was the only CEO not wearing a suit or tie.

    Elon’s relatability and openness is part of the reason why many millions (if not billions) of people know his name.  Certainly his strategies are working well.

    Remarkability is a strong strategy so stay different and don’t be afraid to break the mould and stand out.

    With products like the Cybertruck and rockets to Mars in 2026 Elon is playing a huge roll in making the future look like the future moreso than ever before.

    Amazing abundance is on the way.

  • Produce a Superior Product

    Produce a Superior Product

    Elon took on the auto industry and the aerospace industry…and won!

    So he knows what it takes to be the little guy and do what it takes to innovate, grow and win against some of the biggest companies in the world.

    Make no mistake when you are the little guy with big competitors they will try and stamp you out.

    And since the big competitors benefit from economies of scale you rarely can compete against them on price…

    So to win you need to create a superior product.

    As Elon puts it: “If you’re a new company entering an existing marketplace where there are large entrenched competitors then your product or service needs to be much better than theirs…

    It can’t be a little bit better.  Because then you put yourself in the shoes of the consumer and they say why would you buy it as a consumer.  You’re always going to buy the trusted brand unless there is a big difference.

    So a lot of times an entrepreneur will come up with something which is only slightly better.  And it can’t just be slightly better, it’s got to be a lot better.”

    With that attitude in mind they built the original Tesla roadster.

    The same commitment to quality remains in the design of new products, like new Tesla Roadster.

    Think about what kind of product you would love to have and put as much passion as possible into the product you create.

    You have to love your product in order for other people to love it too.

  • Help Save Lives

    Help Save Lives

    Saving Lives on Earth and in Space: Elon Musk’s Vision

    At Tesla, safety is the number one priority.

    Certainly at SpaceX safety is a priority as well and this is reflected by the fact SpaceX has flown many crew missions to space and the ISS with a 100% survival rate and without any casualties or major problems.

    At Tesla, not surprisingly, the great priority of safety combined with Tesla’s incredible rate of innovation have made Tesla into the safest car company in the world.

    Tesla is the only car to ever receive better than a five star safety rating.  The rating system since it gave them what was deemed an unfair advantage so they are now technically “5 star” even though the latest built Tesla are the safest Tesla’s ever built.

    Rapid iteration of safety and other innovations are the reason Tesla vehicles do not correspond with model years: Teslas are improving and becoming safer all the time.

    In his interview where Elon had turbulent words for bankers when on an investors call he said: “There are over 1,200,000 automobile deaths per year.  How many of them do you read about?  But if it’s an autonomous death it’s headline news.”

    In fact Tesla vehicles are significantly safer than the competition and are the safest cars on the road.

    The mission of SpaceX is directly related to human survival as making life multiplanetary is essentially a backup of humanity and human consciousness.

    With The Boring Company the tunnels they create have the potential to create a significant solution for the problem of traffic, which will contribute to many lives being saved.

    The Boring Company saves lives with their tunnels by preventing accidents when they ensure vehicles travel along a path, and without the fumes of a combustion engine.

    Over 3 million people have already been transported with these tunnels.

    Millions of lives can be saved by utilizing tunnels and self-driving cars to mitigate hostile traffic and death caused by cars.

    Setup Your Strategy for Survivalism

    Any product or service which can be positioned as a lifesaver will find itself with a strong value proposition.

    Humans are hardwired for survival.

    Emphasise the survival aspect of the products and services you have to offer and human instinct will compel people to buy more of what you have to sell.

  • Be a Market Leader

    Market Leadership: What It Is and How to Achieve It.

    By carving out a new market segment and being a market leader you are able to give yourself and your company a head start on the competition.

    As Elon’s friend (PayPal co-founder) Peter Thiel likes to say:

    “Competition is for losers.” 

    Being a leader means leading the way with products and services other companies have not yet executed on.

    When Tesla first got started none of the major automakers were building electric cars.  Now they all are.

    Another way Elon helped Tesla establish itself as a leader is by open sourcing all Tesla patents and creating the Tesla patent pledge.

    This leadership is irrevocably entrenched with the Patent Pledge on the Tesla website.

    Patent Pledge

    On June 12, 2014, Tesla announced that it will not initiate patent lawsuits against anyone who, in good faith, wants to use its technology.

    Tesla was created to accelerate the advent of sustainable transport, and this policy is intended to encourage the advancement of a common, rapidly-evolving platform for electric vehicles, thereby benefiting Tesla, other companies making electric vehicles, and the world. These guidelines provide further detail as to how we are implementing this policy.

    Tesla’s Pledge

    Tesla irrevocably pledges that it will not initiate a lawsuit against any party for infringing a Tesla Patent through activity relating to electric vehicles or related equipment for so long as such party is acting in good faith.

    The market leadership from Tesla and their core mission of accelerating the advent of sustainable transport.  

    The virtuous mission that guides Tesla moving forward has helped them to create cooperative agreements to create components for a number of their competitors. 

    Tesla encourages competition.
    Because of their market leadership now Tesla is both the clear leader of electric automobiles, and the leader of all automobile manufacturers in America.

  • Manage Your Expectations

    Manage Your Expectations

    In the documentary Elon Musk: The Real Life Ironman an early PayPal employee who worked with Elon in PR shared a story about his high expectations:

    “Elon expected a lot out of the people, but we all expected a lot of each other, that’s how you get it done.”

    “In the culture of startups the expectation is that everybody is working all the time.  You get there at 9 or 10 in the morning and not leave until 9 or 10 or maybe after that at night and Elon was definitely working until midnight every night…

    It was just what we did.  And it was exciting.  Rarely did anyone complain…”

    It’s important to keep in mind that the first person Elon had high expectations of was himself.  And if he was not working until midnight every night the people he worked with probably would have been less vigilant about holding themselves to such a high standard also.

    Elon fully acknowledged the improbability of starting SpaceX at the Living Legends of Aviation dinner:

    “In the beginning when I told people I was trying to create a rocket company, they thought I was crazy. That seemed like a very improbable thing.  And I agreed with them – I think it was improbable.  But sometimes the improbable happens.”

    Elon is living proof of the power possible when you go all in and work hard to make the improbable into reality.

  • Tighten Your Timelines

    Tighten Your Timelines

    Elon Musk’s Mantra for Rapid Innovation.

    Rhymes are enduring and Elon has some catch phrases that pack a punch of memorable management info.

    When he gave a Starship Update he explained his management mantra, which enabled them to build the ship in just four month:

    “If the schedule is long it’s wrong…

    If it’s tight it’s right…

    The best part is no part…

    The best process is no process.

    It weighs nothing, costs nothing, can’t go wrong.”

    Elon explains “Time is the ultimate currency” and an extension of this means optimizing for time efficiencies is the ultimate optimization.

    “If the design takes too long to build, it’s the wrong design.”

    By utilizing a recursive feedback loop Elon is able to speed up the production schedule.

    Another time optimizing insight Elon shared is to minimize the amount of needed parts: 

    “The tendency is to over complicate things…The thing I am most impressed with when I meet with the design team at SpaceX is what did you undesign?”

    The tighter the feedback loop and the fewer parts needed in production are two key factors in production time optimization, and you can apply these strategies to your own life.

    “The best part is no part. The best process is no process. It weighs nothing, costs nothing, can’t go wrong.”

    Keep Elon’s advice in mind and always seek ways to optimize your time.