Tesla is in turmoil. The electric car-maker’s shares have fallen by over 25% in value since last September, and analysts are predicting further losses. One reason is the increasing concern over its productivity: the company has consistently failed to meet the manufacturing forecasts for its “Model 3” cars.
The signs of strain are showing on Tesla’s charismatic CEO, Elon Musk, who has a famously extreme work ethic. He’s currently sleeping on the factory floor to save wasting travelling time; he claims he is so rushed that he no longer showers.
Musk clearly is not a fan of excessive meetings, which he describes as “the blight of big companies”
Musk is now asking his employees to show a similar commitment to his company, with a leaked email in April sharing his tips for greater productivity. (You can read the full email here.)
But do they make any sense? BBC Capital has examined a couple of the bolder claims, using the psychological literature to determine what does and doesn’t work.
Musk clearly is not a fan of excessive meetings, which he describes in the email as “the blight of big companies”. He advises against big meetings “unless you’re certain they are providing value to the whole audience” and frequent meetings “unless you are dealing with an extremely urgent matter” – and he advises any employee to drop out of any gathering that they do not find useful. “It is not rude to leave, it is rude to make someone stay and waste their time,” he adds.
Tesla's Model 3 electric car was eagerly awaited but the company had missed manufacturing deadlines (Credit: The Washington Post via Getty Images)
Musk’s thoughts probably strike a chord for many workers, and a study from the University of North Carolina would seem to confirm our suspicions. If you calculate costs of the employees’ time, the average company devotes between 7 and 15% of its personnel budgets on meetings.
That’s not to mention the work wasted due to “meeting recovery syndrome” – the period of distraction after a frustrating meeting
Unfortunately, few companies actually test whether that’s time well spent. The reality is that around two-thirds of meetings fail to achieve their initial goals. (And per meeting, around one third of the time is occupied with unproductive discussions.) That’s not to mention the work wasted due to “meeting recovery syndrome” – the period of distraction after a frustrating meeting. So Musk is probably on the right track here: eliminating needless meetings may be the one easiest step anyone can take to increase productivity. Don’t have “face time” just for the sake of it.
If you do feel that a meeting is essential, positive steps to reduce the time-wasting would include setting fixed agendas and offering a revolving door, allowing people to come and go when they are needed.
Break the hierarchy
Musk’s email contains two further tips on improving communication. The first concerns the “vertical” transmission of messages up and down the hierarchy. “Communication should travel via the shortest path necessary to get the job done, not through the ‘chain of command’,” he wrote. “Any manager who attempts to enforce chain of command communication will soon find themselves working elsewhere.”
He’s also concerned about the “horizontal” communication between departments. “The way to solve this is allow free flow of information between all levels. If, in order to get something done between depts, an individual contributor has to talk to their manager, who talks to a director, who talks to a VP, who talks to another VP, who talks to a director, who talks to a manager, who talks to someone doing the actual work, then super dumb things will happen.”
Here the scientific literature is more ambiguous. There is clear evidence that too strict a hierarchy can backfire. The fact is that people on the frontline will first notice potential problems and ineffective procedures, and their message needs to be known quickly if the company is to react appropriately. For this reason, free communication between workers of any level is often considered one of the core principles of “high-reliability organisations”.
The internet went abuzz last month when an email from charismatic Tesla CEO Elon Musk that outlined his visions for productivity was leaked online (Credit: Getty Images)
You can go too far, though. If the hierarchy breaks down completely, you may find people engaged in “status conflict” – with each person questioning their colleagues’ authority. The result is often serious inefficiency (particularly in meetings) – exactly the kind of lost productivity that Musk is trying to avoid. People often work better if they have some kind of idea where they stand in the larger organisation.
In reality, you need a happy medium – a chain of command in which people mutually respect each other’s expertise, while still allowing free and easy communication without needless barriers. And that’s easier said than done.
Think for yourself
Musk’s final recommendations concern his employees’ critical thinking. “In general, always pick common sense as your guide,” he told his employees. “If following a ‘company rule’ is obviously ridiculous in a particular situation, such that it would make for a great Dilbert cartoon, then the rule should change.” Along similar lines, he has also banned the use of meaningless jargon in the workplace.
It would seem hard to argue with this, but many organisations do not take this view. Indeed, the management scientists Andre Spicer and Mars Alvesson have now documented many cases of “functional stupidity”, in which employees are actively discouraged from thinking deeply about their work. This could arise from an apparently upbeat corporate culture, through slogans such as “don’t bring us problems, just bring us solutions”, which sends out the subtle message that a reflective, critical attitude is unwelcome if it’s going to bring bad news.
The result is that the managers’ own biases and blind spots go unchecked, and long-term problems are over-looked in favour of short-term gains. (Enron would be the obvious example, with one employee commenting that “we’ve all got to drink the kool-aid”).
In principle, Musk’s message would seem to be a timely reminder to resist these temptations. Unfortunately, Spicer and Alvesson have also observed that functional stupidity often rises during times of stress and anxiety, and when companies are pushing for greater productivity – exactly the kinds of problems that Tesla is facing today.
David Robson is a freelance writer based in London. He is @d_a_robson on Twitter.
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