Entrepreneurship and Innovation: Personal Qualities, Challenges, and Performance

This document explores the major personal qualities possessed by Elon Musk, the challenges faced in the Space X venture, and the entrepreneurial performance and shortcomings in Tesla. It highlights the importance of entrepreneurship and innovation in achieving success in business.

INNOVATION
AND
ENTREPRENEURSHIP

TABLE OF CONTENTS
TABLE OF CONTENTS................................................................................................................2
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................1
TASK-1............................................................................................................................................1
Major personal qualities..............................................................................................................1
TASK- 2...........................................................................................................................................3
Entrepreneurial challenges faced in the Space X venture...........................................................3
TASK- 3...........................................................................................................................................5
Entrepreneurial performance and the shortcomings in Tesla......................................................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Entrepreneurship can be defined as the set of skills or abilities that are developed to set
up, run and administer a business along with the risks pertaining to that and earn profitability in
the long run. The project shall be highlighting the major personal qualities that are possessed by
Elon Musk which has helped him in becoming a successful entrepreneur in the business world. It
shall also be reflecting the crucial entrepreneurial challenges that are faced in the execution of
the recent project of Space X where he wants to establish the first sustainable city. Lastly the
report shall be providing an in-depth analysis of the Tesla investment and the related
entrepreneurial performance and the shortcomings that were faced by the business.
MAIN BODY
TASK-1
Major personal qualities
 Clear sense of direction-
Clear sense of direction is one of the major entrepreneurial quality that is possessed in Elon
Musk which has guided him enough to become successful business person (Akhmetshin, and
et.al., 2019). The goals and objectives that are to be attained through the start-ups or ventures are
clearly established and organized so that the operations are carried on in the right direction and in
a smooth and efficient manner. The well-defined activities that are developed by him helps in
becoming optimistic towards the business and the various challenges and obstacles that are faced
while executing the plans.
If the entrepreneur has clearly developed the vision and mission of the business, in that
case they have sheer opportunities to convert them into reality and build profitability and future
growth prospects for the business. Also, when an entrepreneur is clear about what is to be done
in the business then it shall also be facilitating the process of strategic decision-making for the
businesses which shall be contributing in developing the competitive advantage.
The recent venture of Space X for the launch of Starship can be related to the quality of
having a clear sense of direction. The new launch is based on a clear vision of humanity's first
ride to Mars or developing a self-sustainable city on the planet of Mars. This clarity further shall
be boosting the operational efficiency in the business and meeting the organizational objectives.
• Passion for innovation-
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This is another major quality that is associated with the personality of Elon Musk who is
a successful business entrepreneur because of the passion for the innovation and experimenting
with the newer technologies. This passion is required in the business for capitalizing on the
opportunities that are provided in the external environment of the organization (Sidrat and
Frikha, 2018).
All the businesses show that Elon Musk had innovation in the business ideas like tesla the
electric car or Space X the starship to mars planet. This innovation combined with the risk-taking
capacity of the entrepreneur and the passion to achieve the objectives makes the business a
successful and a profitable venture. The goals of the business that were established were also
unique and creative in nature like developing a self-sustainable city on mars planet through
launching the starship. Elon Musk had the power to initiate and stand out of the crowd which
became a major contributor to the businesses that were executed.
The entrepreneurial spirit, positive energy and the optimistic thought process were the
key factors that provided the motivation as to innovate, have a clear sense of direction and follow
the business idea until it is achieved. Passion and hard work shall help in conquering all the
struggles that come in the way and also attract the talented lot of people to work for you,
ultimately maximizing the operational efficiency of the business.
• Leadership-
Leadership is another major quality of a successful business entrepreneur which shall
guide the subordinates towards the right path and help in the achievement of the organizational
objectives through motivating them. These leadership traits can be used in the team building,
taking initiatives, developing common goals, building relationships and motivating and
rewarding the employees in the business (Esmer and Faruk, 2017).
The great man theory of leadership specifies that the great leaders are born and cannot be
developed. In the similar way Elon Musk can be considered to be having the leadership traits
from the time he was born and are now being evidently witnessed by the business ideas and
entrepreneurship talent that he is showcasing. The influential personality that Elon Musk has
cannot be developed through the various training and developmental sessions.
The business-like Tesla, Space X and PayPal shows that tremendous risk is assumed by the
owner of the business in order to initiate a new concept in market that can be capable of meeting
the needs and expectations of its target market. A good leader is one who motivates and
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influences the followers to possess the learning attitude and do not hesitate the failures or the
obstacles that are coming in your way, this self-determination can only make an entrepreneur
successful and create milestones that becomes difficult to achieve in reality by the competitors in
the industry.
TASK- 2
Entrepreneurial challenges faced in the Space X venture
The Space X venture of Elon Musk has been facing a lot of entrepreneurial challenges in
its successful execution in the market. It has been facing several failures in the launch of it first
Starship to the planet Mars with a well-defined vision of establishing a self-sustainable city. The
spaceship is landing but not successfully in the mere yards as it had declared, but Elon Musk and
his group are still motivated to learn from the failures and drive success in the business that has
been undertaken (He, Standen and Coetzer, 2017).
Some major challenges that were faced in the successful execution of the Space X venture are
the following: -
• Oversized capital requirements- The launching of the starship on the planet Mars is a
very costly affair in terms of the requirement of capital. The requirements in terms of the
technology, specialized work force, designing the new equipment, research and developmental
costs and the other costs related to licensing, safety measures, assets and resources etc. are
certainly posing great pressure on the financial requirements. So, it can be assessed that the
arrangement of the finances is a difficult task for the business and this makes the venture a
challenging one.
In the acquisition of the finances the company faced several difficulties as the vision of
the company was not common and thereby the commercial success of it cannot be easily
ascertained. To discount the idea in the market was a pretty challenging and tough job for the
company as the investors thought it to be highly risky and lacking the potential capabilities
without the due support. Also, the company planned that it shall be receiving the support from
the air force, but this did not happen due to the increasing competition in the military launch
competition in the market.
The huge investment funding that is required has to be managed in a viable way where
the company is not facing more burden of the financial liabilities since it shall not be able to
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generate good returns in the initial years of the project. So, the sources of equity funding shall be
rather highly preferable in terms that will not impose liability to pay in the recent years of the
project.
• Lower business profitability- The business model that was developed by Elon Musk
regarding dominating the launch market or the commercial space market by cutting the rates and
offering the services at a lower price than that of the competitors was a big challenge to the
company’s profitability and the financial well-being. Apart from that the major problems are
related to the huge capital investment and the financial liabilities that are attached with it, which
the company is unable to meet unless they earn extraordinary profits from the venture (Kruger
and Steyn, 2020).
The company planned to operate on the market penetration pricing strategy through
lowered profit margins, but this ultimately challenged its own survival in the market. They
planned that for the lowering down of the costs they shall execute vertical integrations and
assume the benefit of synergy but this did not work much for the company due to the repeated
failures that it faced in the market. The earnings after the interest and tax that were generated in
the initial years were significantly less even though some payments were excluded from the
income statement of the company. And if these payments would have formed the part, then the
company would have certainly incurred loss.
Another major reason for the dimmed profits of the company was the stagnation of the
commercial markets for space. The industry in itself was dull and did not offer much scope for
the growth prospects of the company. The competitors of the company Arianespace admitted that
the demand in the market has dropped and so to sustain in the market the company needs
averagely 10 launches.
• Measures for the civil safety- The fulfilment of the civil safety measures is also a big
challenge in the business execution for Elon Musk. The NASA and the other space authorities
have formulated strict regulations related to the launching of the spaceships. Following these
rules appropriately and making sure that no legal compliances are avoided which can impact the
brand reputation of the company (Zozimo, Jack and Hamilton, 2017). If any legal claims are
imposed it shall negatively impact the publicizing of the company in the minds of people.
Once Elon was caught smoking marijuana on the podcast against which the NASA
administrator took action. This also caused negative publicity of the company and drew a
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question mark on the ethical code of conduct that is followed by the company. Further the Space
X is proposing to launch a human flight to space which is prudently deemed to be riskier in
nature. Proper precautionary measures and safety standards shall have to maintained to get the
valid certification for the military market access.
TASK- 3
Entrepreneurial performance and the shortcomings in Tesla
Tesla is one of businesses of Elon Musk which focused on the idea of innovating through
the electric cars which used the sustainable energy and renewable energy solutions. It is amongst
one of the entrepreneurial experiences of Elon which has some great performances and also
lagged behind due to some of the shortcomings in the execution of the business plan.
Entrepreneurial performance: - As per the Timmons model of entrepreneurship it is considered
that there are three factors that shall impact the performance of a business one is the
opportunities that are available, the other is the team that is employed in the business and the last
one is the utilization of the resources. Tesla was based on the opportunity to bring the cars that
use renewable energy sources for the sustainable development and fulfilling the corporate social
responsibility. The team of Elon has highly specialized and creative bunch of people who had
passion for innovation just like Elom Musk. And the third was resources wherein the startup
required huge resources which was not acceptable under the Timmons model who believed that
the start must be of low cost (Performance Management at Tesla. 2020).
Some major strategic decision-making of the authorities of Tesla Inc helped the company
in generating operational performance like they differentiated their product for the betterment of
the society and also charged less prices for offering the same. The designing of the cars was done
to use solar energy and other renewable energy sources for the sustainable growth and
development of the society. The quality management was one of the major criteria of the
business where they sought to achieve customer satisfaction and loyalty for the cars.
The effectiveness of the supply chain management is behind the entrepreneurial success
and performance of the business. The company thought to establish a long supply chain so that
the products can have global reach and can be easily accessed by all the potential customers.
Through managing the optimum utilization of the resources and scheduling the productivity of
the automobile was critical to achieve the operational efficiency in the business. Over the time
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Tesla became a successful venture in the segment of the electric cars by managing the
productivity and operations globally and meeting the demands of its target market.
Tesla was able to achieve the profitability as well as customer satisfaction with the
immense hard work and dedication of Elon Musk who had strong vision to make the company a
success.
Despite all the creativity and innovative business idea the company still had shortcomings
that impacted its performance in the industry (Tesla, Inc.’s Operations Management: 10
Decisions, Productivity. 2021). One of the significant backlogs was related to Elon Musk being
the sole representative of the company and the whole business was a one-man show. Apart from
that other weaknesses that they experienced was with meeting the growing demands and the
customer expectations in the real time. Tesla was unable to achieve high productivity like
economies of scale which shall further reduce the cost of operations of the business (Perkins and
Murmann, 2018).
Some of it models were disaster and a big failure in the market which destroyed their brand
as well as losing the competitive edge in the market. The big players in the automobile industry
were posing huge threat to the business and its survival in the market. To derive the competitive
advantage and gain the market share was a great challenge for the company. Adaptation of the
customers to the new market of electric cars was a threat that had to be faced and avoided by the
business. The pedestrians were with a mentality that self-driven cars are a major issue, the
positioning of the brand was required in a more efficient manner so that reputation can be build
and capitalized upon by the business of Elon Musk.
CONCLUSION
It can be summarized from the above project that entrepreneurship has to be conducted with
the clarity of vision, mission, goals and objectives to derive success and profitability in the
business. Elon Musk has initiated several new and innovative business ideas and have achieved
success because of the personal qualities that are possessed in his personality. To become an
entrepreneur, it is necessary to be passionate and innovative and also the leadership qualities are
required to stand out of the crowd and initiate a new business plan. There are certain
entrepreneurial challenges that are faced by the Space X business related to the huge capital
investment, lower profit margins and the safety standards that are to be maintained in the civil
space industry. Since the commercial space market has been stagnated over the time that is the
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reason company has to face struggles to achieve its organizational objectives. Apart from that
Tesla was one of the successful business models that was launched by Elon Musk and had a
favorable market conditions for being launched. It also managed its performance and with that
tried to overcome the short comings of the business.
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REFERENCES
Books and Journals
Akhmetshin, E.M. and et.al., 2019. Acquisition of entrepreneurial skills and competences:
Curriculum development and evaluation for higher education. Journal of Entrepreneurship
Education. 22(1). pp.1-12.
Sidrat, S. and Frikha, M. A., 2018. Impact of the qualities of the manager and type of university
on the development of the entrepreneurial university. The Journal of High Technology
Management Research. 29(1). pp.27-34.
Esmer, Y. and Faruk, D .A. Y. I., 2017. Entrepreneurial leadership: A theoretical framework.
Mehmet Akif Ersoy Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi.4(2). pp.112-124.
He, L., Standen, P. and Coetzer, A., 2017. The perceived personal characteristics of
entrepreneurial leaders. Small Enterprise Research. 24(2). pp.97-119.
Kruger, S. and Steyn, A .A., 2020. Enhancing technology transfer through entrepreneurial
development: practices from innovation spaces. The Journal of Technology Transfer. 45(6).
pp.1655-1689.
Toerien, D., 2018. Productive knowledge, poverty and the entrepreneurial challenges of South
African towns. South African Journal of Science, 114(11-12), pp.1-8.
Lavoie, M. and Addis, J .L., 2018. Harnessing the potential of additive manufacturing
technologies: Challenges and opportunities for entrepreneurial strategies. International Journal
of Innovation Studies, 2(4), pp.123-136.
Zozimo, R., Jack, S. and Hamilton, E., 2017. Entrepreneurial learning from observing role
models. Entrepreneurship & Regional Development, 29(9-10), pp.889-911.
Thomas, V.J. and Maine, E., 2019. Market entry strategies for electric vehicle start-ups in the
automotive industry–Lessons from Tesla Motors. Journal of Cleaner Production. 235, pp.653-
663.
Perkins, G. and Murmann, J. P., 2018. What does the success of Tesla mean for the future
dynamics in the global automobile sector?. Management and Organization Review. 14(3).
pp.471-480.
Chen, Y. and Perez, Y., 2018. Business model design: lessons learned from Tesla Motors. In
Towards a Sustainable Economy (pp. 53-69). Springer, Cham.
Online
Tesla, Inc.’s Operations Management: 10 Decisions, Productivity. 2021. [Online] Available
through: < http://panmore.com/tesla-motors-inc-operations-management-10-decisions-areas-
productivity >
Performance Management at Tesla. 2020. [Online] Available through: <
https://www.performyard.com/articles/performance-management-at-tesla-what-we-know>
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