Leadership, Innovation and Change

This study explores the leadership style of Elon Musk and the challenges faced by Tesla in terms of production, finances, lawsuits, and management. It also discusses the strengths and development areas of Musk as a transformational leader.

Running head: LEADERSHIP, INNOVATION AND CHANGE
LEADERSHIP, INNOVATION AND CHANGE
Name of the Student
Name of the Organization
Author Note

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Company overview – Tesla t
A big group of engineers who had an aim in proving that driving electric vehicles can be
lot better founded Tesla in the year 2003. They proved that electric cars can be lot better, quicker
and more fun than the simple gasoline cars which are found today. Tesla is not only known for
building electric vehicles but also are known for developing infinitely scalable and clean energy
generation and storage products. It is believed by Tesla that the faster the world stops relying in
the fossil fuel which are coming to an end and move to the electric vehicles which are zero
emission vehicles, it will be a better future (Huang, 2019).
The chosen leader is Elon Musk – Tesla
Elon Musk is the co – founder and CEO at Tesla who is known for overseeing all the
products, which are designed, engineering as well as manufacturing of all the electric vehicles,
batteries and solar paneled sunroofs. Elon Musk is also the co – founder, lead designer and CEO
of the Space Exploration Technologies or the Space X. There he is known for overseeing the
development and manufacturing the advanced rockets as well as spacecraft. His mission in Space
X is go reach beyond the Earth’s orbit and create a self sustaining city in Mars. He is alos a
leader and CEO of Neuralink, which is aiming to develop ultra – high bandwidth brain machines
which will be able to connect the human brains with the present computers (Boudette & Musk,
2018). He is also known as serving as a CEO of The Boring Company which is known for
combining fast and affordable tunneling technologies with a fully electric public vehicle which
will be able to run at high speed in order to convey the long distance travel.

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Challenges which are faced by Tesla
Tesla in just building cars, the company needs to boost up the production line of the cars
which are manufactured in Tesla. Due to lack of leadership skills, by various top executives are
leaving the company Tesla is in a position of not meeting its primary goals and meeting targets.
According to Chen & Perez (2018) in the year 2018, the company had finally made an
achievement in meeting its long delayed goals of manufacturing 5000 of Tesla Model 3 per
week. Musk had essentially building the line second for assembly and production unit under a
huge tent in Australia in order to meet the target. Now Musk needs to prove that it was not a
coincidence, and Tesla has the capability of maintaining and even increase the level of
production in the recent years. Tesla had also promised of delivering the Model 3 to the Tesla
fans who had made an investment of $1000 dollars to the company. Therefore, they need to
speed up their production line in order to meet the targets
Tesla need to start making money by hitting the production targets as because it need to
turn the revenues of the company into profits. The company is in badly need to cash in order to
survive the existing market. In the words of Ji et al. (2019) it is estimated that the company is
running under a huge debt of$1.2 billion dollars and Tesla is planning to build a $2.0 billion
dollar plant in China which will be very critical for Tesla to expand in order to become the
world’s largest market for car sales in China. Musk has denied in an interview about the fact that
the company is facing financial problems. He says that the increase in the sales of the Model 3
will help Tesla generating enough cash, which will make Tesla profitable in the coming years.
Dealing with the lawsuits an d the investigator of the company is a very big challenge
which is faced by the company. Tesla was hit by two stakeholder’s lawsuits charging Musk that
he had a “funding secured” which was a false statement, he also had an attempt of manipulating

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the stocks. Numerous reports shows that the Securities and Exchange commission was also
looking into the fact that whether Musk is violating the securities law with the claim of “funding
secured”
Re-establishment of Tesla in the present years has helped Tesla to grow really very fast
and its investors are willing to invest in Tesla and provide funding to the company so that Musk
can build his company accordingly. But after the initial excitement of the investors, the market
for Tesla soon showed that the investors are in a doubt that whether Musk will be able to lead the
company and remain as a public company. Musk says that the short sellers of the company and
the investors are betting that the stocks of the company will be declining. This constant fear,
uncertainty and doubt about Tesla company among the shareholder and customer is damaging
the reputation and goodwill of the company.
Tesla is facing problems with the command head of the company. There is urgency for an
experienced manager in order to help the company run in its day-to-day business. Numerous top
executives have left the company rather then working under Musk’s mercurial management style
in the present years. According to Olsson (2018) finding the right person would not be easy. It is
not possible for Musk to spend hours in the company and factory premises in order to manage
the company. In the words of (Shivaram,2019) Musk is known for spending more than 120 hours
a week, rarely leaving the factory and not having time to meet with the family and friends.
Whereas keeping on working for more than 120 hours a week is a good idea.
Leadership Style of Elon Musk in Tesla
The different types of leadership styles are:

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Heroic Leadership -Heroic leadership is the pinnacle of leadership, conducted by a
transformed and enlightened leader who seeks to transform and enlighten others.
In Servant Leadership the main goal of the leaders present in an organization is to serve
the company. The servant leaders are known to share power of their own and they put the needs
of the employees as a first priority (Hoch, Dulebohn & Wu 2018).
The style of leadership, which is best exemplified in Elon Musk, is the transformational
leadership as because he is known for creating a high performance workforce, which has become
increasingly very important in his business. Transformational leadership is such a leadership
style which is found in all the levels of the organization such as the teams, divisions,
departments, and organization as a whole. These types of leaders are visionary, inspiring, risk
takers, thoughtful thinkers and daring at time. They also have a very charismatic appeal. Elon
Musk is charismatic leaders but charisma alone is insufficient for changing the way the
organization has been working (NEAMȚU & Bejinaru, 2018). He alone has brought many
changes in Tesla from the last few years. The factors, which have helped Musk in the major
changes in a company like Tesla, are provided below:
Inspirational Motivation – Transformational leadership can be considered as the promotion of the
company vision, mission and a set of values to the members of the organization. Their visions
are so compelling that they know what they want from each and every interaction. Musk is
known for guiding his followers by providing them with the senses of meaningful and
challenging work. Therefore, the team of Space X in Tesla, which is under the guidance of
Musk, has the capability to work enthusiastically and optimistically in order to display the spirit

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of a teamwork and commitment towards their work in a company like (Tesla Lang, Handle &
Jablokow, 2018).
Intellectual Stimulation – Musk has always been popular in encouraging his followers in order to
ne more innovative as well as creative in their work. He encourages them by developing new
ideas and following them, he never criticizes them in public for making mistakes, which are
committed by them (Kelan, & Wratil, 2018). These types of transformational leaders are known
for focusing on what is the problem and how can it be solved rather than blaming the part of it.
They also does not feel hesitated in rejecting old practice if it found defective. They always
accept the change in their work. .
Idealized influence – Musk always believed that leaders can only influence his followers when
he practices what he preaches. The transformational leaders act as a role which the followers
seeks in order to incorporate them. Therefore, these types of leaders are always known for
winning the respect and trust of the followers through their actions. Musk is known for placing
the needs of the followers and members in his company over his own. Musk has sacrificed his
personal life and goals and spends more than 120 hours a week in the company and
manufacturing plants which demonstrates high standard of ethical conduct. These types of
leaders are known for using their power in influencing the workers and members who work in
the production unit of the company in order to strive for the common goal of the company.
Individualized Consideration – These type of transformational leaders acts as mentors to the
followers and then rewards the for their innovation and creative ideas. Musk treats his followers
differently according to their talents and knowledge they provide to the company. The Space X

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team of Musk is always empowered to make decisions and he always provides them with
assistance in order to support them implementing their decision.
Strengths and development areas of Elon Musk as a transformational leader
Musk’s transformational leadership has given him the ability to assess his organization’s
current scenario and formulate a vision for the implementation and growth of his projects.
Transformational leads communicate their vision properly to the other leaders and employees in
order to bring everyone on the same track. There is no doubt that Musk has a vision. His present
vision is in changing the world where people would no longer rely on the fossil fuels. His aim is
maximizing the use of green energy and exploring the outer space and is building colonies in
Mars. Even now to most of the people, his vision is neither realistic nor believable, but Musk has
made it his aim and mission.
Transformational leaders promotes enthusiasm, Musk has always encouraged and
inspired his employees in each of his ventures which includes the development of the Tesla
Model S electric car as well as the launch of the Space X Falcon launch vehicle. With all these
recent developments, Musk has managed to generate a group of migratory people in order to
accept the new philosophy and movement of utilizing the green energy (Sosik, Chun & Ete,
2018).
Transformational leaders are known to have the leadership vision, which has the ability to
motivate and inspire the employees and workers of the company. A common trait, which helps
the transformational leaders in order to get through the difficult times, is passion. In order to get
through the difficult times Musk depends upon his passion and vision in helping and getting the
employees work together to a common direction in achieving the company aims and goals. He

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has continually earned trust from his followers by being the most reliable person in each and
every uncertain situations faced by the company. When the company was running in a financial
crisis, Musk was the only person who had funded the company from his own. According to
Kelan & Wratil (2018) the total funding which was made by Musk himself in his company is
around $150 million dollars. He had also funded in to the electric car development team.
Therefore it can be clearly depicted that Musk’s transformational leadership was most effective
when the company was in the times of crises (Gilson, & Abbott, 2018).
Conclusion
The paper thus concludes with the leadership style of Musk. His name is synonymous to
Space X and Tesla Motors. He has his vision of travelling people to the planet Mars. He has also
failed many times but has also succeeded many more times. The success of the company
indicates that the style of transformational leadership and his managing style have been working.
There is still a long path to go for our generation and the generation to come to achieve the
perfect planet Earth, where there are no problems like pollution or global warming. However, we
can believe that Musk is one of the big steps towards the future. Musk’s companies are ground
breaking in the areas of outer space, The solar industry and the automotive industry.Therefore, it
can be recommended that if Musk does not change his consideration of his people’s autonomy,
then a much known innovative company like Tesla will be seeing its downfall soon.

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