Leadership Style of Elon Musk

Explore the leadership style of Elon Musk, co-founder, product architect and CEO at Tesla Inc. Learn about his leadership characteristics, skills, knowledge, and approaches. Find out how he adheres to the mission and vision of the company, sets standards in the industry, and benefits stakeholders. Discover how past failures influenced his leadership style and how he developed his skills and characteristics. Get insights into his participative and transformative leadership style.

Running head: LEADERSHIP
Leadership Style of Elon Musk
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Table of Contents
Introduction:....................................................................................................................................2
Evaluation of leadership characteristics, skills and knowledge of Musk:.......................................2
Adherence to the mission and vision of the company:................................................................2
Goal oriented:..............................................................................................................................3
Standard setter:............................................................................................................................3
Stakeholders’ benefit:..................................................................................................................4
Influence of past failures on leadership style of Musk:...................................................................5
Time and method of Musk developing his skills and characteristics:.............................................5
Leadership methods, approaches or concepts employed by Musk:.................................................6
Conclusion:......................................................................................................................................7
References:......................................................................................................................................8

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Introduction:
Business leaders play the significant role making decisions while leading business
organisations they command. The appropriate decisions which business leaders take play
significant roles in attributing the organisations with high market positions. Certain attributes,
skills and knowledge which the leaders possess enable them to take decisions and lead
organisations under their command especially during challenging or risky market conditions. The
leaders often experience challenges which have great influence on their leadership styles. These
leaders follow certain approaches or models which enable them to lead their subordinates
efficiently (DuBrin, 2016). The aim of the report would be exploring the aspects of leadership of
a chosen business leader namely, Elon Reeve Musk, the co-founder, product architect and the
chief executive officer at Tesla Inc which an American automotive and energy marketing
company.
Evaluation of leadership characteristics, skills and knowledge of Musk:
An evaluation of the leadership characteristics, skills and knowledge of Elon Reeve Musk
would reveal the following facts:
Adherence to the mission and vision of the company:
Musk emphasises on the fact that the business leaders should align their respective
leadership styles with the missions and visions of the companies concerned. Musk encourages
his subordinates to follow the organisational mission and vision while carrying out their
operations. Musk in fact encourages his subordinates to follow their own missions during the
course of their respective professional career (Swisher, 2018). This is evident from the fact that
Musk after holding leadership positions in Zip2 and Paypal, went on to pursue his vision of

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launching space related project, SpaceX. It was a project which aimed to transfer a greenhouse to
the Mars on experimental basis. It can be pointed out that Musk perceived that intercontinental
ballistic missiles could transfer the greenhouse to the Martian surface and visited Russia in
order to obtain the same. However, he did not receive sufficient respect and returned
unsuccessful. Musk visited Russia for the second time but was unable to acquire a rocket since it
was very expensive. These two failures which Musk experienced in obtaining missiles motivated
him to launch a company called SpacX which could manufacture affordable rockets. Thus, it is
clear from the analysis that adhering to visions is one of the most driving features of leadership
style of Musk (Schoemaker, Heaton & Teece, 2018).
Goal oriented:
One of the most notable leadership aspects and skills which Mars exhibits throughout his
career as a business leader is his goal oriented nature. Musk is a goal oriented leader, an attribute
which enables him to take tough decisions when he faces challenges. This characteristic of Musk
was revealed when he was removed by the shareholders of Paypal from the position of the CEO.
The reason of his eviction was that he wanted to convert the operating system of PayPal to the
global leader Microsoft which the shareholders dissented. eBay acquired PayPal in 2002 and
Musk received an amount of $ 165 million. Musk purchased the online financial service
providing platform domain X.com from PayPal. An analysis of this decision of Musk shows that
he is a goal oriented leader. This is reflected from the fact that he wanted to convert the operating
system of PayPal into Microsoft’s OS in to ensure smoother operations. He accepted to resign
from the post of the CEO but adhered to his goal of bringing about technological advancement of
PayPal and ultimately purchased the financial platform of PayPal namely, domain X.com (Bower
& Paine, 2017).

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Standard setter:
The third leadership characteristic of Musk which can be pointed out from analysis of the
leadership record is that he is a setter of standards in the industry (DuBrin, 2016). Musk instead
of being overcome by challenges which he met in the course of his career, took decisions which
set standards in the business world. For example, when Musk failed to acquire a missile or a
rocket capable of launching greenhouse to the Mars, founded SpaceX, the company which can
make rockets at affordable prices (SpaceX.com, 2019). This it transpires from this analysis that
Musk is a standard setter in the industry. His failures and successive successes are capable of
motivating aspiring entrepreneurs and business leaders to make correct decisions in order to
overcome tough situations.
Stakeholders’ benefit:
One of the most important aspects of the leadership style of Musk is his emphasis on
stakeholders’ value creation. This aspect of Musk can be exemplified throughout this career as
leader of different companies (Clifford, 2019). For example, when he failed to acquire the
missile from Russia, he launched SpaceX. The company manufactures rockets at low costs.
This enables medium sized aeronautics companies to acquire rockets to support their respective
space missions (Shin et al., 2015). Similarly, Musk approved Tesla’s plan to manufacture sub-
US$ 30000 compacts which were low priced. This means that the smaller automotive companies
could acquire them to manufacture automobiles. The sub-US$ 30000 compact machines in fact
enabled the small and medium sized automotive companies to manufacture automobiles at
reduced prices. Thus, this analysis shows that Musk emphasised on creating values to customers,
mainly small and medium sized companies. This stakeholder benefit centric characteristic of
Musk was evident in case of SolarCity in which the benefactor stakeholder is the society. Musk

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conceived the idea and financed SolarCity in 2006. The company manufactures and provides
solar power in the country of the United States of America. The aim of Musk in conceiving and
funding SolarCity was to enable control of global warming and environmental pollution which is
caused due to harnessing electricity from coal and petrol. Thus, it can be proved from this
example that Musk is a socially responsible business leader.
Influence of past failures on leadership style of Musk:
An analysis of the career of Musk shows that he has been influenced to a great extent by
the failures which he had faced in the past. For example, when Musk failed to acquire a missile
and a rocket from Russia to send an experimental greenhouse to the Mars, he launched the
rocket making company called SpaceX. Similarly, when the productivity of Telsa was hit due to
financial downfall of the American economy in 2008, Musk assumed the position of CEO and
product architect. The company under the leadership of Musk revealed its future model of sports
car called Model X but was not able to deliver the product on time. Musk in order to tide over
the tough situation, gained support of the two main business customers of Tesla namely,
Mercedes and Toyota. The two companies decided to invest in the shares of Tesla which
strengthened the company’s financial base. Musk in order to acquire new customers for Tesla,
supported building a sub-US$ 30000 compact which smaller and medium sized automobile
companies could afford (Tesla.com, 2019). This decision of Musk enabled Tesla to acquire a
large base of small and medium sized customers which acquired powertrain from Tesla on
regular base. This decision of Musk enabled Tesla to tide over its financial tough phase (Jones,
Michelfelder & Nair, 2017).

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Time and method of Musk developing his skills and characteristics:
Musk developed his leadership attributes from different challenges and failures which he
faced throughout the course of his career. It can be pointed out that Musk was not attributed with
leadership skills and decision making power from the initial phase of his career. This fact can be
exemplified by taking out three different milestones from the career of Musk. First of all, when
Musk envisioned to convert the operating system of PayPal to Microsoft in order to make it more
dynamic, the shareholders of the company removed Musk from the seat of the CEO. PayPal was
acquired by eBay and Musk received an immense amount from the buyout. This incident taught
Musk to hold on his decisions as a leader. The second example of the leadership attribute of
Musk was revealed when he wanted to send a greenhouse to Mars on experimental basis but
failed. Musk aimed to send a greenhouse to Mars on experimental basis and travelled to Russia
to acquire a ballistic missile but failed to acquire it. He launched his company SpaceX which
manufacture rockets. Thus, it is evident out from the analysis of the incident that Musk exhibited
his entrepreneurial skills over here. The third example of the learning of Musk to implement his
decision making skills was when it approved Tesla to manufacture sub-US$ 30000 compact to
sell it small and medium sized automotive companies (Isidore, 2018). Thus, it can be established
that Musk did not have leadership attributes and in fact developed different aspects of leadership
throughout his career. Thus, the method of learning which Musk adopted to develop his
leadership style could be described as experiential learning.
Leadership methods, approaches or concepts employed by Musk:
The leadership methods which Musk employs can be described as a combination of
participative and transformative leadership style. This can be exemplified by several incidents
throughout the life of Musk. Musk as a participative leader motivated his followers to take part

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in the decision making process (Bouwmans et al., 2017). This was evident when Musk financed
the business plan of his cousins to launch a company which would manufacture solar energy.
Musk also gained participation of the departmental heads of Tesla when the company was not
able to deliver the coveted sports car model called Model X. He approved and encouraged the
company to manufacture sub-US$ 30000 compact which allowed the company to sell low priced
compact machines to small and medium scale automotive makers. Thus, it can be pointed out
from this analysis that Musk is a participative leader.
Mars is a transformative leader besides being a participative leader. This is because
he enabled Tesla to gain investments from Toyota and Mercedes when the former was suffering
from financial crises (Grill et al., 2017). Musk instead of being overcome by the challenging
situations, utilises the situations to explore new business avenues. For example, when Musk was
not able to acquire missiles from Russia, he started SpaceX which manufactures rockets. Thus,
he transformed his inability to acquire missiles into a business venture. Thus, it can be inferred
from this discussion that Musk is a transformative business leader.
Conclusion:
It can be concluded from the analysis that Musk exhibits several leadership attributes.
He is a goal oriented leader who prefers to adhere to his own vision. It can also be pointed out
that Musk as a business leader stressed on the importance of causing benefit to stakeholders. The
discussion also uncovers that Musk is a participative and transformative leader. It is evident that
throughout his career as an entrepreneur and business leader, Musk has started several ventures.
It can also be established from the discussion that he has not only succeeded in creating
employment opportunities for himself but also for his employees, thus exhibiting his

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stakeholders’ benefiting nature. It can be established on the basis of the above discussion that
Musk is undoubtedly a role model for future business leaders.

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References:
Bouwmans, M., Runhaar, P., Wesselink, R., & Mulder, M. (2017). Fostering teachers' team
learning: An interplay between transformational leadership and participative decision-
making?. Teaching and Teacher Education, 65, 71-80.
Bower, J. L., & Paine, L. S. (2017). The error at the heart of corporate leadership. HBR’S 10
MUST, 165.
Clifford, C. (2019). Elon Musk, Bill Gates and Warren Buffett agree: Now is the best time to be
alive. Retrieved 20 July 2019, from https://www.cnbc.com/2019/07/19/musk-gates-and-
buffett-say-now-is-the-best-time-to-be-alive.html
DuBrin, A. (2016). Leadership: research findings, practice, and skills [Ebook] (8th ed.). Mason:
South-Western Cengage Learning.
Grill, M., Pousette, A., Nielsen, K., Grytnes, R., & Törner, M. (2017). Safety leadership at
construction sites: the importance of rule-oriented and participative
leadership. Scandinavian journal of work, environment & health, 43(4).
Isidore, C. (2018). Tesla sells cheaper Model 3. Retrieved 20 July 2019, from
https://edition.cnn.com/2018/10/19/tech/new-tesla-model-3/index.html
Jones, S. A., Michelfelder, D., & Nair, I. (2017). Engineering managers and sustainable systems:
the need for and challenges of using an ethical framework for transformative
leadership. Journal of Cleaner Production, 140, 205-212.
Schoemaker, P. J., Heaton, S., & Teece, D. (2018). Innovation, dynamic capabilities, and
leadership. California Management Review, 61(1), 15-42.

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Shin, Y., Sung, S. Y., Choi, J. N., & Kim, M. S. (2015). Top management ethical leadership and
firm performance: Mediating role of ethical and procedural justice climate. Journal of
Business Ethics, 129(1), 43-57.
SpaceX.com. (2019). Retrieved 20 July 2019, from https://www.spacex.com/elon-musk
Swisher, K. (2018). Elon Musk: The Recode interview. Retrieved 20 July 2019, from
https://www.vox.com/2018/11/2/18053424/elon-musk-tesla-spacex-boring-company-
self-driving-cars-saudi-twitter-kara-swisher-decode-podcast
Tesla.com. (2019). Retrieved 20 July 2019, from https://www.tesla.com/elon-musk