The Contradictions of Elon Musk
In our examination of five highly agile companies, SpaceX stood out as a super achiever. That is why it figures prominently in the Agile 2 book. It turned out that their agility stemmed not from their intense work ethic, or from clever work processes. And Agile frameworks were nowhere to be seen. What gave them their agility was a culture of solving problems and trying things. It was behavioral norms – not processes – that created super agility.
The behavior of SpaceX needs to be separated from the behavior of its leader, Elon Musk. Brilliant people are often eccentric. As documented in the BBC series Genius, Einstein was not very nice to his wife, and Picasso was – I would say horrendous – to his own wives and families.
But that is an observation, not an excuse. To say that Elon Musk’s behavior has been quirky is an understatement. News reports certainly seem to indicate a lack of sensitivity towards Twitter’s employees.
What we learned about SpaceX, and about the culture that SpaceX’s founder established, has informed us about the sources of agility and effectiveness. But that does not equate to being fans or supporters of all things Elon Musk.
To his great credit, Musk seems to be motivated primarily by a quest to save humanity. It seems that his personal life is less important to him. He now has ten children, and it is therefore inevitable that such a busy person will not be spending a lot of time with them. But that is about his personal life, and we don’t really care about that, because focusing on that does not help us to understand organizational agility.
To say that Elon Musk’s behavior has been quirky is an understatement. News reports certainly seem to indicate a lack of sensitivity towards Twitter’s employees.
If one considers Musk’s publicized business endeavors, they include,
SpaceX
Tesla
Neuralink
CureVac
The Boring Company
Twitter
For each of these, there is a humanity-saving goal. SpaceX’s goal is to “make life multiplanetary”. Before dismissing that, consider the risks to life on Earth today – there are many. And there is also the matter of personal priorities: just as art and sports are important to some people, the expansion of human presence is important to others. Carl Sagan, founder of the Planetary Society, described the logical fallacy as follows:
“We can’t afford programs to feed malnourished children and educate pre-school kids. We need to urgently deal with crime on the streets. Or: Why explore space or pursue fundamental science when we have so huge a budget deficit?”
Musk has pointed out that as a society, we spend more on cosmetics than we do on space exploration.
Musk has pointed out that as a society, we spend more on cosmetics than we do on space exploration. So it is a matter of priorities; and saying that we should spend all our money on saving the planet and none on space exploration reflects a particular set of values that must be reconciled with other things that we spend money on and the values that those expenditures reflect. Carl Sagan’s point was that we should not spend all our money on one thing and nothing on something competing: rather, that we need a balanced portfolio of spending.
Then there is Tesla, which Musk founded for the express purpose of shifting transportation to renewable electricity. And amazingly it worked – even though business history is littered with failed car startups, and Tesla had the additional handicap of trying to sell an electric car – something that it had to largely create the demand for, which it accomplished by making their S series car so incredibly nice that people wanted it, despite the challenges of charging it.
We are not Elon Musk fans. We are not for him or against him. We are observers.
Neuralink’s goal is to help people who have brain disorders, including paralysis. CureVac’s goal is rapid pandemic response. The Boring Company’s goal is to extend human presence downward, to improve transportation in cities.
And then there is Twitter. Musk’s clearly stated goal for Twitter is to create a healthy public discussion space. Many people assume that he plans to open the floodgates for all the crazies, but he has resoundingly said that he does not plan to do that – even though he sometimes acts a little crazy himself. His stated intention is to try to come up with solutions to the problems that exist today in social media. And imagine if he can do it – I say let’s see what he comes up with, and then judge. Let’s give the person who has done the impossible multiple times a shot at it.
Musk’s house in Boca Chica
But we are not Elon Musk fans. We are not for him or against him. We are observers. The fact that he lives in a tiny house, draws almost no salary, and spends all his time on world-saving projects of his choosing is a strong notch in favor of his character, quite unlike Jeff Bezos who has sought to build a vanity yacht so large that it cannot reach the ocean.
Musk’s treatment of Twitter’s staff is a notch against him. But our interest is in organizational agility. Although, we care about people, and about organizational culture – it is not all business to us. We don’t like the cultural ramifications of firing people en masse. We are disappointed by that. It does not seem like a way to create inspiration and loyalty, which we feel is essential for agility.
Yet these things are complex. There is not “good” or “bad”. There are shades of gray. And it is hard to verify the reality of what actually happens in these companies, and who pulled what trigger.
Again, what we care about is organizational agility, and SpaceX has it in spades. And it is not because they work hard: that explains some of their speed, but not their agility. Their agility shows in how easily they change direction, and their approaches to things. Consider that they radically changed the design of their new “Starship” vehicle several times since the concept was announced. (See figure)
The change that occurred in the fall of 2018 is particularly noteworthy, as they changed the material the vehicle would be made of, from advanced composites to stainless steel – a change with far-reaching implications – despite that they had already begun making critical parts.
The Starship system is projected to have a cost to orbit thousands of times lower than competing systems.
And consider that NASA’s Space Launch System (SLS), its primary technology for returning to the Moon, is years overdue and billions over budget, with each launch projected to cost $2 billion – each launch! Meanwhile, SpaceX routinely launches large payloads for a fraction of the cost of similar systems, with turnaround in days, landing and reusing its rockets like an airplane. And SpaceX developed that technology at their own initiative – no one told them to do it.
The Starship system is projected to have a cost to orbit thousands of times lower than competing systems. Thousands of times. Thousands!
Here’s why: consider the engine used for the SLS. It is called the RS-25. It was based on the Space Shuttle engine, allegedly to save costs. But that is highly ironic, since each engine costs $100 million to make. (See figure below, or video report here.)
Meanwhile, SpaceX’s raptor engine, the most advanced rocket engine ever created, is built at a fraction of the cost: SpaceX now churns out one engine a day. The figure below is a little blurry – apologies for that – but it is an excerpt from a recent NASA report on the progress of the Human Landing System (HLS), for which NASA has chosen to use SpaceX’s new Starship vehicle, which SpaceX had been building anyway.
A gross estimate is that each engine costs a few million at most – again thousands of times less than the RS-25. And to top it off, each Raptor engine will be reused, since the rocket is reused, whereas SLS engines end up on the ocean floor – $100 million literally down the drain for each one.
(In my opinion, we should cancel the SLS program entirely and use the Starship system. That would save us all a huge amount of money.)
So in conclusion, SpaceX has amazing agility. We feel we know why. But our interest is not in Elon Musk. Our interest is in what makes SpaceX so agile, and what Elon has done to make it that way. We do not like everything he does. We like the things that make SpaceX an agile company.
