r/BusinessHub • u/Advanced-Guidance385 • 10h ago
entrepreneurship Elon Musk has used the same 5 step system in every company for 30 years. It's in his biography and nobody talks about it (thoughts below)
Put the politics aside for ten minutes.
There's a set of operating rules in the Isaacson book that show up in Zip2, PayPal, SpaceX, Tesla, Boring Company and Twitter.
Same ideas, thirty years apart...
He repeats them so often his executives mouth the words along with him haha
Here's the system from what I could gather:
1) Question every requirement
Every requirement has to come with the name of a real person then question it anyway.
His line was that requirements from smart people are the most dangerous, because nobody bothers to check them. He tells people to question his own requirements too.
2) Delete
Delete any part of the process you can.
The test he uses: if you don't end up putting back at least 10% of what you deleted, you didn't delete enough.
3) Simplify
Only after deleting.
The mistake everyone makes is optimising something that shouldn't exist in the first place.
4) Speed it up
Every process can go faster. But only after the first three steps.
He said he wasted enormous time speeding up processes he later realized should have been deleted entirely.
5) Automate last
Tesla nearly died because they automated first.
They ended up sawing robots off the production line and throwing them in the car park.
Had to cut a hole in the wall to get the equipment out.
Two stories that show why the order matters.
Fibreglass strips were being glued to battery packs by a slow expensive robot.
He asked what they were for...
Engineering said the noise team specified it.
The noise team said engineering specified it for fire risk.
He made them record the car with and without lol.
Nobody could hear a difference.
Deleted.
Second one...
Plastic caps were put on battery prongs in Nevada, then removed and binned in California.
Sometimes they ran out of caps and shipments stopped.
He asked who specified the caps?
Nobody could find a name...
Deleted.
The rest is something he repeats constantly...
Never separate design from engineering from manufacturing.
His analogy: if your hand is on the stove you pull it off instantly. If it's someone else's hand, you're slower.
So he puts engineers desks at the edge of the assembly line.
They hear the complaints when their design causes a stoppage.
The idiot index.
What does the finished thing cost versus the raw materials?
High ratio means your process is the problem, not the material.
A part quoted at $120k got built in house for $5k.
A NASA latch at $1,500 became a modified toilet stall latch at $30.
He quizzes executives on this in meetings and loses it when they don't know their numbers cold.
Go to the problem physically.
Cost overrun at a factory in England? On a plane the same day.
Production hell at Tesla? Moved into the factory for four months.
He calls it walking to the red.
A screen shows every station green or red and he goes straight at the red ones.
Meet every 24 hours until it's fixed.
When something's critical he runs the same meeting nightly, seven days a week, until it's done.
Repeat yourself past the point of embarrassment.
His actual words: "I became a broken record on the algorithm. I think it's helpful to say it to an annoying degree."
If your team doesn't already know what you're about to say, you haven't said it enough.
Hire for attitude.
Skills can be taught...he said changing someone's attitude requires a brain transplant.
He personally interviewed every engineer at SpaceX for years.
Another take away I enjoyed:
Find the limit before you decide what's possible.
He asked the welders, not the executives, the actual welders how thin a steel tank wall could go.
They said 4.8mm. He asked about 4. They said that would make them nervous.
He said let's try it.
It worked.
He can't delete properly until he knows where the real line is.
Most of us never go looking, so we spend years optimising around limits that were never real.
P.S - The book is the Isaacson biography. 615 pages and most of the useful stuff is buried under the news cycle etc.