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Shenzhen. China – November 11, 2016: Tesla showroom with a car in the Shenzhen o Plaza shopping center
Elon Musk, like the visionaries before him, is intelligent, even brilliant and certainly larger than life for many. He built several companies simultaneously, a feat that is not for the shy. However, like exceptional entrepreneurs before him, there comes a time when non-compliance with the rules has adverse effects. For Musk and Tesla, it is now.
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, the publicly traded company has revenues of $ 11.8 billion, sales worldwide and over 37,000 employees. Although Elon Musk is the main shareholder, he is not the only shareholder. Given these facts, as well as the trials and tribulations of recent times, society needs leadership. Maybe multi-level leadership, but certainly leadership at the top.
In late September, it was announced that Tesla and Musk had reached an agreement with the US Securities and Exchange Commission to resign Musk as president of the company. This should be considered a step in the right direction. The question now becomes, who should take its place?
The speculation is that James Murdoch will become the president of Tesla. Murdoch, son of media mogul Rupert Murdoch, has been on the Tesla board since last year. However, in terms of his potential candidacy, it is not his lack of relevant experience in the industry that is disconcerting, but the fact that he and Musk are apparently friends. Given the alleged kinship, can Murdoch have the independence and the power to regulate Musk? It should also be noted that Murdoch had to step down as News International's executive chairman in 2011 after a hacking scandal. The good news is that it does not need the fame or the money that will flow from it. But is it enough for him to have the means to impose restrictions on Musk?
As president, Murdoch will also oversee Tesla's board of directors, which has its own challenges. Tesla 's board of directors, which includes nine directors, including Musk and Murdoch, is composed of senior executives and a diversity of gender and ethnicity. What he does not have, however, is anyone with relevant experience in the industry.
According to Tesla's 2017 annual report, "our core competencies are powertrain engineering, automotive engineering, innovative manufacturing and energy storage." In addition, "our mission is to accelerate the global transition to sustainable energy".
Tesla's board of directors has experience in media, entertainment and investment. However, as a highly complex manufacturing company with a strong focus on new technologies as well as R & D (Tesla spent more than $ 1.4 billion in R & D in fiscal 2017 ), it is disconcerting that no one on the board, apart from Musk, has worked in these areas. In March, Tesla recalled 123,000 Model S vehicles due to a powertrain steering problem. Can a card without manufacturing experience understand perfectly and effectively solve this type of costly and risky problem? What about the complex experience of the supply chain? Or environmental and regulatory knowledge? Even China's skills are lacking and could be useful, 18% of Tesla's revenue from this country.
In addition, most members of the Tesla Board of Directors are not independent. Kimball Musk, Elon's brother, Brad Buss, former finance director of SolarCity, a subsidiary of Tesla, and Ira Ehrenpreis, investor not only in Tesla but also in SpaceX. Steve Jurvetson, who is on leave from the board following an investigation into sexual misconduct, is one of Musk's personal friends.
These board weaknesses allowed Musk to lose almost control of the company. While it has undeniably led to Tesla's success so far, it has also contributed to the company's current situation, including its lack of profitability. The financial community is increasingly concerned about Tesla's cash flow and its general stability, which has been exacerbated in recent weeks.
So, given all this, what's right for Tesla at this point? More importantly, Tesla needs independence of thought and directors with the power and the ability to influence Musk. Ideally, the influence will not only come from notoriety and name recognition, but rather from a solid set of relevant experiences. This can be manufacturing, production, supply chain, energy, engineering, regulation or even retailing (Tesla operates 330 stores and service outlets.) International experience, as noted above, would be helpful as well as clean energy know-how. Speaking of energy, skills and knowledge of storage systems and solar energy are also useful. As incredible as Elon Musk may be, he must accept the fact that, like many mere mortals, he also has limitations. Knowing how to create a team with relevant and complementary skills and experience can be the most difficult challenge Musk has ever faced.
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Shenzhen. China – November 11, 2016: Tesla showroom with a car in the Shenzhen o Plaza shopping center
Elon Musk, like the visionaries before him, is intelligent, even brilliant and certainly larger than life for many. He built several companies simultaneously, a feat that is not for the shy. However, like exceptional entrepreneurs before him, there comes a time when non-compliance with the rules has adverse effects. For Musk and Tesla, it is now.
You're here
, the publicly traded company has revenues of $ 11.8 billion, sales worldwide and over 37,000 employees. Although Elon Musk is the main shareholder, he is not the only shareholder. Given these facts, as well as the trials and tribulations of recent times, society needs leadership. Maybe multi-level leadership, but certainly leadership at the top.
In late September, it was announced that Tesla and Musk had reached an agreement with the US Securities and Exchange Commission to resign Musk as president of the company. This should be considered a step in the right direction. The question now becomes, who should take its place?
The speculation is that James Murdoch will become the president of Tesla. Murdoch, son of media mogul Rupert Murdoch, has been on the Tesla board since last year. However, in terms of his potential candidacy, it is not his lack of relevant experience in the industry that is disconcerting, but the fact that he and Musk are apparently friends. Given the alleged kinship, can Murdoch have the independence and the power to regulate Musk? It should also be noted that Murdoch had to step down as News International's executive chairman in 2011 after a hacking scandal. The good news is that it does not need the fame or the money that will flow from it. But is it enough for him to have the means to impose restrictions on Musk?
As president, Murdoch will also oversee Tesla's board of directors, which has its own challenges. Tesla 's board of directors, which includes nine directors, including Musk and Murdoch, is composed of senior executives and a diversity of gender and ethnicity. What he does not have, however, is anyone with relevant experience in the industry.
According to Tesla's 2017 annual report, "our core competencies are powertrain engineering, automotive engineering, innovative manufacturing and energy storage." In addition, "our mission is to accelerate the global transition to sustainable energy".
Tesla's board of directors has experience in media, entertainment and investment. However, as a highly complex manufacturing company with a strong focus on new technologies as well as R & D (Tesla spent more than $ 1.4 billion in R & D in fiscal 2017 ), it is disconcerting that no one on the board, apart from Musk, has worked in these areas. In March, Tesla recalled 123,000 Model S vehicles due to a powertrain steering problem. Can a card without manufacturing experience understand perfectly and effectively solve this type of costly and risky problem? What about the complex experience of the supply chain? Or environmental and regulatory knowledge? Even China's skills are lacking and could be useful, 18% of Tesla's revenue from this country.
In addition, most members of the Tesla Board of Directors are not independent. Kimball Musk, Elon's brother, Brad Buss, former finance director of SolarCity, a subsidiary of Tesla, and Ira Ehrenpreis, investor not only in Tesla but also in SpaceX. Steve Jurvetson, who is on leave because of an investigation into sexual misconduct, is one of Musk's personal friends.
These board weaknesses allowed Musk to lose almost control of the company. While it has undeniably led to Tesla's success so far, it has also contributed to the company's current situation, including its lack of profitability. The financial community is increasingly concerned about Tesla's cash flow and general stability, which has been exacerbated in recent weeks.
So, given all this, what's right for Tesla at this point? More importantly, Tesla needs independence of thought and directors with the power and the ability to influence Musk. Ideally, the influence will not only come from notoriety and name recognition, but rather from a solid set of relevant experiences. This can be manufacturing, production, supply chain, energy, engineering, regulation or even retailing (Tesla operates 330 stores and service outlets.) International experience, as noted above, would be helpful as well as clean energy know-how. Speaking of energy, skills and knowledge of storage systems and solar energy are also useful. As incredible as Elon Musk may be, he must accept the fact that, like many mere mortals, he also has limitations. Knowing how to create a team with relevant and complementary skills and experience can be the most difficult challenge Musk has ever faced.
