Page 92 - MS Year in Review 2020

THE BOTTOM LINE

The “bottom line” is that currently Tesla’s overall average score of 3.0 places Tesla
in the category of “Marginally Successful Organizations.” In fact, Tesla’s score

of 3.0 is barely above the category of companies that are “at Risk,” which includes
companies which scores are less than 3.0.

However, it must be noted that these scores can be changed (improved) by

management initiatives. This would mean that Elon musk and his colleagues would
need to take action to improves the underlying factors that drive these scores, as
many other companies have done for decades. Many companies large and small

(such as Starbucks, Neutrogena, Navistar, Emergent BioSolutions, American
Century Investments and many others both in the US and globally) have used this
methodology in their planning processes.

A Game of “Musical Thrones.” So, who is correct about Tesla--The Bulls or the
Bears? Technically, the Bears seem to be correct, but the Bulls are smiling all the

way to the bank.

In the game of “musical chairs,” people circle around a set of chairs until the music
stops. Then there is a race for a chair, which is always one less than the number of

participants. As long as the music continues, there is no problem.

Similarly, for Tesla, as long as “the music” continues, there is no problem yet.

Memo to Elon Musk (and colleagues)

This analysis is intended as a constructive critique. I have previously expressed my
admiration for you in other articles as well as my concern about how Tesla (the

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company) is being built. In brief, my advice: Build a company as beautiful as
your cars!

76 See Eric Flamholtz, “TESLA’S “GROWING PAINS” AND ELON MUSK’S
LEADERSHIP,” Linkedin, March 13, 2020; Eric Flamholtz, “TESLA’S “GROWING PAINS” AND ELON
MUSK’S LEADERSHIP REDUX” Linkedin, June 2, 2020; Eric Flamholtz, “Tesla: The Apotheosis of
Stock Market Madness,” Linkedin, August 7, 2020.

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