Bob's Gutsy Leadership Blog

Tesla Report Card: Innovation = A; Operational Excellence = F

The CEO of Tesla, who is also the Chairman and Co-Founder, is clearly an amazing visionary.  The Tesla all-electric car has created a major inflection point in the automobile industry and with every passing day we are seeing more and more momentum shift toward the use of all-electric cars.

On the other hand, what he is not providing at Tesla is operational excellence.  Here is a brief summary of the latest issues:

1.) Over Promise – For the past few years, virtually no promise from Tesla has been achieved.  The latest is the massive miss on the Model 3, Tesla’s medium-priced entry.   The promise was that by now it would be reliably making 5,000 cars/week.  The reality is that in January, Tesla made only 1,875 for the month!   In fact, as late as mid-January, the batteries for these vehicles were being made by hand.

2.) Over-Hype – Tesla is infamous for being outlandishly positive about most aspects of its business.  Probably the most notable has been its “auto pilot” feature.  The very name would suggest that the car can drive itself.  The latest problem occurred in mid-January when a Tesla smashed into the back of a fire truck while on “auto pilot.”  Every time one of these accidents occurs, the Tesla management will remind reporters that the “auto pilot” feature is “intended for use only with a fully attentive driver.”  Given that is their position, it’s not clear why Tesla is allowed to stick with the name “auto pilot.”

3.) Sloppiness – One state that has been very optimistic about the future of self-driving cars is California.  In fact, California is leading the initiative of extensive road testing of auto-pilot systems with the major manufacturers.  Google, General Motors, Nissan, and several others are involved in this testing.  Google is in the lead in this testing, having certified slightly over 350,000 miles of such testing in California while General Motors is in second place with roughly 130,000 miles.  Surprisingly, Tesla is not participating in this activity.  Tesla has conducted no publicly-documented road testing of its “auto-pilot” efforts.  When asked why not, it has a variety of excuses, such as: “we’re doing simulations instead; we do a lot of closed test track driving,” and a variety of other evasive responses.

Stepping back, what we have here is an incredibly strong visionary leader at Tesla who clearly has little interest and has demonstrated very little capability in executing with excellence. Clearly the company needs a seasoned executive with deep operational experience to run the company on a day-to-day basis.    Why hasn’t the board of directors of Tesla spotted this, since it has been obvious for the last couple of years?  Probably because the visionary leader is the chairman of the board!

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