Elon Musk’s recipe for corporate innovation

WSJ: You’ve spoken often in your career about how important it was for you, as a young entrepreneur and innovator, to come to America. And you’ve said there’s no other country where you could have achieved what you’ve achieved today. Would that still apply in 2020? And are we, broadly as a society, doing everything we should be doing to foster that same environment that brought you here?

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MR. MUSK: The U.S. is still great with respect to innovation and fostering entrepreneurship. We don’t want to be complacent, and we want to say, “OK, how can we make it better over time?" And we want to be cautious about the gradual creep of regulations and bureaucracy.

We should be aware of this, I think, particularly at the state level.

WSJ: When you think through an innovation lens in the broadest sense, what’s the right role for government? Where should government be a player, and where should it be hands-off?

MR. MUSK: A lot of the time, the best thing that government can do is just get out of the way. Then after that would be ensuring that there are not artificial monopolies, that there is a fertile ground for startups.

If you’ve got a duopoly or oligopoly, they’re generally going to have a weak response to their customer. And if they’re a monopoly, they’re going to have the weakest response to the customer.

WSJ: Is that what you see in Silicon Valley today?

MR. MUSK: This is not a Silicon Valley problem, it’s just a general problem. If you look at, say, how many candy companies are there? Big candy has consolidated into three companies or something. And they also own all the dog food and the baby food. So it’s like when’s the last time there was some good candy? What’s the forcing function for a new candy bar? I haven’t seen one in ages.

WSJ: We had a couple of people last night at this event who are joining the Biden administration, a couple of the president-elect’s senior advisers. And clearly, one of the things heavily on their mind is sort of a new national industrial policy, for wont of a better term. They talked about spending a lot more on research and development, and fostering innovation; big government spending, basically. Is that kind of national industrial policy a good idea? Is that a good use of government right now, in your mind? And if it is, where would you focus that kind of effort?

MR. MUSK: It’s government’s responsibility to establish the rules of the game and then ensure that those rules are properly enforced, sort of like the referees on the field. I think that’s an important role for government; to ensure that the rules are correct and that the incentives are what we actually want them to be for the long-term maximum happiness of people into the future. Where I think government does not do a great job is when they want to not just be a referee on the field, they want to be a player on the field.

WSJ: Picking winners and losers, that kind of thing.

MR. MUSK: The government does not need to try to pick technology winners and losers. They can simply incent the outcome. I think it’s incredibly important that government focus on incenting the outcome, not the path.

WSJ: In the corporate suite in America, are companies in general fostering and developing innovation? And are the leaders in corporate America prioritizing innovation as much as we might or need to right now?

MR. MUSK: No. Generally, my recommendation would really be spend less time on finance, spend less time in conference rooms, less time on PowerPoint, and more time just trying to make your product as amazing as possible. And the company might take their cue from that.

WSJ: Is that kind of product mind-set learnable? Is it teachable? Or is there an innate element that somebody has to have to really do it well?

MR. MUSK: It is learnable. Step number one would be: try. And have you tried and have you tried hard? And if you haven’t tried hard, try hard. It’s not some mysterious thing. It’s basically just be like an absolute perfectionist about the product that you make, the service that’s provided. Seek negative feedback from all quarters; from customers, from people who aren’t customers. Like, “Hey, OK, how can we make this better?"

Just get out there on the factory floor, get out there in the stores, talk to customers, think about what would you love to have. If you don’t love it, don’t expect others will either.

WSJ: What are the biggest mistakes you’ve made that you’ve learned from?

MR. MUSK: When I have spent too much time in a conference room, that’s generally when things have gone awry. And when I got to spend time on the factory floor, or really using the cars, thinking about the rockets, that’s where things have gone better.

WSJ: Some people would worry that that risks sending a message to your teams that you personally have to be involved for something to work; that you can’t delegate or you can’t trust. Is that a concern for you?

MR. MUSK: There are a lot of talented people at SpaceX and Tesla. And I think the morale is good. I, for sure, respect them greatly and it’s not hard to work with them. And I find that if I am engrossed in the details of the issues, this does not result in them feeling worse, but feeling better. They’re, in my experience, more energized.

The troops are going to fight a lot harder if they see the general in the front lines than if they think the general is in some cushy situation. Get out there on the goddamn front line and show them that you care, and that you’re not just in some posh office somewhere.

This story has been published from a wire agency feed without modifications to the text.