Elon Musk on Decisions and Staffing

On Decisions

I was listening to the year-end episode of the All In podcast over the weekend. Though I don’t love these kinds of “recap” shows, this show was great because in the middle of it Elon Musk joined. After the initial pleasantries were exchanged, David Friedberg posed a question to Elon about how decisions get made at Twitter. If you want to jump straight to it, it’s at 1:02 or so into the show.

What followed is a blueprint for anyone who wants to understand how companies and founders can set themselves up to have the best chance at success. Here are my key takeaways:

• If you’re going to swing for the fences, you’re going to strike out more often. You can’t be afraid to make mistakes.
• What really matters is how many swings you take (which is a direct function of how quickly you make and move through decisions).
• The error rate goes down over time as you learn more.

I’ve written about the OODA Loop in the past, a framework that has been incredibly helpful for me in building the habit of making decisions quickly.

I once heard a quote from Kevin Compton, a longtime, very successful VC, where he said “If it is a truly hard decision, it doesn’t matter what you choose. It only matters what you do next.”

All of these ideas have the same fundamental principle. The faster you make decisions, the more decisions you get to make, the better your decision-making will get over time.

On Staffing

The conversation quickly transitioned to how Musk made the decision to slash Twitter’s workforce and/or give those who wanted to the opportunity to leave. Musk’s answer was:

“Anyone who is exceptional at what they do, where the role is critical, they have a positive effect on others, and they can be trusted (they put the company’s interests before their own) should stay.”

Elon Musk

Pretty simple rubric for evaluating your current team:

• Exceptional
• In a critical role
• Positive impact/works well with others
• Puts the company first

He then goes on to talk about starting with answering the question of how many people are required to keep the product (in his case Twitter) operational and keep customers happy, rather than starting with the current headcount and working backward.

Whether you like Elon Musk or not, he has an ability to boil things down to their essence better than nearly anyone else.

As we all head into what is likely to be some turbulent air in 2023, it seemed appropriate to take a step back and focus on the essentials. Move quickly, and do it with only the best people.