Musk, the world’s richest man, appears impatient to turn Twitter into a money-making machine, but understanding the requirements for successful organizational change takes time.
Elon Musk’s actions at Twitter will be remembered as the gold standard in what not to do as a case study in how to implement organizational change.
Evidence suggests that successful organizational change necessitates, among other things, a clear, compelling vision that is effectively communicated; employee participation; and fairness in the way change is implemented. Leaders must also be trusted.
Musk, the world’s richest man, appears eager to turn Twitter into a money-making machine. However, understanding the requirements for successful organizational change takes time. Two out of every three such initiatives fail, resulting in significant costs, a stressed workforce, and the loss of key talent. Change management rarely goes as planned. It’s difficult to tell whether Musk has a plan at all.
Musk’s ‘extremely hardcore’ personality
Since taking over Twitter on October 27, Musk has prohibited employees from working from home, cancelled employee lunches, and laid off approximately 3,700 employees, accounting for roughly half of the company’s workforce. When they couldn’t access their laptops, many employees realized they’d been fired.
Only a few days later, it was revealed that Musk had a team of snoopers comb through employees’ private Slack messages, firing those who had criticized him.
Then, last Wednesday, Musk issued an ultimatum to employees to commit to a new “extremely hardcore” Twitter that “will require working long hours at a high intensity.” Employees had until 5 p.m. the following day to accept or decline a severance package.
Approximately 500 employees reportedly wrote farewell messages.
Musk does not appear to have anticipated this reaction. As the “hardcore” deadline approached, he began bringing key personnel into meetings in an attempt to persuade them to stay.
He also reversed his ban on working from home, informing employees that “all that is required for approval is that your manager takes responsibility for ensuring that you are making an excellent contribution.” It was a failure. As a result, many employees decided to leave on Friday. Twitter locked down its office until Monday, owing to confusion over who still worked there and should have access.
Organizational change frequently involves layoffs and restructuring. However, how they are managed has a significant impact on both those who leave and those who remain. Telling employees they are lazy and threatening them will not get them to be committed and respond to a crisis.
Choice is important.
But what about SpaceX and Tesla, the companies that Musk has built his reputation and fortune on? Isn’t their success proof that he’s a good leader?
Not so quickly. There is a significant difference between a mission-driven company such as SpaceX and a platform such as Twitter. Employees will often willingly work extremely long hours in difficult situations when there is a common mission to achieve something extraordinary or that has never been done before.
They will choose to go above and beyond and work long hours if they believe their work is important and aligned with the organization’s mission.
Musk disregards the fundamentals.
Many Tesla and SpaceX employees are dissatisfied, with lawsuits filed over working conditions and Musk’s management style. He has been praised for his ideas on iterative design and problem solving in engineering. It is critical to challenge old models that may no longer be useful. However, the fundamentals of leadership and organizational change remain critical, and Musk falls woefully short on both.
While his employees, who aren’t billionaires and have rent or mortgages to pay, were debating what it meant to be “hardcore” and how it might affect their ability to have a life outside of work, Musk was tweeting about his poll on whether former US President Donald Trump should be allowed back on the platform. Musk then tweeted the following after Trump declined to return: It’s difficult to imagine any other CEO sending such a message on social media.
Some have speculated that Musk is on an ego trip, which is supported by his attempt to back out of the deal. Even if there are enough employees to keep the business running, his actions pose a significant risk to it.
Yoel Roth, Twitter’s former head of trust and safety who resigned on November 10th, wrote last week:
Almost immediately after the acquisition was completed, a wave of racist and antisemitic trolling hit Twitter. Wary marketers, including those at General Mills, Audi, and Pfizer, reduced or halted ad spending on the platform, sparking a crisis within the company to protect valuable ad revenue.
But, as Roth pointed out, the digital storefronts of Apple and Google are even more powerful than the advertisers:
Failure to follow Apple’s and Google’s guidelines would be disastrous, risking Twitter’s exclusion from their app stores and making Twitter’s services more difficult to obtain for billions of potential users. Organizations are complex, interconnected systems that are supported by a web of behavioral processes. Successful change requires the alignment of individual, work group, and organizational goals.