Updated at 6:55 p.m. ET on November 7, 2022
Elon Musk has spent the past 12 years tweeting whatever comes into his mind, often without major negative consequences. That was before he owned the place. Now, less than two weeks after his $44 billion purchase, the world’s richest man is finding that his actions—which recently included tweeting a baseless conspiracy theory to Hillary Clinton about the assault on Paul Pelosi—may actually have consequences. Advertisers are fleeing, the employees remaining after a round of mass layoffs are alienated, and onlookers are completely vexed by a freewheeling approach that has coincided with a rise in hate speech on the platform, among other problems.
Musk’s fans see the billionaire as a visionary, but it’s worth noting that many casual observers—people whose only real understanding of Musk is as the guy who put the fancy electric cars on their streets—have also internalized the heuristic that he is Good at Business and the type of man who spends his waking moments dreaming of how to save humanity from its existential problems. But what the past two weeks demonstrate is that Musk is, at best, a mediocre executive—and undoubtedly a terrible, distracted manager.
Musk is obviously wildly financially successful, and the companies he owns have a reputation for taking futuristic-sounding ideas and dragging them into the present. But what Musk is showing us in real time is the folly of equating financial success with intellect, managerial savvy, and good judgment. I reached out to some experts to see if I was possibly missing something about Musk’s performance so far. Given Musk’s current focus on advertisers leaving the platform, I called up Rick Webb, the COO of Timehop and a co-founder of the Barbarian Group, a major digital-ad agency. Webb also served as a marketing and sales consultant for Tumblr during its heyday. I asked him to assess Musk’s first few days on the job, and he did not mince words.
“The advertisers are gone because of his awful tweets,” Webb told me. “There’s no room for debate. He stated his intentions up front. He cared about advertisers and didn’t want them to leave and then he told us they’ve left.” Webb suggested to me that Musk’s now-deleted Paul Pelosi tweet was perhaps the most expensive tweet ever: It may have cost Twitter billions in advertising revenue. Companies including General Mills, Audi, and Pfizer are pulling their marketing from Twitter because they likely don’t want their brands to be associated with anything remotely scandalous. High-level executives—CMO types—are the ones ultimately deciding what these brands spend on Twitter, and “those people are, to a T, conflict-avoidant,” Webb said.
Musk seems to understand this—according to reporting from Kara Swisher, he realized that ad execs were freaking out and tried to quell concerns on a conference call last week. It did not go well. “There were CMOs who literally paused/shifted budgets DURING the call because of the uncertainty,” Swisher tweeted. Worse yet, Musk has either alienated or fired some of the employees—such as Twitter’s chief customer officer—who maintain crucial brand and agency relationships.
As bad as that sounds, Webb argues that the reality is worse: “What people might not understand is that the advertisers don’t need Twitter. They barely cared about it at all before Musk. The only reason those people cared about Twitter ads is because they had personal relationships with members of Twitter’s marketing team or because there are hundreds of Twitter account reps making them pay. And Elon may have fired those people.” Twitter is much smaller than rivals like TikTok, Facebook, Instagram, and YouTube, after all.
With each passing day, Musk seems to be digging a deeper hole. This morning, to the dismay of many brand advertisers who strive to be apolitical, Musk used his 114-million-follower platform to endorse the Republican slate of candidates for tomorrow’s midterm elections. “The dude could’ve napped and saved billions of dollars,” Webb said. “Every decision he’s made has lost him money. It’s astonishing.”
Musk’s marketing debacles are not the stuff of visionaries, but they pale in comparison to his management skills. Here’s a brief summary of how he has steered the company so far.
Before assuming control of Twitter, the billionaire reportedly floated the idea that he could gut the company’s workforce by nearly 75 percent, which created a sense of low-grade panic inside the company. Despite the specter of mass layoffs, Musk walked into Twitter headquarters like a court jester, filming content for his own Twitter feed. In his first hours, Musk fired some well-liked executives and, on his first full day, pompously asked engineers to print out their code so Tesla staffers could review it. (Later, he reversed course and asked staffers to shred their printed code.) When it came time for layoffs, he cut nearly half of the company via email (though word leaked beforehand and left many employees wondering about their fate) and, in an act of extreme cowardice, didn’t even sign his name. Many staffers found out about their termination ahead of time, when their work accounts stopped functioning. The cuts—which hit or completely destroyed big chunks of the trust-and-safety, policy, machine-learning, social-good, accessibility, communications, ethical-AI, data-science, and research teams—caused real concern that the company may now be especially vulnerable to outages and attacks, which could be particularly dangerous during the midterms. Inside the company, managers scrambled. They told employees to work 80-hour weeks to build products for Musk (lest they be terminated too) and instructed employees to come up with ideas to tantalize their mercurial new owner. The vibe was like “hack week, but with a gun to your head,” a Twitter employee told the New York Times podcast Hard Fork.
This is awful, chaotic management. Johnathan and Melissa Nightingale, who run the Raw Signal Group, a consultancy that focuses on coaching managers in the technology industry, told me that Musk is putting on a master class in what not to do to run an effective organization. “Absolutely nothing he’s doing is cultivating an environment that helps people be creative, consistent, and innovative,” Melissa Nightingale said. For the employees who remain, Musk has created an atmosphere of panic and uncertainty, which destroys trust and leads to employee resentment. Musk has created a vast network of ex-employees who will go on to talk trash and share nightmare stories about Twitter. This is already backfiring spectacularly: Some of the employees had skills necessary to build products Musk actually wants to launch and were terminated by mistake, Bloomberg reported, and the company is trying to lure them back.
Had Musk listened to people with experience running social networks (like those I cited in this magazine two weeks ago), he might have understood that they are complex, fragile systems and that staff reductions must be managed carefully. But instead, Musk surrounded himself with a group of yes-men advisers, many of whom also lack specific expertise. These men and Musk all operate under a hyper-rationalist managerial framework: They appear to have reasoned that Twitter was bloated and losing money on payroll, that change needed to come quickly, and that layoffs are naturally messy, so there’s no need to handle them with care. That lack of care in particular is a hallmark of bad, shortsighted management, the Nightingales told me.
“When we say ‘care,’ we mean it both in an empathetic sense, but also in a professional, attention-to-detail sense,” Melissa Nightingale said. The pair argued that Musk’s haphazard cuts and alienation of his employees may work in the short term by balancing the company’s budget, but disaster might soon follow. “If you start looking long term and evaluating his decisions by metrics like How many labor-discrimination suits will he face? or How many people will work for him again?, it looks different.”
The Nightingales argued that Musk’s managerial decisions show a lack of human understanding that is key to running any business—and especially a business like Twitter. “He may really understand things from an engineering perspective,” Johnathan Nightingale said. “But humans are different. And care is a major input in creating a human system.”
Unfortunately for Musk, Twitter is less of an engineered machine and more of a chaotic collection of humans. “He loves to talk about Twitter as a great public square,” Johnathan Nightingale told me.* “But public squares are built with care. They are not machines … Public squares are for humans and designed by humans. And Musk has just fired half of them.”
There is always a chance that this somehow all works out for Musk (The Verge reported Monday afternoon that user growth is currently at an all time high) and an even greater chance that his confident, unapologetic, and wrongheaded style will only endear him to his fans. But even if he does manage to salvage part of his $44 billion investment, what we are seeing is the opposite of a business mastermind at work. Musk is not leading Twitter with careful vision, and he is certainly not dragging us all into the future with him. He’s bumbling his way through a job he’s unqualified for. He’s treating a human problem like an engineering problem, torching bridges and embarrassing himself in the process. As Melissa Nightingale put it, “The entire history of capitalism is a lesson that you can be very successful and also very terrible.” In this sense, Musk is an excellent teacher.
This article previously misattributed a quote from Johnathan Nightingale to Melissa, and vice versa.