SpaceX to Its Employees: Elon Musk Is Untouchable

Experts slam SpaceX for firing employees who had written a letter lambasting CEO Elon Musk.

Elon Musk, the world’s richest man, and the CEO of Tesla  (TSLA) – Get Tesla Inc. Report and SpaceX, to name a few of his titles, certainly has a reputation for making controversial statements.

Sock Puppet and Karen

Some of his greatest hits, so to speak, include describing President Joe Biden as “damp sock puppet in human form,” and calling Senator Elizabeth Warren “Senator Karen” in another Twitter dust-up.

Musk, who has bid to acquire Twitter  (TWTR) – Get Twitter Inc. Report, but threatened to bail on the deal, posted the poo pile after Parag Agrawal, the microblogging site’s CEO, offered a lengthy description of the company’s efforts to remove bots and spam.

And then there was the time he tweeted a photograph of Adolph Hitler with the statement “Stop comparing me to Justin Trudeau. I had a budget.”

And then in 2018 Musk called British diver Vernon Unsworth, who was a diver in the Thai cave rescue operation to save a group of stranded boys, a pedophile.

And then there was the tweet that launched a lawsuit from the Securities and Exchange Commission where Musk said “am considering taking Tesla private at $420. Funding secured.”

All right, so there seems to be a pattern here–and we haven’t even mentioned the unflattering image he tweeted of Microsoft  (MSFT) – Get Microsoft Corporation Report founder Bill Gates side-by-side with a pregnant man or his plan to reverse Twitter’s ban of former President Donald Trump.

‘Distraction and Embarrassment’

These actions-and probably a whole bunch more–prompted employees at SpaceX to pen an open letter denouncing Musk’s behavior.

“Elon’s behavior in the public sphere is a frequent source of distraction and embarrassment for us, particularly in recent weeks,” according to The New York Times. “As our CEO and most prominent spokesperson, Elon is seen as the face of SpaceX — every tweet that Elon sends is a de facto public statement by the company.”

SpaceX responded by firing employees who helped write and distribute the letter, the Times reported on June 17.

“The letter, solicitations and general process made employees feel uncomfortable, intimidated and bullied, and/or angry because the letter pressured them to sign onto something that did not reflect their views,” Gwynne Shotwell, SpaceX’s president and chief operating officer, said in an email to the Times. “We have too much critical work to accomplish and no need for this kind of overreaching activism.”

The controversy comes as Musk held a town hall meeting with Twitter employees.

‘Unstable and Unhealthy’

Several workplace analysts criticized SpaceX’s handling of the situation as well as Musk himself.

“It is rare for employees to be so upset about an executive’s behavior that they take to publicly airing grievances and asking to be distanced from that executive,” David Trainer, CEO of New Constructs, an investment research firm, based in Nashville. “Public airing of concerns usually means that attempts to address concerns privately were unsuccessful.”

Trainer said that the employees’ unmitigated disdain for Mr. Musk “suggests that the culture at SpaceX is unstable and unhealthy.”

“Investors in all of Musk’s other companies should take note because it is likely that SpaceX employees are not the only ones who are unhappy,” he said. “Unhappy employees and bad culture are strong leading indicators for poor company performance in the short and long term.”

What’s worse, Trainer added, “is that Musk seems only to continually overcommit himself and does not have the time or energy to devote to stabilize SpaceX’s culture.”

‘A Healthy Work Environment’

“You can’t claim you have a healthy work environment when criticizing the CEO leads to people getting fired,” said Wojtek Dabrowski, managing partner of Provident Communications, a crisis communications firm. “A transparent, open culture means that feedback about executives, even if critical, is welcome and encouraged in the spirit of continuous improvement. This doesn’t appear to be the case here.”

Dabrowski said that it was also noteworthy that criticism of Musk is then met not by him directly but rather by the president of SpaceX.

“A strong leader wouldn’t hide behind someone else and tackle the comments openly,” he said. “Has Musk’s behavior on twitter been helpful for his employees? Clearly not. Is it a distraction? Absolutely – and arguably even more so than the critical letter.”

Still, Dabrowski added, “Musk appears unconcerned with the impact of his tweets, even when it attracts the ire of regulators as was the case with the SEC in the past.”

‘A Low Personal Profile’

 Peter Cappelli, professor of management and director of the Center for Human Resources at Wharton University, said that start-up and entrepreneurial companies find it useful to have CEOs who can get attention because then that attention spills over to the brand and the business.

“Celebrities who have their own cosmetics and lifestyle companies are a good example,” he said. “If the companies get big enough to have their own clear brands, and it is not just an extension of the leader’s, then that is much less important, and there can be confusion between the two.”

Cappelli said that the CEO’s of established corporations keep a pretty low personal profile, and “their public persona is kept close to their role as the leader of the company – they are in public doing things for and about the company.”

“The risk where CEOs have personal brands and images that are independent from the brand is that the former can hurt the latter,” he said. “It is pretty easy for that to happen, which is why CEO’s avoid it and boards don’t like it. We’ve seen this where the CEO’s take political positions: no matter what it is, the position is likely to alienate some consumers.”

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