Given its strategic challenges, do you agree that for Tesla a flatter organisation was the right way to go? During 2018, the Silicon Valley electric car company Tesla was struggling to produce enough of its first mass-market electric car, the Model 3. The company had 500,000 customer reservations for the new car, but was not yet reaching its production target of 5,000 cars per week.

This target was essential for Tesla to break even financially.

Company founder, Chairman and Chief Executive Elon Musk claimed he was working so hard at resolving what he described as ‘production hell’ that he was sleeping on the factory floor, with no time to go home and have a shower.

Musk was busy not only with the Model 3 Tesla car. He was closely involved in a whole raft of other companies. In 2002, Musk had created SpaceX, a space transport services company, of which he continued to be CEO and lead designer.

In 2006, Musk helped found SolarCity, a solar energy services company that is now a subsidiary of Tesla and operates under his chairmanship. In 2015, Musk co-founded OpenAI, a non-profit research company interested in friendly artificial intelligence. The next year he had co-founded Neuralink, a neurotechnology company where he acted as CEO. That same year, after getting stuck in a traffic jam, Musk established The Boring Company, a tunnel-

construction company aimed at getting traffic moving faster. The Boring Company’s first product in fact turned out to be a flame-thrower.

In resolving the problems at Tesla, Musk naturally had a senior management team to help. The most prominent roles in the company were the Chief Financial Officer, the Chief Technology Officer, the Chief People Officer, the Senior Vice President for Engineering, the Chief Designer, the Vice President for Production and the Vice President for Global Sales.

The organisation had grown rapidly in recent years, with total full-time employees reaching 37,000 in 2017, against a couple of thousand in 2012.

However, the financial markets were increasingly sceptical of Tesla’s ability to meet its production targets. During the first part of 2018, the stock price fell by nearly a quarter.

Musk responded by announcing a new flatter organisation structure in May 2018. In his memo, he wrote:

‘To ensure that Tesla is well prepared for the future, we have been undertaking a thorough reorganization of our company. As part of the reorg, we are flattening the management structure to improve communication, combining functions where sensible and trimming activities that are not vital to the success of our mission