Though we never met in college, Elon Musk and I attended joint degree programs at the University of Pennsylvania and Wharton Business School over the same years. I’ve studied his career ever since and even interviewed him once. You surely know the contours: He grew PayPal into the dominant online payments solution. Then, he led Tesla Motors to the first U.S. automobile IPO since Ford Motor Company. Musk also helped transform the aerospace industry with SpaceX, not to mention launching or co-launching SolarCity, Neuralink, which is developing ultra-high bandwidth brain to machine-brain interfaces. There’s also the Boring Company, which aims to revolutionize transportation through the construction of underground tunnels.
It may seem that highly successful innovators like Musk sprung were gifted with genius or luck. How else could they repeatedly predict the potential of successful revolutionary ideas? But research shows innate intelligence is only part of the answer and fortune can be created.
The source of repeated success lies more directly in innovative patterns of thinking. And when you can identify those patterns, you can adopt the same thinking playbook to generate your own disruptive innovations.
My research and doctorate work are based on a framework of thirty-six strategic patterns that can be used to analyze how the most innovative companies and business leaders think. In this article, I’ll dissect three strategic plays that align with Musk’s companies and explain how you can activate the same playbook in your business or career.
Pattern 1: Move to the next battleground early
In May 2020, SpaceX became the first privately held company to transport NASA astronauts to the International Space Station. Back in 2008, I asked Musk why he thought his SpaceX company would succeed. His response was, “I just think a future in which any company can send people into space is more interesting than one in which only the government can.” Musk recognized that fields of play are shifting rapidly and that the battlegrounds of the future may not be here on Earth.
Innovators like Musk are not following the rules of today. In fact, they are not even playing today’s game. They are looking ahead to start playing a new game with entirely new rules. Athletes will recognize Wayne Gretsky’s philosophy, (which came from his father Walter) “Go to where the puck is going, not where it has been.” As the pace of change accelerates, it’s not enough to have a plan to win the current game. You must have plans for future games and learn how to turn battleground shifts to your advantage.
To identify your next opportunities, ask yourself:
- Where is the next battleground?
- What can I do to move there early now?
- What new technologies, social shifts, or economic changes underway will change the future for my career and industry in the long term?
Pattern 2: Be good
Since Milton Friedman popularized this view of capitalism in the 1960s, it was assumed that corporations existed for one primary purpose: to create wealth for their shareholders. But the last twenty years have challenged that paradigm. Now, companies that survive are those who generate value for multiple stakeholders—customers, employees, suppliers, communities, and the environment. A smart strategy is one that maximizes shareholder value by benefiting all stakeholders.
Tesla Motors embodies a “Be good” strategy by saving tons of CO2 emissions per vehicle, setting new standards for low energy and water usage, installing solar panels to generate sustainable global energy, responsibly sourcing commodities, and hiring as a “minority-majority” company.
Musk revealed this pattern many years earlier, in the early days of PayPal, when he said “It’s better to approach this [building a company] from the standpoint of saying–rather than you want to be an entrepreneur or you want to make money–what are some useful things that you do that you wish existed in the world?” When your growth is good for the world, that’s the ultimate strategy.
To do good in your organization, ask:
- Who else, besides your shareholders, benefits from your growth?
- What revenue model will incentivize you to keep making the right choices?
- Do you passionately communicate how your growth is good for the world?
Pattern 3: Create a deer in the headlights moment
When Musk took over Tesla, automobile companies were facing the incoming potential of electric vehicles like deer in headlights. This happens when a company is locked in a conflicting agenda. We all know they should do “A” but doing so would mean damaging “B.” For example, in the early days, Sony knew radio manufacturers like RCA should stop selling the old vacuum-tube radios and embrace new transistor technology. But RCA and others made so much money from selling their old, clunky boxes, they resisted. Sony moved in. Later Sony got stuck in the headlights. It should have embraced digital music and plugged it into its popular Walkman portable players, but it worried this would damage the music label it owned. It hesitated. Apple’s iPod moved in.
Similarly, Musk recognized that big automobile companies were dragging their heels in introducing the kinds of exciting electric vehicles that would cannibalize their profitable fleets of gas-powered ones. So Tesla moved in.
You could say Musk is now following the same thinking process with Neuralink. While most AI players are focused on advancing AI, he recognizes they are not focused on humans. He has openly voiced his concerns that AI will eventually surpass human intelligence. Neuralink, a company that aims to sidestep rampant investment in artificial intelligence by linking the brain with computers, Musk claims, will enable humans to compete with AI.
To find your own “deer in the headlights” moment, ask:
- What are competitors focused on protecting?
- What opportunity or need does this mean they will resist pursuing?
- What would happen if you stepped in the gap of their inaction?
To start shifting to think more like Elon Musk, ask yourself these three questions:
- What are you doing now to prepare for the next battleground and how can you use that preparation to disrupt your competitors? (Move early to the next battleground)
- What could you start or what could you stop doing to do better in the world? (Be good)
- What customer or brand attribute will your competition choose not to defend? (Deer in the headlights)
Creators and innovators like Elon Musk appear to draw on a secret wellspring of winning ideas to captivate customers and impact the world. However, such a flow of successful ideas is available to all of us, if we understand and start applying new thinking patterns.