Tesla started product meetings with the customer

Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

1. 30:40

   How did Elon run product meetings? He started with, I think this is something any CEO can learn from. He turned to me first because my primary responsibility was the marketplace, the market. And he would turn to me and say, in front of the rest of the team is engineers, manufacturing, et cetera. He'd say, what does the market want? And that's where the meeting started. So I think a first principle that a lot of CEOs can use or leaders can use is, if you're going to talk about product, talk first about what the customer wants, because that grounds the whole discussion.

2. 31:17

   So an example of that, a dry example of that is, we released the Model X. It's selling okay, but not great. And so in the weekly product session, Elon turns to me on a Monday and says, what does the market want? I said, like, I've heard this all around the world. Moms want a bench seat. We've put these two captain's chairs in the second row. They want a bench seat. They've got three car seats to line up and we don't have a bench seat. So he immediately goes to the whiteboard and starts to draw how we would attach a bench seat to the existing Tesla chassis. It turns out that is not an easy problem because it wasn't designed for that. And there aren't attachment points that are obvious. And sure enough, the head of engineering is right up next to them and they're drawing. And they're starting to work through the engineering. And

3. 32:08

   then the supply chain leader is looking at that saying, given the direction they're going, I need to start to light up the supply chain to see if we could get these kinds of parts underway. And it's happening like in real time, but that's the way the product meetings worked. It was, what does the customer want? How do we solve this? And let's go right into solution mode. Let's not debate the obvious. Let's go right into solution mode. And you've got the leaders of the company who are at whiteboards designing solutions. And the junior engineers that are in the room are watching this, and they're saying, oh, the currency in this place is getting stuff done. So if I want to be successful here, and look like that person, I need to act like that person, so I need to get stuff done.

4. 32:50

   So the whole speed mentality is kind of built into the DNA of the way the place runs all the way down to the product meetings. I would have thought from the outside, looking in naively, obviously, that there's like presentations and like... Like presentations are a no-no. Actually, like slides are kind of a no-no. They have their place in like, if you're doing financial analysis and stuff like that, but if you're doing product, we want it to be hands-on.

5. 33:16

   And so you couldn't present, like, slides of your software designs. You had to, like, show the software. We wanted to have it in front of us, and we wanted to be playing with it. So we could give real feedback, which you can't do on slides, because slides tend to mask the problems. You can't really see them. You certainly can't interact with it. So presentations were a big no-no. A lot of stuff was just hands-on.

6. 33:38

   I talked to somebody at GM in prep for this, and they mentioned that you had an impact on the product meetings there. but getting rid of slides, is that? I hope so. Like, I don't know if I did, but what I've found is it's super helpful not to be talking about the theoretical with slides, but to be talking about the actual product. And one of the last product walkthroughs that we did, it was in a lab with the new software-defined vehicle, and we could literally touch, we could see the wiring, see the connectors, see the software.

7. 34:13

   And that for me, that's great comfort. Like that's how I was used to doing product presentations where we could literally interact with the engineers who were designing each step of the system and we could literally see it. You could see how the wiring harness was going to work, weave its way through the car. You could see if the connector pods made sense, if you could see where the zones made sense because you could literally see it and touch it.

8. 34:35

   It wasn't on an image on a slide that was in a sim somewhere that may or may not reflect reality. Do the leaders dog food their own products at these companies? Like, does Mary take home the top new model and drive it herself and, like, go through all the challenges that customers go through? It's a principle that is super important. And we used to drive a Tesla off the line every night so people wouldn't know which car we were going to grab.

9. 35:02

   I couldn't dress it up. Like, literally, we'd come and say, okay, that one that's fifth from being finished, I'm going to stand here until it comes off the line. I'm taking that one. Oftentimes you'll see like people, people will know, okay, somebody's coming down, some executives coming down, they're going to pick a car. Let's go pull a car. Let's polish the heck out of this thing. Make sure there are no warts, no issues, no bugs. And we're going to give them the perfect product. We said, we don't want the perfect product. We want the product the customer is going to receive off the line. So I'm going to come down, I'm going to pick a car at random and I'm going to immediately take that car and I'm going to drive it home and I'm going to drive it back to the factory the next morning, typically super early in my case, because the

10. 35:43

    shift started at six. I'm going to then write down my return drive notes. And so by the time an engineer hits their desk at 8 a.m., in their inbox are notes from a number of executives saying, here's my experience with this product. Here's what was awesome. Here's what I couldn't stand. Can you please fix this? And it's daily. It's a daily feedback loop where we are saying, hey, we're consumers too. We want the product to get better. So those weekly or biweekly software releases you get, a lot of that's coming from eating dog food. And we would not only eat our dog food. Elon said, I'll take the Twitter feedback, the X feedback. I said, great. I'll take the Reddit and the forums. And so I was, both of us were interacting on a daily basis.

11. 36:27

    Like I would carve time out in between meetings. I'd be reading like Reddit feedback on us and I'd be able to walk into a meeting and say, guys, Reddit is lighting up because something has goofed up with our last software release. Can we just, can we get on this? And we would often joke around, I don't think our competition's executives are this in tune. And it was helpful for us because we owned our own stores.

12. 36:49

    We weren't selling through dealerships. We owned our own service centers. So we saw the data about what was getting fixed on a car immediately. And we had these feedback loops that would help us be responsive to the marketplace. And that was the whole idea. Again, this whole theme of speed, speed, speed.