Musk versus, PayPal, Twitter … the limitations of transferable knowledge

Elon Musk’s recent antics have demonstrated the limitations of transferable knowledge — AKA the Mike Ashley syndrome.

So who’s Mike Ashley? He’s a British billionaire retail entrepreneur who bought English football club Newcastle United without much appreciation of what it would take to run a big established business, and manage the expectations of a global audience — sound familiar?

Culture shock

Ashley had a tangential connection with sport, in that the focus of his entrepreneurialism is in the sporting goods market, via Sports Direct. But, as Ashley came to learn, there’s a big difference between putting bums in a sweatpants and bums on seats.

Musk, like Ashley, seemed to demonstrate an unwillingness to learn and a strident intention to stamp upon their respective purchases their own brand of command and control, at the expense of the existing culture:

Mike Ashley fails to understand the heritage of this great stadium. He has “renamed” it, although nobody ever calls it that.

The constant bad decisions that have characterised the Mike Ashley years, from the sackings of Keegan and Hughton to the sale of Carroll and Barton, have caused many to take a stand. These fans seem unlikely to return while Ashley is still in charge.

An understanding of large-scale infrastructure, a grasp of business finance, and a knowledge of identifying markets are all examples of knowledge that’s transferable, but it’s Musk’s management style that appears to have not made the transition, and we’re witnessing a clash of cultures at Twitter — indeed, as the departures continue, with each person leaves, so too goes knowledge, expertise, and culture.

I’m confident Musk wouldn’t have imposed onerous working conditions on the employees of his own ventures, risking the infrastructure critical to their existence, but that is what’s happened at Twitter:

“Twitter has also been around for ~15 years. [So,] a lot of infrastructure ‘cruft’ has built up. “Is that important, or can it be turned off” is the kind of thing best answered via asking people. 50% of Twitter was let go today, and your oral tradition just walked out the door too.”

Who spends $44 billion and instigates a regime of mind games to bend everyone to their will? Elon Musk, but I suspect few else. Musk founded and PayPal, so it isn’t as if he doesn’t have experience with software, but there too were huge tensions with investors and employees, a short tenure as a CEO, problematic approaches to infrastructure, and acrimonious departures.

Managing failure

Some time ago, a friend had been asked to build a web application for a local business. Like me, my friend wanted to first learn something about the business and to interview the people who would have been using his application. The managing director insisted the thoughts of their employees weren’t important, and was intent on having the application built in secret, as a surprise. The surprise was on them because their employees hated it, were infuriated that they hadn’t been consulted (the application didn’t deal with a whole list of problems they’d reported to management), and some chose to leave as a result.

Again, there are similar features here with what’s been happening at Twitter, and while I don’t think Twitter is going to vanish (although it could fail soon), I suspect Musk is going to learn a hard and perhaps expensive lesson before things improve.

Understanding the people and the culture of a business isn’t some fuzzy warm thing that glows in articles like this, it’s an essential attribute to be understood and be made foundational to most everything else.

As the Qatar World Cup 2022 begins, it’s going to be interesting to see how Twitter copes, and like Ashley before him, the Beautiful Game could where Musk meets his match!

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