Consumer Reports Withdraws Its Tesla Model S Recommendation

At first glance, people see the headline from Consumer Reports above and think that Tesla has some really big problems.  Their car was just downgraded by Consumers Reports and their stock took a hit.  In their survey, Consumer Reports found a wide range of issues, and some of the areas of the car actually got worse from 2014 to 2015.

For most businesses, a public report like this, could have the potential for a major impact on the company’s very own survival.  That being said, Tesla is not “most businesses”.  You see, Elon Musk, the company’s founder, made his fortunes in the software industry.  One thing you quickly learn when building software is to listen to your customer and involve your customer in the building of the product.  In fact, according to the Agile Manifesto’s 12 Principles, the number 1 Principle is:  “Our highest priority is to satisfy the customer through early and continuous delivery of valuable software.”  Clearly, Musk took notice.

I know what you’re saying.  That sounds like a great idea for building software, but how can it possible work for building a car?  How could you get close to the customer and even if you did, how could your manufacturing process support feedback for something fast enough to make a difference?

Well, Musk didn’t just build a car company, he built a Brand that just happens to build cars.  What do you think of when you think of a Tesla?  Do you think of the Horsepower the car delivers?  Do you think of the navigation system or the stereo?   More than likely, you are aware of the technical specifications of a Tesla car, but you are more aware of the experience of owning one of theses electric cars.  If you don’t believe me, then take this for example.

According to a Techcrunch article about the Consumer Reports recent downgrade:

Asked for comment, a Tesla spokesperson emailed us the following statement: “Consumer Reports also found that customers rate Tesla service and loyalty as the best in the world. Close communication with our customers enables Tesla to receive input, proactively address issues, and quickly fix problems. Over-the-air software updates allow Tesla to diagnose and fix most bugs without the need to come in for service. In instances when hardware needs to be fixed, we strive to make it painless.”

The Agile Manifesto, Principle number 1 in action:  “Our highest priority is to satisfy the customer through early and continuous delivery of valuable software.”

Were it not for the close communication Tesla has with their customers, they would not be able to address issues and proactively fix problems.  Think for a moment how this story could have turned out differently had Tesla not built a system to enable close communication that helped them continuously delivery value?  Think about your own car ownership experience and the last time you had a problem.  Would you rate your service and loyalty as “best in the world”?

In reading the recent Tesla story, I couldn’t help but think of Tony Hsieh, the CEO of Zappos, and his attention to delivering more than just a product.  Tony figured out early on that the secret to his company’s success was in “Delivering Happiness“, which is also the title of his recent book.  At Zappos, he created a culture that is focused on employee happiness, which transcends into providing amazing customer service to make their customers happy, which then results in happy customers spending more money at Zappos.  Tony made happiness the centerpiece of Zappo’s strategy and it is working.

Tony’s focus on happiness is a part of everything Zappos does.  In fact, as noted in the book, Search Inside Yourself, by Chade-Meng Tan, Tony describes three types of happiness:

  1. Pleasure: This type of happiness is about always chasing the next high.  It is the rock-star type of happiness because it is very hard to maintain unless you are living the lifestyle of a rock star.
  2. Passion: Also known as “flow”, where peak performance meets peak engagement, and time flies by.
  3. Higher Purpose: This is about being part of something bigger than yourself that has meaning to you.

Tony Hsieh and Elon Musk have both created companies that are focused on a Higher Purpose.  It is this Higher Purpose that allows them to have setbacks and continuously learn and adapt to make their products that much better.  What is your Higher Purpose?  Let’s not loose sight of the Agile Manifesto and the 12 Principles when building our own products.  How you address each Principle will show you what your highest priority is and whether or not you are delivering the highest business value to your customers.