Building out the HR infrastructure to hire and manage talent is a difficult business, and most companies rely on products from a few big vendors such as SAP, Workday, or ADP.
Tesla isn’t most companies. According to a new report in The Information, the electric-car giant has built its own proprietary software for tracking job applicants. Why burn the time and resources on such a complicated project? CEO Elon Musk reportedly wants to reduce Tesla’s use of external software vendors—even for relatively straightforward internal functions.
Tesla is also entering a complicated period on the hiring front. In June, Musk told an audience at the Qatar Economic Forum that Tesla would cut around 3.5 percent of its total workforce (which currently stands at roughly 100,000 people). “We grew very fast on the salaried side,” Musk added, according to Bloomberg.
This isn’t Tesla’s first big set of layoffs. Four years ago, the company laid off 9 percent of its staff; two years ago, it furloughed workers during the initial stages of the COVID-19 pandemic. This time around, though, Musk is blaming the layoffs on a combination of overexuberant hiring and his own “super bad feeling” about the economy.
Unlike other tech giants, Tesla is also instituting a “no remote work” policy, with warning emails sent to those who don’t show up at their office desks for at least 16 workdays per month. “Anyone who wishes to do remote work must be in the office for a minimum (and I mean *minimum*) of 40 hours per week or depart Tesla,” Musk wrote in an email to executives in June. “This is less than we ask of factory workers.” (Bloomberg excerpted portions of the email.)
Other tech giants (such as Google and Apple) have embraced hybrid and remote work; as these companies compete with one another for highly specialized talent in arenas such as machine learning and artificial intelligence (A.I.), remote-work policies could influence job candidates’ decisions about where to work. Is Tesla putting itself at a disadvantage by insisting all employees come into the office? It’s unclear right now.
In the meantime, Tesla seems dedicated to severing its connections to external software vendors. Maybe building an effective piece of HR software isn’t as complicated as putting together a luxury sedan that drives itself, but it’s a major undertaking nonetheless—despite the layoffs, Musk may have to hire some specialists to get it done.
