The Algorithm summary

It was 2015, when the author, Jon McNeill, was first asked to join the team at the electric vehicle company, Tesla. At first, he was a little confused. Wouldn’t they be better off with someone who had more experience dealing with large-scale car manufacturing? But as Tesla’s co-founder, Elon Musk, explained, that was exactly what he didn’t want. A big car company exec wouldn’t want to take quick, decisive action; they would look to always maintain the status quo. Tesla had immediate problems, and not a lot of money to fix them, so given McNeill’s years of experience as an entrepreneur helping start-ups grow, he was exactly the kind of guy Musk was looking for.

Over the next few years, the author would face a number of challenges, culminating in him learning what is now called the Algorithm – five principles that are all about solving problems and growing your business.

Let’s start with the first principle: Question every rule. 

This one might sound a little obvious coming from the world of start-ups and major disruptors like Tesla or Musk’s other company, SpaceX. But that doesn’t make it any less important. In fact, it’s pretty fundamental to the Algorithm because it is amazing what you can accomplish when you start taking nothing at face value. Every rule, every requirement, every assumption, now is the time to really second-guess it all.

You might be shocked at how many steadfast rules can be broken. As the author discovered early on at Tesla, even laws in foreign countries – countries that aren’t exactly known for their flexibility – can be changed when it’s in everyone’s best interest. 

In this case, that country was China. Since China was the largest auto market in the world, with deep manufacturing expertise and a strong appetite for electric vehicles, figuring out how to get a foothold in the nation was a major part of the puzzle that needed solving. The biggest issue was that every foreign company was expected to partner with a national entity. This ultimately meant you’d need to share profits and give up partial ownership. All the global giants that had entered China had agreed to this structure.

But Elon Musk wasn’t having it. Even though this was essentially a government law, he didn’t see it as etched in stone. Instead, he directed McNeill and his team to figure out a solution.

So they approached it like a question. What if this rule wasn’t as rigid as it seemed and there was room to negotiate? After all, China had its own priorities; they needed to create jobs and they wanted to be global leaders in clean energy. So the author’s team built a case that aligned Tesla’s goals with China’s ambitions. And sure enough, after about a year of steady negotiation, they reached a breakthrough: approval for Tesla to have the first 100 percent foreign-owned auto plant in China.

The advice here isn’t to ignore reality. These outcomes emerged through the process of examining things more closely and recognizing that many “rules” are shaped by context, incentives, and history. When you can see those elements clearly, you’ll start to see how the rules can change.

Many organizations operate within layers of inherited rules. Some are useful, no doubt. But others can act like handcuffs preventing you from growing and innovating. So look closely at how things work across the business, from product design to internal processes. Ask questions, and see which ones are truly necessary and which ones are holding you back. If someone shrugs their shoulders and says, “I don’t know, that’s how it’s always been done,” that just might be an opportunity for a major improvement.