Introduction
Hello, friends usually when we all look at Elon Musk he is a great genius and he has learned a lot of things on his own and started many new companies from he is earning millions of profits and he is the number one billionaire in the world. Although we have heard such common things have we ever thought about how he does it to such an extent? When he exited PayPal in 2002 he invested all the money he had in two new companies and grew them to such a large scale that he made so much profit and he attributed this decision to a concept. In this post, we will see the thinking pattern he adopted.
First Principal Thinking
Generally, we all have a habit that is we follow the things that our parents and society have been following since we ruled, but if we ask why we follow it, there is no right answer. But First Principle Thinking is about finding and thinking from the basic rationale. But we humans usually look at something in the past and think about how it will be in the future and work on it. Looking at what others are doing and building the next level from that can be an instant solution, but it’s not always the perfect solution.
Example of First Principal Thinking
To give an example of this, in the early days of the Tesla Company, Elon Musk understood that we needed a battery to make an electric car. Well now it is known that battery is very important to make this electric car who will provide it with full quality at an affordable price who will manufacture it and we will think about who will give us the best deal if we order more quantity with them but Elon Musk doesn’t think so. He will think about whether we can manufacture this battery ourselves instead of buying it from outside and whether we can manufacture it at a cheaper price and with better quality than them. This is the core concept of First Principal Thinking.
Elon Musk’s Secret Quality
When we encounter a problem we need to know why to approach the problem and how we can fix it. When approaching a problem, not everyone can think it through from the basics. Even if they think like that, many people do not know how to implement it. Elon Musk faced a lot of problems when he started his company SpaceX in the early days. During that period only government agencies had these space-related research institutes and companies. Thus starting the company, he had to launch a rocket into space as the beginning of his dream of sending humans into space.
But he began to break it down by first principal thinking concepts about why the cost of the rocket was so high. While researching this, he looked at the cost of the materials used in the rocket. He understood that the cost of the materials used in the rocket was not even 5 percent of the total cost of the rocket, and why there was such a huge price difference.
He understood that the cost of the rocket increases manifold when the spare parts of the rocket are assembled by different companies. So he started making his rocket parts in his own company. Currently, 80 to 92 percent of the spare parts for rockets used in Space X are manufactured by them as per their requirements. Apart from that they have brought an innovation in rocket technology and brought a reusable rocket.
Conclusion
Thus when you face a problem you have to think about it from the starting point of the problem and if you understand how the problem is formed and what is the cause of it then you can come out of those problems and give a better solution. Ideas should always be based on facts rather than opinions and work about others. Be open-minded if you want to bring about changes in any matter. If you want to change something you don’t like, take this first-principle approach.
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