# How will you measure your life? 🤔

- Published: 2021-05-02
- URL: https://notes.webutvikling.org/how-will-you-measure-your-life
- Tags: startup, economics, Clayton Christensen

Christensen wears his values on the outside. Job to be done, plus a framework for not wrecking the rest of your life.

Clayton Christensen, attributed for coining the term _disruption,_ stands out from the typical business/tech authors I read.
He wears his values on the outside, talking about and showing how he prioritizes principles, family and faith.

**It's refreshing to have an author talk about his personal values openly.** Most authors I read attempt to stay neutral and keep
their personal values away from the book. Some succeed and others clearly "sell a logic" to justify their own biases – which I find exhausting.
Christensen is open and reflected around his personal values, which makes it easy to appreciate his thoughts and frameworks
of thinking, even though I don't share his views or prioritizes.

### The job to be done

I think of _job to be done_ as a variant of being customer focused, or emphatic with the user.
His explanation in the video below about selling more milkshakes boils down to that businesses
having to understand the customers feelings to succeed.

> Companies focus too much on what they want to sell their customers, rather than what those customers really need.
> What's missing is empathy: a deep understanding of what problems customers are trying to solve.

[Video](https://www.youtube.com/watch?v=rHdS_4GsKmg&t=720s&ab_channel=TalksatGoogle)

_You have to **understand** people in their situation at the moments where you are able to solve **their problem/job**_.
(Simply asking them or survey them is not enough).

### Incentive vs Motivation theory

- **Incentive theory:** Hire and pay managers based on the financial performance of the company,
  aligns the managers incentives with the shareholders incentive. Hence, a company should
  give stock or stock options to their CEOs, or other types of performance based bonuses.

- **Motivation theory:** Financial compensation is a hygiene factor, and will not make employees
  motivated. The best thing you can hope for is that no one is dissatisfied because of it.

[Motivation theory](https://en.wikipedia.org/wiki/Two-factor_theory) (or two-factor theory) splits motivation in two:

- Hygiene factors: Things that make employees _dissatisfied_ with their work. These include _status, job security, work condition, company policies, supervisory practices **and compensation**_.
- Motivators: Things that make employees _satisfied_ with work. These include _challenging work, recognition, responsibility, purpose and personal growth_,

With great motivators and bad hygiene factors, you can then hate _and_ love your job.

_Motivate people with other means than just money._

### Don't marry your deliberate plan

Honda almost went bankrupt while [trying to enter the American market](https://www.ukessays.com/essays/business/managing-strategy-the-honda-effect-business-essay.php).
They wanted to sell _big_ motorcycles, as it was what the customers in America (already) bought,
and bled money to achieve a position in that market. What saved them was discovering that there was
a profit to be made in the (basically non-existing) market for small, quick and playful motorcycle market.

_Be flexible enough with your plan to identify and figure out emerging strategies_

### Focusing on marginal profit will kill you in the end

Most companies think in marginal profits and focus on making better profit margins
for their high profit customers. This creates a focus on financial metrics which prioritizes
innovations that pay of in the short term, which disruptive innovations is not a part of.

> If you study the root causes of business disasters, over and over you'll find a predisposition
> toward endeavors that offer immediate gratification over endeavors that result in long-term success.

[Video](https://www.youtube.com/watch?v=rHdS_4GsKmg&t=3098s&ab_channel=TalksatGoogle)

This is the underlying cause for Dell loosing their customer computer market til Asus: Dell improved
their [Return on assets](https://www.investopedia.com/terms/r/rona.asp) by outsourcing more and more
of their production, until Dell was not much more than a label sticker on Asus hardware.

_Don't remove capabilities or stop innovating in the chase for better financial fractions._

### A theory of good and bad capital

Christensen says that a company should _initially be patient for growth, and impatient for profitability._
When profitability is discovered and the path forward is clear, switch it around: be _impatient for growth and patient for profitability._

This is a variant of what [Reid Hoffman says in Blitzscaling](/blitzscaling/):

> If your product/market fit isn't right, or your business model doesn't work yet, or if the market
> conditions aren't right for hypergrowth, then premature blitzscaling can lead oh so painfully
> (and rapidly!) to "blitzfailing".

_Make sure your product makes sense and is profitable, before thinking about scaling it up._

## Summary

Clayton is a charismatic fellow, and I'd recommend seeing him in the videos above.
In the book he presents them with more depth along with personal values.

He talks equally much about how the concepts can be applied with family as with work:

- Don't give your spouse what you want to give them – instead try to see why they hired you: what's _their job-to-be-done_ in this situation?
- Be aware of overfocusing on short term payoffs in life. It implicitly negatively affects your long term goals.
- Don't let go of your principles, even if it's _just this once_. "The path to hell is paved with good intentions [or _just this once_]".