Clayton Christensen on "How Will You Measure Your Life?"

Excerpts from Clayton Christensen’s address to the 2010 graduating class at Harvard Business School on “How Will You Measure Your Life?”

Clayton Christensen on “How Will You Measure Your Life?”

In his 2010 address to the graduating class of Harvard Business School, Clayton Christensen suggested a several strategies for a successful career and a happy family. Here are six excerpts that highlight his theories. The three ideas I found most useful were: explain your models and let people reach their own conclusions; live your purpose as your identity not as something you can compromise; entrepreneurs–acting as managers and leaders–can have a profound impact on their employees’ lives.

Meeting with Andy Grove: explain models and let people reach their own conclusions

Before I published The Innovator’s Dilemma, I got a call from Andrew Grove, then the chairman of Intel. He had read one of my early papers about disruptive technology, and he asked if I could talk to his direct reports and explain my research and what it implied for Intel. Excited, I flew to Silicon Valley and showed up at the appointed time, only to have Grove say, “Look, stuff has happened. We have only 10 minutes for you. Tell us what your model of disruption means for Intel.” I said that I couldn’t—that I needed a full 30 minutes to explain the model, because only with it as context would any comments about Intel make sense. Ten minutes into my explanation, Grove interrupted: “Look, I’ve got your model. Just tell us what it means for Intel.”

I insisted that I needed 10 more minutes to describe how the process of disruption had worked its way through a very different industry, steel, so that he and his team could understand how disruption worked. I told the story of how Nucor and other steel minimills had begun by attacking the lowest end of the market—steel reinforcing bars, or rebar—and later moved up toward the high end, undercutting the traditional steel mills.

When I finished the minimill story, Grove said, “OK, I get it. What it means for Intel is…,” and then went on to articulate what would become the company’s strategy for going to the bottom of the market to launch the Celeron processor.

I’ve thought about that a million times since. If I had been suckered into telling Andy Grove what he should think about the microprocessor business, I’d have been killed. But instead of telling him what to think, I taught him how to think—and then he reached what I felt was the correct decision on his own.

That experience had a profound influence on me. When people ask what I think they should do, I rarely answer their question directly. Instead, I run the question aloud through one of my models. I’ll describe how the process in the model worked its way through an industry quite different from their own. And then, more often than not, they’ll say, “OK, I get it.” And they’ll answer their own question with more insight than I could have.”

Clayton Christensen in “How Will You Measure Your Life“

SKMurphy take: effective joint action, whether it’s collaborating on a task or decision or teaching someone how to be self-sufficient, requires agreement on both the facts of a situation and on how the world works. Christensen’s model of explaining the theory allows his students–and consulting clients–to reason from the facts using the theory to settle on a course of action. We try and do the same thing in our practice: outlining our principles, models, and heuristics in a way that clients can take advantage of them where they feel they are applicable.

Three key questions about career, family, and staying out of jail

On the last day of class, I ask my students to turn those theoretical lenses on themselves, to find cogent answers to three questions:

How can I be sure that I’ll be happy in my career?

How can I be sure that my relationships with my spouse and my family become an enduring source of happiness?

How can I be sure I’ll stay out of jail?

Though the last question sounds lighthearted, it’s not. Two of the 32 people in my Rhodes scholar class spent time in jail. Jeff Skilling of Enron fame was a classmate of mine at HBS. These were good guys—but something in their lives sent them off in the wrong direction.

Clayton Christensen in “How Will You Measure Your Life“

SKMurphy take: these are three very practical questions that everyone needs to answer for themselves. Stephen Covey’s suggestion that “the main thing is to keep the main thing, the main thing,” is a short answer to at least the first two questions. People who are successful from an early age may not learn the ethics and self-control needed to prevent themselves from slowly wandering off the path into what ends in clearly illegal behavior.

How to be happy in your career

Frederick Herzberg hygiene theory offers great insight into how to find happiness in our careers. His theory is that the powerful motivator in our lives isn’t money; it’s the opportunity to learn, grow in responsibilities, contribute to others, and be recognized for achievements. I tell the students about a vision of sorts I had while I was running the company I founded before becoming an academic. In my mind’s eye, I saw one of my managers leave for work one morning with a relatively strong level of self-esteem. Then I pictured her driving home to her family 10 hours later, feeling unappreciated, frustrated, underutilized, and demeaned. I imagined how profoundly her lowered self-esteem affected the way she interacted with her children. The vision in my mind then fast-forwarded to another day, when she drove home with greater self-esteem—feeling that she had learned a lot, been recognized for achieving valuable things, and played a significant role in the success of some important initiatives. I then imagined how positively that affected her as a spouse and a parent.

My conclusion: Management is the most noble of professions if it’s practiced well. No other occupation offers as many ways to help others learn and grow, take responsibility and be recognized for achievement, and contribute to the success of a team.

Clayton Christensen in “How Will You Measure Your Life“

SKMurphy take: the opportunity to learn, to take on responsibility, to contribute to others, and to have your achievements recognized are all present in any entrepreneurial career. Obviously, there are “hygiene factors” that also need to be satisfied, for example, enough salary to take care of yourself and family members and safe workplace conditions. I think that the challenge for many entrepreneurs is to learn how to be the kind of manager and leader that enables employees also to learn, grow, contribute, and be recognized.

Create a strategy for your life

A theory that is helpful in answering the second question—How can I ensure that my relationship with my family proves to be an enduring source of happiness?—concerns how strategy is defined and implemented. Its primary insight is that a company’s strategy is determined by the types of initiatives that management invests in. If a company’s resource allocation process is not managed masterfully, what emerges from it can be very different from what management intended. Because companies’ decision-making systems are designed to steer investments to initiatives that offer the most tangible and immediate returns, companies shortchange investments in initiatives that are crucial to their long-term strategies.

Over the years I’ve watched the fates of my HBS classmates from 1979 unfold; I’ve seen more and more of them come to reunions unhappy, divorced, and alienated from their children. I can guarantee you that not a single one of them graduated with the deliberate strategy of getting divorced and raising children who would become estranged from them. And yet a shocking number of them implemented that strategy. The reason? They didn’t keep the purpose of their lives front and center as they decided how to spend their time, talents, and energy.

Clayton Christensen in “How Will You Measure Your Life“

SKMurphy take: this reminds of a conversation that I can recall my mother and father having many times. It would start with my mother reading about someone who had suffered a setback in their life–divorce, jail, bankruptcy, alcoholism–as a consequence of poor decisions they had made. She would finish reading–sometimes aloud for our benefit–and say, “I don’t understand, they were wealthy and successful, how could they have made this mistake?” My mother believed that most problems could be solved with more money. My father would observe that “a wealthy son of a bitch was still a son of a bitch and bound to become unhappy when his actions caught up with him.”

Allocate your resources for the long term: avoid immediate gratification

When people who have a high need for achievement—and that includes all Harvard Business School graduates—have an extra half hour of time or an extra ounce of energy, they’ll unconsciously allocate it to activities that yield the most tangible accomplishments. And our careers provide the most concrete evidence that we’re moving forward. You ship a product, finish a design, complete a presentation, close a sale, teach a class, publish a paper, get paid, get promoted. In contrast, investing time and energy in your relationship with your spouse and children typically doesn’t offer that same immediate sense of achievement. Kids misbehave every day. It’s really not until 20 years down the road that you can put your hands on your hips and say, “I raised a good son or a good daughter.” You can neglect your relationship with your spouse, and on a day-to-day basis, it doesn’t seem as if things are deteriorating. People who are driven to excel have this unconscious propensity to underinvest in their families and over invest in their careers—even though intimate and loving relationships with their families are the most powerful and enduring source of happiness.

If you study the root causes of business disasters, over and over you’ll find this predisposition toward endeavors that offer immediate gratification. If you look at personal lives through that lens, you’ll see the same stunning and sobering pattern: people allocating fewer and fewer resources to the things they would have once said mattered most.

Clayton Christensen in “How Will You Measure Your Life“

SKMurphy take: this was the key insight I took away from his speech, that the resilience of relationships in the face of a small amount of neglect fools us. We get used to people giving us the benefit of the doubt and take it for granted, without acting like someone who deserves the benefit of the doubt. This is a hard trade-off to manage when you are getting a startup off the ground. I think you have to treat your spouse as a member of the board of directors and keep them in the loop–at a high level–as to what you are working on and trying to achieve. I also think you have to be very careful to meet the commitments that you make to your family and to draw clear boundaries between work and family. Easy to write, very hard to do. One of the saddest conversations that took part in was with three former co-workers who had been managers during a period of high growth in the company. We got together for a dinner about ten years later, and I was shocked to find all of them divorced and estranged from their children–in some cases the children were struggling with addiction issues. They were trying to spend all of the money that they had made while they were neglecting their family to now make up for the neglect. It was not working. I don’t think I had behaved much differently than they had in terms of spending a lot of time at work, but I had never assumed that I could buy my way back into my family’s good graces. So I tried to do something each week to maintain my relationships with my wife and children.

Avoid the “marginal costs” mistake

We’re taught in finance and economics that in evaluating alternative investments, we should ignore sunk and fixed costs, and instead base decisions on the marginal costs and marginal revenues that each alternative entails. We learn in our course that this doctrine biases companies to leverage what they have put in place to succeed in the past, instead of guiding them to create the capabilities they’ll need in the future. If we knew the future would be exactly the same as the past, that approach would be fine. But if the future’s different—and it almost always is—then it’s the wrong thing to do.

It’s easier to hold to your principles 100% of the time than it is to hold to them 98% of the time. If you give in to “just this once,” based on a marginal cost analysis, as some of my former classmates have done, you’ll regret where you end up. You’ve got to define for yourself what you stand for and draw the line in a safe place.

Clayton Christensen in “How Will You Measure Your Life“

SKMurphy take: I read an interesting perspective on the difference between “I eat sensibly” and “I am trying to lose weight.” The former is a statement of identity; the latter is a principle someone is trying to uphold most of the time. It also works with smoking: “I don’t smoke” vs. “I am quitting.” The latter allows you to have a cigarette today and start quitting again tomorrow. I think you have to make your ethics part of your identity; it has to be 100% of the time.

Update May-22-2021: Brian Lui has extended this analysis to organizations and nations, looking at effect of weak tie interactions on the level of luck that is generated by virtuous vs. virtuous interactions in essay “Upside Decay.” I took these key points away (but the entire article is worth a read)
Upside decay means that an organization doesn’t get any lucky breaks.
Upside decay is hard to spot. It’s invisible if we’re not specifically looking for it, because the absence of rare positive events is unexceptional.
Upside decay is preceded by a lack of virtue that leads to zero-sum or even win-lose transactions
Leadership choices
1. virtuous culture -> positive sum interactions -> weak ties help -> lucky breaks
2. unvirtuous culture -> zero sum interactions -> weak ties abandon -> upside decay

“The right culture, the highest and best culture, is a seamless web of deserved trust.”
Charles Munger

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Clayton Christensen on “How Will You Measure Your Life?”