Life Advice Through Management Theory and Business Strategy

When Har­vard Busi­ness School’s class of 2010 invited pro­fess­or Clayton Christensen (expert on dis­rupt­ive tech­no­logy and innov­a­tion, author of The Innovator’s Dilemma) to address them, they reques­ted he talk on how to apply man­age­ment the­ory prin­ciples to one’s per­son­al life. Christensen respon­ded by answer­ing three ques­tions:

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

One of the the­or­ies that gives great insight […] is from Fre­d­er­ick Herzberg, who asserts 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. […] 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. More and more MBA stu­dents come to school think­ing that a career in busi­ness means buy­ing, selling, and invest­ing in com­pan­ies. That’s unfor­tu­nate. Doing deals doesn’t yield the deep rewards that come from build­ing up people.

I want stu­dents to leave my classroom know­ing that.

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

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. […]

When people who have a high need for achieve­ment […] 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. […] In con­trast, invest­ing time and energy in your rela­tion­ship with your spouse and chil­dren typ­ic­ally doesn’t offer that same imme­di­ate sense of achieve­ment. […]

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. […]

Your decisions about alloc­at­ing your per­son­al time, energy, and tal­ent ulti­mately shape your life’s strategy.

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

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. […]

Uncon­sciously, we often employ the mar­gin­al cost doc­trine in our per­son­al lives when we choose between right and wrong. A voice in our head says, “Look, I know that as a gen­er­al rule, most people shouldn’t do this. But in this par­tic­u­lar exten­u­at­ing cir­cum­stance, just this once, it’s OK.” The mar­gin­al cost of doing some­thing wrong “just this once” always seems allur­ingly low. […] Jus­ti­fic­a­tion for infi­del­ity and dis­hon­esty in all their mani­fest­a­tions lies in the mar­gin­al cost eco­nom­ics of “just this once.” […]

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 […] 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.

The entire art­icle is well worth a thor­ough read; it’s full of inter­est­ing insights and great advice.