Clayton Christensen on "Hiring a Milkshake"

Have you ever wanted to think more like an entrepreneur? There's probably no better person to help us do that than Clayton Christensen of Harvard Business School.

The idea in this video is that we "hire" products and services "to do a job." This sounds deceptively simple -- so much so that your first instinct might be to say 'duh Professor'. But think about how most high-falutin companies work: they use focus groups, surveys, and all manner of data collection to determine demographics and statistical profiles of their customers. They spend lots of money on all of this research. And it probably helps to some degree. But does it help as much as asking the simple question: "why are these people hiring my product? What job do they want done?" It's a different mental model.

As it happens, I'm sitting in a coffee shop writing this. I almost always write these posts from a coffee shop. I buy one cheap cup of medium roast and I go to town blogging. I do enjoy coffee. But I'm hiring that cup of coffee to do a bigger job for me than getting me caffeinated and exciting my taste buds. That cup of coffee allows me to sit in a pleasant environment for hours so I can blog for my customers -- you -- and get out of the house. The owners of my coffee shop - once they get to know me - start to understand that's why I'm hiring them and their coffee. And they have learned to be attentive to the needs of customers like me who are very often regulars.

All of this, of course, goes back to the idea that entrepreneurship is a discovery process. And when we aggregate all of those entrepreneurial discoveries we get a market. This fact alone should make us extremely skeptical of macroeconomic abstractions--which tend to paint economies as black boxes and entrepreneurs as mere epiphenomena. But when we put entrepreneurship back at the center of thinking about economics, we get an entirely different way of looking at the world.

Comments

[Tom Grey]

Yes, the market is based on entrepreneurs (humans) trying to discover ... how to make money giving people what they're really willing to pay for.

(First visit.)
Interesting site, why so few comments?

[Max]

Hey Tom. Thanks for dropping by. Few comments because we've only been around for (less than) two months. Our traffic is modest at the moment. But hopefully readers like you will continue to help us build -- one "customor" at a time.