How Will You Measure Your Life?

Source: Deseret News, Jan 24, 2020

On January 23, 2020, Clayton Christensen passed away at the age of 67.

I found out about his passing during my commute home from work on Friday, and it left me reflecting deeply on my experiences with Clay. I enrolled in his class back in 2000 at HBS, and was fortunate enough to have him agree to be an advisor to me on an independent project on the topic of disruption. Over the years, when I would visit HBS for recruiting or for a case study, I would always try to stop by to see him. Ever gracious and thoughtful, he may have been the most influential professor in my life.

There have been some wonderful pieces written about Clay in the past couple of days, mostly reflecting on his impact on management theory or his lifelong dedication to his family and his church. The list of his accomplishments is appropriately long. However, there are a few personal details I’d like to add to the story.

First Meeting

Many people are familiar with Clay’s work on innovation and disruption, made famous by his 1997 book, The Innovators Dilemma. It’s always shocking to me when I meet people in Silicon Valley who haven’t read it – that’s how fundamental it has been in shaping my thinking about business & strategy.

However, the professor I met at Harvard twenty years ago didn’t talk about innovation, disruption or how to build a successful business. He talked about the morality of business, the ethics of leadership and about his own personal journey.

Clay was a warm and friendly person, but when I first saw in him walk into our class, it was hard to ignore just how tall he was. At Harvard, the third row of seating is known as the “Power Deck” because when seated you are eye-level with the professor. I used to joke that in Clay’s class, it was the fourth row that was the Power Deck.

In some ways, Clay’s height made his approachability and humility even more surprising and authentic.

Clay’s class was supposed to be about strategy, but he opened his first lecture with a discussion of people. He spoke about how we spend most of the hours of our adult lives  at work, and how impactful those hours are on the emotional wellbeing of people even outside of work. He asked us to think about great managers we’d had in the past who supported us and gave us energy, and terrible managers who had drained us of it.

And that’s when he told us that he believed that being a great manager was one of great moral responsibility, because your leadership would either make the people who worked for you miserable, or they could bring those people joy & accomplishment.

When Clay talked about leadership, he talked about it with a clarity and conviction that is rare. To this day, when I take on a new leadership position, I talk to my teams about the responsibility I feel to them based on Clay’s words.

Professional Journey

Clay’s professional journey also resonated with me. Most people don’t know that Clay himself was a founder, starting a company focused on advanced ceramics back in the 1980s material science boom. It’s a bit of personal trivia, but my first love at Stanford  wasn’t Computer Science. It was the Introduction to Material Science that made me decide to major in Engineering.

But after that experience, Clay had decided to go back to school. It is unusual for an MBA to go back to get a PhD, but he went back because he wanted to study management and teach. His passion for a more rigorous framework on how managers make decisions led him to the insights that became The Innovator’s Dilemma, and the career that we all know him for. His fundamental belief that managers were intelligent and capable led him to frame an incredible problem: how do large companies continue to fail when they have access to so many smart people and almost unlimited strategic resources?

However, his choice wasn’t purely motivated by academic or professional interest. He talked openly about his family, his wife and his children, and the life he wanted to create for them. He talked about his faith, and how he wanted to be judged in the end.

Not everyone who is religious leads an exemplary life, but for Clay, his faith seemed to amplify and enforce his ethical rigor. In his later work, he would argue that it was easier to hold the line ethically 100% of the time than 98% of the time, because one compromise leads to another, then another.

How Will You Measure Your Life?

Over the years, when I would visit Clay at HBS, he was always warm and encouraging. We would discuss each career move I made: eBay, LinkedIn, Greylock, Wealthfront. The clarity of his strategic thinking was always a gift, and his willingness to engage and debate when we disagreed was always a bit surprising to me. But Clay loved to sharpen his thinking, and had seemingly no ego tied to defending ideas or business strategies. He just loved finding more insight; a twinkle in his eye in the pursuit of a clearer glimpse of the truth. I always left of our conversations feeling amplified by both his support and his energy.

In 2010, Clay published a piece based on these ideas that became a book by the same name, How Will You Measure Your Life.  It is worth reading, and even re-reading.

I have a pretty clear idea of how my ideas have generated enormous revenue for companies that have used my research; I know I’ve had a substantial impact. But as I’ve confronted this disease, it’s been interesting to see how unimportant that impact is to me now. I’ve concluded that the metric by which God will assess my life isn’t dollars but the individual people whose lives I’ve touched.

I think that’s the way it will work for us all. Don’t worry about the level of individual prominence you have achieved; worry about the individuals you have helped become better people. This is my final recommendation: Think about the metric by which your life will be judged, and make a resolution to live every day so that in the end, your life will be judged a success.

Rest in Peace, Clay.

Ikigai: How to Find Professional Success

On December 25, 2017, I tweeted out a page from the World Economic Forum about Ikigai and was shocked at how broadly it spread. This post elaborates on the concept.

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Over the last twenty years, I’ve been asked by hundreds of students for advice on how to think about their careers post-graduation. Inevitably, I’ve always responded with a simple framework to help structure their thinking around picking a profession:

  1. What are you exceptional at?
  2. What do you love to do?
  3. What does the world value?

As it turns out, there is a Japanese concept for this framework. Ikigai.

The Reason You Get Up in the Morning

Dan Buettner gave a TED Talk called, “How to Live to Be 100+.” He focuses quite a bit of his lecture on the island of Okinawa and their extraordinary number of centenarians. He identifies several diet and lifestyle habits that seem to correlate with a long and healthy life. Ikigai is one of those concepts. He recently gave an interview in the Telegraph:

They all have an ikigai. “In the Okinawan language,” said Dan, “there is not even a word for retirement. Instead, there is one word that imbues your entire life, and that word is ‘ikigai’. And, roughly translated, it means ‘the reason for which you get up in the morning.’”

He talked of a 102-year-old karate master who still practised, a 100-year-old fisherman who loved to bring the catch to his family, and a 102-year-old who, asked what her ikigai was, said that holding her great-great-great-granddaughter, a century her junior, felt like “leaping into heaven.”
In Buettner’s framework, Ikigai is not just something you think about when you are picking majors. It’s a form of balance that you seek through your entire life.

What Are You Optimizing For?

When I was in college, my mother constantly reflected on the bad advice she felt students were given as they attempted to pick a career. “Everyone tells students to follow their passion. It’s not that simple. There is a big difference between a hobby and a career.”

My father tended to be more direct. “The world doesn’t owe you a living,” he would often say, “Find something that people value.”

Our popular culture has become saturated with the idea that if you just find your passion, something you love doing, then your career will magically present itself. If only success were so simple. Finding something you love to do is critical, and if you are fortunate, you’ll find several. As it turns out, that’s just one piece of the puzzle.

The fact is, you may love something that the world doesn’t value highly. The world may value things that you aren’t very good at. And of course, you may be good at something that you don’t want to do.

The benefit of Ikigai is that it helps separate out the dimensions you can optimize your professional efforts around, in attempt to help you find a combination that will result in professional success and fulfillment.

Four simple questions.

  1. What do you love? Find something that you really enjoy doing. It’s simple to say that the journey is the reward, but when you love to do something, work can be something you look forward to.
  2. What are you good at? We all have different talents and aptitudes. With practice and determination, you can develop mastery in a wide variety of areas. However, if you have a natural (or hard-earned) talent in an area, that’s worth identifying.\
  3. What can you be paid for? Just because you can do something, doesn’t mean that the other humans around you will value it. Looking for something that the market will reward financially is a critical piece of this puzzle if for no other reason than to set expectations realistically.
  4. What does the world need? Being the unabashed capitalist, I originally assumed that anything the world needed would also be something the world would pay for. Stepping away from the theoretical argument, there is significant value in transparency from separating out this requirement.

Imperfect Combinations of Three

One of the most insightful aspects of Ikigai is the imperfect combinations of three of the four dimensions that are represented in the chart by different colors.

If you find work that you are good at, that you can be paid for, and that the world needs, you may find yourself feeling comfortable but unfulfilled. In this case, you aren’t working on something you love, but likely being compensated for your work and seeing its valuable impact on others.

If you find work that you love, you are good at, and that you are being paid for, you may find yourself feeling satisfied but useless. In this case, you aren’t working on something the world needs, but likely being compensated for your work and enjoying what you do.

If you find work that you love, you are good at, and that the world needs, you may find yourself feeling delighted but uncompensated. In this case, you aren’t working on something that world pays for, but you enjoy what you do and do it well. Fulfillment without wealth.

If you find work that you love, you can be paid for, and that the world needs, you may find yourself feeling excited but uncertain. In this case, you aren’t good at what you do, but you are being paid for something useful, and you love it. Purpose without proficiency.

It is not difficult to think of situations and phases in your life where you might not need to optimize for every dimension. For example, after a financially successful career, it is fairly easy to imagine why a person might optimize around work that ignores the need to be paid. For a retiree, the space between passion and mission might look ideal.

Finding Balance

Ikigai might sound like the right way to talk to students or young professionals in your life about their professional focus. But I would argue that no matter where you are in your career, you should take the time to be intentional about your professional choices and ask yourself these four questions.

Ikigai. It might be the key to a long & healthy life.

Stanford CS 007: Personal Finance for Engineers (Reviews & Reflection)

For those looking for the course material, I’ve posted the slides for all 10 sessions on a parallel site: http://cs007.blog

On September 26th, I had the great pleasure of officially kicking off a brand new course at Stanford University, “Personal Finance for Engineers“.  The course was offered through the Computer Science department (CS 007), but was also open to undergraduate & graduate students of any major.

How quickly the quarter went. On December 6th, I gave the 10th and final lecture of the seminar. Grades were submitted by December 18th, and course evaluations were summarized and provided to lecturers by December 20th.

In the interest of learning & transparency, I thought I’d post some of the feedback here, as well as summarize a few of my own reflections on the seminar.

Summary Results: Learning Goals

Out of the 93 students who took the course, it looks like 69% (64) left feedback on the course.  The following charts and material are provided anonymously by Stanford University.

The learning goals for the course were as follows:

  1. Expose students to a wide range of personal finance topics.
  2. Provide students with both practical & theoretical frameworks to make financial decisions.
  3. Build confidence in students on how to approach real life financial decisions.
  4. Provide students with content that will encourage discussions with family and / or friends.

Overall, the student feedback on these four areas were fairly consistent. A majority felt the course achieved these goals “extremely well” (highest ranking), with a large minority giving the course “very well” for these goals.The individual comments left by students seemed to confirm these results. A few samples:

Q: What skills or knowledge did you learn or improve?

“I literally knew nothing about personal finance, but just being exposed to this material helped me ask the right questions to myself and my parents.”

“Everything — I’m a financial manager on the row and a senior, but knew next to nothing about finances. This was super super helpful.”

“I improved on a great deal in this class. From understanding behavioral finance. to deciding whether or not to rent/buy, this class truly taught me about personal finance and more.”

Summary Results: Instruction & Organization

One of the elements I underestimated when proposing this class was the amount of time it would take to prepare an 80 minute lecture every week. Converting what previously had been a 60-minute talk into a 10 seminar course proved to be a significant time commitment (one of the reasons you haven’t seen any posts on this blog since the course started).

As a result, I was particularly concerned about what the feedback would be to the course material, since most of it was new. Fortunately, the results look positive.

Individual Feedback: Student Recommendations

One of the most telling results from teaching a course at Stanford are the individual recommendations that students are asked to give about a course to future students.

Q: What would you like to say about this course to a student who is considering taking [CS 007] in the future?

These reviews confirm how much students want to learn and engage around personal finance topics. The desire is there, the fundamental problem is that few schools offer any curriculum to fulfill it.

If you are wondering, Review #12 is my Mom’s favorite.

Data: What sessions did students value most?

Stanford allows faculty to add supplementary questions to the student feedback form. I asked students specifically to name three sessions that they found most valuable, and to name a session they found least valuable.

The results were interesting. Investing was far away the seminar students found the most valuable, with compensation, real estate and debt following.

Investing 28
Compensation 16
Real Estate 12
Debt 10
Financial Planning & Goals 7
Bonus: Crypto, VC & Derivatives 6
Behavioral Finance 5
Savings & Budgeting 4
Net Worth 2

When students were asked which session was the least valuable, there were far fewer votes to count. Still, it was interesting that despite being one of the favorites, “Real Estate” was also one of the least favorites. Reading the comments, it seems as if some students felt like real estate was too far in the future to be relevant to their current situation. The students who enjoyed it clearly enjoyed the section on how to make the decision between renting & buying.

Real Estate 7
Behavioral Finance 5
Debt 3
Compensation 2
Bonus: Crypto, VC & Derivatives 2
Savings & Budgeting 2
Financial Planning & Goals 1
Net Worth 1
Investing 0

It is worth noting that 8 students actually put down that all of the sessions were valuable, so I think it is fair to say that the content was well received.

Final Thoughts & Reflections

As part of developing this course, I chose to post the slides from every seminar online within a couple of days of teaching the class. My goal was to get as many eyes as possible on the content, to ensure there were no mistakes and to get advice on places to improve it.

There was only one session that received several corrections, and that was the “Real Estate” seminar. A special thank you to those of you on Twitter who helped me improve  & correct this content.

Top requests that I received for the next time I teach the class:

  • PDF versions of the slides
  • Voice over version of the slides
  • Video of the lectures

I likely should have done all of these in 2017, but I was a bit nervous about doing this with a brand new course & course material.

The most important reflection I have on this quarter is a sincere feeling of gratitude to Stanford University for allowing me to teach this course. Mehran Sahami, the Associate Chair for Education in the Computer Science department, sponsored the course, and without him it would not have been possible. A special thank you is also due to Greylock Partners, who supported my efforts to teach this course this year.

I also would like to thank the 93 students who took the course and provided excellent feedback along the way. The course was originally opened to only 50 students, and it was incredibly gratifying to see so many students request an exception to take the class during the Fall Quarter.

If you have additional feedback or thoughts about the course, and how to broaden the reach of financial education, please feel free to reach out with comments on Twitter or LinkedIn.

Stanford CS 007: Personal Finance for Engineers (Kickoff)

Update: For those looking for full course material, I’m posting it on a parallel site:
http://cs007.blog

Yesterday, I had the great pleasure of officially kicking off a new course at Stanford University, “Personal Finance for Engineers“.  The course is offered through the Computer Science department (CS 007), but is open to undergraduate & graduate students of any major.

Personal Finance for Engineers

 

It was a packed room, and I was delighted. In fact, I was delighted for three reasons.

First, I love teaching. In an unexpected coincidence, the room my course was assigned, 200-034, is the same room that I taught CS 198 for the CS 106 Section Leaders over 20 years ago as a graduate student. It was the home of CS 198 for many years. To see it filled with students again was wonderful.

Second, the level of student engagement has been outstanding. Originally set for a maximum of 50 students, I expanded the enrollment to 75, and with waitlist interest the total number of students easily went over 100. For a new course without a track record on campus, I was delighted to see so many students interested in the topic.

Third, the topic is incredibly important to me.  Those of you who have been following my efforts around personal finance education know that I care deeply about the topic. Over the past 7 years, I’ve given talks at dozens of companies like Facebook, LinkedIn, Twitter & Dropbox, hoping to better educate and inspire employees to learn more about personal finance and make better financial decisions.

I’m hoping this class can amplify those efforts even further.

Making Personal Finance Education Open

I feel grateful to Stanford University and the Computer Science Department for supporting this effort, and I hope that by making the material public, we can help get higher quality education about personal finance to as many students as possible.

My hope is that by circulating this material, more people will engage to give feedback on the content, make suggestions for improvement and continue to improve the material and the class.

After every class, I’ll be posting the slides for the session up on Slideshare. The materials from the first class, “Introduction,” are now available.

As the introductory session, I focused the seminar on three topics:

  1. Why the topic of Personal Finance is worth studying?
  2. Real data from a survey of students enrolled in the class.
  3. Full syllabus for the topics that will be covered during the course.

Student Survey Data

The second topic is based on 10 questions I asked every student in the class to complete before the start of the first session. It is hardly a scientifically representative student survey, but I wanted to ground some of the initial discussion of financial topics with data about their own experiences & expectations.

73 students completed the survey. It’s worth sharing the results of the 10 questions here:

A few data points worth sharing:

Question 1: A little over 50% of the class are either graduating seniors or graduate students. Only 14% are freshman or sophomores.

Question 2: Approximately 3/4 of the class (76%) had a “magic number” in mind when asked about how much wealth would define success for them. While the most common answer fell between $10M-$100M, the range spread from $20,000 to $15B. It was truly a blank field in the survey, so students typed in whatever number came to mind, and it started the process of open & honest discussion on why students picked the number they did.

Question 3: 92% of the students reported that they had either “some” or “quite a bit” of knowledge about the finances of their parents or guardians. Given the selection bias inherent in who signed up for this course (or even what type of students end up at Stanford), it’s hard to assign deep meaning to this result, but this was a class of students who clearly had received some meaningful exposure to financial decisions at home.

Question 6: 92% of students in the class do not expect to be responsible for any student loans after graduation. This was the most surprising result to me, based on both overall market data and my own personal experience .

I have two possible hypotheses to explain the result of Question 6. (1) The selection bias for enrollment in the class might explain part of the result. It is possible that the type of students who are most willing to sign up for a class on personal finance are not burdened by student loans.  (2) It is possible that the financial aid policies of the premier schools, like Stanford, have been highly effective in lowering the number of students requiring loans dramatically. For families with household income below $125,000, tuition is waived, and 71% of families with up to $245,000 receive scholarship assistance. (In fact, 34% of families making over $245,000 also get scholarship assistance.)

Since the syllabus was not shared in advance, Question 10 gave me a clear read of the expectations and hopes students had coming into the class. Not surprisingly, the students were, for the most part, very pragmatic. They are looking for information about compensation & job offers, the stock market, real estate and how to maximize their earning power during their careers.

Feedback

Throughout the next few months, I’ll be posting the course material in the hopes of receiving both corrections and ideas for improvement. If there are topics or material out there worth formalizing into the curriculum, I want to know about them.

Best way to reach me about the course will be through twitter @adamnash

Thank you in advance for your help.