In its March issue, Wired featured an interview between Jeff Howe and Harvard Business School professor Clayton Christensen. At one point, Howe asked Christensen, "If you had to list some industries right now that are either in a state of disruptive crisis or will be soon, what would they be?" Christensen answers:
Journalism, certainly, and publishing broadly. Anything supported by advertising. That all of this is being disrupted is now beyond question.
This is neither new nor uplifting. Christensen made similar points last year, in a conversation with Nieman's Joshua Benton. Christensen's views are pretty stark, but I think his assessment of ad-supported media is entirely accurate.
Howe could have continued dissecting "disruption" as a topic, but he went on to ask about another of Christensen's passions: measuring one's life. Christensen says in part:
Many people think of management as cutting deals and laying people off and hiring people and buying and selling companies. That's not management; that's dealmaking. Management is the opportunity to help people become better people. Practiced that way, it's a magnificent profession.
Christensen then talks about what he calls "the Doctrine of New Finance". The concept is part of The Capitalist's Dilemma, a book he is working on now. Struck by the visible paradox of strong corporate balance sheets next to persistent national unemployment, Christensen observes:
We’ve encouraged managers to measure profitability based on a return on net assets, or return on capital employed. That encourages companies to liberate their capital, so they invest in efficiency innovations, which means they can make more money with fewer resources. But what the economy ultimately needs are empowering innovations—like the Model T, the transistor radio. Empowering innovations require long-term investments, which tie up capital for years and years. So companies are using capital to create more capital, and consequently the world is awash in capital but the innovations we need to advance aren’t there.
It's no secret that I like to write about disruption, and Christensen certainly leads the way on that topic. May he have equal or greater success changing the way we talk about management and corporate responsibility.
