Free vs. Getting Paid

by Krishna on July 8, 2007

In a previous post on making your hobby count, I mentioned that when you start making money, the focus shifts from you to your customers. There are 2 logical objections to a statement like that:

Objection 1: When you start earning money for something, isn’t it about you at that point?

It is definitely true that you are benefiting from a commercial activity. But unless you produce something that others need, there will be no money flowing in. Your ideas about your product are incidental to its success or failure — the only thing that matters is whether your customers like it.

Now, there are persons and companies (like Steve Jobs and Apple) whose idea of a product closely matches with that of their customers. But that need not be the case. And if there is a conflict between your idea and what customers expect, you have to be willing to change your idea, not expect the customers to change their wants or needs.

That is why incremental product design works. You identify a customer need. You build something. Customers start using it and/or provide feedback. If you are wise, you will modify the application to suit their needs. The cycle of listening to customer feedback and development continues and your product gains momentum in the market place.

This concept is true of every job, even if you are not in product design. If you are getting paid, the money comes from the customers of your company or organization. Although the company’s owners pay the salaries, it really comes from your customers. If your job does not do anything to help your customers, it is actually contributing to reducing the potential revenues for your company and indirectly affecting what you could be paid.

For example, a recruiter is not really hiring a resource to meet a project manager’s needs; he is hiring the best resource that can make a product better and more attractive to customers. A secretary at the front desk is not there simply to take calls or receive visitors; she can be an ambassador of the company to create a positive influence on potential employees, customers and partners.

If a company’s executives, managers and employees are not customer-oriented, that company will die. No questions about that. It does not matter how big the company is or how brilliant its people are. If customers do not want what the company produces, die it must. That is market reality.

Objection 2: If you are not earning money for something, does it mean that you are not producing any value for others?

Doing free work does not mean you are not producing any value. In fact, open source is all about producing value and giving it away for free. But here is the thing: When you do something for free, it is not necessary to produce anything that someone else values.

You can work on whatever you want. You can spend as much time as you want. You can do 99% of the work and quit without producing anything. You can produce something that solves a problem in a totally inefficient manner. You can even decide to re-create something that has already been done by someone else, just because it is fun.

Since nobody is paying the bills, you have no obligation to anyone. You can do anything you want, within reason and social/legal norms.

Examples abound. People spend a lot of time, effort and money collecting things from stamps to baseball cards. Although sometimes, these activities can be profitable, most of the time they aren’t and people don’t do it for the money anyway. Many people spend a lot of time playing sports and games. Although playing sports is good for health, the reason most people do it is for enjoyment, not for the health benefits.

Why this concept matters?

  • Many creative people find it difficult to work at a day job because many of their ideas are frequently shot down by customers. My opinion: It doesn’t matter. You have a duty to provide the best ideas you can to your customers and argue for them passionately, but ultimately it is the customer’s decision. It is their money on the line and they have to make the decision that they are most comfortable with. Whether the customer’s decision is ultimately right or wrong (based on the market reaction) is simply irrelevant.
  • Once again, your boss does not pay your salary. Your customers do. Your obligation, whatever your role in the organization, is to meet the needs of your customers. Structure the way you work to provide maximum value to your customers.
  • When you do something that you are not getting paid for, other people’s opinions do not matter. You can always listen to people’s suggestions and what they do in a similar situation. But such input should be non-binding and only followed if it makes sense for you. This frees you to do what your heart wants and what your mind feels is right. It avoids unnecessary pressure to meet someone’s expectations of what you should do. This is not just for hobby projects, but for any activity you do.
  • Do you keep worrying about what other people will think about your actions? Are they paying you? If not, quit caring about them now.

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