Elon Musk says every company should maximize the 'curve of customer happiness' — here's what that means

• Elon Musk has some business advice for other companies: "Maximize the area under the curve of customer happiness."
• The Tesla CEO said that is the goal of his company, and other businesses should aim to do the same thing.
• The hill-shaped curve shows that with more options, like Tesla's option to "subscribe" to its self-driving capabilities, customers have more ways to be satisfied.
• Visit Business Insider's homepage for more stories.

Tesla's goal is to "maximize the area under the curve of customer happiness," CEO Elon Musk said in an earnings call on Wednesday.

He advised that it's "the kind of thing that all companies should try to do."

Musk said Tesla will offer its self-driving capabilities as a subscription service — in addition to the traditional, permanent option — for customers who didn't purchase it outright when they bought or leased their vehicles.

By giving customers additional choices, Musk said he is expanding its curve of customer happiness.

This curve is a hill-shaped line, with its peak being the height of customer happiness. Leading up to the peak are customers wishing for more choices, and leading down from the peak are customers overwhelmed with too many options.

As customers have different needs and wants, the philosophy behind the curve is that by maximizing the area under that curve, there is more room for customers to find satisfaction with a company or product.

"It's what results in long-term value creation," Musk said. "Our goal is always really to do the best thing for the customers."