In this episode Urko Wood, with Reveal Growth Consultants, discusses how business-to-business (B2B) companies can grow in a predictable manner using a method — Jobs-To-Be-Done — which also sustains value and profitability.
Urko also has a free white paper, 3 Steps to Consistently Fill Your New Product Pipeline with Only Good Ideas, you may find quite beneficial for developing new products.
The discussion opens with the reality one can’t just prepare to do Jobs-To-Be-Done (JTBD) via a major in college. His initial contact with the method was with improving existing products and services. At the time it was not necessarily good at discovering new products and services that could be offered in new markets because the method was limited to existing products and services. Eventually he read an article in the Harvard Business Review and connected with Ulwick, the CEO and founder of Strategyn and became a part of his team from 2005 to 2012. From there Urko founded Reveal Growth Consultants, working mostly with small to midsize B2B companies.
The conversation switched to VOC (the Voice of the Customer). The problem with that approach is it tends to focus on products that are already in place. With JTBD the opportunities lie with unmet needs. And in line with that it is important to separate the need from the solution, per Theodore Levitt, because “customers don’t want to buy a drill, they want to buy a hole.” A laser may do a better job than a drill. The customer wants to get the job done!
The key is shifting from what we know how to do to what it takes to get the customer’s job done. The #1 reason for product failure is not understanding the customer’s needs. With JTBD the first goal is to discover the customer’s unmet needs.
In line with this Urko approaches the customer defining 7 key terms:
- Customer need
- Customer unmet needs
- A Market
- A Market segment
All terms need to be defined with the customer for innovation to occur. The client team must have a consistent definition of these terms.
Innovation is first discovering the customers unaddressed needs and then integrating ideas to address them. THE SEQUENCE IS CRITICAL! The need must be defined separate from any possible solutions. This increases the odds of achieving a breakthrough. Failure to put solutions first can create real problems. The example was given of the cell phone industry switching from analog to digital and being disrupted due to analog leaders focusing on solutions first. This also occurred in the image industry with the switch from film to digital. The flow then is to first discover the customer’s unmet needs then evaluate those needs with the client’s team using concepts such as strategic fit, time to market, relative advantage, etc., in order to win in the market place.
Innovation always comes before products in order to avoid being tied to existing products/services, e.g., an accounting consulting firm purchasing a digital security firm since most of their clients had that need.
Most growth comes from discovering unmet needs, eliminate phantom needs, and then matching solutions with the important unsatisfied needs.
The challenges of product management and innovation are often reflected in the company’s internal politics, diluting the focus on relevancy for the customer. In such situations it’s key to have an objective metric against which one can make good decisions. In other words, use the JTBD approach. JTBD uses market statistics to determine a prioritized list of needs, increasing the odds of success in terms of product development. The discussion may take some time and massaging the metrics give a good starting point rather than, say, the CEO’s pet idea.
To get this information the conversation turned to methodology. A simple place to begin is asking customers what they are trying to accomplish with your product or service. It’s important to be qualified in terms o knowing what questions to ask. If it turns out the customer’s needs are best met with new technologies your company lacks then it’s best for the CEO to set up a new group separate from existing ones in order to avoid to avoid being “contaminated” with existing methods that may not meet the customer’s needs.
The need to adapt and be disruptive is shown by the fact that most companies are bought out within 12 years and during that time they will have to reinvent themselves several times. Disruption is becoming the norm. Failure to do that can lead to disaster, e.g., Palm going under in the PDA/cell phone market. Funds were diverted to dividends that would have been better spent in JTBD.
To keep clients “on the same page” Urko work on alignment in terms of uncovering customer’s needs, determining how the customer measures success, and then determining how much of a solution can be put into a solution. The focus is on asking not only what customers want but what they want to avoid, e.g., safety issues with hand tools.
It’s important to avoid confusing needs with requirements. There should be a clear mapping between the two.
Urko refers to himself as an innovation guide, totally focused on serving his client who usually are dealing with a threat and need to grow by creating new value through differentiation. What is key is having everyone who will be involved at the kickoff meeting — getting everyone on board in terms of innovation. Because of potential change management issues it is best to create a culture of innovation so people aren’t attached to one particular solution. Modeling innovation throughout the company is critical, i.e., get a clear definition of the problem or solution needed before doing any design efforts. So when submitting and idea the presenter needs to identify:
- Who is the target customer?
- What’s the job they are trying to get done?
- Where are they struggling on that job?
- What’a the opportunity for value creation?
- What’s your idea going to do to mitigate or increase/create new value?
- What’s your evidence that shows it’s a problem?
- How broad is this issue in the market?
Gary referenced the similarity of this approach to the one presented with regards to implementing solutions in the 12 Steps to Flow, which has a supporting series of podcasts (WWC podcasts 0037, 0042, 0043, 0045, 0046, 0047, 0049, 0050, 0051, 0053, 0054, 0055).
Flow emphasizes the need for openness throughout the organization both vertically and horizontally when solving problems relating to innovation -always having a focus on the client’s problem that needs to be solved.
The value of JTBD and finding hidden markets was the next topic. It’s important to know what inputs to get and how to get them from target customers. Must know how to create the needs statements so that they are accurate and unambiguous, and validated in order to go into a survey of the representative sample of the target population to rate for how important it is and how satisfied are you with your ability to implement. With a sufficiently large population segmentation can be used to see if the same valuation is placed by a sufficiently large segment that it is worth one’s while to develop solutions for that segment because they are underserved. This is superior to demographics in terms of assessing shared values.
It’s all about being in the realm of causality rather than correlation.
Urko explains the criteria and mechanics of putting an accurate and valid survey together — it’s a specialty.
Surveys aren’t the first step – qualitative interviews are. It helps establish:
- the target customer
- what they want to accomplish
- what steps they have to go through
- what criteria for success
- and where do they struggle and why
Surveys don’t penetrate to this level of information. Surveys tend to focus on sales methods.
For more information contact Urko on
Urko also has a white paper, 3 Steps to Consistently Fill Your New Product Pipeline with Only Good Ideas that is quite beneficial to learn more about Jobs To Be Done
CHANGE MANAGEMENT WHITE PAPER LINK.
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