How to compete against luck
10 takeaways from Christensen’s latest book
Clayton Christensen is one of the foremost authorities on innovation and growth. He has an insightful way of explaining deep strategic concepts and thus, whenever he launches a new book it is a must for us to get our hands on it immediately.
He recently published a new book: Competing against luck. In this book Christensen and his three other co-authors explain in depth the Job-to-be-done (JTBD) Theory: Understanding customers does not drive innovation success; understanding customer jobs does. The essential idea behind this is the following: when we buy a product, what we are actually doing is ‘hiring’ it to get a job done. People ‘hire’ the same product to carry out different jobs, depending on the circumstances.
What can we learn from the book?
I want to highlight 10 takeaways that, in our experience, are the most valuable tips from the book:
1.- Don’t be fooled: big data is not enough
Companies tend to accumulate masses and masses of data. But this data is not organized in a way that enables to reliably predict which ideas will be successful. Data may tell you that “72% percent of customers prefer version A over version B” or “this customer looks like that one”, but no data tells you why customers make those choices. Data won’t help to create any new successful innovation until we understand the ‘why’ behind those preferences. The value of the JTBD Theory lies not in explaining past successes, but in predicting new ones.
2.- Job-to-be-done = Progress (job) + circumstances
Christensen defines a Job as “the progress that a person is trying to make in a particular circumstance”. It´s key to understand why they make the choices they make. A Job isn’t just a set of functional dimensions, it has social and emotional dimensions too (This particular aspect of the Theory is very well described in the following article). An example of this is shown on the following figure: Brushing your teeth is not only brushing your teeth.
3.- We don’t “create” jobs; we discover them
There are five ways to uncover jobs: spotting jobs in your own life, finding opportunities in non-consumption, identifying workarounds, zoning in on things we don’t want to do, and noticing unusual uses of products.
4.- To ‘hire’ a new product/service, usually requires to ‘fire’ the old one
In order to hire your new solution, customers must fire the sub-optimal solution they were relying on (including firing the solution of doing nothing at all). The job has to have sufficient magnitude for people to be willing to change their behavior.
“What they hire — and equally important, what they fire — tells a story.” — Dr. Clayton Christensen
5.- New products succeed because of the experience they provide
Products don’t succeed because of the features and functionality they offer. Products that solve customers’ jobs are essentially helping them to overcome the obstacles that get in their way of making the progress they seek. Creating experiences and overcoming obstacles is how a product becomes a service rather than a product with features and benefits.
6.- Companies with a successful growth strategy are structured around their customers’ jobs
Many companies are structured around function, business units or geography. But those with a winning growth strategy are the ones organized around the job-to-be-done. This subtle organizational aspect confers quite a competitive advantage.
7.- There are clear benefits for a job-focused organization
When a company is focused in the customer JTBD, it is easier to empower the organization in decision-making. They are more agile, they align resources to what‘s most important, inspire people, unify their culture, and measure what matter most.
8.- Don’t forget about the job once the product succeeds
According to Christensen´s research and experience, it´s a common mistake to forget the focus on the job when your product becomes real and starts to gain success.
9.- Avoid moving from ‘Puzzle solvers’ to ‘number crunchers’
In the early stage of any JTBD uncover, managers are puzzle solvers: they work hard on uncovering the richness of it. But when they start having operational data (volume, profitability…) about products, clients, channels, etc. they start thinking about how to sell more products to existing customers. And they lose focus. They forget the reason that brought them success in the first place.
10.- The icing on the cake: the most important strategic marketing insights
Finally, Christensen borrows two ideas to summarize the JTBD theory: the famous “People don´t want to buy a quarter-inch drill; they want a quarter-inch hole” from Ted Levitt, and “the customer rarely buys what the company thinks it sells him” from Peter Drucker.
Christensen introduced the job-to-be-done long ago, but Competing against luck offers game-changing insights for any Executive that is looking for new revenue streams. From IGENERIS, we highly recommend it. Hope you enjoy it!