Jobs to be Done: Theory to Practice Read online

  Why did you choose to go with Strategyn and ODI over other options?

  Prior to joining Church & Dwight and taking lead of the Arm & Hammer nutrition business, I led a business that sold anti-microbial actives and formulated products, and I was responsible for developing markets and new products. I first came across the ODI concept while reading The Innovator’s Solution, by Clayton Christensen. That book makes reference to your work and the concept of Jobs-to-be-Done, and that led me to read your book, What Customers Want. It was natural for me to decide that if I was going to do something to improve innovation, I might as well go to the people who wrote the book on it.

  We’re happy that you did. Let’s talk about the results. What surprising insights came out of the Strategyn/ODI research?

  The research helped on many fronts. First, it helped clarify in our minds that the customer is the dairy producer, not the nutritionist. Next, understanding that the “job” they were trying to get done had little to do with nutrition and was focused squarely on optimizing herd productivity. Then it was certainly eye opening to see how many desired outcomes the dairy producer is trying to satisfy in a given day, in a given month, in a given year. I think we identified over 165 different desired outcomes (well-constructed need statements). We homed in on optimizing dairy herd productivity, and when we started prioritizing the outcomes through quantitative research, the most surprising thing was how many opportunities there were, and how few of those opportunities were directly related to nutritional ingredients for the dairy producer. Our whole business is focused on supplying nutritional ingredients and supplements, so that was probably the most surprising thing.

  Scott, how would you describe the market strategy that Strategyn recommended based on the customer insights?

  Clearly the market strategy started with our collective recognition of whom we needed to target for value creation. Even though we don’t sell directly to the dairy producer, we need to make sure that we keep our eye on the dairy producer and the job they are trying to get done. We have relationships with various other components in the supply chain, but at the end of the day, we need to create value for the dairy producer.

  The second major focus was changing our messaging and how we speak about things—moving away from talking about product benefits and features and toward talking about outcomes, and linking our products to the outcomes they satisfied. The third focus was taking a look at the job map, which had 15 steps in it, and saying, “Let’s take a step back and look at where we can position ourselves in the marketplace that impacts the majority of these steps.”

  The other part of the market strategy is segmentation: recognizing that the normal demographic methods for segmenting customers, while helpful for sales resource prioritization, are not helpful for opportunity identification, and hence solution identification. One of the things I go back to, one of the surprising things that came out of the research, was that a large dairy or mega dairy can share many of the same unmet needs and outcomes as a small dairy. And geography wasn’t necessarily the determinant either: ultimately there were some key outcomes that decided what kind of segmentation there was. Thinking about that—the segments and how we position the business—has become an important part of our marketing strategy.

  How did the Outcome-Based Segmentation solution impact your market strategy?

  Outcome-Based Segmentation gave us a more realistic way to look at the market. Over time we had confused sales prioritization with real customer market segmentation. At the end of the day, we only have a certain number of salespeople, so we tend to want to call on the larger dairies, because if you get one of them, they have a measurable impact on your business. We just assumed that all those large dairies share certain needs, and that small dairies have completely different needs. The data showed that was not the case, so that absolutely was surprising.

  What other market strategy recommendations provided your team with immediate value?

  One of the key recommendations that we initially focused on was to go after the low-hanging fruit, to find out if and where our existing products addressed some of the most underserved outcomes that were identified. We basically got into a room, listed 165 of the outcomes on the wall, color coded the segmentation, and identified the 10 or 11 outcomes that all segments shared and identified as high priorities. We literally went through each one of our products and tried to see which outcomes those products could potentially help address.

  We then focused a lot on the redesign of our whole messaging. We took all our product literature and our website and redesigned and focused them on outcomes. Our whole marketing talk and speak turned to outcome based, and that is very prevalent now in our whole business. People talk about outcomes. Now you hear salespeople saying, “We need to position this in terms of an outcome a person is trying to satisfy.” So that is rewarding, to hear people starting to think that way. I think some of the basic elements of the recommendations we followed pretty quickly.

  There were several recommendations made around becoming a total solution provider to the dairy. We probably have been a little slower to respond on that, but it’s not ignored; it’s probably something I am spending more time on now, thinking about.

  Was there a reason the organization was ready for change?

  Yes. We had a product—a protective license product—that we had developed and launched. We spent seven years developing it based on hearing in the market that there was a need for it. I would argue and defend it as the best in the market, and we launched it to much fanfare. Then it kind of just did a ho-hum. So that example was fresh in our teams’ minds, and we could say, “What went wrong here?” It’s not the product development, and certainly not our marketing. It’s certainly not our company’s reputation, and it’s not our overall knowledge of who to call on, or our ability to access any of the particular decision makers. It’s just that we didn’t ask the right people the right questions. That was probably one of the easiest ways to start convincing people: we had just had a fresh example of a product innovation that was just lackluster.

  Of all the actions taken to date, which had the most impact on revenue?

  Clearly, changing our messaging helped us differentiate our products versus competitors’. Whenever you pick up a trade journal in our industry, you see a cow in an ad and virtually the same story: “We can help improve milk production, protein production, fat production, dry matter intake.” It doesn’t matter which ad you are looking at; it is virtually the same thing. So what we have been able to do is say, that’s not really what the people are focused on. It’s actually surprising when you think about it. Of the 165 outcomes that the dairy producer mentioned, not one of them identified any of those key points that you see in almost every one of the ads. So we didn’t necessarily have to go change our pricing or products or redesign or reformulate the products. The biggest impact was changing the messaging so people understood, “Oh that’s what that product can help me get done.”

  Can you describe how the market strategy implementation rolled out?

  By the end of 2013 we got all the results, and we spent the end of 2013 really going through the first stage of looking at our products, digesting the information, and asking ourselves, “Okay, how do we act on this data?” Second, we tried to understand how our products could address some of the underserved outcomes, and we started thinking about the segments and how we should change some of our sales conversations, based on what segments a customer might fall into. By the time 2014 rolled around, we had really started the wholesale change to be forward facing to the market—changing our positioning and our Web design and promotional literature. By the first quarter of 2014 and certainly by the second quarter of 2014, we were full on into repositioning how we go into the marketplace.

  How long did it take for you to start seeing results?

  I would say we started to see results almost immediately. You start seeing the results in terms of the conversations you are having, and then you start
seeing incorporation of products. We had a phenomenal 2014. Off the charts. The dairy economy helped—it was a factor in it. I think our execution, our messaging, and our positioning all contributed to an outstanding year.

  Can you share how the ODI-based market strategy impacted your revenue growth?

  I’ll say we grew revenue greater than 30% and the ODI process played a significant role in that growth. Every one of our products had double-digit growth.

  In addition, in January 2015, we made an acquisition of a business, Vi-COR, that got us into more species than just dairy. It brought a very nice complimentary product for us to use in dairy, but it also got us into the poultry and swine markets, which is exciting for the growth of our business. When we made this acquisition, the template I used to explain to our executive team why it made sense was generated from the ODI work. I was able to show them that here is a job map, and here are outcomes the dairy producer is trying to satisfy, and here is why Vi-COR’s products are going to help us with some of these key outcomes. Vi-COR also brings in a service component that helps address some areas that we identified as some of the top opportunities in dairies. I found that this small business was operating in a very important niche, providing a very important solution to dairy producers. I used the work from ODI to screen for acquisitions, and that work assisted in the acquisition.

  How did these successes impact the organization and you personally?

  Probably the biggest personal gratification I have is looking at my team and seeing that they are embracing the methodology. I think it helped them think more broadly about who we are as a business and what we do, and what opportunities are out there.

  How would you describe your experience working with Strategyn?

  It was terrific. I believe the agriculture nutrition industry was a little bit outside of where Strategyn normally works. All the same, you guys are great, professional, intelligent, right on time. Great communications—it was definitely really enjoyable to work with the group. And I speak for my whole team.

  That is always good to hear. Thank you. And just as a final question, is there anything else you would like us to share with the readers of this case study?

  That no one else in agriculture should try this! But more seriously, the thing that I would share is, once you get involved and you start to think about a market through this lens, the notion of defining your customer as a job executor, and then asking customers what job they are trying to get done instead of asking them what solutions they want is such a basic, simple, and obvious way to approach product development. It’s remarkable that companies just don’t do it more often. But I do understand why. It’s not trivial to do. I’ve come to appreciate that it’s not an easy exercise, but once you have gone through it, it’s so obvious – and powerful. It is obviously the right way to approach marketing and innovation.

  BOSCH

  Discovering hidden growth opportunities

  When the Robert Bosch Tool Company decided to enter the North American professional circular saw market, many challenges stood in the way of their success. Randall Coe, director of product development, noted that management had four key objectives in mind: “We wanted to (1) enter the market with a saw that reflected the high-quality image carried by the Bosch name, (2) compete effectively and outperform the products produced by DeWalt and other competitors in the U.S. market, (3) ensure our product would be carried by the big-box retailers, e.g., Home Depot and Lowe’s, and (4) price the resulting product at a competitive industry price point while yielding the desired profit margin.”

  There had not been much innovation in the circular saw market for many years, and it was perceived as both mature and commodity-like, so Bosch knew that success would depend on the company’s ability to uncover and inexpensively address market opportunities that others had missed.

  To identify opportunities for product innovation, the Bosch team targeted professional tradesmen (the job executors) who were responsible for cutting wood in a straight line (the Job-to-be-Done). They targeted roofers, framers, contractors, finish carpenters, plumbers and electricians.

  Through interviews with the professional tradesmen, the ODI practitioner dissected the Job-to-be-Done into its component parts through the use of a job map and worked to capture a complete set of approximately 85 desired outcome statements.

  Next, ODI-based quantitative research methods were employed. Through a controlled online survey, approximately 270 professional tradesmen rated each desired outcome statement for (i) its level of importance, and (ii) the degree to which it was satisfied, given the circular saws they were currently using. This data was used to run a variety of data analyses (Outcome-Based Segmentation, competitive analysis, etc.).

  Not surprisingly, the results showed that in the market on average (when looking at all 270 responses combined), there were no unmet needs. This meant that to discover unmet needs, Outcome-Based Segmentation practices were required. Strategyn’s Outcome-Based Segmentation methods revealed four segments of opportunity, one of which made a perfect target for Bosch. This hidden segment of opportunity, which was comprised of primarily finish and advanced carpenters, represented over 30 percent of all users. They were underserved because they made more finish and angle cuts and had to make frequent blade angle and blade height adjustments. The segmentation analysis and opportunity landscape for this segment clearly revealed that 14 of the customer’s approximately 85 desired outcomes were unmet with this segment of users.

  Knowing where to focus its efforts was the key to Bosch’s success, as it dramatically simplified idea generation.

  The innovation and the impact

  The team went through the list of 14 opportunities, systematically generating ideas that would better satisfy each underserved outcome. Coe reports, “We started by focusing on the underserved outcomes related to the cord and devised the Direct Connect™ cord system concept. This innovation, which connects the extension cord directly to the saw, reduces the chances that users will cut the cord or catch the plug on the material being cut when making a long cut while maintaining their ability to lower the tool from a ladder to the ground using the cord. This system also reduces repair costs and down time because if the cord gets cut, the user can simply grab another extension cord and continue working. Satisfying all these outcomes at the same time is what made this a true innovation.”

  “Next,” Coe says, “we focused on line-of-sight issues and devised a way in which the user can confirm that the cut is on track when starting the cut, while making the cut, and when approaching the end of the board. Designing a cutout in the table helped to better satisfy all of these underserved outcomes.” The team went on to address the remaining unmet outcomes, in all cases devising low-cost features that would dramatically improve customer satisfaction.

  Bosch successfully addressed the 14 underserved outcomes in the newly discovered segment with a new product—the CS20 circular saw—that successfully addressed each of them. Remarkably, Bosch accomplished this without increasing product cost—a prime management objective. This was largely due to the fact that the highly regarded Direct Connect™ system significantly cut product cost while adding customer value.

  Most successful new products and services improve customers’ satisfaction in areas of unmet needs by less than 10 percent, but concept testing revealed that the CS20 circular saw was projected to increase the level of customer satisfaction by approximately 38 percent (with total satisfaction levels rising from 63 to 87 percent).

  Before the saw was released, the Bosch team used these findings to help gain the support of two key distributors: Lowe’s and Home Depot. Given limited shelf space and a competitive market, Bosch had to convince them that the CS20 circular saw uniquely addressed a number of unmet customer needs and did so at a competitive price. The data made a convincing case, and Lowe’s and Home Depot requested that Bosch delay the release of the product by two months so that enough saws could be manufactured to meet the anticipated deman
d.

  Bosch successfully entered the North American market with what quickly became one of the top-selling and top-rated circular saws. Bosch’s innovations, which addressed cord and line-of-sight issues, resulted in a highly successful product launch and dramatic improvements in customer satisfaction. Improvements in handling, adjustments, and other functions only added to the new value created.

  Upon its introduction, the CS20 circular saw won accolades from Popular Science, being voted one of the top 100 innovative products of the year.

  ABBOTT MEDICAL OPTICS

  Discovering hidden growth opportunities

  Abbott Medical Optics, or AMO (formerly Advanced Medical Optics), is a leading provider of lenses, insertion systems, laser vision correction systems, and other devices for cataract and refractive surgical procedures.

  Historically a technology-based company, AMO recognized the need to improve its approach to service innovation in an effort to attract and retain customers through secondary service offerings. Angelo Rago, AMO’s senior vice president of global customer services, noted that a cycle of incremental service improvements had resulted in “me too” service delivery mechanisms and support services— services that looked just like AMO’s competitors’ offerings. Worse, Rago and his team recognized that sales were being lost to competitors due to poor customer service.