Competing Against Luck: The Story of Innovation and Customer Choice

by Clayton M. Christensen

Here is the fundamental problem: the masses and masses of data that companies accumulate are not organized in a way that enables them to reliably predict which ideas will succeed. Instead the data is along the lines of “this customer looks like that one,” “this product has similar performance attributes as that one,” and “these people behaved the same way in the past,” or “68 percent of customers say they prefer version A over version B.” None of that data, however, actually tells you why customers make the choices that they do.

If a company doesn’t understand why I might choose to “hire” its product in certain circumstances—and why I might choose something else in others—its data3 about me or people like me4 is unlikely to help it create any new innovations for me.

“If you do not know how to ask the right question, you discover nothing.” After decades of watching great companies fail over and over again, I’ve come to the conclusion that there is, indeed, a better question to ask: What job did you hire that product to do?

They were conceived, developed, and launched into the market with a clear understanding of how these products would help consumers make the progress they were struggling to achieve.

theory of disruptive innovation,1 which explains the phenomenon by which an innovation transforms an existing market or sector by introducing simplicity, convenience, accessibility, and affordability where complication and high cost have become the status quo—eventually completely redefining the industry.

As the team put all these answers together and looked at the diverse profiles of these people, another thing became clear: what these milk shake buyers had in common had nothing to do with their individual demographics. Rather, they all shared a common job they needed to get done in the morning.

But their tepid response made me wonder how many companies are operating within such fixed assumptions about how to think about innovation that it’s difficult to step back and assess whether they’re even asking the right questions.

Creating the right experiences and then integrating around them to solve a job, is critical for competitive advantage. That’s because while it may be easy for competitors to copy products, it’s difficult for them to copy experiences that are well integrated into your company’s processes.

What causes a customer to purchase and use a particular product or service?

We define a “job” as the progress that a person is trying to make in a particular circumstance.

The circumstance is fundamental to defining the job (and finding a solution for it), because the nature of the progress desired will always be strongly influenced by the circumstance.

What progress is that person trying to achieve?

What are the circumstances of the struggle?

What obstacles are getting in the way of the person making that progress?

Are consumers making do with imperfect solutions through some kind of compensating behavior?

How would they define what “quality” means for a better solution, and what tradeoffs are they willing to make?

But what’s important is that you focus on understanding the underlying job, not falling in love with your solution for it. For innovators, understanding the job is to understand what consumers care most about in that moment of trying to make progress.

What matters is not the bundle of product attributes you rope together, but the experiences you enable to help your customers make the progress they want to make.

If you can spot barriers to progress or frustrating experiences, you’ve found the first clues that an innovation opportunity is at hand.

Jobs Theory is an integration tool—a way to make sense of the complex amalgam of needs that are driving consumer choices in particular circumstances. It tells you which pieces of information are needed, how they relate to one another, and how they can be used to create solutions that perfectly nail the job.

A jobs lens changes what you see: the priorities and tradeoffs that customers are willing to make may look completely different, the competitive landscape shifts to a surprising cast of characters, and opportunity for growth appears where none might have seemed possible.

When you start with the assumption that you’re just altering what you already have created, or relying on broader industry-accepted category definitions, you may have already missed the opportunity to uncover the real job for consumers.

As we’ll discuss more later, it’s actually important to signal “this product is not for you” or they’ll come back and say it’s a crummy product.

While most companies spend the bulk of their market research efforts trying to better understand their current customers, important insights about jobs can often be gathered by studying people who are not buying your products—or anyone else’s—a group we call nonconsumers.

What they hire—and equally important, what they fire—tells a story. That story is about the functional, emotional, and social dimensions of their desire for progress—and what prevents them from getting there.

My wife may buy a new dress, but she doesn’t really consume it until she’s actually cut the tag off and worn it. It’s less important to know that she chose blue over green than it is to understand why she made the decision to finally wear it over all other options.

What has to get fired for my product to get hired?

Think of it this way: the job has to have sufficient magnitude to cause people to change their behavior—“I’m struggling and I want a better solution than I can currently find”—but the pull of the new has to be much greater than the sum of the inertia of the old and the anxieties about the new.

Ultimately, you want to cluster together stories to see if there are similar patterns, rather than break down individual interviews into categories.

Before a customer hires any new product, you have to understand what he’ll need to fire in order to hire yours. Companies don’t think about this enough. Something always needs to get fired.

New products succeed not because of the features and functionality they offer but because of the experiences they enable.

American Girl was so successful in nailing the Job to Be Done of both mothers and daughters that it was able to use its core offerings—and the loyalty they established—as a platform to expand into what might seem to be wildly diverse fields. Dolls, books, retail stores, movies, clothes, restaurants, beauty parlors, and even a live theater in Chicago, all of which Rowland actually had in mind before she launched the company.

the job spec is from the innovator’s point of view: What do I need to design, develop, and deliver in my new product offering so that it solves the consumer’s job well?

The reason why we are willing to pay premium prices for a product that nails the job is because the full cost of a product that fails to do the job—wasted time, frustration, spending money on poor solutions, and so on—is significant to us.

Creating experiences and overcoming obstacles is how a product becomes a service to the customer, rather than simply a product with better features and benefits.

Organizations that focus on making the product itself better and better are missing what may be the most powerful causal mechanism of all—what are the experiences that customers seek in not only purchasing, but also in using this product?

Purpose brands provide remarkable clarity. They become synonymous with the job. A well-developed purpose brand will stop a consumer from even considering looking for another option. They want that product. The price premium that a purpose brand commands is the wage that customers are willing to pay the brand for providing this guidance.

You can capture the relevant details of the job in a job spec, which includes the functional, emotional, and social dimensions that define the desired progress; the tradeoffs the customer is willing to make; the full set of competing solutions that must be beaten; and the obstacles and anxieties that must be overcome. The job spec becomes the blueprint that translates all the richness and complexity of the job into an actionable guide for innovation.

Talking to a live human being, within minutes or hours, is a completely different experience from arriving home after a long, hard day at work to find a big white envelope nestled among the junk.

The important thing is to be attached to the job, but not the way we solve it today. Processes must flex over time when a better understanding of customer jobs calls for a revised orientation. Otherwise you’ll risk changing the concept of the job to fit the process, rather than the other way around.

Customers don’t want products, they want solutions to their problems.

Data is always an abstraction of reality based on underlying assumptions as to how to categorize the unstructured phenomena of the real world. Too often, managers conveniently set this knowledge aside: data is man-made.

Data has an annoying way of conforming itself to support whatever point of view we want it to support.

With just one chapter being prefilled in, Intuit saw a noticeable uptick in the number of customers who actually completed the TurboTax interview, even when customers had to manually correct some of the data that was automatically filled in.