Competing Against Luck: The Story of Innovation and Customer Choice

by Clayton M. Christensen

toolbox full of theories that teach me not what to think but rather how to think.

Good theory is the best way I know to frame problems in such a way that we ask the right questions to get us to the most useful answers.

Embracing theory is not to mire ourselves in academic minutiae but, quite the opposite, to focus on the supremely pract...

crapshoot?

What causes a customer to purchase and use a particular product or service? We believe Jobs Theory, at last, provides an answer.

Defining the Job There is a simple, but powerful, insight at the core of our theory: customers don’t buy products or services; they pull them into their lives to make progress. We call this progress the “job” they are trying to get done, and in our metaphor we say that customers “hire” products or services to solve these jobs. When you understand that concept, the idea of uncovering consumer jobs makes intuitive sense. But as we have suggested, our definition of a Job to Be Done is precise—and we need to take a step back and unpack the elements to develop a complete theory of jobs.

Progress

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.

Functional, Social, and Emotional Complexity

What Isn’t a Job?

A company couldn’t create a product or service to help me feel like a good dad without knowing the particular circumstances in which I’m trying to achieve that.

but on “why.” Understanding jobs is about clustering insights into a coherent picture, rather than segmenting down to finer and finer slices.

Your Video Should Capture Essential Elements:

Clave para la clase

For innovators, understanding the job is to understand what consumers care most about in that moment of trying to make progress. Jobs Theory enables innovators to make the myriad, detailed tradeoffs in terms of which benefits are essential and which are extraneous to a new offering. Understanding the circumstance-specific hiring criteria triggers a whole series of important insights, perhaps most notably that the competitive field is likely completely different from what you might have imagined.

Netflix CEO Reed Hastings made this clear when recently asked by legendary venture capitalist John Doerr if Netflix was competing with Amazon. “Really we compete with everything you do to relax,” he told Doerr. “We compete with video games. We compete with drinking a bottle of wine. That’s a particularly tough one! We compete with other video networks. Playing board games.”

What each of those companies makes of that new perspective will determine how successful their new efforts will be in the long run. Because if you don’t know what you’re really competing with, how could you ever hope to create something that consumers will choose to hire over all other potential solutions?

Key

the kind that truly explains, predictably, what will cause what to happen—does not develop overnight. It has to be shaped, tested, and refined, and the context in which it does and does not apply must be understood.

We know, for example, that Jobs Theory is not useful if there is no real struggle for a consumer or the existing

solutions are good enough.

It’s not useful when the decision to be made relies almost entirely on a mathematical analysis, ...

Cost or efficiency is not a core element of a job. In those circumstances, there is not a complex bundle of social, emotional, and functional needs in search of progress. There are rational decisions to be made—and ones that can just as easily be made by a computer. A theory is essentially a proposition: we propose this set of processes will help develop innovations that will be successful. But if someone has a better set of processe...

While many in the business world associate the word “theory” with something purely academic or abstract, nothing could be further from the truth. Theories that explain causality are among the most important and practical tools business leaders can have.

Questions for Leaders Do you understand the real reason why your customers choose your products or services? Or why they choose something else instead? How do your products or services help your customers to make progress in their lives? In which circumstances are they trying to make that progress? What are the functional, emotional, and social dimensions of this progress? What is competing with your products and services to address these jobs? Are there competitors outside of those included in the traditional view of your industry?

What jobs are your customers hiring your products and services to get done? Are there segments with distinct jobs that you are inadequately serving with a one-size-fits-none solution? Are your products—or competitors'—overshooting what customers are actually willing to pay for? What experiences do customers seek in order to make progress—and what obstacles must be removed for them to be successful? What does your understanding of your customers’ Jobs to Be Done reveal about the real competition you are facing?

minidocumentary we discussed in chapter 2? You’re trying to capture the story of customers in their moments of struggle or desire for progress. 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. Jobs are all around us, but it helps to know where to look and how to interpret what you find. You have to have a job-hunting strategy. We offer here five ways to uncover jobs that might be right in front of you if you know what you’re looking for: seeing jobs in your own life, finding opportunity in nonconsumption, identifying workarounds, zoning in on things we don’t want to do, and spotting unusual uses of products. Here’s how that works:

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

Experiences and Premium Prices In my classroom I share an illustration with my students to highlight how to think about innovating around jobs. It’s just a simple representation, but it’s intended to underscore the point that although identifying and understanding the Job to Be Done is the foundation, it’s only the first step in creating products that you can be sure customers want to hire. Products that they’ll actually pay premium prices for. That involves not only understanding the job, but also the right set of experiences for purchase and use of that product, and then integrating those experiences into a company’s processes. All three layers—Uncovering the Job, Creating the Desired Experiences, and Integrating around the Job—are critical. When a company understands and responds to all three layers of the job depicted here, it will have solved a job in a way that competitors can’t easily copy.