Competing Against Luck: The Story of Innovation and Customer Choice

by Clayton M. Christensen

“Correlation is enough,”2 then-Wired editor in chief Chris Anderson famously declared in 2008. We can, he implied, solve innovation problems by the sheer brute force of the data deluge. Ever since Michael Lewis chronicled the Oakland A’s unlikely success in Moneyball (who knew on-base percentage was a better indicator of offensive success than batting averages?), organizations have been trying to find the Moneyball equivalent of customer data that will lead to innovation success. Yet few have. Innovation processes in many companies are structured and disciplined, and the talent applying them is highly skilled. There are careful stage-gates, rapid iterations, and checks and balances built into most organizations’ innovation processes. Risks are carefully calculated and mitigated. Principles like six-sigma have pervaded innovation process design so we now have precise measurements and strict requirements for new products to meet at each stage of their development. From the outside, it looks like companies have mastered an awfully precise, scientific process. But for most of them, innovation is still painfully hit or miss. And worst of all, all this activity gives the illusion of progress, without actually causing it. Companies are spending exponentially more to achieve only modest incremental innovations while completely missing the mark on the breakthrough innovations critical to long-term, sustainable growth. As Yogi Berra famously observed: “We’re lost, but we’re making g...

other. As Nate Silver, author of The Signal and the Noise: Why So Many Predictions Fail—But Some Don’t, points out, “ice cream sales and forest fires are correlated because both occur more often in the summer heat. But there is no causation; you don’t light a patch of the Montana brush on fire when you buy a pint of Häagen-Dazs.” Of course, it’s no surprise that correlation isn’t the same as causality. But although most organizations know that, I don’t think they act as if there is a difference. They’re comfortable with correlation. It allows managers to sleep at night. But correlation does not reveal the one thing that matters most in innovation—the causality behind why I might purchase a particular solution. Yet few innovators frame their primary challenge around the discovery of a cause. Instead, they focus on how they can make their products better, more profitable, or differentiated from the competition. As W. Edwards Deming, the father of the quality movement that transformed manufacturing, once said: “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? For me, this is a neat idea. When we buy a product, we essentially “hire” something to get a job done. If it does the job well, when we are confronted with the same job, we hire that same product again. And if the...

Who would have imagined that a service that makes travelers pay to stay in a stranger’s spare bedroom would be valued at more than Marriott, Starwood, or Wyndham Worldwide? Airbnb did it. The videos that Sal Khan made to teach math to his young cousin were, by his description, “cheaper and crappier” than many other educational videos already online, but they now enable millions of students all over the world to learn at their own pace.

The foundation of our thinking is the Theory of Jobs to Be Done, which focuses on deeply understanding your customers’ struggle for progress and then creating the right solution and attendant set of experiences to ensure you solve your customers’ jobs well, every time. “Theory” may conjure up images of ivory tower musings, but I assure you that it is the most practical and useful business tool we can offer you. Good theory helps us understand “how” and “why.” It helps us make sense of how the world works and predict the consequences of our decisions and our actions. Jobs Theory5, we believe, can move companies beyond hoping that correlation is enough to the causal mechanism of successful innovation. Innovation may never be a perfect science, but that’s not the point. We have the ability to make innovation a reliable engine for growth, an engine based on a clear understanding of causality, rather than simply casting seeds in the hopes of one day harvesting some fruit.

Why is success so hard to sustain? That question nagged at me for years. In the early years of my career, I had the opportunity to work closely with many companies that were in trouble, first as a consultant for Boston Consulting Group and then as the CEO of my own company, CPS Technologies, a company I founded with several MIT professors to make products out of a set of advanced materials they had developed. And I witnessed firsthand how a lot of smart people were unable to fix the problems of once-great companies. At that same time, I watched the rise of a local Boston company, Digital Equipment Corporation (DEC), as it became one of the most admired in the world. Whenever you read explanations about why it was so successful, inevitably its success was attributed to the brilliance of the company’s management team. Then about 1988 Digital Equipment fell off the cliff and began to unravel very quickly. When you then read explanations about why it had stumbled so badly, it was always attributed to the ineptitude of the management team, the same folks running the company who had earned unfettered praise for so long.

In the mid-1990s, two consultants from Detroit asked if they could visit my office at Harvard Business School to learn more about my then newly published theory of disruptive innovation. Bob Moesta and his partner at the time, Rick Pedi, were developing a niche business advising bakeries and snack-food companies on developing new products that people would predictably buy. As we discussed the theory of disruption, I could see that it predicted very clearly what the established companies in the market would do in the face of an impending disruption from small bakers and snack-food companies. In that regard, it offered a clear statement of cause and effect. But as we talked, it became apparent that the theory of disruption did not provide a roadmap for their clients. The theory of disruption does not offer a clear and complete causal explanation of what a company should do offensively to be successful: if you do this and not that, you will win. In fact, I realized that even if a company has the intent to disrupt a vulnerable incumbent, the odds of creating exactly the right product or service to achieve that are probably less than 25 percent. If that. For years, I’d been focused on understanding why great companies fail, but I realized I had never really thought about the reverse problem: How do successful companies know how to grow? It wasn’t for months that I finally had an answer. Moesta shared with me a project for a fast-food chain: how to sell more milk shakes. The cha...

People hired milk shakes for two very different jobs during the day, in two very different circumstances. Each job has a very different set of competitors—in the morning it was bagels and protein bars and bottles of fresh juice, for example; in the afternoon, milk shakes are competing with a stop at the toy store or rushing home early to shoot a few hoops—and therefore was being evaluated as the best solution according to very different criteria. This implies there is likely not just one solution for the fast-food chain seeking to sell more milk shakes. There are two. A one-size-fits-all solution would work for neither.

In fact, Unilever’s dilemma helped me understand why one of the most important principles in innovation—what causes customers to make the choices they do—doesn’t seem to get traction with most organizations. Here’s how it played out: Inspired by our milk shake insights, my daughter Ann and I sat in our kitchen thinking about what job we might hire margarine to do. In our case, it was often hired to wet the popcorn just enough for the salt to stick. But not nearly as well as the better-tasting butter. So we headed into the field to our local Star Market to see if we could learn more about why people buy this substitute for butter. We were immediately struck by the overwhelming variety of products available. There were something like twenty-one different brands of margarine right next to its nemesis, butter. We thought we understood the basic benefits of margarine: with its lower fat content, it might have been considered healthier at the time.2 And it was cheaper than butter. Yes, those twenty-one options were slightly different, but those differences seemed focused only on improving an attribute—percentage of fat—that was irrelevant to any job we would hire margarine to do. As we stood there watching which choices people made, we couldn’t quite figure out why people would choose one over the other.

Most of the world’s most successful innovators see problems through a different lens from the rest of us. Why didn’t Hertz come up with a Zipcar-like product first? Kodak came close to creating a kind of Facebook product long before Mark Zuckerberg did. Major yogurt manufacturers understood that there might be a demand for Greek yogurt well before Chobani founder Hamdi Ulukaya launched what is now a $1 billion business. AT&T introduced a “picture phone” at the 1964 World’s Fair, decades before Apple’s iPhone. Instead of looking at the way the world is and assuming that’s the best predictor of the way the world will be, great innovators push themselves to look beyond entrenched assumptions to wonder if, perhaps, there was a better way. And there is.

To understand how revolutionary Pasteur’s contributions were, consider the previously popular ideas that attempted to explain why people got sick. For nearly two thousand years, the medical profession believed that four different bodily fluids—blood, phlegm, yellow bile, and black bile—dominated the health and moods of people. When they were in harmony, all was right with the world. When they were out of sync, people fell ill or into “bad humor.” The theory was known as humorism. Doctors were never quite certain what caused imbalance among these humors—ideas ranged from seasons to diet to evil spirits. So they experimented by trial and error to restore the necessary harmony of fluids—often with now seemingly barbaric methods such as bloodletting, which at the time was said to remedy hundreds of diseases. Sometimes, people got better. But most of the time, they got worse. And doctors were never sure why. By the nineteenth century, people began to blame disease on “miasmas” or “bad airs” that floated around dangerously. As hare-brained as it sounds today, “miasma theory” was actually an improvement over humorism because it spawned sanitary reforms that had the effect of removing real disease agents—bacteria. For example, in 1854, when cholera gripped London, the miasma explanation inspired massive, state-sponsored clearing of the air by draining cesspools. A physician of the time, John Snow, was able to isolate the pattern of new cholera cases and to conclude that new cases ...

Why was Pasteur so successful, after hundreds of years of searching for explanations for the mysteries of human disease? Put simply, it was because Pasteur’s work helped develop a theory—germ theory—that described the actual causal mechanisms of disease transfer. Before Pasteur, there were either crude and untestable guesses or statements of broad correlation without an underlying causal mechanism. Pasteur’s work demonstrated that germs were transmitted through a process: microorganisms, too small to see with the naked eye, that live in the air, in water, on objects, and on skin. They can invade hosts (in this case, humans) and grow and reproduce within those hosts. Identifying the process by which people get sick allowed the development of ways to prevent its spread—in effect to interrupt that process, most notably through personal and social hygiene measures. We all owe Pasteur a debt of enormous gratitude, but his contribution was far greater than even the monumental direct descendants of his work—such as pasteurization and penicillin. He helped fundamentally change our understanding of biology and played a critical role in the rapid evolution of medicine from an art to a science, saving millions of lives in the process. Shifting our understanding from educated guesses and correlation to an underlying causal mechanism is profound. Truly uncovering a causal mechanism changes everything about the way we solve problems—and, perhaps more important, prevents them. Take, for ...

When was the last time you got into your car and worried about whether it would start? The good news is that it’s probably been longer than you can remember since that prospect crossed your mind. But as recently as the 1980s, that wasn’t the case. There were, certainly, plenty of decent cars coming out of Detroit, but there were also a worrying number of lemons, cars that never quite seemed to work properly. No sooner had a technician repaired or replaced one component that had failed in a lemon, than another and then another seemed to follow suit. Multiple system failures conspired to make complete repair impossible. It was a frustrating situation for both manufacturers and buyers. From one point of view, it’s not surprising that lemons were common. A typical car contains nearly thirty thousand individual parts in all. Many of these are prebuilt—like the starter motor or the seats. Still, a typical auto manufacturing line will receive around two thousand unique parts from several hundred different suppliers, arriving from as many as seventeen different countries. The complexity of taking so many things from so many different sources and turning them into a working car is a miracle in itself. Indeed, for years the explanation for poor quality cars was that there is inherent randomness in manufacturing. You can’t possibly get everything right, all the time. Much the same way companies think about innovation now. Manufacturers soldiered on, trying to fix the problem as best ...

As long as Toyota is continually identifying “anomalies” in the manufacturing process, every single defect is seen as an opportunity to make the process better. There are, in effect, a set of rules that ensure that this happens. For example, an employee must never add value to a part until it is ready to be used in the next step of adding value. It must be done in the same way, every time. That way managers know, definitely, that the value-adding step worked with the next step in the process. That creates an environment of repeated scientific experimentation. Each time it’s done the same way constitutes a test of whether doing it that way, to those specifications, will result in perfection every time. For Toyota, the theory was embodied in the set of processes they developed to lead to defect-free manufacturing. Each activity can be seen as an individual if-then statement: “If we do this, then that will be the result.” Through this theory of manufacturing, the quality movement was born. As a consequence, the Americans took what they’d learned from their Japanese competitors to heart and the US automobile industry today churns out very reliable cars. Innovation, in a very real sense, exists in a “pre–quality revolution” state.1 Managers accept flaws, missteps, and failure as an inevitable part of the process of innovation. They have become so accustomed to putting Band-Aids on their uneven innovation success that too often they give no real thought to what’s causing it in t...

Over the years, I’ve come to the conclusion that good theory is what has been missing in the discussions about how companies can create successful innovations. Is innovation truly a crapshoot? Or is innovation difficult because we don’t know what causes it to succeed? I’ve watched so many smart, capable managers wrestle with all kinds of innovation challenges and nagging questions, but seldom the most fundamental one: What causes a customer to purchase and use a particular product or service? We believe Jobs Theory, at last, provides an answer.

Second, the idea of a “circumstance” is intrinsic to the definition of a job. A job can only be defined—and a successful solution created—relative to the specific context in which it arises. There are dozens of questions that could be important to answer in defining the circumstance of a job. “Where are you?” “When is it?” “Who are you with?” “While doing what?” “What were you doing half an hour ago?” “What will you be doing next?” “What social or cultural or political pressures exert influence?” And so on. Our notion of a circumstance can extend to other contextual factors as well, such as life-stage (“just out of college?” “stuck in a midlife crisis?” “nearing retirement?”), family status (“married, single, divorced?” “newborn baby, young children at home, adult parents to take care of?”), or financial status (“underwater in debt?” “ultra-high net worth?”) just to name a few. 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. The emphasis on the circumstance is not hair-splitting or simple semantics—it is fundamental to the Job to Be Done. In our experience, managers usually don’t take this into account. Rather they typically follow one of four primary organizing principles in their innovation quest—or some composite thereof: Product attributes Customer characteristics Trends Competitive response The point isn’t that any of these categories...

Many wonderful inventions have been, unwittingly, built only around satisfying a very general “need.” Take, for example, the Segway, a two-wheeled, self-balancing electric vehicle invented by Dean Kamen. In spite of the media frenzy around the release of Kamen’s “top secret” invention that was supposed to change transportation forever, the Segway was, by most measures, a flop. It had been conceived around the need of more efficient personal transportation. But whose need? When? Why? In what circumstances? What else matters in the moment when somebody might be trying to get someplace more efficiently? The Segway was a cool invention, but it didn’t solve a Job to Be Done that a lot of people shared. I see them from time to time in tourist spots around Boston or in our local mall, but especially compared with the prelaunch hype, very few people felt compelled to pull the Segway into their lives.

Helping me feel like a good dad is not a Job to Be Done. It’s important to me, but it’s not going to trigger me to pull one product over another into my life. The concept is too abstract. 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. The jobs I am hiring for are those that help me overcome the obstacles that get in the way of making progress toward the themes of my life—in specific circumstances. The full set of Jobs to Be Done as I go through life may roll up, collectively, into the major themes of my life, but they’re not the same thing.

Consider some of the most recent entrepreneurial success stories through the lens of a Job to Be Done. Take Airbnb, for example. Airbnb could be reduced to its function—providing a place to stay when traveling. On that level, it’s competing against hotels. And by traditional measures of quality in the hotel industry, Airbnb is a far inferior option. Who would pay to stay on an air mattress on the floor of a stranger’s apartment—or sleep in a stranger’s spare bed—rather than stay in the privacy of their own hotel room? It turns out, lots of people. People weren’t hiring Airbnb only because it’s a place to stay. They were hiring Airbnb because having a place to stay allows them to be someplace so they can participate in something in which they want to be part—and because it offers a more authentic local experience than a cookie-cutter, one-size-fits-the-world hotel chain. Airbnb initially identified a Job to Be Done in cofounder Brian Chesky’s own life. As a new college graduate in San Francisco, Chesky could barely afford his own rent, let alone find the fees to attend a local design conference. When he realized that all the hotels in the area were sold out—and that there must be other aspiring designers with the same struggle he had—he came up with the idea to “rent” three air mattresses in his apartment to help fund his own conference attendance. He could imagine himself as one of those air mattress renters if he found himself in the same circumstances in another city. He...

Here’s one example to illustrate the point. When a smoker takes a cigarette break, on one level he’s simply seeking the nicotine his body craves. That’s the functional dimension. But that’s not all that’s going on. He’s hiring cigarettes for the emotional benefit of calming him down, relaxing him. And if he works in a typical office building, he’s forced to go outside to a designated smoking area. But that choice is social, too—he can take a break from work and hang around with his buddies. From this perspective, people hire Facebook for many of the same reasons. They log onto Facebook during the middle of the workday to take a break from work, relax for a few minutes while thinking about other things, and convene around a virtual water cooler with far-flung friends. In some ways, Facebook is actually competing with cigarettes to be hired for the same Job to Be Done. Which the smoker chooses will depend on the circumstances of his struggle in that particular moment.

Because Aristotle’s was the accepted lens on the universe, centuries of medieval scientists and thinkers went to great lengths to make epicycles work. It wasn’t until the sixteenth century, with one simple but profound observation, that Renaissance astronomer Nicolaus Copernicus reframed our view of the universe. The planets revolved not around the earth, but around the sun. Finally, understanding that provided a foundation for some of the most important advances in history and the foundation for modern astronomy and calculus. Of course, it took eighteen centuries for someone like Copernicus to see and articulate the flaws in Aristotle’s logic. And even he died without knowing that the world would accept he was right. Changing a well-established view of the world rarely happens overnight—and even when it happens, it still takes time to refine and perfect the right new perspective. In the world of innovation, many companies are stuck in a world of creating “epicycles”: elaborate approximations, estimations, and extrapolations. Because we gather, fine-tune, and cross-reference all manner of data, it seems like we should be getting better and better at predicting success. But if we fail to understand why customers make the choices they make, we’re just getting better and better at a fundamentally flawed process. Without the right understanding of the causal mechanism at the center of the innovation universe, companies are trying to make sense of the universe revolving around ...

“We were frustrated and struggling with our inability to grow,” he says now, “and focusing on the Jobs to Be Done felt like a no-brainer.” What had to change at SNHU as a consequence? “Pretty much everything,” LeBlanc recalls, and on two different tracks corresponding to the two distinct jobs. Instead of the second-class-citizen status the online portion of the university had been given since its inception, LeBlanc and his leadership team made it their focus. They moved the small online recruitment and administration team two miles away to new offices in a former mill yard in Manchester—a classic “disruptor” positioning that allowed the online team to grow unfettered by the physical and structural limitations of the traditional university policies and procedures. Then LeBlanc and his team led a session of about twenty of the top online faculty and administrators and charted out the entire admissions process—from first inquiry to first class—on a whiteboard. “It looked like a schematic from a nuclear submarine!” he says. The team circled all the hurdles that SNHU was throwing up—or not helping to overcome—in that process, with an eye toward the unique job of online learners, their unique circumstances, and the functional, social, and emotional dimensions of the job that were important to them. And then, one by one, they eliminated those hurdles and replaced them with experiences that would perfectly satisfy this job. There were literally dozens and dozens of decisions that ...

That realization helped Moesta and his team begin to understand the struggle these potential home buyers faced. “I went in thinking we were in the business of new home construction,” recalls Moesta. “But I realized we were instead in the business of moving lives.” With this understanding of the Job to Be Done, dozens of small, but important, changes were made to the offering. For example, the architect managed to create space in the units for a classic dining room table by reducing the size of the second bedroom by 20 percent. The company also focused on helping buyers with the anxiety of the move itself, which included providing moving services, two years of storage, and a sorting room space on the premises where new owners could take their time making decisions about what to keep and what to discard without the pressure of a looming move. Instead of thirty pages of customized choices, which actually overwhelmed buyers, the company offered three variations of finished units—a move that quickly reduced the “cold feet” contract cancellations from five or six a month to one. And so on. Everything was designed to signal to buyers: we get you. We understand the progress you’re trying to make and the struggle to get there. Understanding the job enabled the company to get to the causal mechanism of why its customers might pull this solution into their lives. It was complex, but not complicated. That, in turn, allowed the housing company to differentiate its offering in ways comp...

Walkman cassette player was temporarily put on hold when market research indicated that consumers would never buy a tape player that didn’t have the capacity to record and that customers would be irritated by the use of earphones. But Morita ignored his marketing department’s warning, trusting his own gut instead. The Walkman went on to sell over 330 million units and created a worldwide culture of personal music devices.

You’ve spotted potential customers—consumers who are so unhappy with the available solutions to a job they very deeply want to solve that they’re going to great lengths to create their own solution. Whenever you see a compensating behavior, pay very close attention, because it’s likely a clue that there is an innovation opportunity waiting to be seized—one on which customers would place a high value. But you won’t even see these anomalies—compensating behavior and cobbled-together workarounds—if you’re not fully immersed in the context of their struggle.

Harvard Business School alum Rick Krieger and some partners decided to start QuickMedx, the forerunner of CVS MinuteClinics, after Krieger spent a frustrating few hours waiting in an emergency room for his son to get a strep-throat test. CVS MinuteClinic can see walk-in patients instantly and nurse practitioners can prescribe medicines for routine ailments, such as conjunctivitis, ear infections, and strep throat. Because most people don’t want to go to the doctor if they don’t have to, there are now more than a thousand MinuteClinic locations inside CVS pharmacy stores in thirty-three states.

What are the important, unsatisfied jobs in your own life, and in the lives of those closest to you? Flesh out the circumstances of these jobs, and the functional, emotional, and social dimensions of the progress you are trying to make—what innovation opportunities do these suggest? If you are a consumer of your own company’s products, what jobs do you use them to get done? Where do you see them falling short of perfectly nailing your jobs, and why? Who is not consuming your products today? How do their jobs differ from those of your current customers? What’s getting in the way of these nonconsumers using your products to solve their jobs? Go into the field and observe customers using your products. In what circumstances do they use them? What are the functional, emotional, and social dimensions of the progress they are trying to make? Are they using them in unexpected ways? If so, what does this reveal about the nature of their jobs?

What are they really trying to accomplish and why isn’t what they’re doing now working? What is causing their desire for something new? One simple way to think about these questions is through storyboarding. Talk to consumers as if you’re capturing their struggle in order to storyboard it later. Pixar has this down to a science: as you piece together your customers’ struggle, you can literally sketch out their story: Once upon a time . . . Every day . . . One day . . . Because of that, we did this . . . Because of this, we did that . . . Finally I did . . . You’re building their story, because through that you can begin to understand how the competing forces and context of the job play out for them. Airbnb’s founders clearly understood this. Before launching, the company meticulously identified and then storyboarded forty-five different emotional moments for Airbnb hosts (people willing to rent out their spare room or entire home) and guests. Together, those storyboards almost make up a minidocumentary of the jobs people are hiring Airbnb to do. “When you storyboard something, the more realistic it is, the more decisions you have to make,” CEO Brian Chesky told Fast Company. “Are these hosts men or women? Are they young, are they old? Where do they live? The city or the countryside? Why are they hosting? Are they nervous? It’s not that they [the guests] show up to the house. They show up to the house, how many bags do they have? How are they feeling? Are they tired? At tha...

The moments of struggle, nagging tradeoffs, imperfect experiences, and frustrations in peoples’ lives—those are the what you’re looking for. You’re looking for recurring episodes in which consumers seek progress but are thwarted by the limitations of available solutions. You’re looking for surprises, unexpected behaviors, compensating habits, and unusual product uses. The how—and this is a place where many marketers trip up—are ground-level, granular, extended narratives with a sample size of one. Remember, the insights that lead to successful new products look more like a story than a statistic. They’re rich and complex. Ultimately, you want to cluster together stories to see if there are similar patterns, rather than break down individual interviews into categories.

As many of the executives we interviewed have told us, when you hit upon a job, it just makes intuitive sense. It feels true. A genuine insight, as neuromarketing expert Gerald Zaltman, a colleague at Harvard Business School, says, is a thought that is experienced as true on conception. When you have an insight, you don’t have to convince yourself that it’s important or powerful. You just know. The key to getting hired is to understand the narrative of the customer’s life in such rich detail that you are able to design a solution that far exceeds anything the customer themselves could have found words to request. In hindsight, breakthrough insights might seem obvious, but they rarely are. In fact, they’re fundamentally contrarian: you see something that others have missed. But as our next chapter will illustrate, uncovering a Job to Be Done is only the first step. You are selling progress, not products. In order to create a solution that customers actually want to hire—and hire repeatedly—you have to see the full context of customers’ Jobs to Be Done and the obstacles that get in their way.

New products succeed not because of the features and functionality they offer but because of the experiences they enable. If you don’t have a preteen girl in your life, you may not understand how anyone can consider paying more than a hundred dollars for a doll. But I’ve done it. Multiple times. That doesn’t even count what we’ve spent on extra clothing and accessories. I think it would have been cheaper for me to buy clothing for myself. My daughter Katie, and many of her friends, coveted pricey American Girl dolls when they were growing up. Check out Craigslist ads right after the holidays—you’ll find a shocking number of parents eager to purchase secondhand or homemade American Girl clothing to supplement their daughter’s Christmas present. By one estimate, the typical American Girl Doll purchaser will spend more than six hundred dollars in total. To date, the company has sold 29 million dolls and racks up more than $500 million in sales annually. What’s so special about an American Girl doll? Well, it’s not the doll itself. They come in a variety of styles and ethnicities and they’re lovely, sturdy dolls. But to my eye, they look similar to dolls that children have played with for generations. American Girl dolls are nice. But they aren’t amazing. In recent years Toys“R”Us, Walmart, and even Disney have all tried to challenge American Girl’s success with similar dolls (Journey Girls, My Life, and Princess & Me)—at a fraction of the price—but to date, no one has made a ...

American Girl dolls are nice. But they aren’t amazing. In recent years Toys“R”Us, Walmart, and even Disney have all tried to challenge American Girl’s success with similar dolls (Journey Girls, My Life, and Princess & Me)—at a fraction of the price—but to date, no one has made a dent. American Girl is able to command a premium price because it’s not really selling dolls. It’s selling an experience. When you see a company that has a product or service that no one has successfully copied, like American Girl, rarely is it the product itself that is the source of the long-term competitive advantage, something American Girl founder Pleasant Rowland understood. “You’re not trying to just get the product out there, you hope you are creating an experience that will do the job perfectly,” says Rowland. You’re creating experiences that, in effect, make up the product’s résumé: “Here’s why you should hire me.” That’s why American Girl has been so successful for so long, in spite of numerous attempts by competitors to elbow in. My wife, Christine, and I were willing to splurge on the dolls because we understood what they stood for. American Girl dolls are about connection and empowering self-belief—and the chance to savor childhood just a bit longer. I have found that creating the right set of experiences around a clearly defined job—and then organizing the company around delivering those experiences (which we’ll discuss in the next chapter)—almost inoculates you against disruption. D...

IKEA doesn’t focus on selling to any particular demographically defined group of consumers. IKEA is structured around jobs that lots of consumers share when they are trying to establish themselves and their families in new surroundings: “I’ve got to get this place furnished tomorrow, because the next day I have to show up at work.” Other furniture stores can copy IKEA’s products. They can even copy IKEA’s layout. But what has been difficult to copy are the experiences that IKEA provides its customers—and the way it has anticipated and helped its customers overcome the obstacles that get in their way. Nobody I know relishes the idea of spending a day shopping for furniture when they really, really need it right away. It’s not entertainment, it’s a frustrating challenge. Factor in that your children will likely be with you when you’re shopping and it could be a recipe for disaster. IKEA stores have a designated child-care area where you can leave your children to play while you wind your way through the store—and a café and ice cream stand to offer as a reward at the end. Don’t want to wait to get your bookshelves home? They’re flat-packed in cartons that can fit in or on most cars.

With the lens of Jobs to Be Done, the Medtronic team and Innosight (including my coauthor David Duncan) started research afresh in India. The team visited hospitals and care facilities, interviewing more than a hundred physicians, nurses, hospital administrators, and patients across the country. The research turned up four key barriers preventing patients from receiving much-needed cardiac care: Lack of patient awareness of health and medical needs Lack of proper diagnostics Inability of patients to navigate the care pathway Affordability While there were competitors making some progress in India, the biggest competition was nonconsumption because of the challenges the Medtronic team identified. From a traditional perspective, Medtronic might have doubled down on doctors, asking them about priorities and tradeoffs in the product. What features would they value more, or less? Asking patients what they wanted would not have been top of the list of considerations from a marketing perspective. But when Medtronic revisited the problem through the lens of Jobs to Be Done, Monson says, the team realized that the picture was far more complex—and not one that Medtronic executives could have figured out from pouring over statistics of Indian heart disease or asking cardiologists how to make the pacemaker better. Medtronic has missed a critical component of the Job to Be Done.

So Medtronic adjusted not only its marketing efforts, but also the services it provided to directly target potential patients. For example, in conjunction with local cardiologists, Medtronic organized heart-health screening clinics across the country—providing prospective patients with free, direct access to specialists and high-tech equipment without having to go through an overwhelmed GP first. The question of paying for a pacemaker and the attendant medical services was no small concern. So Medtronic created a loan program to help patients pay for the pacemaker procedure. The company initially assumed that patients might be drawn to loans that actually expired upon the patient’s death, so that they were not saddling the family with the burden of debt—the emotional and social component of their Job to Be Done. And, as the Medtronic team learned from patients themselves, that was what they often wanted. But friends and family wanted something different: they tended to rally around a patient to find the money necessary. In those cases, the patient was more likely simply to need a bridge loan until those funds could be gathered. Medtronic made sure that the loan process was not daunting for the family: a loan is typically approved within two days, requiring minimum paperwork and entailing no asset mortgage. The experience of navigating the complex web of health care in India could be overwhelming for both patients and their families. So the company began to work with local ...

Making that possible involved creating relationships with several partners who helped Medtronic accomplish customers’ jobs. “Through the assessment of Healthy Heart for All, Medtronic understood the need for partners in different stages of the patient care pathway who can be a strong support in removing the barriers to treatment access,” says Dasgupta. “In this case, partners with capabilities in financing, administration of loans, screening and counselling of patients played a major role. With programs like Healthy Heart for All, Medtronic is delivering greater value to patients, healthcare professionals and hospitals. And it is this value which brings true differentiation where product differentiation may not be easy to demonstrate.”

By contrast, one company that clearly understands the stakes is Uber. In the last several years, few companies have captured the media’s attention like Uber. In my opinion, Uber has been successful because it’s perfectly nailed a Job to Be Done. Yes, Uber can often offer a nice car to take you from point A to point B, but that’s not where it’s built its competitive advantage. The experiences that come with hiring Uber to solve customers’ Jobs to Be Done are better than the existing alternatives. That’s the secret to its success. Everything about the experience of being a customer—including the emotional and social dimensions—has been thought through. Who wants to have to outmaneuver other poor schlubs on the same street corner who are trying to hail a cab? You don’t want to either pay for a car service to wait outside your meeting or be at its mercy when you’re finally ready to call it to come back and get you. With Uber, you simply push a few buttons on your mobile phone and you know that in three minutes or seven minutes a specific driver will arrive to pick you up. Now you can relax and just wait. You don’t have to worry if you have enough cash in your wallet or fear that if you swipe your credit card in that taxi machine, you’ll get a call from your bank wondering if you’ve recently made purchases in some state you’ve never even been to. Calling an Uber has even more potential to ease your anxieties about getting into a cab alone. With Uber there’s a record of your req...

There is a tool that helps you avoid leaving your product or service vulnerable to customers who hire it for the wrong reasons. Done perfectly, your brand can become synonymous with the job—what’s known as a purpose brand. When I list these brands, you will surely instantly know what job they’ve been hired to do: Uber TurboTax Disney Mayo Clinic OnStar Harvard Match.com OpenTable LinkedIn And one of my personal favorites, Jack Bauer. When you need to save the world in twenty-four hours, Jack Bauer is your man. A product that consistently creates the right experiences for resolving customers’ jobs should speak to the consumer: “Your search is over, pick me!” If you need to furnish the apartment you just rented or outfit your daughter’s dorm room, you better hope there’s an IKEA nearby. IKEA has become a purpose brand for “Help me furnish my apartment today.” Purpose brands play the role of communicating externally how the “enclosed attributes” are designed to deliver a very complete and specific experience. A purpose brand is positioned on the mechanism that causes people to purchase a product: they nail the job. A purpose brand tells them to hire you for their job. The reward for perfectly performing a job is not brand fame or brand love—though that may follow—but rather that customers will weave you into the fabric of their lives. Because purpose brands integrate around important Jobs to Be Done rather than conform to established bases of competition, purpose brands frequ...

On the surface, the Mayo Clinic is organized around the specialties of the doctors, like many other health organizations. But really, the main organizing principle is a process to get the right things in the right sequence to get the job done. When you think of the word “process” you might instantly conjure images of a manufacturing assembly line or a bureaucratic standard. But processes touch everything about the way an organization transforms its resources into value: the patterns of interaction, coordination, communication, and decision making through which they accomplish these transformations are processes. Product development, procurement, market research, budgeting, employee development and compensation, and resource allocation are all accomplished through processes. Helping customers have a delightful experience using your product is made up of processes. What information do we need to have in order to decide what to do next? Who is responsible for each step? What do we prioritize over other things?

Processes are invisible from a customer’s standpoint—but the results of those processes are not. Processes can profoundly affect whether a customer chooses your product or service in the long run. And they may be a company’s best bet to ensure that the customer’s job, and not efficiency or productivity, remains the focal point for innovation in the long run. Absence of a process, as is the case with most traditional hospitals, is actually still a process. Things are getting done, however chaotically. But that’s not a good sign. W. Edwards Deming, father of the quality movement, may have put it best: “If you can’t describe what you are doing as a process, then you don’t know what you are doing.”

Toyota wasn’t really worried that it would give away its “secret sauce.” Toyota’s competitive advantage rested firmly in its proprietary, complex, and often unspoken processes. In hindsight, Ernie Schaefer, a longtime GM manager who toured the Toyota plant, told NPR’s This American Life that he realized that there were no special secrets to see on the manufacturing floors. “You know, they never prohibited us from walking through the plant, understanding, even asking questions of some of their key people,” Schaefer said. “I’ve often puzzled over that, why they did that. And I think they recognized we were asking the wrong questions. We didn’t understand this bigger picture.” It’s no surprise, really. Processes are often hard to see—they’re a combination of both formal, defined, and documented steps and expectations and informal, habitual routines or ways of working that have evolved over time. But they matter profoundly. As MIT’s Edgar Schein has explored and discussed, processes are a critical part of the unspoken culture of an organization.1 They enforce “this is what matters most to us.” Processes are intangible; they belong to the company. They emerge from hundreds and hundreds of small decisions about how to solve a problem. They’re critical to strategy, but they also can’t easily be copied. Pixar Animation Studios, too, has openly shared its creative process with the world. Pixar’s longtime president Ed Catmull has literally written the book on how the digital film co...

Intensive care medicine offers a perfect example. In 1952 surgical pioneer Dwight Harken (who also happens to be the grandfather of coauthor Taddy Hall) noted that, while patients were routinely surviving increasingly complex surgical procedures, alarming numbers were dying in post-op recovery because patients were simply transferred from the surgical theater back to the general wards. There simply was no set of processes to ensure that fragile patients in critical care would receive the array of interventions required for survival. In short, the critical-care job had no owner within any one of the hospital’s established medical functions.4 The radical question Harken asked himself was, “How is it that everyone’s doing what they’re supposed to be doing, all of the hospital’s existing processes are functioning as designed—yet patients are dying?” Something wasn’t right. In posing the question, Harken created the space in his mind to continue to seek and find the answer. His ensuing insight enabled him to pioneer the concept of intensive care medicine as we know it, leading to the now ubiquitous intensive care unit that we’ve come to take for granted. This was only possible by the realization that the hospital’s preexisting processes were failing to deliver desired patient experiences—in this case, successful surgical recovery and survival. My colleague at Harvard Business School, Ethan Bernstein, spent two years away from HBS working with Elizabeth Warren to set up the Cons...

There is a second very important lesson in the Amazon story: there is a degree of ambidextrousness that enables processes to be both highly efficient and flexible. Jobs are not flexible—they have existed for years and years, even centuries. But how we solve for jobs varies over time. 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. Interestingly, this principle of a modular internal-process structure in which some pieces persist and others change is fundamental to what computer coders know as subroutines. The idea is that repeated functions—say basic arithmetic and trigonometry, for example—can be coded as subroutines and then essentially copied and pasted wherever that operation is called for in a different process. In programming, this is a very big deal. The right use of subroutines will decrease the cost of developing and maintaining a program, while simultaneously improving its quality and reliability. Solutions to common challenges are not invented ad hoc by programmer X or Y sitting at a desk in the basement. They’re universal, logical, and easily inserted in the right places. Amazon has imported what are essentially subroutines into its operating processes, too, and their power and efficiency are very apparent. This i...

In 2000 Ford announced a joint venture with Qualcomm to create Wingcast, a competitor to OnStar, with a promise to be in the market by 2003. Ford didn’t focus on the Job to Be Done as OnStar did, but rather suggested that Wingcast would be the next great thing in mobile connectivity. That never happened. Ford scrapped the project two years later. It simply couldn’t match the processes that GM had already developed to solve customers’ jobs through OnStar. Ford’s core mistake—of focusing on the product spec rather than the job spec—gets repeated all the time. In fact, the misstep is so common in the high-tech world, that Anshu Sharma of Storm Ventures has earned justifiable recognition for calling attention to the problem, which he has dubbed “stack fallacy.” Stack fallacy highlights the tendency of engineers to overweight the value of their own technology and underweight the downstream applications of that technology to solve customer problems and enable desired progress. “Stack fallacy is the mistaken belief that it is trivial to build the layers above yours,” Sharma says. It’s the reason that companies fail so often when they try to move up the stack. “They don’t have first-hand empathy for what customers of the product one level above theirs in the stack actually want. They’re disconnected from the context in which their product will actually be used.” Stack fallacy applies outside of the technology sphere, too. For instance, it might be easy for you to have a vegetable ...

People don’t want to buy a quarter-inch drill. They want a quarter-inch hole. It’s a profound insight—first popularized by legendary Harvard marketing professor Ted Levitt decades ago.1 Customers don’t want products, they want solutions to their problems. Peter Drucker, too, warned us that the customer rarely buys what the company thinks it sells him. There is, as these two sages pointed out, often a profound disconnect between the company and the customer. These are the two most important marketing insights of the last century—and I don’t know many marketers who would disagree. But the marketers’ actions tell us something different. We believe that most successful organizations are founded, de facto, on this perspective—essentially they identified a Job to Be Done. But after companies have successfully launched, the wisdom of Levitt and Drucker seems to fade away.2 Something shifts. Even in some of the best companies, the Job to Be Done that brought them success in the first place can somehow get lost in the shuffle of running and growing the business. They define themselves in terms of products, not jobs. And that makes a very big difference. Most consumers in North America and Western Europe know the brand V8. It is made from the juices of eight vegetables—hence the brand name, V8. It was introduced in 1933. Campbell’s Soup Company bought the V8 brand in 1948, and it still resides there. In the juice-and-drink aisle of our local supermarket, V8 is juxtaposed right up ag...

He explained that indeed the group had framed its task as differentiating Campbell’s product against all the other drinks and juices. But the concept inspired them instead to inquire whether there was a job that arises in people’s lives on occasion for which they might hire V8. They found one. Through the eyes of one of his customers, it went something like this: When I was old enough and moved away from home, I promised my mother that I would always eat my vegetables. But I am a busy man. As I peel this stupid carrot and boil that limp spinach and wonder why in the world Popeye likes it so much, I now rue the day that I promised my mother that I would do this. It takes so much time to prepare this food that tastes awful. Then I realized that if I drink a V8 every day, I can call my mother while driving my car and drinking my vegetables, and report that I am eating my vegetables, just as I promised. When seen through a Jobs lens, V8 need not compete against Diet Coke and cappuccino. It can compete against vegetables! And just as the milk shake wins the game of commuting hands down against bananas and bagels, V8 wins hands down against peeling carrots, boiling spinach, and flossing celery strings out of your teeth. The management team quickly changed the advertising to juxtapose V8 against peeling and boiling carrots in the life of a busy man. My visitor later reported that in less than a year, V8 sales had quadrupled. Competing against apple juice is tough. Competing again...

By contrast, consider recent success stories like OpenTable, Salesforce.com, Airbnb, or enduring successes such as craigslist or IKEA. Each of these businesses is very clearly organized around a distinct Job to Be Done and each has enjoyed sustained success with minimal competition. It’s a totally different game. This is not a new phenomenon. As Ted Levitt pointed out in the pages of Harvard Business Review decades ago, the railroad industry did not decline because the need for passenger and freight transportation declined. That need actually grew, but cars, trucks, airplanes, and even telephones stepped in to handle that job nicely. The railroads were in trouble, Levitt wrote back in 1960, “because they assumed themselves to be in the railroad business rather than in the transportation business.”4 In other words, the railroads fell into the trap of letting the product define the market they were in, rather than the job customers were hiring them to do. They organized and tracked and measured themselves as if they were in the business of selling drills, not quarter-inch holes.

As data about operations broadcasts itself loudly and clearly, it’s all too easy—especially as the filtering layers of an organization increase—for managers to start managing the numbers instead of the job.6 A great illustration of this is the way public schools in America teach so their students will pass the requisite tests because the government depends on schools hitting certain measured standards. Or in medicine, consider how doctors often treat symptoms, rather than getting to the cause of the problem. High blood pressure, for example, is a symptom of several different diseases. But most drugs for people who struggle with high blood pressure focus on getting those numbers down, rather than curing what’s causing them in the first place. Companies do this, too. They manage the numbers. Think about the correlation between earnings per share and the price of your shares in the market. If a company goes into the market and repurchases some of its own shares, it can improve the earnings per share and the stock price often goes up. But it’s done absolutely nothing to make the company more innovative or more efficient. The number went up. Period.

The New York Times offers a good illustration. There are two customers who matter to the Times: readers and advertisers. In the case of readers, there are lots of jobs that arise in their world—and the Times tries to do more and more jobs for the same set of customers. For example: Help readers unwind at the end of the day. Provide readers with up-to-date news. Help readers become informed. Help readers fill their time productively. But with each additional job that the Times solves, it finds itself up against a competitor who focuses only on that job—and does it very well. The Economist is a great way to feel informed with one weekly briefing, rather than having to spend time on getting informed every day. Nothing’s simpler than turning on the television to relax in the evening—with many more choices about what you want to watch. The Metro newspaper that readers get for free on the subway helps readers fill their time productively on their commute, and so on. Suddenly the Times has a handful of competitors—in addition to other mainstream media—who are solving its customers’ jobs better than the Times can. It’s no surprise that so many newspapers have found themselves struggling to survive in recent years. They weren’t focused around a job. By contrast, Deseret News Publishing Company, which I’ll discuss in depth in the next chapter, has staged a stunning turnaround by reorienting its traditional newspaper along a very distinct Job to Be Done.

To describe this job, they borrowed an acronym from the publishers of the Dallas Morning News, PICA: “Perspective, Insight, Context, and Analysis.” Readers were looking for all these things after an event had already happened and been reported on. In other words, there was still a job focused on helping readers understand the meaning and relevance of a news event after it became known to the public. But that was only the functional part of the job. The emotional part of the job for the Deseret News then layered on top of the functional job and helped readers connect those issues to their deeper interests around their families and their faith. “What the Washington Post is to DC politics, we want to be for the American family,” Gilbert says.

Distributed decision making: Employees throughout the organization are empowered to make good decisions that align with the job, and to be autonomous and innovative. Resource optimization: The jobs focus shines a light on which resources are aligned against what matters most and which are not, and enables them to be rebalanced accordingly. Inspiration: Solving a customer’s job is inherently inspiring to individuals in an organization, as it enables them to see how their work enables real people to make progress in their lives. Better measurement: With a focus on the job, people will naturally seek to measure and manage to more customer-centric metrics. Finding the right way to articulate the job your company is in business to solve—and driving this deeply into your culture—can be difficult and takes real work, but the benefits are worth it.