Competing Against Luck: The Story of Innovation and Customer Choice

by Clayton M. Christensen

Let me illustrate. Here I am, Clayton Christensen. I’m sixty-four years old. I’m six feet eight inches tall. My shoe size is sixteen. My wife and I have sent all our children off to college. I live in a suburb of Boston and drive a Honda minivan to work. I have a lot of other characteristics and attributes. But these characteristics have not yet caused me to go out and buy the New York Times today. There might be a correlation between some of these characteristics and the propensity of customers to purchase the Times. But those attributes don’t cause me to buy that paper—or any other product.

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.”

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.”

These innovations weren’t aimed at jumping on the latest trends or rolling out another new flavor to boost sales. They weren’t created to add more bells and whistles to an existing product so the company could charge customers more. 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. When you have a job to be done and there isn’t a good solution, “cheaper and crappier” is better than nothing. Imagine the potential of something truly great.

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.

As W. Edwards Deming is also credited with observing, every process is perfectly designed to deliver the results it gets. If we believe that innovation is messy and imperfect and unknowable, we build processes that operationalize those beliefs. And that’s what many companies have done: unwittingly designed innovation processes that perfectly churn out mediocrity. They spend time and money compiling data-rich models that make them masters of description but failures at prediction.

That experience made me realize that part of the problem is that we’re missing the right vocabulary to talk about innovation in ways that help us understand what actually causes it to succeed. Innovators are left to mix, match, and often misapply inadequate concepts and terminology designed for other purposes. We’re awash in data, frameworks, customer categories, and performance metrics intended for other purposes on the assumption that they’re helpful for innovation, too.

we will illustrate how the theory (which we’ll explain fully in the chapters ahead) can fundamentally improve innovation—making it both predictable and replicable through real-world examples of companies that consciously used Jobs to Be Done to create breakthrough innovations. The value of Jobs Theory to you is not in explaining past successes, but in predicting new ones.

After you’ve uncovered and understood the job, you need to translate those insights into a blueprint to guide the development of products and services that customers will love. This involves creating the right set of experiences that accompany your product or service in solving the job

Chapter Takeaways Disruption, a theory of competitive response to an innovation, provides valuable insights to managers seeking to navigate threats and opportunities. But it leaves unanswered the critical question of how a company should innovate to consistently grow. It does not provide guidance on specifically where to look for new opportunities, or specifically what products and services you should create that customers will want to buy. This book introduces the Theory of Jobs to Be Done to answer these questions and provide clear guidance for companies looking to grow through innovation. At its heart, Jobs Theory explains why customers pull certain products and services into their lives: they do this to resolve highly important, unsatisfied jobs that arise. And this, in turn, explains why some innovations are successful and others are not. Jobs Theory not only provides a powerful guide for innovation, but also frames competition in a way that allows for real differentiation and long-term competitive advantage, provides a common language for organizations to understand customer behavior, and even enables leaders to articulate their company’s purpose with greater precision.

The Big Idea The more we think we know, the more frustrating it becomes that we keep getting innovation wrong. But you don’t have to leave your fate to luck. Successful innovations don’t result from understanding your customers’ traits, creating jazzy new bells and whistles for your products, catching hot trends, or emulating your competitors. To elevate innovation from hit-or-miss to predictable, you have to understand the underlying causal mechanism—the progress a consumer is trying to make in particular circumstances. Welcome to the Theory of Jobs to Be Done.

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.

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 the first place.

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 practical question of what causes what. Theory has a voice, but no agenda. A theory doesn’t change its mind: it doesn’t apply to some companies or people and not to others. Theories are not right or wrong. They provide accurate predictions, given the circumstances you are in.

I believe that good theory is essential for effective management practice and the most powerful tool I can offer my students.

Because of the inherent complexity of jobs, insights from observing customers in their moments of struggle do not easily break down into bits of data that can be fed into spreadsheets to be analyzed. In practice, seeing a job clearly and fully characterizing it can be tricky. Jobs insights are fragile—they’re more like stories than statistics. When we deconstruct coherent customer episodes into binary bits, such as “male/female,” “large company/small company,” “new customer/existing customer,” we destroy meaning in the process. Jobs Theory doesn’t care whether a customer is between the ages of forty and forty-five and what flavor choice they made that day. Jobs Theory is not primarily focused on “who” did something, or “what” they did—but on “why.” Understanding jobs is about clustering insights into a coherent picture, rather than segmenting down to finer and finer slices.

We also choose things we can manipulate with familiar tools -- see Ackoff

One thought experiment we’ve found helpful to really grasp a job is to imagine you are filming a minidocumentary of a person struggling to make progress in a specific circumstance.

Jobs Theory is an integration tool. When you identify a struggle to make progress, you can begin to infer not only the practical but the critical unseen or unspoken social and emotional dimensions of the Job to Be Done.

But from a Jobs Theory perspective, the competition is seldom limited to products that the market chooses to lump into the same category. 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

But even if a theory doesn’t apply to some particular application, it’s still valuable because knowing when a particular theory doesn’t help explain something will allow you to turn to others to find better answers. That’s a hallmark of good theory. It dispenses its advice in if-then statements.

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.

Chapter Takeaways 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. The field of innovation is in need of better theory, especially for the foundational question “What causes a customer to purchase and use a particular product or service?” Jobs Theory answers this question by asserting that customers purchase and use (or “hire” in our jobs metaphor) products and services to satisfy jobs that arise in their lives. A job is defined as the progress that a customer desires to make in a particular circumstance. This definition is specific and important: Fully understanding a customer’s job requires understanding the progress a customer is trying to make in particular circumstances and understanding all of its functional, social, and emotional dimensions—as well as the tradeoffs the customer is willing to make. Once you understand the customer’s Job to Be Done, it brings into sharp relief the true competition you face to be hired. This provides critical information for how to innovate to make your solution more attractive than any competitor’s.

The Big Idea Jobs Theory is not just another framework or marketing approach, but a powerful lens that has driven breakthrough innovation and transformational growth in some of the world’s most successful organizations—in wildly diverse arenas. Jobs Theory transforms how you define the business you’re in, the size and shape of the market in which you compete, and who your competitors are. This enables you to see customers where there were none, ideas for solutions where there were only problems, and opportunity where you least expect it. Here’s how.

which in turn has allowed it to make major investments in infrastructure, provide award-winning working conditions for its employees, and keep tuition low for students (indeed, online students have had no tuition increases in the last four years). It has also allowed investment in continued cutting-edge innovations, such as SNHU’s $2,500-a-year competency-based program, in which students can earn a degree based on demonstrating competency in various subjects, rather than hours logged in classes or fulfilling the right number of requisite courses.

For example, nothing sounds less innovative than a cheese company rolling out yet another type of cheese. But Sargento cleared $50 million in its first year with its prepackaged ultrathin slices, driving enormous category growth and exceeding $150 million in year two. Why did this product thrive, when the vast majority of the other thirty-four hundred consumer packaged goods launched in the same year didn’t even survive their first twelve months in the market? Sargento’s ultrathin sliced cheese was solving a job consumers were struggling with: “How can I enjoy all of the delicious cheese experience that I love on my daily sandwich without the calories, fat, and guilt that come with it?” Jobs Theory, explains Rod Hogan, vice president of New Business Development at Sargento, “forces you to define the offering in the context of a very specific consumer struggle.

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Intuit cofounder Scott Cook was an early adopter of Jobs Theory—and his work has helped define and shape the theory. Within Intuit he refers to the “improvement in the customer’s life that matters most to him in selecting the product.” But we agree that we’re talking about the same thing: the progress a customer seeks in particular circumstances. He and I eventually went on to coauthor the first article to preview the Theory of Jobs to Be Done in Harvard Business Review2 (along with one of the coauthors of this book, Taddy Hall). This theory helped Intuit launch the wildly successful QuickBooks accounting software for the small business market—and has guided the company’s innovation strategy since.

Competitors were focused on making the best accounting software possible. Cook and his team focused on the job customers were trying to do.

A clear view of customers’ jobs means an organization should never overshoot what those customers are actually willing to pay for.

For far too long, companies have accepted that innovation success is just random and we’ve allowed ourselves failure rates that we wouldn’t tolerate in any other aspect of business. Innovation does not have to be the least successful thing that companies do.

Chapter Takeaways Organizations that lack clarity on what the real jobs their customers hire them to do can fall into the trap of providing one-size-fits-all solutions that ultimately satisfy no one. Deeply understanding jobs opens up new avenues for growth and innovation by bringing into focus distinct “jobs-based” segments—including groups of “nonconsumers” for which an acceptable solution does not currently exist. They choose to hire nothing, rather than something that does the job poorly. Nonconsumption has the potential to provide a very, very big opportunity. Seeing your customers through a jobs lens highlights the real competition you face, which often extends well beyond your traditional rivals.

The Big Idea So where are all these jobs just waiting to be discovered—and how do you find them? The solution lies not in the tools you’re using, but what you are looking for and how you piece your observations together. If you can spot barriers to progress or frustrating experiences, you’ve found the first clues that an innovation opportunity is at hand. We offer here a sampling of ways to uncover jobs: seeing jobs in your own life, finding opportunity in “nonconsumption,” identifying workarounds, zoning in on things you don’t want to do, and spotting unusual uses of products. Innovation is less about producing something new and more about enabling something new and important for customers. Here’s how job hunting works.

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. Jobs Theory is effective because it focuses you on the right complexity, breaking it down into elements you need to understand for successful innovation. It’s the difference between having a full, comprehensive narrative versus a few scattered frames of the movie, randomly selected as highlights. Jobs to Be Done tell the whole story.

As Amazon founder Jeff Bezos is fond of quoting, “Perspective is worth 80 I.Q. points.”

1. Finding a Job Close to Home

it.” Sony’s breakthrough 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.

If it matters to you, it’s likely to matter to others. Take the example of Khan Academy founder Sal Khan’s initial amateur YouTube videos to help explain math to his young cousin.

Done. Sheila Marcelo started Care.com, the online “matchmaking” service for child care, senior care, pet care, and so on, after struggling with her own child-care needs. It now boasts nearly 10 million members across sixteen countries, and revenues approaching $60 million, less than ten years after its founding.

2. Competing with Nothing

Once a company shakes off the shackles of category-based competition, the market for a breakthrough innovation can be much larger than might be assumed from the size of the traditional view of the competitive landscape. You won’t see nonconsumption if you’re not looking for it.

Kimberly-Clark already had a huge share of the market for adult incontinence products when it realized there might be opportunity it hadn’t seen before.

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.

Enter ING Direct, which saw the market through a new lens.

OpenTable, which is an online, real-time restaurant reservation service, was born out of a common workaround.

4. Look for What People Don’t Want to Do

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.

Arm & Hammer baking soda had been a staple in every American kitchen, an essential ingredient for baking. But in the late 1960s, management observed the diverse circumstances for which consumers grabbed that orange box off the shelf. They added it to laundry detergent, mixed it into toothpaste, sprinkled it on the carpet, or left an open box in the refrigerator, as well as other unusual uses. Until then, it hadn’t occurred to management that their staple product could possibly be hired for any job other than classic baking. But those observations led to a jobs-based strategy with the introduction of the first phosphate-free laundry detergent and a series of other highly successful new products, such as cat litter, carpet cleaner, air fresheners, deodorant, and so on.

“It really hit home for me—we’d designed everything in that room from a functional perspective, but we had completely overlooked the emotional score.”

Many companies fall into the trap of asking consumers what about their current offering they could tweak to make it more appealing. Faster? More colors? Cheaper? 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.

But in Goulait’s view, the “needs” being identified were too often limited exclusively to “functional” needs without taking into account the broader social and emotional dimensions of a customer’s struggle. “And the idea that in many cases emotional and social could be on the same plane as functional needs—and maybe even be a driver . . . ,” Goulait says. “For me that was the ‘aha!’ Let’s not separate those three things. They’re integrated. They are, in fact, the key to making a really successful product introduction.” Jobs to Be Done provided not just the language, but the construct—the idea that you have to understand and innovate around all three dimensions of a customer’s job. “We kind of knew that, but we didn’t have the construct and language to address it specifically and to really make it actionable.”