Illuminating Innovation

1 April 2009 David Silverstein

For companies to fully realise the innovation process they need to be aware of all the factors involved, according to David Silverstein, Philip Samuel and Neil DeCarlo.

There are numerous factors involved in successfully applying the techniques and tools of innovation, especially if you are undertaking an innovation deployment on an organisational scale. But even if you are looking to solve one small problem—or just educating yourself about innovation techniques—the following information should be interesting and helpful.

First we will bring some needed focus to innovation’s often fuzzy front edge, making it much clearer and more actionable by exposing two concepts: jobs to be done and outcome expectations.

Focusing on innovation’s front edge

While a common definition of innovation is "introducing something new" or "coming up with the next big idea," we think of it as the act of generating more value for the customer and the business by fulfilling a job to be done better than anyone else.

A job to be done (JTBD) is the purpose for which customers buy products and services, such as buying sanitising soap to keep hands clean and germfree at work. If you can fulfil this JTBD for your customers better than your competitors, at a lower cost and with no harmful side effects, then you win market share. It is as simple as that.

Most corporations are preoccupied with cataloguing and improving their inventory of products and services. Instead of seeing customers who need to stay warm in winter (a JTBD), they are focused on their offerings—gas furnace heaters, space warmers, electric heaters, winter jackets, a more efficient heating syste, and so on. The problem with this thinking is that it is solution-centric, and it assumes that a company exists to provide better and better mousetraps, whatever those mousetraps may be.

Innovation is not about coming up with new or better stuff; it is about solving the problem of what to come up with in the first place. Most organisations are busy filing patents and making their products and services better, but what they really need to do is better address their jobs to be done, and their customers’ jobs to be done.

In the 1700s, customers told candle companies they wanted brighter, longer-lasting candles that produced less smoke and soot, and that dripped less (performance expectations). The most sophisticated customers asked for better-smelling candles in different colours (perception expectations). Some candle makers listened, and kept producing better candles along the lines of what customers said they wanted. Most of the rest went out of business.

"Innovation is not about coming up with new or better stuff; it is about solving the problem of what to come up with in the first place."

In reality, business success requires focus on more than just performance and perception expectations, which are related to the features and functionality of specific offerings (solution specific). It is also critical—especially if you want to innovate—to understand outcome expectations, which are less concrete and related to the jobs customers need to get done (solution neutral). For instance, if illuminating the darkness is the job to be done, then doing this with ease and convenience is an outcome expectation.

Do not confuse solution-specific performance and perception expectations with solution-neutral outcome expectations, or you’ll end up in company with the storied corporations that were caught looking sideways when the wave of change came.

IBM was looking sideways when Microsoft envisioned a PC in the hands of every person, and 300 years earlier, candle makers were busy making better candles while others were relentlessly focused on how to differentiate themselves. Those others were more concerned with how to better achieve the job of illuminating the darkness in a more valuable way (with less cost and harm).

When the light bulb and electricity came along, it really did not matter how well a company could make a candle or a kerosene lamp; these solutions did not satisfy the outcome expectations as well as the light bulbs did. Nor did the big mainframe computers satisfy customer outcome expectations as well as personal computers did.

Maybe the first real step toward organic growth is admitting that you are probably better at refining and improving solutions (performance and perception) than you are at cannibalising yourself in favour of solutions that wow your customers on a higher plane (outcome expectations).

This is perhaps the key reason why only about 10% of publicly held companies are able to reach any reasonable standard of organic growth in a consistent manner.

On the flip side, when important outcomes are poorly satisfied, or the solutions for important jobs to be done are ad hoc or nonexistent, that is a glaring opportunity for innovation. Once the opportunity is identified, any company can pursue focused ideation and solution development to provide more value than what exists today.