(based on Anthony W Ulwick- What Customers Want)

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Innovation

Innovation = a systematic process for creating products or services that delivers new value

Customer Opportunity Offering

Market Research = New Product Failure (often)

PCjr of IBM

New Coke

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Do not ask Customers what solutions they want

Find out what jobs they want done

Find out what metrics the customer will use

Find out what outcomes/metrics are underserved.

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Customer Research Outcome Driven Approach

Find out what solutions (features) customers want

Find out what outcomes customers want to achieve

Customers do not know best about what is the optimum solution ….We should if we deserve our jobs

Innovation

Product/Service Innovation Existing Product/Service Focus on underserved success metrics

New Market InnovationNew Market/Service Focus on underserved outcomes

Operational InnovationNew/Improved OperationsFocus on outcomes in customer/employee interaction

Disruptive Innovation New Technology to disrupt an existing model Focus on overserved customers with low cost technology

ORFocus on new (underserved) csutomers with existing

technology5

All Customers are important

Consider End Users (especially if you sell to OEM)

Consider all relevant customers (not just your purchasers)

Consider inputs directly (do not accept proxy)

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Understanding customer outcomes ≠ Listening to the customer

Capturing Customer Needs

We are already listening to Customer

Benefits “Easy to use”

Needs“Durable”

Specifications“lighter”

Solutions“give me a sweeter drink”

Challenges:First : Customers are rarely qualified to define solutionsSecond: Benefits, Needs and Specifications are not precise enough

We need to ask and probe

What are the Jobs the Customers want to achieve?Jobs can be functional, personal, social.

What are the Desired Outcomes of the Job?Define metrics by breaking down the process of the job

What are the constraints?Constraints can be physical, regulatory or environmental

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Asking for the right inputs is important The method of seeking customer inputs is not

This examples are derived from my experience :

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Examples Drawn from …

1) From the area of Talent Management where I have worked for a decade

2) From the health and wellness industry where I have worked with a few entrepreneur friends

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Applying to Talent Mangement

Jobs Outcomes

Implement hikes (functional)

Minimize the effort in setting up goals

Minimize the effort of getting industry data

Search for skill sets Minimize the effort in getting competency maps

Minimize effort to capture on the job learning

Track recruitment efficiency?

Match performance evaluation with recruting?

Loop back on recruiting process?

Provide career ownership

Show career maps

Identify the talent crown jewels

Experiment with a upcoming technology

Get up and going quickly? 12

Could established organizations have foreseen rise of SaaS vendors?Can organizations develop a “break thru” integrated Talent Management apps

Applying to Health & Wellness

Jobs Outcomes

Reduce expenditure on health (functional)

Reduce the possibility of loss of income (functional)

Improve career prospects (functional)

Improve chances with the opposite sex (emotional)

Improve self esteem (emotional)

Improve sex life (functional)

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Constraints

Requires mental discipline

Requires motivation

Requires physical “push”

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What to specifically focus on

Existing products – focus on Outcomes

In other cases focus on Jobs and Constraints (generally!)

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Identifying Opportunities

Applying the Outcome Driven Model

Identify Opportunities

Opportunity arises when job, outcome or constraint is underserved (or over-served)

The Process of Identification: List all jobs, outcomes, constraintsRate importance of all aboveRate satisfaction of all aboveEnter data in algorithm:

Opportunity = Importance + max (Importance – Satisfaction)

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Importance

Satisfaction

Over Served

Under Served

Satisfaction >> Importance

Satisfaction << Importance

Adequately Served

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Outcomes

Company A

Company B

Company C

Outcome 1

Outcome 2

Outcome 3

Outcome 4

Satisfaction scores move over time Opportunities disappear as competitors/alternate options appear Competitive opportunities appear when a competitor shows a gap

Bring precision to the language of innovation

Wednesday, January 02, 2008