I just finished reading What Customers Want by Anthony Ulwick, 2005. It is an interesting read. But, it provides an incomplete picture of business strategy. In a way, that is what makes it worth reviewing. I will cover the key ideas of the book and also point out a few additional books that may be helpful in getting a more complete picture.
In this book, the author takes the position that Voice of the Customer programs are ineffective. Instead, he suggests an approach called Outcome Driven Innovation.
The customer-driven movement has failed to produce the desired results because asking the customer what he wants solicits not only the wrong inputs, but inputs that inadvertently cause the failures that managers are fervently trying to avoid.
The literal voice of the customer sidetracks the innovation process because customers are not qualified to know what solutions are best—that is the job of the organization. And other inputs offered by customers (for example, statements such as “faster,” “easy-to-use,” “reliable,” “smart,” “powerful,” “durable,” “cheaper,” and “better”), are far too vague to have any meaningful value to designers and engineers. By standardizing the collection and processing of the needed inputs within a structured framework, companies can transform innovation from an unstructured and random customer-driven process into a rules-based discipline.
I learned to do task analysis many years ago. One useful technique I learned was to create a task list and then survey users to identify their most frequent and important tasks. With that information, you can do things like prioritize which features to include in a version of the product, identify clusters of similar users, and ensure that people’s most frequent and important tasks are most visible in the product.
Outcome driven innovation recommends a similar technique with a potentially useful twist. Using this method, you define the jobs customers are trying to get done, the metrics customers use to define success, and the constrains that prevent them from adopting a new product or service.Those success metrics are considered outcomes and are documented as outcome statements. Outcome statements must be made as one of two words, minimize or increase. Each job may have multiple measures that the customer uses to determine their definition of success with the job.
In the outcome-driven paradigm, an opportunity for growth is defined as an outcome, job, or constraint that is underserved. An underserved outcome, in turn, can be defined as something customers want to achieve but are unable to achieve satisfactorily, given the tools currently available to them.
The book recommends you create an Opportunity Score which is the importance score – the satisfaction score for each outcome statement. This will help identify jobs that are underserved – that is, where the job cannot be done or where the customer is not satisfied with how it is being done. With this opportunity score, you can then identify which features appear to be the most promising.
The opportunity algorithm … is a simple mathematical formula that makes it possible to discover the most promising areas for improvement. The formula states that opportunity equals importance plus the difference between importance and satisfaction, where that difference is not allowed to go below zero. The opportunities that are most important and least satisfied receive the highest priority.
The opportunity score seems promising. But the book then spends multiple chapters showing how that score is useful for every aspect of the business. Identifying opportunities, market segmentation, positioning & advertising current products, prioritizing products in your pipeline, identifying breakthrough product ideas, – it does it all.
As has been true of every other aspect of innovation that we have discussed, the solution to this problem is to know what jobs customers are trying to do and what outcomes they are trying to achieve.
I like how this book starts out saying you need to engage researchers & UX people. These are the people who are best equipped to interview and observe people to identify their current tasks, how to make them work better, and also what are the opportunities for improving their experience. But, he doesn’t really follow though on that aspect of the process.
Companies commonly make the following three mistakes, any one of which can derail the innovation process. The company does not consider the end user directly. Companies, especially OEMs and firms that sell only into channels, commonly fail to consider the end user as a target customer, particularly when the end user is not necessarily the primary purchaser of a product or service.
Companies should focus first on the end user, particularly improving the end user’s ability to get a job done, and then consider the buyer or channel as a secondary customer who is mostly concerned with price. Only the end user can legitimately provide the inputs that are needed to improve an existing product or to create a whole new one.
Let the salespeople do what they do best: sell. When it comes to collecting information about customer requirements, let trained professionals go directly to the sources.
This seems like good advice. However, the book then falls short. Instead of using the opportunity score method to drive cross-functional communication and alignment throughout the organization, it recommends having each function repeat the research and sets up ongoing battles around who should drive the research.
Companies must clearly separate the responsibilities and information needs of marketing and development. Marketing should continue to gather customer information for marketing, sales, and advertising purposes and should segment for these purposes as well; but companies should not force this information on development and expect it to make gold out of hay. If marketing wants to provide development with data that is useful for developers, then it must learn what information is needed (jobs, outcomes, constraints, and segments of opportunity) and acquire the skills to obtain that information—otherwise development should be empowered to gather the information on its own. Turf battles have often been fought between marketing and development over which function should obtain the customer inputs necessary for development, but it is time for those battles to end. Responsibility—and budget—should go to whichever function shoulders the responsibility.
In summary, do research directly with users and customers, identify what they are trying to accomplish and how satisfied they are in obtaining that, calculate your results as an opportunity score, and use that score to prioritize every aspect of your business strategy.
Yet, somehow, this approach missed a few key elements of a business strategy. Here is a summary of some of the areas the book either misses or introduces but doesn’t provide sufficient information for success.
What Customers Want doesn’t address the idea of engaging customers through emotion and well designed experiences. The book is very focused on a functional product approach. The author notes that there are emotional aspects to a product purchase. The author calls these ‘social jobs’ but provides no relevant examples or information on how to use that to deliver better products .
Customers buy products and services to help them get jobs done. In our study of new and existing markets we find that customers (both people and companies) have “jobs” with functional dimensions to them that arise regularly and need to get done.
Purchasing an automobile, for example, a woman may want to be able to transport children from one location to another (functional job), but she may also want to feel successful (personal job) and be perceived as attractive by others (social job). A mom throwing a party for her child may want to arrange the party (functional job), but she may also want to feel loved by her child (personal job) and be perceived as a good mom by the other moms (social job). Functional jobs define the tasks people seek to accomplish, personal jobs explain the way people want to feel in a given circumstance, and social jobs clarify how people want to be perceived by others.
In the outcome-driven paradigm the focus is not on the customer, it is on the job: the job is the unit of analysis. When companies focus on helping the customer get a job done faster, more conveniently, and less expensively than before, they are more likely to create products and services that the customer wants. Only after a company chooses to focus on the job, not the customer, are they capable of reliably creating customer value.
At the other end of the spectrum we find companies in industries that produce highly functional items such as medical devices, financial services, and computer and software tools—all products that must satisfy 50 to 150 desired outcomes or more. Such products can be differentiated along many functional dimensions, and customers who buy and use such products rarely use them to get emotional jobs done.
I disagree with the author when he says that people rarely buy products to get emotional jobs done. In today’s socially connected world, purchasing many products, including software and apps, is an emotional activity. People purchase investment and insurance products not just for their features but to enable their dreams or protect their families. Features are important but not sufficient to explain customer behavior.
However, in the book ReImagine, Tom Peters does a great job of explaining some of the other factors beyond product features that engage customers.
And compare What Customers Want to The Experience Economy by Pine and Gilmore. They describe the continuum of products from commodities, goods, services, and experiences. In many cases, it is worth considering moving beyond thinking of just product features and cost. Instead, a company should identify opportunities to deliver experiences. What Customers Want focuses on products or goods. While products can certainly be improved, you should consider looking to the whole customer experience to see if there are opportunities add value beyond the product itself.
I agree with What Customers Want that many businesses need to do a better job of differentiating themselves from their competitors. As the book recommends, this can be done by identifying underserved users and jobs as well as by reducing or removing some features.
A company that is thinking in terms of customer outcomes has been freed from the spec-by-spec mentality, however, and will not necessarily try to match the competition.
But, the few examples given in the book don’t illustrate the opportunity well. Blue Ocean Strategy is a better resource if you want to understand how companies in different categories like wine (Yellow Tail), air travel (Southwest), or entertainment (Cirque du Soleil) have approached segmentation.
What Customers Want also introduces the idea of grouping customers into categories based on the jobs they are trying to do. It begins to touch on user segmentation or clustering. I agree with the author that business often select easy or convenient segments from the businesses point of view. For example, they may select small, medium, and large business rather than looking at clusters of people and the goals they have in common.
What we have discovered in our work with Fortune 1000 companies over the past ten years is far more disturbing: today’s segmentation methods drive companies to target phantom segments (groups of customers that do not really exist), resulting in the very product and service failures that companies are trying to avoid.the greatest opportunity for the company—customers that have unique underserved outcomes.
But, again, this book really doesn’t provide a sufficient treatment of the topic. You might consider a book on clustering like The Clustered World or a book on personas like The User is Always Right to get a better idea of how to do user grouping and segmentation.
What Customers Want spends some time discussing idea generation like brainstorming. The author states that most brainstorming in companies doesn’t work.
Employees do come up with ideas—hundreds of them, in fact. And that is the cause of the second problem; companies often measure the success of an ideation session by the number of ideas that are generated, not the quality of those ideas.
Most brainstorming and idea generation efforts yield poor and unactionable results for three key reasons. The first is because managers rarely know how or where to direct employees’ creative energy. The result is much wasted energy, hundreds of useless ideas, and, unfortunately, few ideas that are truly worthy of pursuit. Consider the typical pattern. In most firms, when employees are asked to come up with new ideas, they are not directed to focus on specific outcomes; rather, they are asked for ideas to improve the company’s products in general (function, ergonomics, fit and finish, distribution, and packaging), leaving the direction for improvement open to interpretation. In the absence of a specific target, employees in turn focus on what they themselves want to improve rather than on what customers want to see improved. This scattershot approach to idea generation will not yield a bull’s-eye because there is no target to aim for.
A few years ago, I attended a Disney Institute session on organizational creativity. They had several great ideas for improving the process. First was that every employee needs to be engaged in looking for customer experience issues and opportunities. They could share those ideas in monthly brainstorming sessions that often produced amazing breakthrough results. One of the things they practice is called ‘thinking inside the box’. That is, there are parameters set around the brainstorming session including looking for low or no cost ways of addressing the issue. What Customers Want also talks about brainstorming in a similar way.
With a diverse team of employees engaged in ideation, a company can generate ideas that target opportunities that neither its current products nor those in its pipeline address. The approach works best when companies follow the five guidelines we have developed to control process variability and ensure a successful result: Stay focused on the targets Aim for breakthrough improvement Constrain thinking to enhance creativity Eliminate bad ideas quickly Optimize the best idea for cost, effort, risk, and sustainability directing employees to honor cost, effort, or other restrictions when devising new solutions does not dilute the divergent-thinking process; it keeps it focused and within bounds.
I agree that brainstorming doesn’t always equal blue sky thinking. In many cases, it should be used to solve a specific problem. But, beyond saying to constrain the conversation, this book provides no tools for effective brainstorming. Without effective moderation, following the advice from this book might shut down the strong pipeline of employee input needed for a business to be effective. There are many useful references on effective brainstorming. I will suggest a few. Just keep in mind that one of the best things a team can do is to learn the basics of improvisation as this will equip them with the right attitude for brainstorming; ‘Yes And Thinking’. Here are a few suggestions to get you started on more effective brainstorming sessions.
Gamestorming by Dave Gray, Sunni Brown, and James Macanufo provides a good overview to a variety of brainstorming techniques.
Back of the Napkin by Dan Roam provides a great introduction to brainstorming through sketching.
The Disney Way by Bill Capodagli and Lynn Jackson has a nice chapter on using storyboarding as a brainstorming technique.
What Customers Want describes the useful idea of looking at task analysis in an outcome oriented way. Adding an Opportunity Score to your task analysis activities may be helpful. However, you will need to look beyond this book to learn many of the tools and techniques needed to enable business innovation.
I hope this review was helpful. Please let me know your thoughts by leaving a comment.
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