In 1995, Clayton Christensen, the Harvard Business School professor who coined the phrase “disruptive innovation,” warned incumbent companies against the threat of smaller, more nimble firms’ eating away at their core business. His runaway best-seller in 1997, “The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail,”  put businesses on notice: Innovate or die. Remember Kodak?
What that book didn’t do, though, was tell readers how to create products and services that customers actually want to buy or how to predict which new products would succeed while others failed. His new book, “Competing Against Luck: The Story of Innovation and Customer Choice,” co-authored with Taddy Hall, Karen Dillon and David S. Duncan, does just that, by repositioning the question of why consumers make purchases.
Christensen calls it the “theory of jobs to be done.” He and his co-authors assert that every purchasing decision comes down to filling a job position. People buy a certain product or are loyal to a brand because it fulfills a specific purpose in their lives better than the competition. The authors argue that businesses will succeed when they understand that their value proposition comes from helping people do that job. “Innovation is less about producing something new and more about enabling something new and important for consumers,” they write.
Then they apply that theory to everything from milkshakes to margarine to furniture. Why has Ikea been so successful — and maintained its success through decades of economic and social upheaval? Because it understands that the job that its customers “hire” the company to do is to help them furnish their apartments today. Everything comes in flat boxes that easily fit in or on cars. And while the furniture does need to be put together, assembly is relatively simple and requires only one or two tools, which Ikea includes in the box.
Yes, there are a lot of other things that Ikea gets right, but the foundation of its success lies in knowing its role in performing a specific job for its customers. “Understanding the most important jobs your company solves for customers can be translated into a rallying cry that aligns individuals across the organization behind a common purpose and functions as an enduring innovation North Star,” the authors say.
Start Your Cash Flow Conversation
Give us a call at 1-855-PNC-CFO5 (1-855-762-2365) or fill out our simple form and a PNC Business Banking representative will get in touch with you.
Request a Contact »
1. “The Innovator’s Dilemma: When New Technologies Cause Great Firms to Fail,” Clayton M. Christensen. © 1997, 2000, 2016, Harvard Business Review Press.
2. “Competing Against Luck: The Story of Innovation and Customer Choice,” Clayton M. Christensen, Taddy Hall, Karen Dillon, David S. Duncan. ©2016, Harper Collins.
The article(s) you are reading were prepared for general information purposes by Manifest, LLC. These articles are for general information purposes only and are not intended to provide legal, tax, accounting or financial advice. PNC urges its customers to do independent research and to consult with financial and legal professionals before making any financial decisions. These articles may provide reference to Internet sites as a convenience to our readers. While PNC endeavors to provide resources that are reputable and safe, we cannot be held responsible for the information, products, or services obtained on such sites and will not be liable for any damages arising from your access to such sites. The content, accuracy, opinions expressed, and links provided by these resources are not investigated, verified, monitored or endorsed by PNC.
We have tools to help you bank when and where you want.Mobile Apps Directory »
Be part of our inclusive culture that strives for excellence and rewards talent.Visit PNC Careers »
The PNC Financial Services Group, Inc. All rights reserved.