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.
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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.
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