Companies that succeed put the customer at the centre of their business universe. Learn how the Jobs To Be Done methodology helps you do that.
The main reason companies fail is because they don’t get enough customers to pay for their product or service at a price which keeps the business afloat. Simples!
At the start up phase, you may think you have created a product that your customers are going to love. The early adopters tell you so but then you stall. You try out lots of new things pretty much at random – go-to-market strategies, or new product features – most of which don’t work but you’re not sure why.
At the mature company stage, you might have created a product that has sold at a good margin for many years but you get so fixated on your product and its features that you lose touch with what the customer really wants and one of your competitors comes along with a product that your customers switch to.
The root cause of many of these company failures is the inability to truly understand customers. You have the data, the customer personas, the demographics and you have done the customer surveys asking the standard questions – what do you like and what don’t you like – all of this is necessary but not sufficient.
So what is sufficient? Switching your mindset from a supply-side or product-centric approach to a demand-side or a Jobs To Be Done (“JTBD”) approach.
Product lens thinking assumes that products cause people to buy them.
Whereas the JTBD viewpoint is that customers hire your product to do a job for them in a particular context. That ‘job’ is a problem a customer is trying to solve or a goal they are trying to achieve. And the ‘context’ is the circumstance within which the customer wants the job to be done. The customer is trying to make progress in some context of their lives.
As Peter Drucker, the leadership and management guru, said, “The customer rarely buys what the company thinks it’s selling them.”
As this is such an important theory with so many applications I have written two essays on the topic. This essay attempts to bring the JTBD theory alive in your mind along with its key benefits. My second essay looks at the core principles and key elements of the JTBD methodology.
Read both essays, change your mindset, apply your new lens and you may well find the bright future you so desire. It’s that big!
What Is JTBD?
Origins of the JTBD thinking came from Theodore Levitt who famously said:
“People don’t want a quarter-inch drill, they want a quarter-inch hole.”
This quote captures the essence of JTBD – the focus on the outcome, not the solution. The drill is a means to an end, not what you want to achieve.
Every day you have plenty of objectives you want to achieve. Some are minor – pass the time in a queue. Some are big – find a new job. Some are habitual – a morning cup of coffee to kick start your day. Some are unpredictable – new tyres for the car after you drove over some glass.
These are all jobs to be done. We are hiring a product or service to solve a problem or make progress in a given circumstance.
The central objective of JTBD is to understand customers’ underlying intent. You are trying to predict human behaviour. When you better understand human behaviour you are more likely to create a better solution.
“When we buy a product, we essentially hire it to help us do a job. If it does the job well, the next time we’re confronted with the same job, we tend to hire that product again,” explained Clayton Christensen, the Harvard Professor, who popularised the JTBD theory, in his 2016 HBS article – Know Your Customers’ “Jobs to Be Done”
The Milkshake Example
Let me run through the famous ‘Milkshake’ example to bring this customer-centric or JTBD approach alive.
The story goes like this.
A fast-food restaurant wanted to improve sales of its milkshakes. Its marketers had defined the market segment by product (i.e. milkshakes) and by the demographic and personality characteristics of the customers who frequently bought milkshakes. They then asked the people who matched the profile about how to improve the milkshakes. They made the improvements but there was no sales uplift.
So they asked Clayton Christensen with Bob Moesta (the president and CEO of The Re-Wired Group), to come in and assess the situation using JTBD.
The research showed that 40% of the sales were purchased early in the morning, by people on their own, who bought nothing else and got straight back into their cars and drove away.
So what caused them to buy the milkshake?
Most of them bought it to do a similar set of jobs.
- Job #1 – Ability to consume slowly over time. The milkshake took about 20 minutes to drink as it was so viscous. This helped distract the commuters from the boredom of the drive
- Job #2 – Avoid getting hungry later in the morning. The milkshake filled them up which kept them in a better mood throughout the morning
- Job #3 – Maximise safety whilst driving + Job #4 – Decrease the mess caused whilst consuming. The sturdy straw and container meant there was no spillage and it was easy to consume
- Job #5 – Maximise speed of purchase. The commuters needed to be served quickly so they could get to work on time
Alternative products the customers with the same job to be done bought included:
- Bagels – but they were too messy
- Bananas – but they didn’t last long enough to solve the boring-commute problem
- Doughnuts – but they didn’t fill them up for long enough
Nothing did the job as well as the milkshake. Whether it was healthy or not was not an essential job they were hiring for.
The research also discovered there were a different set of buyers later in the day – parents who were exhausted from saying ‘no’ to their children, and wanted a job to placate their children and feel like loving parents. But this job was not being fulfilled very well. The parents got impatient waiting for their children to finish the viscous shake.
The two main groups of buyers were buying the shakes for very different reasons. But once they found out the jobs customers were trying to do it became much clearer as to what improvements they needed to make to the shake. For the commuters they made the shake thicker so it would last longer, they added tiny chunks of fruit to make it more interesting and put in dispensers at the front of the counter allowing customers to use their prepaid card and speed up their purchase. Different decisions were made for the afternoon buyers.
By understanding the jobs, and the customers’ needs and then improving the functional, emotional and social dimensions so that they did the job better, the fast-food chain would gain market share not only against other milkshake providers but also against other real competitors such as bananas, bagels and boredom. This actually increased the size of the category which is often the case when you define a market from a JTBD rather than a product perspective.
Improving the product did not come from understanding the typical customer. It came from understanding the jobs to be done and the underlying needs behind them.
Do Milky Way And Snickers Compete?
At a cursory glance, both are chocolate bars, but when we examine the JTBD, we uncover nuanced differences. The Milky Way, with its nougat and caramel, often addresses the job of satisfying a craving for something sweet and light. It’s less about filling up and more about enjoying a simple, sweet treat. The brand’s tagline sums up the JTBD well: “The sweet you can eat between meals without ruining your appetite.”
The Snickers bar, laden with peanuts, caramel, and nougat, has a different mission. It caters to the job of needing a substantive snack, something that can satiate hunger between meals. The brand’s tagline, “You’re not you when you’re hungry,” encapsulates this JTBD. It’s a go-to for those seeking not just a sugar rush, but a filler.
Causal factors contributing to these distinctions include:
- Ingredient Composition: The addition of peanuts in Snickers adds protein, giving it substance
- Marketing and Positioning: Snickers is marketed as a solution to hunger pangs, while Milky Way is often presented as a light treat
- Consumer Perception: Years of branding efforts have shaped how consumers perceive the bars.
So if the Milky Way and the Snickers Bar have different jobs to be done who are they competing with if not each other?
Milky Way – for the job of a light treat, products like cotton floss or even fruit-based sweets come into play.
Snickers Bar – for the substantive snack job, protein bars, or even a packet of mixed nuts could be alternatives to Snickers.
It’s less about the product and more about the underlying need. Whether you’re picking up a Milky Way or a Snickers, you’re not just buying chocolate; you’re hiring them to do a specific job.
“What are the jobs the users of JTBD are trying to get done?”
Ultimately using JTBD methodology puts you in a better position to create an efficient path to growth – YES IT’S THAT TRANSFORMATIONAL!
The JTBD theory provides a lens through which businesses can better understand and address the real-world problems and desires or needs of your consumers. By focusing on the tasks people are trying to achieve, rather than just the products they buy, companies can develop solutions that are more in line with actual consumer needs, leading to better products, happier customers, and more successful businesses.
Two of the key tenets underpinning the JBTD framework are:
- Discover Causality. People get used to making decisions based on correlations. Correlation is surface knowledge and causation is truth. JTBD gives your insight into the causality of why someone is hiring (or indeed firing) you – the truth about why and how your customers buy or don’t buy your products or services
- Uncover Unmet Customer Needs. Tony Ulwick describes needs or desired outcomes as the metrics the customers use to measure success when getting the job done. Customers have underserved and overserved outcomes. Knowing with statistical certainty which outcomes or needs should be the focus of value creation and cost reduction ensures the efficient deployment of resources and greatly improves your odds of success in the market.
10 Key Benefits
Discovering causality and uncovering these unmet needs leads to deeper and more accurate consumer understanding which dictates everything downstream that is going to happen in your company.
- Formulate A Winning Strategy Through A Reliable Innovation Strategy. Innovation Focus. An innovation strategy is the systematic identification of unmet customer needs in a given market and the selection of which unmet needs to target for growth. An innovation strategy is all about what unmet needs you are going to target and not going to target. People struggle to come up with innovation strategies because they start with solutions; the objective with the JTBD approach is to start and stay in opportunity or demand space, understand all the unmet needs and then surgically carve out the opportunities you want to pursue. JTBD makes innovation reliable, predictable and less risky
- Product Development Clarity. It provides a clear roadmap for product or service development by highlighting the functionalities and features that matter the most to the consumers
- Uncover Real Competitive Advantages. By understanding the jobs customers are trying to achieve, businesses can identify gaps in the market where competitors aren’t effectively addressing those jobs
- Improve Marketing & Messaging: Messaging can be crafted to resonate more deeply with consumers, focusing on the outcomes they desire rather than just the features of the product, thereby creating product language fit
- Increase Sales Through Demand-Side Approach. Switch from pushing the product or service, and selling the features and benefits, to creating pull for the customer on how they can navigate their way to make progress
- Improve Cross-Functional Collaboration. Companies are typically organised into functions – sales, marketing, product development, and finance. Each function has different goals and often disagrees on how best to create customer value resulting in misalignment. A solution to misalignment is defining value creation through the eyes of the customer and establishing an understanding of customer needs across functions. Once your teams have a shared understanding of customer needs the different teams are unified around a single version of the truth. JBTD breaks down silos.
- Segment Markets More Effectively. Traditional demographic segmentation might group consumers based on age, gender, or income. But JTBD segments markets based on the jobs consumers are trying to accomplish and their unmet needs. Most markets have one or more segments that are underserved, as well as segments that are overserved. Knowing what outcomes are unmet in each segment, and how much those in each segment are willing to pay to get the job done better leads to more targeted and effective solutions.
- Increase Customer Retention. By continuously ensuring that products are meeting the evolving jobs of their consumers, businesses can boost customer loyalty and reduce churn.
- Future-Proofing. By focusing on the underlying reason your customer uses your product—rather than the product itself—allows you to build a disruption-proof advantage. Over the long term, you are continuously focused on completing more and more of the customer’s job. This helps you see and react to a broader competitive landscape, reducing the prospect of being blindsided by a disruptive solution.
Jobs To Be Done Has Game-Changing Implications
Great insight occurs when you hear something which is surprising but makes total sense and you wonder why you haven’t thought of it before. This is what happened to me when I first heard about JTBD theory – surprising but obvious!
JTBD has grown in popularity in recent years since the late, great Clayton Christensen’s insight that “Customers don’t buy products; they pull them into their lives to make progress.”
Unlike many theories, however, the JTBD Theory is very effective in practice. But it’s not just another tool, it’s a shift in mindset. Thinking about how your customers perceive value shifts your focus from inside-out to outside-in. JTBD puts the customer at the centre of your business universe.
JTBD is a lens through which you can observe customers, segments, markets, customers’ needs, competitors, and strategy differently, and by doing so, give you a better opportunity to create and market solutions that will be desired in the marketplace.
Ultimately, this shift in mindset can guide decisions and help craft solutions for any aspect of the business.
I think it is safe to predict that successful companies – big or small – will become more customer-jobs-centric and outcome-driven.
If you would like to learn more about JTBD and how it can apply to you, reach out to me here or email me at firstname.lastname@example.org.