engg950 autumn2014 lectures week 3

8/10/2019 ENGG950 Autumn2014 Lectures Week 3

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Core Concepts in Innovation:

Product Opportunity Gaps

SETS / JTBD

Prof. Mohamed K. Watfa

ENG950

Innovation & Design



By The End Of Part1 Today, You Should:

• Be able to use the SET factor model to identify and

understand opportunities created by Product

Opportunity Gaps (POGs)

• Be able to articulate a Product Opportunity Gap with aconcise statement that identifies who the target

market/consumer is and what the gap is between

consumers’ needs and offerings on the market, without

specifying how you plan to fill that gap



Launch*

The Cagan and Vogel Innovation Process

RealizeConceptualizeUnderstandIdentify



Phase 1: Identify The Opportunity

• Goals: – Identify and evaluate a set of promising Product Opportunity Gap (POG’s) – Choose the most appropriate POG to move forward with

• Primary results: – Product opportunity statement (hypothesis) – Initial scenario that illustrates the opportunity

• Methods – Brainstorming, observing, researching Social, Economic, and Technology(SET) factors

– Generating POGs based on SET factors – Evaluating and filtering POG ideas generated – Scenario generation, feedback, and refinement

Source: Cagan and Vogel, Creating Breakthrough Products, Chapter 5.

Launch*




Phase 2: Understand The Opportunity

• Goals: – Much deeper understanding of customer and customer’s Value

Opportunities (VO’s), translated into product criteria

• Results: – In-depth understanding of the customer/user, captured through refined

customer scenarios and VOA’s – List of product characteristics and constraints

• Methods – Primary research: observe, interview, listen, task analysis, stakeholder

analysis – Secondary research: human factors, lifestyle reference, dive deeper on

SET factor changes

Source: Cagan and Vogel, Creating Breakthrough Products, Chapter 5.

Launch*

RealizeConceptualizeUnderstand

Identify



Social, Economic, and Technology (SET) Factors

• Identifying and observing broad Social and Economic

changes in a society can help you discover gaps that current products and services are not meeting.

• Likewise, Technological advances can create opportunitiesto create products and services that would have been

previously technically impossible – Technological advances often also create new (and different)

problems for people or societies, which can also be fertile groundfor product opportunities

In general, you are looking for broad, enduring changes touse as a basis for new product opportunities



Social

• Family and work patterns (for example, the number of single

parents with two jobs or the number of double-incomehouseholds with flexible hours)

• Health issues (people living longer with more active lives)

• Use of computers and the Internet

• Sports and recreation / Sporting events

• The entertainment industries, including film and television

• Vacation environments (for example, the fantasy fulfillment

provided by Disney World, Las Vegas, and Club Med)

• Books (for example, Oprah’s Book Club)

• Magazines

• Music (from hip-hop to new classic-chic)

• Environments at work (that raise quality of workplace standards)



Economic

• For example, the economic boom in the 1990s created

multimillionaires overnight through IPOs, stock

options, and individual investment in the stock market.

• Excess disposable cash resulted in a void in material

goods that these young, geeky, intelligent, sociallyresponsible, technology oriented — and rich — new

group of consumers sought.

• Lifestyle-oriented products that filled this void include:

• recreational SUVs, clothing, tech products, PDAs that

connect through the Web for constant stock price

monitoring, and the proliferation of coffeehouses.



Economic (2)

• The eventual great recession of the twenty-first century

• People’s attitudes about spending shifted.

• Smaller cars, including a new class of electric-based,

have replaced SUVs.

• Smart Online Shopping: Smart-phones and tablets haveevolved to keep people connected 24/7, especially

through social media channels and from their home,

where smart shoppers can look for good bargains

without leaving their living room.



Technology

• The always-increasing power and speed of each month’s

latest PC

• Home PC, to the car transmission, to the oven, to the

stereo, and now to everyone’s smartphone, iPod, and iPad.

• The latest technologies, from microelectromechanicalsystems (MEMS) in automobile airbags to layered

manufacturing technologies

• The first genetic fingerprint of the human species in the

year 2000

• The first cloning of Dolly the sheep in 1997



SET Factors

Social

• Social and cultural trends

• Reviving historic trends

Technical

• Introduction of new technologies• Re-evaluating existing technologies

Economic

• State of the economy• Change in focus on where to spend money

• Levels of disposable income

ProductOpportunity

Gap



Examples

The post – World War II:

• The economic boom,

• Cheap gasoline,

• the creation of the suburban lifestyle, and the look of

jets and rockets

• were the SET Factors that created the opportunity:

• for large eight-cylinder cars with sizable tail fins that

dominated the auto industry during the 1950s.• Harley Earl, head of styling and color for GM, saw the

opportunity and introduced fins on the rear of cars,

starting with the low-end Chevy all the way up to

Cadillac.



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SET Factor Exercise

• Divide into three groups (one S, one E, one T)

• Work as a group to come up with a list of at least 10

broad forces / changes / trends in the GCC and/or the

full Arab League nations for your assigned topic(S, E, or T)

• Write them down and be prepared to present them for

discussion.



SET Factor Discussion

• Do you see some common themes emerging?

• Which of these SET factors are mostly the same

throughout the GCC nations? Throughout the Arab

League nations?

• Which of these SET factors vary considerably

throughout the GCC nations? Throughout the ArabLeague nations?



Product Opportunity Gaps (POG’s)

• The next step is to identify Product Opportunity Gaps,

or POGs based on your SET factor analysis.

• A Product Opportunity Gap is the gap between what is

currently on the market and the possibility for new, orsignificantly improved, products that result from

emerging trends.



Examples of Product Opportunity Gaps

• A vegetable peeler that is easily used by people suffering from

arthritis in their hands

• A light source that can be pointed and held focused on a specific point in cramped or difficult locations without requiring the useof the person’s hands to hold it

• A financial instrument that allows young people to move out oftheir families homes to live on their own before they are married

• Training tools and materials that help working adults without

deep technical expertise develop skills with fast-changinginformation technologies



POG Exercise

• Form groups of 3-4 people

• Pick one of the following industries: – Fashion, personal transportation (on land), personal transportation (air)

restaurants, international shipping, real estate, financial services, education,medical, entertainment, Media, hotels, home appliances, army, childcare.

• Based on the SET factors identified, where should the leadingcompanies in that industry be looking for gaps to fill with innovativenew products or services? – Are they doing so currently?

– If not, why not?

• Come up with a list of at least 5 POGs for this industry that yourgroup thinks that companies in this industry should be exploring

• Be prepared to share the top 2 POGs with the class



Jobs To Be Done Analysisand

Outcome Expectations



By The End Of Part 2 Today, You Should:

• Understand the concept of 'hiring' a product to do a job,

and use the technique of identifying and understandingthe Job To Be Done as a way to uncover new ProductOpportunity Gaps

• Be able to use Outcome Expectations analysis to identifyimportant Jobs To Be Done that are not being done in away that meets customers’ needs and expectations

• Be able to use Value Quotient Analyis to identify productopportunity gaps



Phase 1: Identify The Opportunity

• Goals: – Identify and evaluate a set of promising Product Opportunity Gap (POG’s) – Choose the most appropriate POG to move forward with

• Primary results: – Product opportunity statement (hypothesis) – Initial scenario that illustrates the opportunity

• Methods – Brainstorming, observing, researching Social, Economic, and Technology

(SET) factors – Generating POGs based on SET factors – Evaluating and filtering POG ideas generated – Scenario generation, feedback, and refinement

Source: Cagan and Vogel, Creating Breakthrough Products, [CV02] Chapter 5.

Launch*




Jobs To Be Done Analysis

“People don’t buy quarter -inch drills, they buy quarter-

inch holes. The drill just happens to be the best means

available to get that job done.” • Ted Leavitt of Harvard Business School [SSD09] p 10.



Jobs To Be Done (JTBD) Analysis

• Goal: identify the human need you are trying to meet

• Focus on the outcome that your customers want to achieve,

not on the product that you want to sell to them

• JTBD analysis steps

1. Identify a focus market

2. Identify jobs customers are trying to get done

3. Categorize the jobs to be done

4. Create job statements

5. Prioritize JTBD opportunities

6. Identify Outcome Expectations regarding the job

Source: [SSD09] pages 1-8.



Different Types of Jobs To Be Done:

• Functional jobs describe the task that the customers

want to achieve

• Emotional jobs relate to feelings and perceptions

– Personal jobs relate to how customers want to feel about

themselves – Social jobs relate to how customers want to be perceived by

others

• Ancillary jobs are other jobs that customers want to getdone before, during, or after they get their main jobdone




Job Statements

• Express the JTBD with a Job Statement, which usually

takes the form: – <Action verb> <Object of Action> <Contextual Clarifier>

• Examples

– Listen to music in the car with friends

– Allow the kids to listen to different music in the car than their parents

– Travel from home to work comfortably and quickly without

the stress of driving in traffic – View pictures at home that were taken with a digital camera

– Satisfy appetite for ice cream without becoming overweight

Source: [SSD09] pages 1=8.



Exercise: Describe The Job(s) To Be Done By…



Exercise: Describe The Job(s) To Be Done For …



Outcome Expectation Analysis

• Goal: list desired and undesired outcomes of a product that

addresses a Job To Be Done to identify places wherecurrent solutions fall short

• Focus on broad benefits and drawbacks, not features or

performance characteristics for specific products

• Outcome expectation analysis steps

1. Identify the Job To Be Done

2. List the JTBD’s related Outcome Expectations

3. Create Outcome Statements

4. Determine high-priority Outcome Expectations




Outcome Expectations Grid

Customer Provider

Undesired

Desired

Source: [SSD09] page 10.




Customer Provider

Desired

Undesired

Job statement: Prevent other people from seeingthe private information stored on my smartphone




Customer Provider

Desired

• Strongly secures private data

• Easy to install

• Easy to use

• Inexpensive to buy / own• “Just works” on my phone

• …

• Cheap to produce and maintain

• Easy and inexpensive to

distribute

• Requires little advertising /marketing support

• …

Undesired

• Difficult to use

• Expensive

• Sometimes makes me lose

access to my own data

• Does not work on my existing

smartphone

•…

• Expensive to create

• Expensive to support / maintain

• Complicated to support/maintain

• Customer data loss causes

lawsuits or bad customer relations

• Attackers can easily go around

security provided

•

…

Job statement: Prevent other people from seeingthe private information stored on my smartphone



Outcome Statements

• Clearly and precisely state desired/undesired outcomes

• Structure:

– Direction of action (decrease, increase, maximize, etc.)

– Unit of measurement (time, length, weight, cost, etc.) – Object of control (what it is you are influencing)

– Context (where or under what circumstances)




Outcome Statement Examples

• Minimize the difficulty of installing on phone

• Minimize the technical knowledge required of phone

user

• Minimize the likelihood that the customer will lose data

• Increase the “invisibility” of protecting the data

• Reduce development and maintenance costs for

supplier

• < other examples? >




Exercise: Outcome Expectations

• Create an Outcome Expectations grid for the following

JTBD Job Statement:

– Record images from vacations to share with friends

• Create outcome statements for this job statement and

prioritize them based on importance and the level of

consumer satisfaction with current solutions



Exercise: Outcome Expectations Grid

Customer Provider

Undesired

Desired



Value Quotient

• Key Idea: start from ‘perfect’ and work backwards

• To improve Value Quotient look for places to improve

desired outcomes or reduce undesired outcomes

Value _ Quotient Desired _ Outcomes

Undesired _ Outcomes



Value Quotient Analysis Steps

1. Identify the Job To Be Done

2. Identify the desired and undesired outcomes

3. Plot the ideal innovation

4. Plot existing solutions

5. Identify opportunity value gaps

6. Close the value gaps



Value Analysis Plots: Perfect World

Job To Be Done: Record images from vacations

to share with friends



Step 5: Identify Opportunity Value Gaps

• Where to look for value gaps:

– Dimensions with high customer importance and low customer

satisfaction

– Dimensions that customers report as not very important and

they are satisfied

• This may present an opportunity to ‘lower the bar’ to produce a

cheaper, simpler, alternative for the low end of the market

– Dimensions for which there is currently no good solution

l Q i



Value Quotient

V l Q i E i



Value Quotient Exercise

• For the identified Job To Be Done:

– Record images from vacations to share with friends

• Select three different solutions currently on the market

for this JTBD.• Plot the existing solutions on your value analysis graph

• Identify opportunity value gaps that this analysis

exposes

• Propose different ways that you might close these gaps

R f



References

[CV02] Jonathan Cagan and Craig M. Vogel,

Creating Breakthrough Products,Prentice Hall, 2002, ISBN: 0-13-969694-6.

[SSD09] David Silverstein, Philip Samuel, NeilDeCarlo, The Innovator’s Toolkit,

John Wiley and Sons, 2009,

ISBN: 978-0-470-34535-1.

engg950 autumn2014 lectures week 3

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