how to formulate a winning growth strategy · 2019. 4. 1. · outcome-driven innovation® (odi) odi...

#ODInnovation #JTBD

@ulwick

HOW TO FORMULATE A

WINNING GROWTH STRATEGY

OUTCOME-DRIVEN INNOVATION® (ODI)ODI is a customer-centric, data-driven strategy and innovation process that ties

customer-defined metrics to the customer’s "job-to-be-done”.

05.Use the data model

to formulate a

winning growth

strategy

04.Discover hidden

segments of

opportunity

03.Quantify the

degree to which

each need is

under/overserved

02.Uncover the

customer’s

“needs”—metrics

used to measure

success

01.Define the market:

job executor and

“job-to-be-done”

A outcome is unmet when—

it’s important to the customer

population, but not satisfied by

existing solutions.

ODI-BASED RESEARCH REVEALS UNMET NEEDSStatistically valid quantitative research (180 – 1000+ completed surveys) reveals hidden

segments, competitive strengths, unmet outcomes and more.

When trying to [job step], how important is it to you

that you are able to:

When using [solution], how satisfied are you with your

ability to:

Not at all important

Somewhatimportant

ImportantVery

importantExtremely important

Not at all satisfied

Somewhatsatisfied

SatisfiedVery

satisfiedExtremely satisfied

Minimize the time it takes to get the songs in the

desired order for listening

Outcome 1

Outcome 2

0

2

4

6

8

10

0 2 4 6 8 10

Outcome

THE OPPORTUNITY LANDSCAPEOpportunity score = importance + max (importance – satisfaction, 0)

Minimize the time it takes to get

the songs in the desired order

for listening

Importance

- - - V E IMP

5 5 9 47 34 8.1 81%

Satisfaction

- - - V E SAT

12 28 30 17 13 3.0 30%

Opportunity Score

13.213.2

30% of the sample

rated the outcome very

or extremely satisfied.3.0

81% of the sample

rated the outcome very

or extremely important

8.1

0

2

4

6

8

10

0 2 4 6 8 10

Outcomes

THE OPPORTUNITY LANDSCAPEReveals precisely where the market is under- and over served—and by how much.

Importance

- - - V E IMP

5 5 9 47 34 8.1 81%

Satisfaction

- - - V E SAT

12 28 30 17 13 3.0 30%

Opportunity Score

13.213.2

3.0

8.1

Underserved

Overserved

Table

Stakes

ARE CUSTOMERS

WILLING TO PAY MORE?

We are able to use this input to answer the following

questions:

• Are underserved customers willing to pay more to

get the job done better?

• Compared to what customers are paying today,

how much more are they willing to pay to get the

job done perfectly?

• Given all the desired outcomes that are

underserved, which contribute most to the

customer’s willingness to pay more to get the job

done better.

How much more

are you willing to

pay to get the job

done perfectly?

OUTCOME-DRIVEN INNOVATION® (ODI)ODI is a customer-centric, data-driven strategy and innovation process that ties

customer-defined metrics to the customer’s "job-to-be-done”.

05.Use the data model

to formulate a

winning growth

strategy

04.Discover hidden

segments of

opportunity

03.Quantify the degree

to which each need

is under/overserved

02.Uncover the

customer’s

“needs”—metrics

used to measure

success

01.Define the market:

job executor and

“job-to-be-done”

SEGMENTATION

The process of… discovering

groups of job executors that

have different unmet outcomes.

NOT ALL JOB

EXECUTORS ARE ALIKE

Segments of customers with different unmet

outcomes exist because people struggle

differently when executing the job-to-be-done.

Demographic, psychographic and attitudinal

segment classifications do not reveal segments

of customers with different unmet outcomes.

Traditional segmentation methods cause

companies to target phantom segments.

GENDER DOES NOT REVEAL MEANINGFUL DIFFERENCESOur research proves that segmenting a market around gender

does not reveal significant customer differences.

0

2

4

6

8

10

0 2 4 6 8 10

AGE DOES NOT REVEAL MEANINGFUL DIFFERENCESOur research proves that segmenting a market around age


0

2

4

6

8

10

0 2 4 6 8 10

REGION DOES NOT REVEAL MEANINGFUL DIFFERENCESOur research proves that segmenting a market around region


0

2

4

6

8

10

0 2 4 6 8 10

OUTCOME-BASED SEGMENTATIONThe best way to find segments of customers with different unmet needs

is to segment the market around unmet needs.

Factor

Group

1

Factor

Group

2

Factor

Group

3

Outcome 10

Outcome 3

Outcome 4

Outcome 11

Outcome 5

Outcome 8

Outcome 2

Outcome 9

Outcome 6

Outcome 1

Outcome 7

The variables serve as

a solid basis for

segmentation.

Variable 1

Variable 2

Variable 3

Statistical-based clustering process

Cluster analysis places respondents into a predetermined number

of groups (segments) based on how they rated the importance

and satisfaction of the segmentation variables.

Segment profiling exercise

The most important insight is figuring out what is causing

respondents in one segment to struggle more/differently than

others. This insight leads to the creation of statistically valid

“personas” or segment descriptions.

ON AVERAGE THE MARKET MAY APPEAR WELL SERVEDBut the average customer does not exist. There are always segments


0

2

4

6

8

10

0 2 4 6 8 10

0

2

4

6

8

10

0 2 4 6 8 10

DISCOVER HIDDEN SEGMENTS OF OPPORTUNITYOutcome-Based Segmentation reveals under- and overserved segments,

their size, and which outcomes to target for growth.

19% of respondents

57%24%

0

2

4

6

8

10

0 2 4 6 8 10

21% of respondents

45%

34%



0

2

4

6

8

10

0 2 4 6 8 10

31%

34%

35%



0

2

4

6

8

10

0 2 4 6 8 10

18% of respondents

26%

56%



0

2

4

6

8

10

0 2 4 6 8 10

15% of respondents

21%

33%

31%



JTBD MATRIX

The matrix ties the opportunity to

the appropriate strategy.

Get job done

BETTER

Get job done

WORSE

Charge MORE Charge LESS

People buy products and services to get a

job done better and/or more cheaply.

The growth strategy options available given

these parameters can be described in a matrix:

Better + charge more Better + charge less

Worse + charge lessWorse + charge more

BUILDING A GROWTH

STRATEGY MODEL



Each of these options will appeal to only

certain types of customers:

Better + charge more

Win underserved

customers only

Better + charge less

Win all types of customers

(under- overserved, etc.)

Worse + charge less

Win overserved customers

and nonconsumers

Worse + charge more

Win customers

with limited options

Get job done

BETTER

Get job done

WORSE


BUILDING A GROWTH

STRATEGY MODEL



We have identified and classified 5 types of

growth strategies that are possible when

looking at a market through a jobs-to-be-done

lens:

Get job done

BETTER

Get job done

WORSE

Differentiated strategy

Win underserved

customers only

Dominant strategy



Disruptive strategy


and nonconsumers

Discrete strategy

Win customers with

limited options


BUILDING A GROWTH

STRATEGY MODEL

Sustaining

strategy

STRATEGY

The process of determining which

segments and unmet customer

outcomes to target—and how.

OPPORTUNITIES DICTATE STRATEGYThe Opportunity Landscape reveals where the market is under- and

overserved—and to what degree. This informs what strategy to pursue.

0

2

4

6

8

10

0 2 4 6 8 10

DIFFERENTIATED

STRATEGY

V1V2

V3

CUSTOMERS MAY NOT BE WILLING TO SPEND MOREIf customers aren’t willing to spend more to get the job done better, than

a dominant strategy would be more effective than a differentiated strategy.

0

2

4

6

8

10

0 2 4 6 8 10

DOMINANT

STRATEGY

V1V2

V3



0

2

4

6

8

10

0 2 4 6 8 10

Better

More cheaply

DOMINANT

STRATEGY



0

2

4

6

8

10

0 2 4 6 8 10

DISRUPTIVE

STRATEGY



0

2

4

6

8

10

0 2 4 6 8 10

SUSTAINING

STRATEGY

Table stakes

Better



0

2

4

6

8

10

0 2 4 6 8 10

SUSTAINING

STRATEGY

PORTFOLIO STRATEGY

The data shows you what

strategies to pursue to win

across the entire market.

OUTCOME-BASED SEGMENTATIONThe only way to find segments of customers with different unmet needs

is to segment the market around unmet needs.

Factor

Group

1

Factor

Group

2

Factor

Group

3

Outcome 10

Outcome 3

Outcome 4

Outcome 11

Outcome 5

Outcome 8

Outcome 2

Outcome 9

Outcome 6

Outcome 1

Outcome 7

The variables serve as

a solid basis for

segmentation.

Variable 1

Variable 2

Variable 3

Statistical-based clustering process

Cluster analysis places respondents into a predetermined number

of groups (segments) based on how they rated the importance

and satisfaction of the segmentation variables.

Segment profiling exercise

The most important insight is figuring out what is causing

respondents in one segment to struggle more/differently than

others. This insight leads to the creation of statistically valid

“personas” or segment descriptions.

ON AVERAGE THE MARKET MAY APPEAR WELL SERVEDBut the average customer does not exist. There are always segments


0

2

4

6

8

10

0 2 4 6 8 10

0

2

4

6

8

10

0 2 4 6 8 10



19% of respondents

57%24%



Companies can create products that get a job

done better and/or more cheaply. The strategy

that should pursued is dependent on what

opportunities exist.

A disruptive strategy will not work when

targeted at an underserved segment. Nor

would a differentiated strategy when targeted

at an overserved segment.

Sustaining

strategy

Get job done

BETTER

Get job done

WORSE

Differentiated strategy

Win underserved

customers only

Dominant strategy



Disruptive strategy


and nonconsumers

Discrete strategy

Win customers with

limited options


JTBD GROWTH

STRATEGY MATRIX

0

2

4

6

8

10

0 2 4 6 8 10

MULTIPLE STRATEGIES ARE OFTEN REQUIREDOutcome-Based Segmentation reveals under- and overserved segments,


57%24%

Differentiated

Sustaining

Disruptive

0

2

4

6

8

10

0 2 4 6 8 10

45%

34%



Differentiated

Disruptive

0

2

4

6

8

10

0 2 4 6 8 10

31%

34%

35%



Better

Dominant strategy

Cheaper

0

2

4

6

8

10

0 2 4 6 8 10

26%

56%



Dominant

0

2

4

6

8

10

0 2 4 6 8 10

21%

33%

31%



Differentiated

Disruptive

Understanding a market

through a JTBD lens

increases a company’s

chances for success

5-FOLD

how to formulate a winning growth strategy · 2019. 4. 1. · outcome-driven innovation® (odi) odi...

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