TTMG 5103 Techniques and Tools for Identifying High Potential Innovation Projects

1. TTMG 5103Techniques and Tools for Identifying High Potential Innovation Projects Student Marinel Rosca TIM Program, Carleton University

2. Agenda • Managerial challenges & Objective • Jobs to be done • Determine the human need you are trying to fulfill • Outcome expectations • Give customers more of what they desire • Value quotient • Identify opportunity gaps in the marketplace • Ethnography • Observe your customers to uncover unarticulated needs • Job Scoping • Broaden or narrow your innovation focus

3. Agenda (cont’d) • Lessons learned • References • Appendices • Conclusion

4. Managerial Challenges • “Most companies segment their markets by customer demographics or product characteristics and differentiate their offerings by adding features and functions.” • “But the consumer has a different view of the marketplace. He simply has a job to be done and is seeking to ‘hire’ the best product or service to do it.” • Challenge: There is a problem with the way companies identify their target markets and, therefore, their innovation project objectives: www.innovatorstoolkit.com

5. Objective • What will be learned • How to identify and create viable innovation opportunities • How to scope innovation projects • How to use direct observation of customers’ struggles with existing solutions and identify unarticulated needs

6. Objective • What can be done with the knowledge • enable organic growth by identifying, creating, refining and scoping viable innovation opportunities

7. Agenda Managerial challenges & Objective Jobs to be done Determine the human need you are trying to fulfill Outcome expectations Give customers more of what they desire Value quotient Identify opportunity gaps in the marketplace Ethnography Observe your customers to uncover unarticulated needs Job Scoping Broaden or narrow your innovation focus

8. Jobs To Be Done - JTBD There are different types of Jobs to Be Done: • Functional jobs describe tasks that customers want to do • Emotional jobs are related to feelings and perception, i.e. they are subjective • Social jobs refer to how customers want to be perceived • Ancillary jobs are other jobs that customers want to get done before, during, or after they get their main job done

9. Examples of JTBD

10. JTBD – Key Points • JTBD are completely neutral of the solutions we create • While a customer JTBD remains fairly stable over time, products and services should change at strategic intervals as we strive to provide ever-increasing value

11. The 6 Steps 2 JTBD

12. JTBD: Step 1 Identify a Focus Market • Markets can be identified by growth strategies: • Core growth • The core business stream gets expansion • Disruptive growth • The growth is associated with a disruptive approach • Regulated job growth • Diversify the business by expanding in other areas • New job growth • Expanding the Business in areas not yet explored

13. JTBD: Step 2 Identify jobs customers are trying to get done • Study customers and find out what they are trying to accomplish • Several methods exist • Ethnography research • Cultural Archetype research • Other techniques • observation, interviews, customer complaints • focus groups

14. JTBD: Step 3 Categorize the Jobs to Be Done • There is no one way, or a standardized, commonly used scheme for categorizing JTBDs • General rule: Adopt a scheme that makes sense for your own industry! • Example • In the retail sales industry many key JTBDs are related to how you make people feel (emotional jobs) rather than what a product or service actually does (functional jobs)

15. JTBD: Step 4Create Job Statements • A “job statement” is used to describe a JTBD • Key components of a job statement • action verb • object of the action • clarification of the context in which the job is performed • Examples: • “Manage personal finances at home!” • “Clean clothes at home!”

16. Job Statement Structure • Manage • Personal finances • At home

17. JTBD: Step 5 Prioritize JTBD Opportunities - I • There are hundreds of jobs that customers are trying to get done in every market • Jobs that customers want to get done for which no good solutions exist are the ones that provide the greatest opportunity for innovation

18. JTBD: Step 5 Prioritize JTBD Opportunities - II • Prioritizing JTBDs is a function of: • How important they are • How satisfied customers are with existing solutions • The general potential for developing new (or ideal) solutions • The specific potential of the provider for creating new solutions that better meet outcome expectations

19. JTBD: Step 5 Prioritize JTBD Opportunities - III • There are different prioritization rating schemes • using sampling techniques to ask customers about the degree of importance (c.f. Likertscale) • A Likert scale can also work for assessing the level of satisfaction customers have with existing solutions

20. JTBD: Step 6Identify Outcome Expectations Regarding a Job • For a particular job, identify its associated desired and undesired outcome expectations • Make these expectations become the drivers of further ideation activities in the innovation process

21. Moment of Truth Related to JTBD • Discussion time • Examples

22. Agenda Managerial challenges & Objective Jobs to be done Determine the human need you are trying to fulfill Outcome expectations Give customers more of what they desire Value quotient Identify opportunity gaps in the marketplace Ethnography Observe your customers to uncover unarticulated needs Job Scoping Broaden or narrow your innovation focus

23. Outcome Expectations • A JTBD should be associated with outcome expectations • Understanding these expectations and knowing how satisfied (or unsatisfied) customers are with current solutions helps in • identifying unidentified market space • filling that space with better solutions than the current ones

24. Outcome Expectations - Background • There are four types of outcome expectations: • Desired outcomes customers want to achieve • Undesired outcomes customers want to avoid • Desired outcomes providers want to achieve • Undesired outcomes providers want to avoid

25. Outcome Expectations - Rule of Thumb • By segmenting outcome expectations in this manner, we can look at the JTBD through the lens of what customers want and don’t want, as well as what the provider wants and doesn’t want • Both parties must benefit from the innovation or it will never reach viable commercialization • Customers typically choose the solution that gives them more of the desired outcomes (benefits) and less of the undesired outcomes (cost and harm )

26. Step 1: Identify the Job To Be Done • Develop job statements and determine which JTBDs are priorities for innovation • Follow these steps to select the JTBD for which you’ll develop related outcome expectations

27. Step 2: List the JTBDs Related to the Outcome Expectations • Use a simple table to brainstorm the four types of outcome expectations that relate to your selected JTBD • “What is it about this JTBD that customers want to achieve or avoid ?” • Think in terms of • time, cost, potential errors, quality • dependability, availability, ease of use, maintainability • etc

28. Step 3: Create Outcome Statements • Since the job of innovation is to meet expectations to a greater extent than they are met today, they should be stated in imperative terms, using a standard structure • That structure is: • The direction of action (minimize, increase ) • The unit of measurement (time, cost, probability etc) • The object of control (what it is you’re influencing ) • The context (where or under what circumstances )

29. Step 4: Determine Priority Outcome Expectations • High-priority outcome expectations are the guides for ideating superior products, services, and solutions • Provide needed focus at the front end of innovation, which mitigates the risk of generating and pursuing big ideas that really aren’t so big because they aren’t grounded in market sweet spots

30. Outcome Expectations - Analysis • Plot outcome expectations (or JTBDs) on an XY graph, with importance on Y-axis and satisfaction on X-axis • Use the location in the graph to determine opportunities for the various categories of organic growth • disruption, core growth • new job growth, and related jobs growth

31. Moment of Truth Related to Outcome Expectations • Discussion time • Examples

32. Agenda Managerial challenges & Objective Jobs to be done Determine the human need you are trying to fulfill Outcome expectations Give customers more of what they desire Value quotient Identify opportunity gaps in the marketplace Ethnography Observe your customers to uncover unarticulated needs Job Scoping Broaden or narrow your innovation focus

33. Value Quotient • Ratio of a solution’s desired outcomes to its undesired outcomes - relative to some JTBD • Example • One key desired outcome for a driver is to increase visibility at all times, then a car window that cleans itself has a higher value quotient than a window you have to clean

34. Value Quotient - Rules of Thumb • Value Quotient technique enables an innovator to identify opportunities (value dimensions) that are ripe for exploration and exploitation • The extent to which we can increase value along these dimensions determines the extent we will be successful with an innovation project

35. Value Quotient - Steps

36. Step 1: Agree on and Document the Job to Be Done • The appliance company decides the JTBD is to clean clothes at home

37. Step 2: Identify the Desired and Undesired Outcomes • For the job of cleaning clothes at home, list a sample of expected outcomes, desired and undesired, from both the provider’s and customers’ perspective

38. Step 3: Plot the Ideal Innovation • If we were to discover and develop a perfect solution for the JTBD, what would it be? • Could a cleaning appliance wash all types of clothes in only one simple mode? • Could all stains be removed from all clothes all time? • Could clothes be cleaned without detergent?

39. Step 4: Plot Existing Solutions • After plotting the ideal innovation, the task is to plot existing solutions in the same manner according to the expected outcome dimensions • The key is to make plots in as many different ways as you want or need • Plot your solutions against the ideal innovation or different competing solutions, expectations, or dimensions

40. Step 5: Identify Opportunity Value Gaps • Condition 1: Customers report the dimension is very important but their satisfaction is low • Condition 2: Customers report that the dimension is not very important and are satisfied • Condition 3: There is no good solution so the customers cannot say whether they are satisfied

41. Step 6: Close the Value Gaps • Narrowing value gaps is a matter of ideating and developing superior solutions by moving through the innovation process and applying various techniques and tools • Recognize that if you can move your solution closer to the ideal innovation and beyond any and all competitors you have successfully innovated

42. Moment of Truth Related to Value Quotient • Discussion time • Examples

43. Agenda Managerial challenges & Objective Jobs to be done Determine the human need you are trying to fulfill Outcome expectations Give customers more of what they desire Value quotient Identify opportunity gaps in the marketplace Ethnography Observe your customers to uncover unarticulated needs Job Scoping Broaden or narrow your innovation focus

44. Ethnography • Ethnography is a science that describes human social phenomena based on fieldwork and observation • In innovation management ethnography is the practice of observing how customers try to get their “jobs done” by using your offerings, your competitors’ offerings, or neither

45. Step 1: Plan the Study • When will you observe people? When they’re purchasing your product, or when they’re using it? • Where will you observe people? In their homes, places of business, or a public place? • For how long will the ethnographic study take place, and how many people will you observe? • Where will you observe people? • Who will you observe?

46. Step 2: Identify Participants • Identify specific participants and obtain their permission to be part of the study • Make sure to clearly convey to them the purpose of your study, what type of information you will be documenting, and how the results will be used

47. Steps 3: Observe the participants • When we begin the ethnographic study, our primary task is to observe and take notes on how people interact with your product or service and what they think about it • During the study, it is imperative that we separate observation from interpretation • Like a courtroom juror, we should only be concerned with the facts while observing

48. Step 4: Interview Participants • Depending on our desired level of interaction with the participants, we may choose to interview them after observation • Remaining sensitive to the participant’s beliefs, opinions, and concerns is important • If a question makes someone uncomfortable, we shouldn’t force an answer

49. Steps 5: Collect Artefacts • Just as an anthropologist makes assumptions and draws conclusions about a culture via tangible artefacts, a company can draw conclusions about its products and services via the collection of behavioural artefacts • Ethnographic observation often reveals ingenious solutions designed by customers in lieu of commercial solutions

50. Step 6: Analyze Data • Sorting the data we gathered from the ethnographic study, including observations, interviews, and artefacts • Watching for patterns or trends that can be used to form one or more hypotheses • If we had a theory in mind before beginning the ethnographic study