Competing Against Luck

1. Jobs Theory: Customers 'hire' products to make progress in specific circumstances

We define a "job" as the progress that a person is trying to make in a particular circumstance.

Progress, not products. Jobs Theory posits that customers don't simply buy products or services; they pull them into their lives to make progress. This progress is defined by the functional, social, and emotional dimensions of the job. The theory provides a framework for understanding the causal mechanism behind customer choices, offering a more predictable approach to innovation.

Circumstances matter. A job can only be fully understood in the context of the specific circumstances in which it arises. These circumstances include not just the functional situation, but also social and cultural pressures, life-stage factors, and financial status. By focusing on jobs, companies can see beyond traditional customer segments or product categories to uncover new opportunities for innovation.

• Key elements of a job:
  • Progress desired
  • Specific circumstances
  • Functional, social, and emotional dimensions
  • Competing solutions
  • Obstacles and anxieties

2. Uncovering jobs requires deep understanding of customers' struggles

Hearing what a customer can't say requires careful observation of and interactions with customers, all carried out while maintaining a "beginner's mind."

Look for struggles. To uncover jobs, innovators must become part detective and part documentary filmmaker. They need to observe customers in their moments of struggle, looking for workarounds, compensating behaviors, and instances where existing solutions fall short. This requires setting aside preconceptions and maintaining a "beginner's mind" to truly see what customers are trying to achieve.

Build customer stories. One effective approach is to create detailed storyboards of customers' experiences, capturing the full context of their struggles and the progress they're trying to make. These stories should include both the "push" factors driving customers to seek new solutions and the "pull" of potential new offerings, as well as the forces of anxiety and habit that might hold them back from change.

• Methods for uncovering jobs:
  • Observing customers in their natural environments
  • Conducting in-depth interviews focused on specific circumstances
  • Looking for unexpected uses of existing products
  • Studying non-consumption and workarounds
  • Building detailed customer journey maps

3. Innovation success comes from nailing the job, not just improving products

New products succeed not because of the features and functionality they offer but because of the experiences they enable.

Solve the whole job. Successful innovations don't just offer incremental improvements to existing products. They provide holistic solutions that address all aspects of the job customers are trying to get done, including the functional, emotional, and social dimensions. This often requires looking beyond traditional product boundaries to create entirely new categories or business models.

Remove obstacles. A key part of nailing the job is identifying and removing the obstacles that prevent customers from making progress. This might involve simplifying complex processes, reducing anxiety around adoption, or creating new distribution channels. By focusing on the job, companies can often find opportunities to innovate in areas that competitors have overlooked.

• Examples of job-focused innovations:
  • Airbnb: Solving for authentic local experiences, not just accommodation
  • Uber: Addressing the job of urban mobility, not just taxi rides
  • IKEA: Enabling affordable home furnishing, not just selling furniture

4. Focusing on jobs transforms how companies define their business and competition

When you understand that concept, the idea of uncovering consumer jobs makes intuitive sense.

Redefine your business. Jobs Theory challenges companies to think beyond traditional industry and product category definitions. Instead of seeing themselves as being in the "milk shake business" or the "newspaper business," companies should define themselves by the jobs they solve for customers. This shift in perspective can open up new opportunities for growth and innovation.

Expand competitive landscape. Understanding jobs also transforms how companies view competition. Instead of just looking at direct product competitors, they need to consider all the ways customers might solve their job, including "non-consumption" options. This broader view of competition can reveal both new threats and new opportunities for differentiation.

• Examples of redefined businesses:
  • OnStar: From car feature to peace of mind while driving
  • American Girl: From dolls to enabling connections between mothers and daughters
  • Southern New Hampshire University: From traditional education to enabling career advancement for working adults

5. Creating the right experiences is crucial for solving customers' jobs

Complete solutions to jobs must include not only your core product or service, but also carefully designed experiences of purchase and use that overcome any obstacles a customer might face in hiring your solution and firing another.

Design for the full job. To truly solve a customer's job, companies need to consider the entire experience surrounding their product or service. This includes how customers discover, purchase, and use the offering, as well as how it integrates into their lives. The goal is to create a seamless experience that addresses all aspects of the job.

Overcome adoption barriers. A critical part of designing experiences is identifying and addressing the anxieties and habits that might prevent customers from adopting a new solution. This might involve creating risk-free trials, providing education and support, or finding ways to make the transition from existing solutions as painless as possible.

• Key elements of job-focused experiences:
  • Seamless discovery and purchase process
  • Intuitive onboarding and first use
  • Ongoing support and engagement
  • Integration with existing habits and systems
  • Clear communication of job-related benefits

6. Processes aligned with jobs provide sustainable competitive advantage

Competitive advantage is conferred through an organization's unique processes: the ways it integrates across functions to perform the customer's job.

Integrate around jobs. To consistently deliver on customers' jobs, companies need to align their internal processes and organizational structure around those jobs. This often requires breaking down traditional functional silos and creating new cross-functional teams focused on specific jobs or customer journeys.

Build unique capabilities. Job-aligned processes can create a powerful source of competitive advantage that is difficult for competitors to copy. While products can often be reverse-engineered, the complex web of processes and organizational capabilities required to consistently nail a job is much harder to replicate.

• Examples of job-aligned processes:
  • Mayo Clinic: Coordinating specialists around patient needs
  • Amazon: Optimizing every process for fast delivery and vast selection
  • IKEA: Integrating design, manufacturing, and retail to enable affordable home furnishing

7. A jobs focus enables distributed decision-making and inspires employees

A well-articulated job provides a kind of "commander's intent," obviating the need for micromanagement because employees at all levels understand and are motivated by how the work they do fits into a larger process to help customers get their jobs done.

Empower employees. When everyone in an organization understands the jobs customers are hiring them to do, it becomes much easier to make decentralized decisions. Employees at all levels can use the job as a guiding principle to prioritize their work and make day-to-day choices that align with customer needs.

Create meaning and motivation. A clear focus on jobs can also be incredibly inspiring for employees. It provides a sense of purpose and connection to customer needs that goes beyond just hitting sales targets or improving product features. This shared mission can help unite diverse teams and functions around a common goal.

• Benefits of a jobs-focused organization:
  • Clearer decision-making criteria at all levels
  • Improved cross-functional collaboration
  • Higher employee engagement and motivation
  • More customer-centric culture
  • Faster, more agile innovation processes

8. Beware of common data fallacies that can lead companies astray from jobs

Data has an annoying way of conforming itself to support whatever point of view we want it to support.

Look beyond active data. Companies often focus too heavily on easily measured "active" data like sales figures or customer demographics, while overlooking the crucial "passive" data found in customer struggles and contextual observations. This can lead to a disconnection from the real jobs customers are trying to solve.

Avoid confirmation bias. There's a natural tendency to interpret data in ways that confirm existing beliefs or support desired outcomes. To truly understand jobs, companies need to actively seek out information that challenges their assumptions and be willing to revisit core beliefs about their business.

• Common data fallacies to watch for:
  • Overreliance on quantitative data at the expense of qualitative insights
  • Focusing on product attributes rather than customer progress
  • Mistaking correlation for causation in customer behavior
  • Ignoring data that doesn't fit existing mental models
  • Generalizing findings beyond the specific job context

9. Purpose brands arise when products become synonymous with jobs

A purpose brand is positioned on the mechanism that causes people to purchase a product: they nail the job.

Create a clear association. When a product or service becomes so closely associated with a specific job that customers automatically think of it when that job arises, it has achieved "purpose brand" status. This powerful positioning can lead to significant competitive advantages and premium pricing.

Communicate job focus. To build a purpose brand, companies need to consistently communicate how their offering solves a specific job, rather than just promoting features or general benefits. This requires a deep understanding of the job and a commitment to staying focused on it even as the business grows.

• Examples of strong purpose brands:
  • Google for finding information
  • FedEx for urgent package delivery
  • Uber for urban transportation
  • Airbnb for authentic travel experiences
  • TurboTax for easy tax preparation

10. Jobs Theory has broad applications beyond product innovation

I have been stunned by how broadly and deeply the Theory of Jobs can be used.

Expand your perspective. While Jobs Theory is powerful for product and service innovation, its principles can be applied to a wide range of challenges in business and beyond. From improving education and healthcare to addressing personal relationships and societal issues, the jobs lens offers a valuable framework for understanding human motivations and designing better solutions.

Continually evolve the theory. As with any powerful theory, Jobs Theory will continue to evolve and improve as it's applied to new contexts and challenges. Practitioners are encouraged to look for anomalies and push the boundaries of the theory, using these insights to further refine and expand its applicability.

• Potential applications of Jobs Theory:
  • Education: Understanding the jobs students and parents hire schools to do
  • Healthcare: Aligning provider incentives with patient jobs for better outcomes
  • Government: Designing policies and services that address citizens' real needs
  • Personal relationships: Improving communication and understanding in families
  • Social issues: Addressing complex societal challenges by focusing on underlying jobs

Last updated: August 9, 2024