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Product Strategy and Innovation Blog

Ron Johnson Didn’t Understand Apple

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Ron Johnson was recently ousted as the CEO of JC Penney after a series of failed experiments to drastically alter the consumer’s shopping experience. John Gruber (who we usually agree with completely) and others have commented that perhaps Johnson wasn’t given enough time to turn around JC Penney.

But we have a different view. We think Ron Johnson actually didn’t understand what makes Apple successful. This may seem difficult to believe given Apple’s retail success. But let’s look at what Ron Johnson has said and contrast it to what Steve Jobs has said. We believe most people, including Ron Johnson, take away the wrong lessons from some famous Steve Jobs quotes.

Johnson’s tenure at JC Penney was clearly a disaster. Sales dropped 25% in 2012. Johnson decided JC Penney customers didn’t want the hassle of dealing with coupons and sales and would prefer an upscale atmosphere in lieu of bargain racks.

Johnson rejected testing any of his radical changes because he claimed, “just like at Apple, customers don’t always know what they want.”

This myth, that “customers don’t know what they want” has frequently been attributed to Steve Jobs. So what was Steve Jobs really saying? And how does Apple really innovate?

The key to answering these questions is using precise language to describe the innovation process. If you look at two quotes from Jobs, you can see how he could be misinterpreted, even by someone like Johnson who worked for Jobs.

First, Steve Jobs said: “you can’t just ask customers what they want and then try to give that to them. By the time you get it built, they’ll want something new.” And second he said, “you‘ve got to start with the customer experience and work back toward the technology – not the other way around.”

So what do these two statements mean? And how could Ron Johnson misinterpret them? In our view, the key to these statements are two missing words: “products” and “jobs-to-be-done”.

If you combine these two statements and add the missing words, you can clearly see what Steve Jobs was saying: “customers don’t know what products (i.e. solutions and technologies) they want, but they certainly know what job-to-be-done (i.e. customer experience) they need to accomplish.”

This is profoundly different than saying “customers don’t know what they want,” meaning that they don’t know what needs they have. Companies make this mistake all the time. Here is a simple example. If you asked a thousand cooks what products they wanted, they would almost certainly never come up with the microwave, which would require extensive technical knowledge and expertise.

But if you asked the same cooks about preparing food (the job-to-be-done), they could tell you absolutely everything about the difficulty and frustrations of preparing food quickly, predictably, and successfully. These metrics related to speed, stability, and output of executing the jobs-to-be-done are the customer needs. They are knowable, measurable, and actionable. Understanding the “experience” of cooks (i.e. their jobs-to-be-done) is critical to increasing the innovation success rate and mitigating the risk of investing in a failed product.

Ron Johnson took away the wrong message from Apple and decided not to analyze the jobs-to-be-done for JC Penney customers. Like almost every innovation effort that fails to analyze the customer’s job-to-be-done first, Johnson’s effort was a failure. But his biggest failure may be learning the wrong lesson from Apple and his former boss.

Strategyn

Started by Tony Ulwick, Strategyn has generated billions of dollars in equity value for its clients and has achieved the highest innovation success rate of any firm. Whether your goal is to protect, grow or disrupt existing markets, successfully enter new markets or to optimize your customer’s product/service experience, Strategyn will help you achieve your growth objectives.

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