In a survey of product developers, we found that 90 percent have never in their career worked on a project where all the customer needs were known. The same survey showed that most product managers believe it is impossible to know all their customers’ needs using their current customer needs and latent needs analysis methods.
As a result, companies have become accustomed to making important product decisions without knowing all their customers’ needs. There is a good reason why it’s done this way. For decades, companies have believed that customers have latent needs. These are needs that customers themselves supposedly don’t know they have. If customers have latent needs (so the thinking goes), customers can’t be expected to articulate them, and consequently companies cannot possibly know them. This belief has been supported and perpetuated by many well-respected individuals and organizations.
The idea that customers have latent needs began when Abbie Griffith and John Hauser loosely defined “customer need” in their 1991 article “Voice of the Customer” as “a description, in the customer’s own words, of the benefit that he, she or they want fulfilled by the product or service.” Unfortunately, this definition, and the notion that it is acceptable to capture the literal voice of the customer, took companies down the wrong path because customers often talk about their own ideas for new product features rather than talking about what it is that they’re hoping to accomplish. As a result, many companies have come to accept product improvement ideas (solutions) from customers as if they were legitimate customer needs. Unfortunately, this has misled companies for years.
Here is the problem: a solution is not a need. A solution addresses a need. And when companies accept a solution as a need, they end up falsely concluding that customers have latent needs. How does this happen? Like this: Customers don’t know what solutions will best address their needs. They are not materials experts, technologists, or scientists. So, in the end, when they forgo the purchase of the product that contains the features they asked for in favor of a product that contains features that actually help them get a job done better, companies conclude that customers must not know what they want — otherwise, they would have described the solution they ultimately purchased.
But it is the company’s job to figure out the best solutions, not the customers’. It is also the company’s responsibility to figure out the customers’ unmet needs. Customers don’t know what inputs companies need to create great products – and unfortunately, neither do many companies. As a result, most product developers have never had a complete set of customer needs and think getting all of them is impossible.
This confusion about latent needs is the root cause of failure in innovation. We solved this decades-old problem by thinking about customer needs very differently. We get the right inputs needed for innovation by defining needs around the “job” the customer is trying to get done, rather than around the product they are using. The truth is there is no such thing as latent needs. This insight has enabled us to invent a powerful innovation process called Outcome-Driven Innovation (ODI), which has a success rate that is five times the industry average.