Outcome-Driven Innovation®

How the ODI process works

Outcome-Driven Innovation is a strategy and innovation process conceived through a Jobs-to-be-Done lens. It includes all the steps a company must take to conceptualize and approve a product for development.

1. Define your market around the customer’s job-to-be-done

Companies traditionally define markets around a product, technology, geography, or vertical, but those are ineffective ways to define a market.
Since people buy products to get a job done, we define a market as a group of people and the job they’re trying to get done.
Defining your market around the “JTBD”  instead of the technology or product allows you to fully understand what your customers are trying to do, build the products they want, and give your company a stable focal point for value creation.
The process defines a “market” in such a way that makes it:

• A stable focal point for long-term value creation – stable over time
• Customer-centric
• Independent of a solution
• A unit of analysis that enables a deep, empathic understanding of customer needs

Example:
Tradesmen (groups of people) cutting wood in a straight line (the JTBD) – This definition is independent of a solution and allows the team to focus on the best way to create value without the constraint of technology. In addition, the statement is valid for as long as tradesmen need to cut wood, whereas technologies come and go.

2. Uncover your customer’s outcomes (Perfect need statements)

Customers want to get their jobs done perfectly. 


Customer needs traditionally focus on solutions, benefits, gains, requirements, exciters, specs, value drivers, etc.


Outcomes transform customer needs from vague preferences into precise, measurable targets for innovation, creating the “perfect” need statement.

Outcome statements:

• Inform all disciplines
• Knowable and discoverable
• Solution-independent
• Measurable and controllable
• Unambiguous
• Valid across geographies
• Stable over time 


We use leading qualitative methods to uncover the 100+ outcomes your customers use to measure the successful execution of a job-to-be-done, define what perfection means – and instruct your company how to deliver it.

3. Determine which outcomes are unmet

Customers have underserved and overserved outcomes.

Knowing with statistical certainty which outcomes should be the focus of your value creation and cost reduction efforts and ensures the efficient deployment of resources.

Leveraging statistically valid primary quantitative research, the process reveals hidden opportunities, competitive strengths, targets for cost reduction, and more.

The Opportunity Landscape

To discover which outcomes are under and over-served, we have devised a mathematical formula we call the Opportunity Algorithm. It states that opportunity = importance + max(0, importance – satisfaction).

This formula reveals the most important and least satisfied customer outcomes, representing the best growth opportunities. We plot the scores on the opportunity landscape, revealing with precision where the market is under and over-served.

Teams know with certainty which of the 100+ outcomes are unmet and to what degree.

4. Discover hidden segments of customers

Customers rarely agree on which outcomes are unmet. 


Segmenting your markets into groups of people with unique sets of unmet outcomes allows you to pursue opportunities your competitors will fail to see.


Traditional segmentation methods like demographic, psychographic, attitudinal, and behavioral segment classifications, along with use cases and personas, are proxies—and often result in targeting phantom segments.

This is why we segment the market directly around unmet outcomes. It produces segments of people with different unmet needs.

Using this approach, market segments are discovered in a way that makes them:


• Valid and distinctive: groups of people with different unmet needs
• Actionable: products can be targeted at the right segments using the right growth strategy
• Reachable through context and other characteristics
• Defensible: backed by data
• Hidden from competitors using traditional methods

5. Formulate the innovation and product strategy

The innovation strategy is the selection of segments and unmet outcomes to target for growth. 

Knowing where the hidden opportunities lie, your company can better position and improve its existing products, fill gaps in its portfolio, make impactful R&D investment decisions, and more.


This purposeful exercise is the essence of positioning and strategy. 


The strategy consists of these 3 critical elements:

Build a long-term, customer-centric growth strategy


A shared understanding of the opportunities aligns sales, marketing, development, R&D, M&A and operations actions for long-term growth planning.