Trading: What Is the 'Job to Be Done?'

Thursday, November 07, 2019

A 2016 article from Harvard Business Review discusses innovations in four very different fields as exemplary of what its authors (including Clayton M. Christensen, who coined the term disruptive innovation) regard as a way to focus one's inventive efforts: Know the jobs your current and prospective customers need done. (I have seen this abbreviated elsewhere as JTBD.) After a somewhat long lead-in -- which you can skip by searching "The Business of Moving Lives" -- the authors get to what I found to be the most interesting example.

A building company had been having trouble selling condominium units to its target market of downsizers (e.g., empty-nesters and divorcing parents) and was unable to figure out why from any of the usual ways of investigating the problem, such as from demographic data. And attempts to boost sales, such as from changes to the units based on focus groups, were unsuccessful. So the company brought in Bob Moesta, an innovation consultant.

Moesta's approach involved interviewing people who did buy units in order to see whether there were any common threads that might help him discover what job the units were successfully doing for the buyers. This is an important part of what he was able to piece together:

Image by Annie Spratt, via Unsplash, license.
[I]n Moesta's conversations with actual buyers, the dining room table came up repeatedly. "People kept saying, 'As soon as I figured out what to do with my dining room table, then I was free to move,'" reports Moesta. He and his colleagues couldn't understand why the dining room table was such a big deal. In most cases people were referring to well-used, out-of-date furniture that might best be given to charity -- or relegated to the local dump.

But as Moesta sat at his own dining room table with his family over Christmas, he suddenly understood. Every birthday was spent around that table. Every holiday. Homework was spread out on it. The table represented family.

What was stopping buyers from making the decision to move, he hypothesized, was not a feature that the construction company had failed to offer but rather the anxiety that came with giving up something that had profound meaning
. The decision to buy a six-figure condo, it turned out, often hinged on a family member's willingness to take custody of a clunky piece of used furniture.

That realization helped Moesta and his team begin to grasp the struggle potential home buyers faced. "I went in thinking we were in the business of new-home construction," he recalls. "But I realized we were in the business of moving lives." [bold added]
On reaching this understanding, Moesta came up with ways the company could make moving less traumatic for its customers. Upon implementing his advice, his client saw an impressive gain in sales despite terrible overall market conditions.

The last bolded line of the above passage is the most important: Even when it seems obvious what one's job is, unexpected difficulties might be a symptom that one's assumptions about it are wrong. Or, to put it more broadly: Gaining and maintaining a firm grasp of the job-to-be-done is an active and ongoing process that is essential to occupational success.

I highly recommend this piece not only for its obvious merits to businessmen, but also because almost anyone can learn from it to become a better trader, and at any point in a career.

-- CAV

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