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Core Concepts in Innovation:

Product Opportunity Gaps


SETS / JTBD
Prof. Mohamed K. Watfa
ENG950
Innovation & Design

By The End Of Part1 Today, You Should:


Be able to use the SET factor model to identify and
understand opportunities created by Product
Opportunity Gaps (POGs)
Be able to articulate a Product Opportunity Gap with a
concise statement that identifies who the target
market/consumer is and what the gap is between
consumers needs and offerings on the market, without
specifying how you plan to fill that gap

The Cagan and Vogel Innovation Process

Identify

Understand

Conceptualize

Realize

Launch*

Phase 1: Identify The Opportunity


Identify

Understand

Conceptualize

Realize

Launch*

Goals:

Identify and evaluate a set of promising Product Opportunity Gap (POGs)


Choose the most appropriate POG to move forward with

Primary results:

Product opportunity statement (hypothesis)


Initial scenario that illustrates the opportunity

Methods

Brainstorming, observing, researching Social, Economic, and Technology


(SET) factors
Generating POGs based on SET factors
Evaluating and filtering POG ideas generated
Scenario generation, feedback, and refinement

Source: Cagan and Vogel, Creating Breakthrough Products, Chapter 5.

Phase 2: Understand The Opportunity


Identify

Understand

Conceptualize

Realize

Launch*

Goals:

Much deeper understanding of customer and customers Value


Opportunities (VOs), translated into product criteria

Results:

In-depth understanding of the customer/user, captured through refined


customer scenarios and VOAs
List of product characteristics and constraints

Methods

Primary research: observe, interview, listen, task analysis, stakeholder


analysis
Secondary research: human factors, lifestyle reference, dive deeper on
SET factor changes

Source: Cagan and Vogel, Creating Breakthrough Products, Chapter 5.

Social, Economic, and Technology (SET) Factors


Identifying and observing broad Social and Economic
changes in a society can help you discover gaps that current
products and services are not meeting.
Likewise, Technological advances can create opportunities
to create products and services that would have been
previously technically impossible
Technological advances often also create new (and different)
problems for people or societies, which can also be fertile ground
for product opportunities

In general, you are looking for broad, enduring changes to


use as a basis for new product opportunities

Social
Family and work patterns (for example, the number of single
parents with two jobs or the number of double-income
households with flexible hours)
Health issues (people living longer with more active lives)
Use of computers and the Internet
Sports and recreation / Sporting events
The entertainment industries, including film and television
Vacation environments (for example, the fantasy fulfillment
provided by Disney World, Las Vegas, and Club Med)
Books (for example, Oprahs Book Club)
Magazines
Music (from hip-hop to new classic-chic)
Environments at work (that raise quality of workplace standards)

Economic
For example, the economic boom in the 1990s created
multimillionaires overnight through IPOs, stock
options, and individual investment in the stock market.
Excess disposable cash resulted in a void in material
goods that these young, geeky, intelligent, socially
responsible, technology orientedand richnew
group of consumers sought.
Lifestyle-oriented products that filled this void include:
recreational SUVs, clothing, tech products, PDAs that
connect through the Web for constant stock price
monitoring, and the proliferation of coffeehouses.

Economic (2)
The eventual great recession of the twenty-first century
Peoples attitudes about spending shifted.
Smaller cars, including a new class of electric-based,
have replaced SUVs.
Smart Online Shopping: Smart-phones and tablets have
evolved to keep people connected 24/7, especially
through social media channels and from their home,
where smart shoppers can look for good bargains
without leaving their living room.

Technology
The always-increasing power and speed of each months
latest PC
Home PC, to the car transmission, to the oven, to the
stereo, and now to everyones smartphone, iPod, and iPad.
The latest technologies, from microelectromechanical
systems (MEMS) in automobile airbags to layered
manufacturing technologies
The first genetic fingerprint of the human species in the
year 2000
The first cloning of Dolly the sheep in 1997

SET Factors
Social
Social and cultural trends
Reviving historic trends

Product
Opportunity
Gap

Economic

Technical

State of the economy


Change in focus on where to spend money
Levels of disposable income

Introduction of new technologies


Re-evaluating existing technologies

Examples
The postWorld War II:
The economic boom,
Cheap gasoline,
the creation of the suburban lifestyle, and the look of
jets and rockets
were the SET Factors that created the opportunity:
for large eight-cylinder cars with sizable tail fins that
dominated the auto industry during the 1950s.
Harley Earl, head of styling and color for GM, saw the
opportunity and introduced fins on the rear of cars,
starting with the low-end Chevy all the way up to
Cadillac.

SET Factor Exercise


Divide into three groups (one S, one E, one T)
Work as a group to come up with a list of at least 10
broad forces / changes / trends in the GCC and/or the
full Arab League nations for your assigned topic
(S, E, or T)
Write them down and be prepared to present them for
discussion.

SET Factor Discussion


Do you see some common themes emerging?
Which of these SET factors are mostly the same
throughout the GCC nations? Throughout the Arab
League nations?
Which of these SET factors vary considerably
throughout the GCC nations? Throughout the Arab
League nations?

Product Opportunity Gaps (POGs)


The next step is to identify Product Opportunity Gaps,
or POGs based on your SET factor analysis.
A Product Opportunity Gap is the gap between what is
currently on the market and the possibility for new, or
significantly improved, products that result from
emerging trends.

Examples of Product Opportunity Gaps


A vegetable peeler that is easily used by people suffering from
arthritis in their hands
A light source that can be pointed and held focused on a specific
point in cramped or difficult locations without requiring the use
of the persons hands to hold it

A financial instrument that allows young people to move out of


their families homes to live on their own before they are married
Training tools and materials that help working adults without
deep technical expertise develop skills with fast-changing
information technologies

POG Exercise
Form groups of 3-4 people
Pick one of the following industries:
Fashion, personal transportation (on land), personal transportation (air)
restaurants, international shipping, real estate, financial services, education,
medical, entertainment, Media, hotels, home appliances, army, childcare.

Based on the SET factors identified, where should the leading


companies in that industry be looking for gaps to fill with innovative
new products or services?
Are they doing so currently?
If not, why not?

Come up with a list of at least 5 POGs for this industry that your
group thinks that companies in this industry should be exploring
Be prepared to share the top 2 POGs with the class

Jobs To Be Done Analysis


and
Outcome Expectations

By The End Of Part 2 Today, You Should:


Understand the concept of 'hiring' a product to do a job,
and use the technique of identifying and understanding
the Job To Be Done as a way to uncover new Product
Opportunity Gaps
Be able to use Outcome Expectations analysis to identify
important Jobs To Be Done that are not being done in a
way that meets customers needs and expectations

Be able to use Value Quotient Analyis to identify product


opportunity gaps

Phase 1: Identify The Opportunity


Identify

Understand

Conceptualize

Realize

Launch*

Goals:

Identify and evaluate a set of promising Product Opportunity Gap (POGs)


Choose the most appropriate POG to move forward with

Primary results:

Product opportunity statement (hypothesis)


Initial scenario that illustrates the opportunity

Methods

Brainstorming, observing, researching Social, Economic, and Technology


(SET) factors
Generating POGs based on SET factors
Evaluating and filtering POG ideas generated
Scenario generation, feedback, and refinement

Source: Cagan and Vogel, Creating Breakthrough Products, [CV02] Chapter 5.

Jobs To Be Done Analysis


People dont buy quarter-inch drills, they buy quarterinch holes. The drill just happens to be the best means
available to get that job done.
Ted Leavitt of Harvard Business School [SSD09] p 10.

Jobs To Be Done (JTBD) Analysis

Goal: identify the human need you are trying to meet


Focus on the outcome that your customers want to achieve,
not on the product that you want to sell to them

JTBD analysis steps


1.
2.
3.
4.
5.
6.

Identify a focus market


Identify jobs customers are trying to get done
Categorize the jobs to be done
Create job statements
Prioritize JTBD opportunities
Identify Outcome Expectations regarding the job

Source: [SSD09] pages 1-8.

Different Types of Jobs To Be Done:


Functional jobs describe the task that the customers
want to achieve
Emotional jobs relate to feelings and perceptions
Personal jobs relate to how customers want to feel about
themselves
Social jobs relate to how customers want to be perceived by
others

Ancillary jobs are other jobs that customers want to get


done before, during, or after they get their main job
done
Source: [SSD09] pages 1-8.

Job Statements
Express the JTBD with a Job Statement, which usually
takes the form:
<Action verb> <Object of Action> <Contextual Clarifier>

Examples
Listen to music in the car with friends
Allow the kids to listen to different music in the car than their
parents
Travel from home to work comfortably and quickly without
the stress of driving in traffic
View pictures at home that were taken with a digital camera
Satisfy appetite for ice cream without becoming overweight
Source: [SSD09] pages 1=8.

Exercise: Describe The Job(s) To Be Done By

Exercise: Describe The Job(s) To Be Done For

Outcome Expectation Analysis

Goal: list desired and undesired outcomes of a product that


addresses a Job To Be Done to identify places where
current solutions fall short

Focus on broad benefits and drawbacks, not features or


performance characteristics for specific products

Outcome expectation analysis steps


1.
2.
3.
4.

Identify the Job To Be Done


List the JTBDs related Outcome Expectations
Create Outcome Statements
Determine high-priority Outcome Expectations

Source: [SSD09] pages 10-13.

Outcome Expectations Grid


Customer

Undesired

Desired

Source: [SSD09] page 10.

Provider

Outcome Expectations Grid


Job statement: Prevent other people from seeing
the private information stored on my smartphone

Customer

Desired

Undesired

Provider

Outcome Expectations Grid


Job statement: Prevent other people from seeing
the private information stored on my smartphone

Customer

Desired

Undesired

Provider

Strongly secures private data


Easy to install
Easy to use
Inexpensive to buy / own
Just works on my phone

Cheap to produce and maintain


Easy and inexpensive to
distribute
Requires little advertising /
marketing support

Difficult to use
Expensive
Sometimes makes me lose
access to my own data
Does not work on my existing
smartphone

Expensive to create
Expensive to support / maintain
Complicated to support/maintain
Customer data loss causes
lawsuits or bad customer relations
Attackers can easily go around
security provided

Outcome Statements
Clearly and precisely state desired/undesired outcomes
Structure:

Direction of action (decrease, increase, maximize, etc.)


Unit of measurement (time, length, weight, cost, etc.)
Object of control (what it is you are influencing)
Context (where or under what circumstances)

Source: [SSD09] pages 11-13.

Outcome Statement Examples


Minimize the difficulty of installing on phone
Minimize the technical knowledge required of phone
user
Minimize the likelihood that the customer will lose data
Increase the invisibility of protecting the data
Reduce development and maintenance costs for
supplier
< other examples? >

Source: [SSD09] pages 11-13.

Exercise: Outcome Expectations


Create an Outcome Expectations grid for the following
JTBD Job Statement:
Record images from vacations to share with friends

Create outcome statements for this job statement and


prioritize them based on importance and the level of
consumer satisfaction with current solutions

Exercise: Outcome Expectations Grid


Customer

Undesired

Desired

Provider

Value Quotient
Key Idea: start from perfect and work backwards
Desired _ Outcomes
Value _ Quotient
Undesired _ Outcomes

To improve Value Quotient look for places to improve


desired outcomes or reduce undesired outcomes

Value Quotient Analysis Steps


1.
2.
3.
4.
5.
6.

Identify the Job To Be Done


Identify the desired and undesired outcomes
Plot the ideal innovation
Plot existing solutions
Identify opportunity value gaps
Close the value gaps

Value Analysis Plots: Perfect World


Job To Be Done: Record images from vacations
to share with friends

Step 5: Identify Opportunity Value Gaps


Where to look for value gaps:
Dimensions with high customer importance and low customer
satisfaction
Dimensions that customers report as not very important and
they are satisfied
This may present an opportunity to lower the bar to produce a
cheaper, simpler, alternative for the low end of the market

Dimensions for which there is currently no good solution

Value Quotient

Value Quotient Exercise


For the identified Job To Be Done:
Record images from vacations to share with friends

Select three different solutions currently on the market


for this JTBD.
Plot the existing solutions on your value analysis graph
Identify opportunity value gaps that this analysis
exposes
Propose different ways that you might close these gaps

References
[CV02] Jonathan Cagan and Craig M. Vogel,
Creating Breakthrough Products,
Prentice Hall, 2002, ISBN: 0-13-969694-6.
[SSD09] David Silverstein, Philip Samuel, Neil
DeCarlo, The Innovators Toolkit,
John Wiley and Sons, 2009,
ISBN: 978-0-470-34535-1.

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