Why Digitalization Doesn't Change the Way Companies Innovate

Kevin Kelly, co-founder of the magazine “Wired” and author of the book “The Inevitable: Understanding the 12 Technological Forces That Will Shape Our Future,” said: “The business plans of the next 10,000 startups are easy to forecast: Take X and add AI. Find something that can be made better by adding online smartness to it.” No question, the digital revolution has arrived in full bloom and will affect almost every aspect of business in the future. However, will digitalization fundamentally change the way companies innovate? Our answer is no. While digital technologies hold enormous innovation potential, they belong to the sphere of “solutions” and are means to a higher purpose. While digital technologies evolve with breathtaking speed, a companies’ innovation strategy should refer to something more stable.

This higher-purpose and stable-over-time reference unit is a customer’s Job-to-be-Done (JTBD). According to JTBD theory, customers “hire” products and services to get a certain job (= task, goal or anything else a customer is trying to achieve) done. Digital technologies offer yet unknown potential to help customers get their jobs done better. Explained trough the Job-to-be-Done lens, digital technologies can help to:

• get a job done better,
• get more aspects of a job done,
• get several jobs done on one platform.

Let me give you some examples to make this more clear:

1. Digital technologies can help get a job done better
There are countless examples that show how digital solutions help get a job done faster, more efficiently and/or more effectively. Researchers at the National Center for tumor diseases in Heidelberg, for example, proved that a specially trained algorithm could recognize skin cancer faster and far more reliably than any physician can. Digital solutions will help farmers to minimize the use of chemical sprays, maintenance staff to recognize deviations and initiate prognostic maintenance and bank advisors to find the right investment strategy.

2. Digital technologies can help get more aspects of a job done
Uber made it more convenient for customers to “Get from destination A to B” than classical taxi operators did, by getting more job steps done on one platform. To call a taxi via a taxi operator, you had to pick the correct number, call the taxi, wait for an unknown duration, monitor if the driver takes the correct route, pay with cash (or find a cash machine in case you did not have any money with you), and so on. Uber takes over all these steps in its app.

3. Digital technologies can help get several jobs done on one platform
I am not sure if Florian Gschwandtner could ever imagine the enormous success of his product when he and his team developed the fitness app “Runtastic” in 2009. Runtastic is an app that captures personal fitness data like distance, food energy converted, speed, etc. when practicing a sport, and providing statistics around these metrics. Molded into a comprehensive business model including software, hardware and community components, Runtastic enables customers to get a range of jobs done on one platform, like “Manage fitness status”, ” Create personalized training plan”, “Motivate yourself for sport” or “Lose weight”.

The three examples above have one thing in common: The customers’ needs behind the solutions already existed long before the technologies to fulfil them arose. Every physician wanted to detect a disease at the earliest possible time, travelers wanted to get from destination A to B in the most convenient way and people wanted to become healthier and fitter. So, to come back to the question if digitization will change the way companies innovate: Uncovering customer needs and the growth opportunities they represent have to be the focal point of the innovation process, regardless if the solution is digital or not. In a digitalized world, being clear about uncovered customer needs is even more important than before. Having a focused, customer-centric growth strategy helps companies to navigate through a forest of digital opportunities and temptations; it helps to stay focused. The winners of the future will be those companies that can play on both decks and satisfy uncovered customer-needs with the upcoming technological possibilities.