One of the key principles in disruptive innovation theory is the concept of “jobs to be done.” The concept explains how customers want to “hire” a product to do a job, or, as Harvard Business School professor Theodore Levitt put it, “People don’t want a quarter-inch drill. They want a quarter-inch hole!” Behind every good product exists a job it must perform. We’ve found this approach is so effective that innovators who discover the correct job of a customer can often deliver highly competitive products or services against much larger and more established market leaders. Incumbents, influenced by many traditional marketing and sales metrics, often fail to identify the real struggles that shape customers’ purchase behavior—thus exposing themselves to better-attuned disruptors.
The healthcare industry is no different from other industries where customers have a number of painful struggles yet to be addressed. But the challenge is that “healthcare” encompasses a broad range of topics for a highly variable population. Healthcare choices often involve very prominent functional, emotional, and social dimensions in addition to the symptoms of the illness. Consequently, the causality of consumer choice—their job to be done—is rooted in the overall circumstances they find themselves in, both before and during the point of decision-making.
This complexity often makes it difficult for disruptive innovations to emerge. When the context of circumstances differs for each consumer, it’s increasingly difficult to identify not only the consumer’s job, but competing products or services as well. The competitive set is not always forthcoming and often has little to do with industry or product verticals. This is well described in Clayton Christensen’s milkshake story. When the “jobs to be done” framework was applied to a fast-food chain with unsatisfactory milkshake sales, researchers discovered a hidden job behind morning commuters’ “hiring” a milkshake. Customers wanted to eat something during their morning commute that was easy to consume while driving and would stave off hunger until noon. The competitors for this job were not other milkshakes, but other food items such as bagels or bananas.
Similarly in healthcare, consumer choices to address a job are not limited to specific products or services in one sector. Hospitals not only compete against retail clinics and new prescription medications but also with health-food stores, gyms, and even increased personal discipline. For some, using WebMD can be as valuable as seeing a primary care physician. These are some of the tools people hire to accomplish the job of addressing their health issues—and each is a direct competitor to traditional healthcare products and services.
It’s also a common mistake to overlook the dynamics between the patient and his/her family members or caregivers. The important jobs for healthcare often arise away from those suffering from the disease themselves. Cancer diagnostics are often purchases made by family members; sudden illnesses of close friends and family prompt us to consider a purchase of healthcare products or services; in pediatrics and elderly care, purchase decision makers are rarely the beneficiaries.
Depending on the individual’s circumstance and how she perceives the value of a healthcare product, she might be willing to sacrifice different factors, such as money, time, convenience, and outcome, to “hire” the product to address her job. If we can define the tradeoffs between these different choices, we can evaluate the underlying value of the customer’s job or unmet struggle.
Unfortunately, innovations in healthcare have yet to address many of these jobs. Therefore, a proliferation of products and services that do not effectively address jobs have led healthcare to become more expensive. Higher costs are leading to less consumption of care in younger populations, a trend that could be more costly over time. An in-depth understanding of individual purchase behavior of healthcare will be crucial to changes in consumption and delivery of healthcare. Few people can exactly explain why they do the things they do—but their purchasing behavior speaks volumes. Better care and deeper satisfaction at lower costs for both the patient and the provider are possible if we dig deeper into individuals’ purchase decisions for clues.
