Anthony W. Ulwick

What is the secret to a winning value proposition?

The unmet needs of today represent the winning value propositions of the future. Knowing which needs are unmet—which desired outcomes are underserved—enables a company to secure a unique and valued competitive position. This is the essence of strategy, and it is best tackled through the effective use of Jobs Theory. To secure a winning value proposition, a company must (1) know where in the job the customer is underserved, (2) secure the value proposition that communicates to customers that their needs can be satisfied, and (3) do everything in its power to satisfy the targeted unmet needs better than its competitors.

The best way to figure out where the customer is underserved is through the application of Outcome-Based Segmentation. It was designed for this purpose. To create a winning value proposition, a company must know why a segment of customers is underserved, along which dimensions they are underserved, and to what degree. Once a company knows those three things, it can define a value proposition in a way that communicates its intent and ability to address all the unmet needs.

Once the value proposition is defined, the company must fulfill its promise. First, it must point out to customers ways in which its product or service already addresses the unmet needs it has discovered. Next, it must accelerate development of product and service features in the pipeline that further address the targeted unmet needs. Then it must create or invent new features that address any remaining unmet needs that are within the sphere of its value proposition. Coloplast worked over a period of years to address all the unmet needs associated with preventing complications.

A value proposition that is tied to unmet needs aligns company employees around a common vision and is integral to a company’s long-term success.

6. 
   CONDUCT THE COMPETITIVE ANALYSIS
   

Why do you conduct competitive analysis? Is it merely to see which features of competitors’ products are technically superior? Or is the goal to gain the insight that is needed to
create products and services that get a job done better and/or more cheaply than competing solutions? We argue that the latter should be the goal. Therefore, comparing feature sets—“speeds and feeds”—of competing products is a waste of time. It’s an outdated approach that provides irrelevant information.

We conduct competitive analysis by having customers quantitatively evaluate competing offerings against a complete set of desired outcome statements. That process reveals precisely which offerings get the job done better and which get it done worse. These customer insights help along two fronts: (1) they pinpoint precisely which desired outcomes to address to offset the strengths of competing offerings, and (2) they reveal what underserved desired outcomes exist in the market as a whole, thus offering a path for leapfrogging all competitors and establishing a unique and valued competitive position.

The same survey that is fielded to gather the data needed to perform the Outcome-Based Segmentation analysis is used to gather the information needed for this type of competitive analysis. In the survey we determine the importance of each desired outcome and the level of satisfaction users have with the leading products (the competitive product set).

Once this work is completed, an evaluation of competing products can begin. This can best be understood through the

example of Bosch's ODI-based competitive analysis with dummy data of the competitive North American circular-saw market.