Jobs-To-Be-Done (JTBD) for Investors

The concept of "Jobs to be Done" (JTBD) has been gaining traction among product developers, marketers, and innovators. But how does this concept apply to the world of investing? In this article, we will explore the JTBD framework and its relevance for investors.

What is Jobs to be Done?

At its core, the JTBD theory posits that customers hire products or services to get specific jobs done. Rather than focusing on the product or the customer, JTBD concentrates on the underlying task the customer is trying to accomplish. By understanding these tasks, businesses can design better products and services that fit the needs of their customers. Example: Instead of saying "I bought a drill," a JTBD perspective would say "I needed to make a hole." The job is making a hole, and the drill is just one tool to accomplish that job.

Why Should Investors Care About JTBD?

For investors, the JTBD framework offers several advantages:

• Better Market Understanding: It provides a deeper insight into the market's actual needs, allowing for smarter investment decisions.

• Predicting Disruptions: By focusing on the job and not the product, investors can identify potential market disruptions.

• Assessing Company Strategy: It can help determine if a company's strategy aligns with the actual needs of the market.

How Can Investors Use JTBD?

• Identifying Unmet Needs: By understanding the jobs customers are trying to get done, investors can spot opportunities where there are unmet needs. Example: If a significant number of people are "hiring" taxis not for transportation but for the job of "moving large items," there may be a market for a service specifically designed for that job.

• Assessing Product-Market Fit: A company with a strong product-market fit has products that cater specifically to the jobs their customers want to be done. Example: Dropbox was successful because it catered to the job of "I want to access my files from any device without thinking about where they are stored."

• Evaluating Competitive Threats: By focusing on the job, investors can spot potential competitors outside the traditional industry boundaries. Example: For the job of "I need to get from point A to B," the competitors include not just car manufacturers but also bike-sharing services, public transport, and even telecommuting solutions.

Case Study: The Disruption of the Camera Industry:

Years ago, the primary job of a camera was "I want to capture memories." Traditional camera manufacturers focused on this job and consistently improved their products. However, they were disrupted by smartphones. Why? From a JTBD perspective, smartphones catered to a broader job: "I want to capture and share memories instantly." While traditional cameras focused solely on the capturing part, smartphones addressed both capturing and sharing, fulfilling a more comprehensive job for the customer. Investors who recognized this shift early on could have predicted the rise of smartphones as the primary tool for photography and the subsequent decline of many traditional camera companies.

Limitations of JTBD for Investors

While JTBD is a powerful framework, it's not without limitations:

• Not Always Applicable: Not every market or industry will have clear "jobs" that customers are trying to get done.

• Requires Deep Customer Insight: The effectiveness of JTBD relies on having deep insights into customer needs, which may not always be readily available.

• Evolution of Jobs: The jobs that customers want to be done can evolve over time, requiring continuous reassessment.

Jobs to be Done offers a unique lens through which investors can view the market, products, services, and competitive landscape. By focusing on the underlying tasks or needs that customers are trying to fulfill, investors can gain a deeper understanding of market dynamics and make more informed investment decisions. Like all frameworks, it should be used in conjunction with other tools and methodologies to get a comprehensive view of investment opportunities.