Brioneja - My Boss Told Me To Get The Voice of the Customer, Now What?

MY BOSS TOLD ME TO GET THE VOICE OF THE CUSTOMER, NOW WHAT?
ProductCamp Austin January 15, 2011
Jose A. Briones, Ph.D.
SpyroTek Performance Solutions
Twitter: @Brioneja

Introduction
Product innovation has been described as the way out of today’s difficult business environment.
The rate of success of development projects, in particular disruptive innovation projects remains too low.
We believe that a reason for the low success rate is the erroneous application of analysis methods designed for incremental innovation to projects with high levels of uncertainty
www.Brioneja.com Twitter: @Brioneja

Background
Voice of the Customer may be one of the most misunderstood concepts in the product management process.
Unfortunately any survey or conversation with a customer these days is labeled as “Voice of the Customer” and just viewed as a “check box” item.

In this Chapter of the “Beyond Stage Gate” series we will discuss how there are different types of Voice of the Customer surveys and how the misapplications of each type will pre-determine the results that are obtained.
We will relate different Voice of the Customer approaches with project portfolio classifications for product development.
Recommendations for how to apply them in different segments of the value chain will also be provided

Clayton M. Christensen
“We keep rediscovering that the root reason for established companies’ failure to innovate is that managers don’t have good tools to help them understand markets, build brands, find customers, select employees, organize teams, and develop strategy”
“There’s a better way for management teams to grow their companies. But they will need the courage to challenge some of the paradigms of analysis and the willingness to develop alternative methodologies”

Classical Stage-Gate Process
Source: Product Development Institute, Inc.
Project is managed in a linear fashion
“The Stage-Gate system assumes that the proposed strategy is the right strategy, the problem is that except in the case of incremental innovations, the right strategy cannot be completely known in advance” – Clayton M. Christensen

C. Christensen’s Disruptive Innovation Models
Twitter: @Brioneja www.Brioneja.com

Product/Project Minimum ROI Requirements
Disruptive
High
Level 3
Potential reward
Radical
Level 2
Incremental
Level 1
High
Risk
Low

A New Innovation Project Categorization
High
Medium
Low
Technical Uncertainty
Low Medium High
Market Uncertainty
Source: Product Development Management Association
This categorization is based on the most critical variable for new innovation projects: Degree of uncertainty

The Spiro-Level™ 3-D Approach to Innovation
Resources
Launch
Quadrant IV
Quadrant I
Roadmap/Timeline
Idea
Generation
Level
3
Risk Analysis
VOC
2
Customer
Testing
1
Time
Time
Technology
Assessment
Supply Chain
Analysis
Business
Case
Value in Use
Analysis
Regulatory
IP Strategy
Prototype
Development
Quadrant II
Quadrant III
Resources

Relationship Between Spiro-Level and Project Type

Overall Project Management

The Need for True Iterations
For Disruptive innovations, 1 round of VOC’s is not enough to be the cornerstone of a project
Customers cannot say that they want what they do not know
Customers can only provide feedback on incremental modifications on what they do know
Iterations are needed where customers evaluate a prototype and a new cycle starts, complete with a new VOC, market and business analysis

Source:
HutchCarpenter

Clayton Christensen: Customers do not buy products, they hire products to do a job.
Define the job your product is hired to do and the benefit your customer gets from it
Customers do not want to buy a drill, they want to make a hole

Voice of the Customer Types

VOC Approach to Level
VOC Level 1: Broad and shallow
VOC Level 3: Narrow and deep

Unmet Needs
If a genie in a bottle granted you three wishes what would they be?
The drill customer that still does not know he/she needs to make a hole

KJ Analysis
Relies on user observation
Structures a large number of user statements and provides relations between the statements

Job To Be Done
The "job-to-be-done" approach plumbs the deeper motivations surrounding use of your product. Understand that, and you can design products that attach themselves more closely to satisfying customers' needs. Hutch Carpenter
How deep is the hole you need? How fast do you need to make it?

Product Features
What color do you need the drill to be?
Electricity or battery?

VOC Dependency On Value Chain
As innovation moves from incremental to disruptive, VOC should be obtained further down the value chain, away from current customers

IDEO KJ Analysis of Eclipse Aviation Prototype
To design a brand new aircraft the size of an SUV, a design team from Ideo asked pilots to test a a mock-up with Post-it Note controls
Source: Business Week

Eclipse Aviation Prototype
Early research identified multiple problems with the existing design. From a usability perspective

The team built a "mockpit" – a prototype cockpit with foam core controllers and Post-it Note instruments that they invited Eclipse test pilot Bill Bubb to "fly"

As the designers gained flying knowledge, they would move Post-its — representing instruments — around on a printout of the cockpit panel, testing different positions and groupings to find the optimal layout

Eclipse Aviation's current design for the 500's instrument panel reflects many of Ideo's recommendations

VOC Tips
Go to listen – open-ended questions – don’t presuppose (which is so hard) and don’t send just send the sales guy in!!!!! –
You want to learn about what they see as their products/services, their distribution channels, their customers, their end-users (may be different from their customers), their customers’ decision makers, their geographies, the things that influence their biz which they may or may not be able to control (e.g., economy, weather, currency rates), how they help their customers save $ (profit), make $ (revenue), feel good
Deborah Mills-Scofield

VOC Tips
Do ‘day in the life’ – follow them around as they do their jobs – if it’s B2C, watch then shop, watch how kids pile into a minivan, SUV, what they eat, do with the trash etc. – how a plumber does their thing etc. – if B2B, how they order your stuff, get help with your stuff, get rid of your stuff, etc. – just follow them around and shut up at first and then ask questions about HOW, not how you’d do it
Deborah Mills-Scofield

Summary
There are different types of VOC surveys and approaches
The type of VOC approach used will predetermine the type of answers and information you get
It is important to match the right VOC approach to the right type of development project

ProductCamp DFW
Dallas-Fort Worth, TX Product Management Community
May 21, 2010 –University of Texas - Dallas

Contact Information
Brioneja@SpyroTek.com
www.Brioneja.com
Twitter: @Brioneja

References
The Entrepreneurial Mindset, 2000, http://www.amazon.com/Entrepreneurial-Mindset-Continuously-Opportunity-Uncertainty/dp/0875848346/ref=sr_1_1?ie=UTF8&s=books&qid=1274888243&sr=1-1
Innovation Killers, 2008, http://hbr.org/product/innovation-killers-how-financial-tools-destroy-you/an/R0801F-PDF-ENG?Ntt=innoation%2520killers
The Eclipse: Safety By Design http://www.businessweek.com/magazine/content/07_31/b4044416.htm
IDEO’s Shopping Cart Video http://www.youtube.com/watch?v=M66ZU2PCIcM

Attribute Map Questions
Non Negotiable:
Which three non negotiable attributes are the most expensive to deliver? Can we do something creative to reduce their cost, particularly in ways that competitors can’t imitate?
Differentiator
Why does this segment buy from us and not the competition?
What do we offer that customers not only like but are prepared to pay a premium for?
What do distributors and customers say we do better than anyone else?
How close is the competition to matching us on these features?
Exciter
If a genie in a bottle granted us one wish that would allow us to redesign our product or service and add or enhance an attribute in such a way that we could capture huge market share, what would we wish for? Is this within the realm of the possible for us?

Tolerable
What features would our most important customer segments list if we asked them to complete the following sentence: “If only you could eliminate ________ from your offering, I would buy a lot more often”
Can we get rid of a tolerable in ways that competitors can’t? How?
Are we experiencing increasing complaints on this tolerable?
To what extent are target customers beginning to compare us unfavorably with the competition?
Dissatisfier
On what subject do people who interact with customers hear the most rumbling?
Is it something all providers do, or something only we do?
To what extent is this attribute a key reason for recent customer defections?
To what extent is this attribute increasingly cited as a key reason for product returns?
To what extent are our competitors advertising their superiority with respect to this attribute?

Enrager
Are people who are in contact with customers observing reactions that go beyond minor irritation to enraging?
Have customer written letters of complaint or otherwise been proactively critical of this feature?
So What?
Look at every expensive attribute and ask what its elimination or reduction would do to sales
Why do we offer those attributes?
Are there any cost/complexity-reduction opportunities associated with getting rid of them?
What are the three most expensive “nice to haves” we offer – that is, features that we believe to be necessary but that customers appear unwilling to pay for?
Is there a competitive reason to keep these features, or could we eliminate them?

Price Sensitivity Analysis
At what price would it be so cheap that quality is doubted?
At what price would you consider this product to be a bargain – a great value for the money?
At what price would it start getting expensive, but still worth considering?
At what price is it so expensive that it would not be considered at all?

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Brioneja - My Boss Told Me To Get The Voice of the Customer, Now What?

by Jose Briones on Jan 15, 2011

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Brioneja - My Boss Told Me To Get The Voice of the Customer, Now What? Presentation Transcript