Clarity Tip Sheet...

Gaining Competitive Advantage By Identifying Unfulfilled Needs

In general, products are becoming more alike and their lifespan shorter. This makes it important to have continuous product development, either by imitating and replicating your competitors’ products or by setting new standards yourself.

It’s worth bearing in mind, though, that copying others will never get you ahead.

Most companies are aware of the need to be innovative to survive over the longer run. Unfortunately, many do not quite manage to practice this principle. Most companies habitually bring new products to the market, but often these are really minor adjustments to existing products, frequently as a response to competitors having launched a similar or perhaps a superior product.

That’s not innovation. Innovation is more a matter of applying new technical possibilities to cover unfulfilled needs in the market.

Innovation should permeate the entire company
Innovation does not happen by itself, just because you talk about it. Rather, it’s an attitude that should pervade throughout the organisation, from top to bottom, and not just in the “R&D department”.

International studies show that most, sometimes 90%+, of new products fail. Why? Either the “new” products are actually “me-too”, or they don’t really solve customers’ needs better than existing products. Undoubtedly, a number of these failures could have been avoided through integrated product development.

Yet, too many companies leave product development to the “R&D” function alone, leaving questions like, “how many of these will we be able to sell”, too late in the process.

What are you selling?
Although product development should be integrated, it would seem the R&D department would primarily be responsible for applications of new technical possibilities, whilst customer oriented departments’ (e.g. Marketing departments, Sales, but sometimes also Service) expertise is in identifying unfulfilled needs.

However, consider the question: what does your company actually sell? The notion, “we sell solutions, not products” is easier said that done and many companies are still far from realising the philosophy.

Consider George Eastman, Kodak’s founder, who asked his salesmen what they were selling. Answers were along the lines of “good cameras”, “pictures”, “film”, etc. Eastman’s response was: “...we sell memories”.

Do customers know what they want?
Once you’re clear about what your customers actually buy, it’s much easier to identify unfulfilled needs. Mostly, it’s a waste of time asking customers what they want. Customer can talk about what’s wrong with existing products, but rarely can they be innovative on your behalf.

That’s because they have neither the knowledge nor the mind's eye to combine technological possibilities with their own future needs. Nobody approached Akio Morita to develop the Walkman, nobody asked Thomas Edison to invent the light bulb, and Steve Jobs & Steve Wozniak were driven by their own vision of a personal computer when developing the Apple.

Identifying unfulfilled needs
Still, how do you identify unfulfilled needs (about which customers may be more or less conscious)? There are number of approaches, but one in particular is both overlooked and highly practical: Problem Analysis.

Firstly, gather a number of customers and prospects and let them discuss the problems and annoyances they experience with current products (those of your company and of your competitors). If this debate is professionally managed it’s not uncommon for several hundred points to emerge, the majority of which you would probably not have thought about if you had started with a blank piece of paper.

By expanding the analysis to several customers and prospects, you can prioritise the issues and end up with invaluable inspiration for product development based on unfulfilled needs.

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