By: Erich Joachimsthaler, Boston : Harvard Business School Press , 2007 . 253 + xiii pages. . Review by: Reardon Smith
To listen to some of today's top-management people or to read some of today's popular business books, you would think that the secret to success for your firm is to focus carefully on continually expanding your product line and keeping a careful lead over your competitors. Customers will then gratefully buy your products in large quantities. In Hidden in Plain Sight, Erich Joachimsthaler suggests that this is totally the wrong approach. Basing future plans on your current products and those of your competitors is by nature an inward-looking process and, as such, will constrain your thinking rather than allow the kind of innovation that will take your firm from good to great: “For those unwilling to adopt an outside-in perspective, the future likely holds a fairly linear projection toward certain demise and a predictable downward path into commodity hell” (p. 21).
To help companies adopt this outside-in approach, Joachimsthaler proposes to replace traditional competitive advantage strategies withcustomer advantage (p. 5). This somewhat awkward grammatical coupling represents the “the intersection of opportunities for innovation, major trends and market discontinuities, people's changing behaviors and experiences in life and work, and competitive success” (ibid.). To help swallow this mouthful, he puts forward “a framework called the demand-first innovation and growth, or DIG, model” (ibid.). The demand-first component is to ensure that companies have that outside-in perspective, where they consider the opportunities first before considering how their current offerings could be enhanced. Apple's iPod is given as an example of a product being a success because of a lifestyle application—they are cool to own and be seen with. It takes an outside-in view to recognize that. “The opportunity … has nothing to do with improving the attribute or feature set of an MP3 player, or serving a daily task, or filling a need or want for listening to music ‘on the go’ that wasn't already addressed twenty-five years ago by the Walkman. It just isn't about that” (p. 8).
In this way a company should focus its efforts toward achieving its vision without constraining itself to a particular product line or even line of business. Starbucks is in more than the coffee business because its view of its customers includes their other wants, like music or their need for a place to do a little business.
Joachimsthaler discusses these concepts in the first 56-page section of the book. The remainder illustrates the concepts of the DIG model and of customer advantage through a series of case studies. These are interesting enough, but since none of the companies set out with the concepts of the DIG model or customer advantage in mind, the cases suffer a bit from the convenience of hindsight. In a few cases, I wondered if the final result couldn't have been achieved with much less fuss by using traditional brainstorming. However, these case studies make the important point that if you really want to get off that predictable downward path to commodity hell, you had better do something different for your customers—something that they may not even be aware that they want. Of course, this is not a new thought. Clayton Christensen (1997) addressed these shifts, and even Henry Ford famously said early in the last century, “If I had listened to my customers, I would have given them a faster horse.”
If you like case histories and are looking for ideas that may help you broaden your view of customer research, then this is a worthwhile book. If you are looking for major new insights into making the next great leap forward, this book probably isn't for you.
Released: October 2, 2013, 2:36 pm
| Updated: October 30, 2013, 2:02 pm