Vast number of new service concepts fail (> 4 out of 10), because they are build first and then introduced to the market (Bettencourt, 2010). The focus should be another way around and shifted away from the service solutions and back to the customer. Rather than asking, “How are we doing?” companies must began asking “How are the customers doing?

The key questions in service innovation are “How the customers define value?” and “How the companies approach customer needs?”. Outcome-driven innovation is an innovation philosophy and process built around the understanding that people “hire” goods and services to get jobs done (Bettencourt, 2010). By concentrating on these jobs, companies are capable of creating services beyond traditional services. For example when a person opens a bank account, creates a budget etc. the fundamental job is managing day-to-day cash flow. Service innovation in this case would be to create service to help the customer manage cash flow on daily bases. Creating a tool to help the customer make a budget in an easier and better way would not be service innovation but service development. Continue reading →