What does it mean to know the reality for customers?

In my previous article, I discussed the first process of value creation, “ Intuition of a Strategy Story,” in detail, using examples. In this article, I would like to talk about the second process of value creation, “ethnography.”

The entire value creation process can be seen here.

Perceive the reality for N=1 specific customer

Ethnography is a fieldwork research methodology originally used in cultural anthropology and sociology. It refers to a methodology for understanding the culture and community of people from cultures different from one’s own, using qualitative data such as observations and interviews, rather than numbers (quantitative data) using questionnaires. This is also very effective in value creation in strategy stories.

In normal market research, a certain number of N is collected and segmented based on specific characteristics for analysis. However, although segmented data (e.g., women in their 40s, married) can be categorized and analyzed, it is not suitable for getting a real sense of the emotions behind the behavior.

Of course, quantitative research is very effective in some situations. However, in the initial stage of value creation, it is necessary to fully feel the experience of the N=1 customer as if it were our own. From this, we can develop business opportunities and customer issues, which will help us to develop business ideas with a realistic feeling.

Feel it, rather than know it

The important thing here is not to “know” the reality for the customer through secondary information such as what someone has researched, but to “feel” the reality for the customer through primary information such as direct experience.

When there is a customer, Ms. A (N=1), it is necessary to feel the story of her problem not only from a bird’s eye view, but also from her own perspective. Using a movie metaphor, this means that we need to feel the story from the point of view of the actor, not just from the point of view of the movie director, who has a bird’s eye view of the whole story. It is like being in Ms. A’s shoes and perceiving her problems as if her problems were our own.

It is also important not to make snap judgments when sensing the problems that Ms. A has. People often judge new things based on their past experiences and knowledge. This is not to say that such judgments are generally wrong, but when trying to create something new, making easy judgments based on existing experience and knowledge can lead to overlooking the seeds of creation.

The way we look at things is important

Here’s a question for you….

Question A: “What is this (what you see in the picture below)?”

That’s right. It’s a peach.

Question B: “Then what is this (the one in the picture below)?”

It’s also “peach”.

Now, the next question.

Question C: “Are these two the same?”

Yes, if you look closely, both of these are peaches, but they are different peaches.

Let me ask you a key question here.

Did you see the peaches the same way when you looked at these pictures in question A or B, compared to when you looked at them in question C?

Perhaps it was different. When it came to questions A and B, you probably thought, “That’s a peach,” as soon as you saw it. For question C, you may have thought, “These are peaches, but what characteristics do they have?”

This difference in perspective is important. The way of looking at things in questions A and B is to organize them within an existing framework by labeling them with existing knowledge and experience. Question C is the way of looking at something and trying to capture its characteristics.

In ethnography, it is important to look at “this is a peach, but how is it like ?” (the way we look at it in question C), rather than looking at labeling it as a “peach” (the way we look at it in questions A and B). It is also best if we can purely see it as, “What is this?” without even labeling it as a peach. This is the way children see and feel when they see something new or have a new experience.

Focus on your own problems and those of your neighbors

So how can we sense the problems of N=1 specific customer?

Even if we already have customers, it is not easy to ask them again about their problems. What should you do if there are no customers yet?

At such times, my practice is to stay close to my own problems and the problems of my near and dear ones.

I will explain with specific examples. The first example is an inspired case based on my own problems.

As I mentioned in a previous article, our main product at the beginning of the company was 100 Fungos, a hands-on educational program based on the concept of “get used to it before learning it.” When we were conceiving 100 Fungos, we came back to our own problems from our own experiences.

I feel that many of the things I was taught in elementary, middle and high school, as well as in university, were very meaningful, but the style of education was often one-way and input-oriented, with many students listening to what the teacher was saying.

On the other hand, the process of learning various things at the consulting company was not in the form of a training program, but it was interactive and output-oriented, where I learned by receiving feedback on my output repeatedly.

Both of them have their own merits and demerits, so it’s not a 0–100 story, but at the very least, I began to have doubts about the education for working adults at the time, which was uncritically adopting a one-way, input-oriented style of education as the standard. The experience I’d had up to that time had given me the feeling that even if I understood something in my head, I wouldn’t be able to use it at work.

This is not an approach to interviewing our own customers, but it can be seen as an approach to focus on what we ourselves have found troubling as customers (in this case, students).

As another case study, I would like to share an example of ethnography in action, as we have recently envisioned developing a business for small and medium-sized companies.

Although small and midsize companies have the same needs for employee training as large companies, the transaction amount per company is lower than that of large companies, and even if we provide a good service, we will not be able to receive repeat orders once the training measures have run their course and there are no new targets.

Up until now, we had been targeting only large corporations because we had run into these issues with our face-to-face employee training services, but the acquisition of etudes, an e-learning platform (LMS=Learning Management System), has opened the door for us. That’s because even if we could not provide face-to-face training services, we could continue to provide services through e-learning or LMS.

During the time when we were planning our business, Mr. T, who is coaching a local youth baseball team with me, asked me, “I would like to strengthen our internal human resource development.” Mr. T’s company has a few hundred employees, and our company defines it as a small to medium-sized company.

At that time, I could have introduced the sales representative and proceeded with the “business opportunity,” but since Mr. T had approached me, I took a different approach because I wanted to help him directly and because it was an opportunity for me to do an ethnography as a customer of a small to medium-sized company.

It consists of three to four sessions of two hours each, where we listen to their problems and discuss with them what direction they should take to solve them.

When I proposed this to Mr. T, he was very surprised. He commented, “I would appreciate it if you could introduce me to a sales person, but I don’t feel comfortable asking the president to spend a lot of time with me.”

When I mentioned that this process would not only help Mr. T’s company to find a meaningful solution, but would also be beneficial to our company’s business concept, he readily agreed to let us hold several “dialogue sessions”. Since it was our request, we of course conducted the sessions free of charge.

At about the same time, Mr. K, who had attended a cram school with me when we were in junior high and high school, contacted me and told me that he wanted to strengthen human resource development in his company.

When we told Mr. K that we would hold several “sessions where we would listen to his concerns and think about solutions together” and the background of such a proposal, including our own circumstances, he readily agreed.

Through these sessions, I was able to get a sense of what issues are related to people and organizations, how these issues affect the company as a whole and the business, what constraints need to be taken into account when implementing solutions, who needs to be involved in building consensus, and many other things.

While some of the stories were specific to Mr. T’s company and Mr. K’s company, they also included issues that are common to many small and medium-sized companies. The content was very useful for our business concept for small and medium-sized companies.

This kind of interaction with Mr. T and Ms. K can be described as an approach that gives us the opportunity to directly feel the problems of the people around us.

In this article, I talked about the second process of value creation, “ethnography.” In the next article, I will discuss the third process, “deriving a strategy story.”

Here are the quests of the day. (If you’d like, please share your thoughts in the comments.)

・If you were able to consciously use the three ways of looking at things mentioned in the article (see the three ways below) in your everyday life, what good would come to you?•

・If you were to practice ethnography in the business you are involved in, what kinds of problems of yours or those of people close to you would be good to focus on?

Bunshiro Ochiai