First Look

August 21, 2007

Professor Clayton M. Christensen, whose books The Innovator's Dilemma and The Innovator's Solution grabbed headlines a few years ago, has been busy. A new "note" he's written with 3 coauthors explains how customers see the world. Companies make a mistake by segmenting markets by demographics or product characteristics. Instead, write Christensen et al. in "Finding the Right Job for Your Product," "Customers' purchase decisions don't necessarily conform to those of the 'average' customer in their demographic; nor do they confine the search for solutions within a product category. Rather, customers just find themselves needing to get things done." The advice is 3-fold: segment markets by job, identify the job-based structure of a market, and let innovators understand how to accomplish the work. First Look is otherwise short but sweet this summer week. Look for a chapter on bandwidth allocation in peer-to-peer file sharing networks, a study of the U.S. Food and Drug Administration at its centennial, and several cases on Earthbound Farm, Hewlett-Packard, and Prosper Marketplace, Inc.
— Martha Lagace

Working Papers

None this week


Cases & Course Materials

Finding the Right Job for Your Product

Harvard Business School Note 607-028

Asserts that the typical ways that companies have learned to segment their markets, by product category, or customer, actually causes most innovations to fail. If innovating managers will instead segment their markets by the different jobs that customers might use their products for, their probability of success will be much higher. Understanding the job is much more important than understanding the customer. Describes methods managers can use to segment their markets by job. Shows how the major elements of a coherent business plan become clear, once the job is understood.

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Hewlett-Packard (B)

Harvard Business School Supplement 507-036

Supplement to the (A) case.

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Earthbound Farm

Harvard Business School Case 807-061

Describes a set of decisions confronting the senior management of Earthbound Farm, the largest organic produce company in the world. Focuses on what to do with an East Coast distribution center that is losing money but may be useful strategically.

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Prosper Marketplace, Inc.

Harvard Business School Case 807-074

Describes a set of financial and strategic decisions confronting the founding management team of a new online financial services company. Prosper Marketplace is an internet-based market for individuals to borrow money from other individuals who wish to invest in such loans.

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Perspectives on Risk and Regulation: The FDA at 100


Perspectives on Risk and Regulation: The FDA at 100 brings together the viewpoints of Food and Drug Administration officials and industry leaders on the future of regulating food, drugs, medical devices, and dietary supplements. In a period of rapid scientific and market changes the success of regulation in these areas increasingly hinges on communication and collaboration between the FDA and the private sector. By situating forward-looking perspectives of agency leaders and industry representatives within FDA's regulatory history, this volume presents readers with new tools for evaluating policy recommendations and will better equip the public and experts to assess pressing regulatory issues.

Bandwidth Allocation in Peer-to-Peer File Sharing Networks


We present a model of bandwidth allocation in a stylized peer-to-peer file sharing network with s peers (sharers) who share files and download from each other and f peers (freeriders) who download from sharers but do not contribute files. Assuming that upload bandwidth is scarcer than download bandwidth and efficient allocation, we compute the expected bandwidth obtained by each peer. We show that (i) while the exact formula is complex, s/(s+f) is a good approximation and (ii) sharers (freeriders) obtain bandwidth larger (smaller) than s/(s+f). The paper constitutes a first step towards a general analytical foundation for scarce resource allocation in peer-to-peer file-sharing networks.