The Progress Economy

Uncovering strategic moves to fix sales, innovation and growth problems comes from understanding how progress is made

Progress as an operating model

Progress – our deceptively simple concept – blossoms into a powerful operating model explaining how the world works. When you understand these inner workings, you unlock strategic insights that drive sales, fuel innovation, and accelerate growth.

Our operating model comes with four distinct layers:

• foundation layer – the underlying service-dominant logic and definitions of key concepts (like progress and value) that we build upon
• decision layer – the decisions that actors, predominantly the Seeker, make during progress journeys
• operational layer – how progress is made (resource integration, applying capabilities, decision process)
• strategic layer – strategic choices a progress helper should embrace, aligned to Seeker’s progress

Within and across the layers lie a set of powerful insights and progress levers. These offer practical ways for a Helper (you) to improve the progress Seekers make, reduce their friction, and enhance the perceived value of what you offer.

Let’s jump into each of these layers. We’ll start with the strategic layer as it’s the most impactful for you who want to help progress.

Before that though, a couple of up-front definitions that help as we’re looking at this in reverse order: a Progress Seeker is the entity looking to make progress; a Progress Helper is an entity that offers to help; these entities perform a service exchange (often indirectly using service credits) and price is an indication of how much effort should be in that exchange – a difference in opinions on that effort leads to the inequitable exchange progress hurdle.

Strategic layer: setting the direction

At the strategic layer of the Progress Economy, we illuminate where progress leads – and why it matters for sales and innovation.

We’ll uncover four strategic insights that help us improve sales and innovation.

1. deeply understand Seekers’ progress origin and progress sought – across all three dimensions: functional, non-functional, and contextual.
2. identify the Seeker’s missing capabilities – and understand the specific context in which they’re needed.
3. identify what contexts Seekers wish to change – turn those into functional/non-functional aspects of new propositions
4. design propositions that minimise the progress gap – between your offer and the Seeker’s situation, reducing friction and increasing perceived value.
5. Segment by progress, not by demographics or product features – group Seekers by similarity in progress journeys, not demographics or product features, to reduce unnecessary customisation.

As the name suggests, everything in the Progress Economy begins with understanding what progress is.

Seeking Progress

We begin with a simple, powerful premise: everyone is trying to move from where they are now (their progress origin) to a more desired future state (their progress sought). These individuals or organisations are Progress Seekers (or simply, Seekers). Their movement defines a progress journey which is the key mental picture in the Progress Economy. In fact, we’ll often visualise them using a progress diagram, the simplest of which is below.

This diagram shows progress is a shift from a Seeker’s progress origin, where no value has emerged, to a Seeker’s progress sought state, where maximum value has emerged. While a Seeker’s progress sought spans all aspects of their life, we often focus on one aspect at a time for practical analysis.

Each journey involves change across three dimensions of progress, all equally important:

Let’s unpack each of these.

The functional progress sought is often the easiest to identify. It’s the ran a half marathon, arrived in Oslo, learnt Mandarin Chinese to HSK level 5, increased wealth, defended against missile attack, recovered from an illness, etc. The functional progress origin may be quite varied, and is important to know. The marathon journey, for example, starts at different places for a non-runner, a first timer, and a seasoned competitor.

Non-functional progress accompanies functional progress. This includes how one wishes to experience the journey – quickly, safely, easily, enjoyably, flexibly. Perhaps the seeker values gaining autonomy, or the emotional reward of a sense of achievement.

And contextual progress captures the environment in which progress is attempted. Conditions like “in rush hour” or “no driver’s license” fundamentally alter the nature of a progress attempt. As Christensen rightly observed:

A job can only be defined – and a successful solution created – relative to the specific context in which it arises

Christensen, C (2016) “Competing against luck”

In combination, the progress origin, progress sought, and the journey between them provide a deep understanding of what Christensen and Ulwick refer to as a job-to-be-done.

Seekers draw on capabilities – skills, knowledge, time, strength, etc, carried by various resources (including themselves) – to attempt these journeys. However, many Seekers lack some or all of the capabilities required. When such a gap exists, it creates a lack of capabilities progress hurdle.

This is where Progress Helpers enter. They offer progress propositions – bundles of supplementary capabilities, carried by resources – to support Seekers in reaching their progress sought.

Progress Offered / Sought: The obvious strategic fit

A Helper’s proposition typically offers to support a Seeker in reaching a specific progress state: the progress offered.. Ideally, this matches the Seeker’s progress sought. In practice, such alignment is rare, as shown in the following progress diagram.

More often, propositions approximate what the Seeker wants. There are inevitable misalignments across one or more of the three progress dimensions. When faced with a near-fit, Seekers must decide whether the proposition is close enough – phenomenological decision made through lived experience, situational context, and their assessment of six progress hurdles.

Misalignment can cut both ways.

• If progress offered falls short of progress sought, the Seeker may abandon the attempt or chain multiple propositions together.
• If progress offered exceeds what the Seeker needs, the result may be over-engineering leading to overpricing; raising the inequitable exchange hurdle.

This second case creates fertile ground for disruptive innovation (as defined by Christensen in The Innovator’s dilemma). Here, a new entrant offers to help Seekers with less demanding progress sought than the mainstream, that are attracted to encumbants’ offers. Over time the encumbants chase the more demanding Seekers’ evolving progress sought, whereas the new entrants progress offered improves. If the new entrant starts attracting the mainstream, then disruption has occurred.

Still, over-delivering on progress is not inherently negative. In some cases, it encourages the Seeker to stretch their ambitions in beneficial ways to them.

What’s often overlooked, but strategically critical, is the progress origin assumed by the Helper.

Progress Origins: Another important strategic fit decision

Just as Seekers have a progress origin, so do propositions. Helpers need to assume a starting point when they define their offer. If this origin is misjudged, say, overestimating what the Seeker is already capable of, then the Helper may under-deliver on required capabilities. The Seeker’s lack of capabilities hurdle may still be too high, and progress stalls.

Consider a public transport service whose nearest bus stop is 2km from the community it intends to serve. The proposition’s origin does not match the Seeker’s, and the gap becomes a barrier.

Conversely, offering too many capabilities, especially if the proposed progress-making activities are mandatory, can backfire. Imagine forcing an intermediate Mandarin speaker through a 10-week beginner course. The Seeker may feel their progress is blocked because what’s offered is irrelevant to their current state. It may lead to value destruction. They’ll also likely feel a high inequitable exchange hurdle since you want exchange for something that is not useful to them.

When a proposition’s progress origin and progress offered align closely with the Seeker’s own origin and sought state, value emerges rapidly. Misalignment, however, leads to friction, increased effort, and potentially disengagement.

Strategically, you should identify and reduce any origins gap. What can a Helper do? One option is customisation.

Strategic Customisation

To reduce misalignment, Helpers can choose to offer customisation to either the progress origin, the progress offered, or both. This enables a proposition to better match a Seeker’s specific journey.

In theory, the ideal proposition would be fully customisable, adapting seamlessly to any Seeker’s starting point and desired outcome. In practice, customisation takes Helper effort, and that translates to an increased equitable exchange demand, potentially increasing the inequitable exchange hurdle.

This trade-off is well understood in many markets. A Savile Row suit, for example, offers precision tailoring that justifies its higher price. Off-the-rack options, by contrast, minimise customisation to serve a broader audience at lower cost.

The strategic question for Helpers is this: How much customisation will our market support, and how much are we willing to offer?

Yet there is also a strategic opportunity here too. Where there are markets that offer little customisation, is there an opportunity for others to offer customisation? Either as part of you existing offering, or as a distinct offering itself. Some high-street suit retailers might offer an additional limited tailoring service; traditional tailors offer more for those who seek further progress.

Another large example is after-market customisations for cars. There is a sizeable revenue that car manufacturers leave for others to grab.

Progress Seekers are adept at chaining propositions to cover more of their progress journey than one helper offers. Are you looking for these “completion” opportunities? Can you reduce a Seeker’s friction by chaining together propositions for them? A package holiday is more friction free for a Seeker than booking flights, transport and hotel separately.

Strategic unbundling

And this discussion on bundling propositions offers another insight. Can you unchain/unbundle your existing proposition to offer choices?

When I order online, I often see various options for payment (cards, direct bank transfer etc) as well as for delivery (often several courier companies, or send to storage boxes, or last mile deliverers).

Ultimately, the amount of customisation needed by a Seeker to make there progress with your proposition depends on the gaps between the origins and progress sought/offered. Segmentation can help reduce those gaps.

Strategic segmentation

An approach strategic Helpers employ to minimise customisation, where there is a large spread of origins(progress sought, is to segment propositions by the three progress dimensions (not by the usual product features or demographics). This opens the door to designing multiple variations (potentially up to nine), but not all need to be executed. Often, several segments share common origins or sought outcomes. Or the Helper may decide to focus on only one, or a subset, of segments.

Take learning Mandarin Chinese. Segmentation does not exclude the idea of personal one-one teaching. But we often find three proposition classes, one targeted at beginners (say HSK level 1 to 2), one at intermediates (HSK 3.to 4) and another at advanced (HSK 5). Providers tend not to offer a proposition for HSK 1-5, or 2-4. Instead, Seekers appear happy to move through the 3 propositions in a chain.

The power of segmenting on progress comes when we think of context and non-functional. These help drive the above propositions into in-person class room, on-line class room, online recorded (or other recorded, for those of us still with CDs, or tape players…). Or “functional” segmentation – learn what you need for holiday or dedicated to specific careers like medicine or computing.

(you could even argue “learning” is too restrictive here. Perhaps the Seeker wants “to communicate whilst on holiday” – learning Chinese is one solution, a translator app another, access to a translator is another, I’m sure there’s more. “Learning” is fine if the non-functional progress sought is, say, “sense of achievement” – this is why understanding all three dimensions is important)

Removing contextual constraints

Remember I said we have the convention that contextual progress doesn’t change over a progress attempt. And that if the Seeker wants to change the context they should do that as a separate aspect of progress sought. For example the constraint of “not having a driving license” would become the functional progress sought of “have a driving license”.

You should strategically look for these opportunities.

Finding blue oceans

I like Kim and Mauborgne’s Blue Ocean strategy – a strategy to apply cost and value innovation to identify markets where there are no competitors. It comes with several tools, that can be leveraged in the progress economy to find blue oceans in progress origin, progress sought and progress offered.

Sales as a strategic alignment

Sales, viewed through the Progress Economy lens, is no longer about pitching features, it’s about aligning your proposition with the Seeker’s progress journey. It is persuading the Seeker that your proposition helps them make the best possible progress, from where they currently are, with the lowest hurdles acceptable to them.

Key alignment questions include, does the Seeker believe the proposition:

• gets them closer/closest to their progress sought?
• begins close enough to their progress origin to make engagement feel easy?
• lowers the six progress hurdles enough – such as lack of competence, adoptability, or inequitable exchange (simplified here as cost)?

On a progress diagram, it looks like this:

The more complex the progress you are offering to help with, the more you need to deeply understand your Seeker’s progress origin and progress sought. It’s a discovery process before they engage your proposition, and then a continuing journey together as the progress is made. Your aim is to minimise value destruction – which, unlike in the traditional value-in-exchange model of value, is defined as when one or both parties do something to hamper progress.

Crucially, front-line teams play a strategic role. They uncover local adaptations, workarounds, new use cases, and organic innovation. These aren’t anomalies, they’re signals. Smart organisations capture, interpret, and scale these insights across their sales process, operational model, and offerings.

Sales doesn’t end at the start of progress attempt. Continued dialogue during the progress journey ensures alignment, helps steer outcomes, and surfaces new needs and innovations. That said, the simpler the proposition (low progress hurdles and minimal progress-making activities), the less interaction may be required, and indeed may be possible..

innovation: Making better progress

Peter Drucker famously wrote that a business has only two functions: marketing and innovation.

Because the purpose of business is to create a customer, the business enterprise has two–and only two–basic functions: marketing and innovation.

Peter Drucker

In the Progress Economy, these two imperatives take on new clarity. Marketing becomes the act of identifying the Seeker’s progress origin and progress sought, segmenting them based on their progress journeys, and interacting with them throughout their progress attempts.

Innovation becomes the act of improving progress:

• improving progress that can be currently made
• improving progress towards progress sought from progress origin – filling in more of the progress journey
• reducing one or more of the six progress hurdles – more adoptable, lower equitable exchange etc

In short, marketing discovers and aligns; innovation enables and improves.

Innovation can be driven by Seekers themselves – for example:

• using propositions in alternative ways beyond their original intent
• combining available propositions to span more of their progress journey
• creatively reconfiguring their own progress-making activities using available capabilities

Mostly we’ll focus on Helpers, where innovation revolves around creating or improving a proposition (to better help a Seeker). That itself relates to:

• updating proposed progress-making activities
• introducing new capabilities
• improving or swapping resources (that carry capabilities) in the resource mix

Strategically, it’s time to retire the notion of innovation as episodic or in parallel to every day business. Innovation (and marketing) must be part of daily business, not an add-on.

Why innovation must be continuous

A Seeker’s progress origins and progress sought are constantly evolving:

• progress sought becomes more ambitious as Seekers are influenced by their other progress attempts and what they observe in other domains or industries
• progress origin evolves as Seekers gain reusable capabilities from other progress attempts.

And in the background, externalities – who insert elements into a Seeker’s progress sought to protect Seekers and society – also evolve there constraints.

Together, these dynamics render static propositions obsolete. Capabilities that once felt distinctive become common. Frictions once tolerated become deal-breakers. What was once desirable becomes insufficient.

Helpers must continually revisit what “progress” looks like from the Seeker’s view – not their own. Competitors, including the Seekers themselves, are continuously improving their ability to reach progress sought. Standing still is falling behind.

Now we know why Peter Drucker put it bluntly:

Innovate or die.

The Progress Economy shows us that’s not a slogan, it’s the operating reality.

Impact on helper organisation

Such a progress-first approach needs to be reflected in a Helper’s organisational set-up. We’ll propose that a Helper needs an individual that we’ll call a Progress Owner. They are responsible for three key activities:

• Marketing – keeping on top of understanding the changing progress origin and progress sought of the Seekers (and what competitors are offering)
• Execution – ensuring the progress proposition is executed correctly each time
• Innovation – evolving the proposition to continue to attract Seekers (and grow either the number of exchanges or size of exchanges)

If this is the where of progress, let’s now turn to looking at the mechanics.

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