Exploring Business Design pt. 2

The Exploring Business Design series

• Part 1

The core concept of Business Design is to thoroughly understand the customers, their needs and desires, whether conscious or subconscious. This might sound very obvious. However, look at most businesses and you quickly realize that their core strategy is more rooted in what the company's resources can produce rather that what the customers want.

It's a well documented fact that most companies spend far too little time on research and development as well as on creating positive customer experiences. These companies are at risk today in the current turbulent, get-real economy. The winners will be those companies that can outimagine and outcreate their competitors. Great design has become as important to competitive advantage as smart technology.

Even the biggest producers on earth - the factories of China - have realized that design and innovation are the way to raise margins and grab customer attention. Despite what many in the West seems to think, Chinese companies will not be satisfied with only supplying low cost manufacturing. Just like their Western counterparts, they want the healthy margins that come with branded products.

Does it sound preposterous that you will some day pay more for a Chinese brand than a Western one? Thirty years ago, the idea of a Japanese luxury car was ridiculous. Today, the Lexus is a status vehicle enjoying healthy sales. In South Korea, electronics giant Samsung faced the same dilemmas as the Chinese do today, with low status and cheap, low margin products. A stringent, design-driven strategy has changed that and payed off handsomely. Samsung mobile phones are among the top mobile brands, and other products are following.

As large companies like Samsung, Toyota (maker of Lexus) and Philips (which I blogged about here) have realized, scale alone is no longer enough to thrive in a world where markets are rapidly globalizing nor will incremental improvement deliver a decent ROI. Companies will only continue to prosper if they push to the higher ground of design and innovation.

Succeeding with design

How do you implement a design-driven strategy and turn your company into a innovative market leader?

While creativity, design and innovation might seem mysterious, weird or even fluffy for some people, Brittish design legend sir Terence Conran has an excellent definition:

"Intelligent design is 98% common sense and 2% aesthetics."

When reviewing companies that have succeeded, a few factors stand out:

Top management dedication

Management must be thoroughly committed to not only the design-driven strategy, but also to make design and innovation a part of the company culture. According to Jonathan Ives, Apple's senior vice president of design, this is a major factor of the Apple design success.

Design focus

Design does not work as an afterthought or window dressing, it must be a starting point. Furthermore, design is not primarily about good looks. It's about solving a problem by blending function and usability with aesthetics to create an emotional connection.

Thinking outside the box

Greatness is not achieved by doing like everybody else. By thinking differently you can make a difference. IKEA created a booming furniture empire by delivering furniture in flat boxes for customers to assemble themselves. Apple designed an mp3-player with less features than the competitors.

Quick prototyping

A design-driven company doesn't labour on a product until it's perfect. Instead, launching new products often and then improving on them according to user reactions are more common.

Think like a designer

In order to manage a design-driven strategy it helps to try to think like a designer. Trouble

is, most business folks don't. Instead they crunch numbers, analyze, and ultimately redefine the problem to something they are familiar with and have encountered before.

Design is a way of approaching problems and coming to rich and creative solutions. How then, differs the thinking of a designer, or any trained creative person, when confronted with an assignment?

The first step is often to define the problem. And that always have to be done from the customer's or user's point of view. How can this product and service make their lives easier, more enjoyable, more productive or more profitable? Sometimes their problem might be obvious by interacting with customers and users. At other times the problem might be subconscious. The need is there but the customer might not have realized it. After all, how many people would have considered it necessary and desirable to have a computer at home forty years ago?

Once the problem has been defined, research is next. It's not the numbers and statistics a business person might choose, rather how the user of the product or service that is being created, lives, thinks and acts. Sometimes a good imagination can do the trick. At other times, interviews or observations might be necessary.

This is basically an exercise in trying to step into someone else's head and shoes to try to nail down the problem he or she has with current solutions. Design does not only solve a problem. It solves a problem elegantly. It provides a great solution with superior customer experience. Simply put; the customer can't live without it and comes back for more.

Without drawing any conclusions, an excursion into the technical possibilities might be next in order to set the framework. Creative solutions doesn't come from thin air, they thrive on limitations and boundaries, but also on technical advances. What kind of materials are available? How can things be produced? How can we make production more efficient?

The third step is the more mysterious. This is where all input is processed in the designer's head and then turned into something new - outside the box. It might be a long process that starts with a vague idea that is gradually worked into a whole as attention is turned to details that provide important triggers for the overall design. The iPod's click wheel is one such detail that is the center of the design.

No right or wrong

In the business world, numbers are often perceived to be the truth. Everything that can be measured or calculated have a greater ring of truth than that which is described or drawn. It is, of course, a myth as WorldCom and Enron proved.

In design, there are no right or wrong which can be hard for business people to get used to. However, two questions should always be answered: What problem does it solve? And, is it desirable?

Next part: An organisation optimised for business design. Coming soon!