How to Remain Relevant in an Economy Based on Experiences

As customers have become the centre of attention for most business strategies, companies have been forced to suddenly apply plot twists to get and maintain success and profit.

Customers don’t just want to buy a product or service, but to feel the whole experience behind it.[1]

Now they want to buy a whole experience. An experience which starts even before the purchase moment and may be extended to infinity, through as many iterations as customers are willing to perform, while they get the expected effect.

This statement probably affects every existing industry, as customers are now much more exigent globally when talking about the quality of the products and about the quality of the interactions between companies and themselves, across every contact point in the customer journey.

But it’s a fact that companies do not appreciate those environmental changes with enough speed, probably due to a sort of complacency or confidence on their position within the statu quo.

Besides that, we keep hearing about the urgent need/opportunity to innovate in order to differentiate companies. Innovation does not only apply to setting objectives and new developments but also to the way companies should think about their business. There’s no place for complacency any more, things must be done in a different way.

The value of the unknown (harvesting the strangeness)

Both, innovation processes and exercises arouse innovation, by abstracting the observer from any pre-judged ideas and predefined solutions. While it forces participants to build hypothesis as if they were complete strangers to the problem to solve.

“I try never to understand. I hear it’s called an open mind” (The Doctor[2])

We all can agree that the main purpose of any innovation process is to generate new value (for customers and business). And for that, companies may deploy foresight exercises to define an expected future, or use design methodologies to address present challenges.

Regardless the chosen innovation process, to collect as much information as we can should always be the first step .

Social is the new black (nurturing the process)

Feeding the process is the tough part. The social insights are the key fuel to move the innovation engine and ethnography provides good resources to start working on that. However it’s difficult to reach the milestones for the roadmap for tomorrow when you are exploring on people’s past and their present concerns. Here is when innovation may enter into conflict with social research[3].

To find the perfect match between social research and the needs for the business, developing business Design is the answer. This turns to be a perfect bridge between the main purpose for the business — its business model — and the ever-changing social behaviours.

Product and Service Design (shaping the future)

For a while, product design has been closely linked to the physical appearance of the item, its package and main functionalities. Probably the closest to a human-centric approach about designing new products was reduced to ergonomics and attractiveness.

But for this 21st-Century economy based on Experiences, the design has turned to be a much wider concept[4] which sets the human beings (customers) not just at the centre, but at the beginning of the process, by identifying motivations and frustrations that will lead their purchasing decisions.

By the addition of the whole Customer Experience into the product and services design, companies are starting to realize they must manage those designed experiences as if it was the actual asset they are offering. An experience that bundles omni-channel connections and high added value, which can be permanently measured and improved.

The smartest way to manage those experiences seems to be through a high level vision of the whole customer journey as a whole product line.

Connections Experience[5] Design (defining the contact)

The Customer journey, as the main raw material for Customer-Centric approaches, must be treated as if they were product lines themselves. A portfolio of experiences which needs to be actively managed, measured and nurtured[6].

When a company establishes an emotional connection with its customers, benefits turn higher and more stable in time. As this is a great field to grow, companies must treat those emotions as a science and a strategy[7].

The first companies to understand this will be the ones obtaining a really needed competitive advantage. Beyond that, establishing an emotionally connected strategy requires a deep commitment on relying on the customers insights, through a new way of managing them.

Designing a business models (defining the incomes)

Where does the profit come from? Easy, from a business model that is a consequence of the Design process.

There are already some tools to help identify and evaluate possible new business models in a creative and agile way, like the Business Model Canvas.

To learn about the Business Model Canvas, visit the website of its creators:Strategyzer

A roadmap to become a design-driven corporation (setting up the governance)

Although the competitive advantage of a design based business is commonly agreed, large corporations are still lazy to apply design principles to their core strategies, maybe due to a lack of proper understanding and enough maturity on design methodologies[8].

This transformation to be deployed in a slow and pre-defined long-way[9]

Transforming a company into one that uses design as a driver of change takes time.

Next you’ll find a series of steps to keep in mind to fully ensure a correct deployment of Design processes:

  1. Establish a Design Leadership[10] (preferable a C-Suite responsibility)
  2. Deploy a test and learn culture (permanent improvement loop)
  3. Incorporate or build internal Design expertise
  4. Establish regular methodologies to collect and analyse customers insights and motivations
  5. Create a map of the customer journey and use human-centred design research techniques to interact with customers and uncover pain points and opportunities
  6. Speed up. In the fast-moving world, speed is much better than perfection

Originally published in LinkedIn (Oct. 2015)

[1] An Economy of Experiences

[2] Doctor Who, season 9, episode 2 “The Witch’s Familiar” aired on 6th September 2015

[3] Ethnography Alone Cannot Generate Transformative Insights (Michael Graber)

[4] New Product Development in the Era of the Customer

[5] The Customer Connections Experience (CCX)

[6] McKinsey & Company: The New Consumer Decision Journey

[7] The New Science of Customer Emotions

[8] Fast Company: Abby Godee Thinks Companies Have Only Just Started To Truly Understand Design

[9] McKinsey & Company: Building a design-driven culture

[10] New Product Development in the Era of the Customer

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