Customers, not technology, are increasingly being placed front and centre in the design of products and services by successful businesses.
It comes out that understanding customer issues and how a product can address them is more crucial than merely incorporating new features made possible by the most recent technological advancements.
“Design thinking” is a technique for achieving this customer-centric viewpoint that is gaining a lot of attention in its application across many areas of the company.
“A collection of practices that help teams better identify with customer experiences and shift from logical problem-solving to creative experimentation,” according to Forrester Research, defines design thinking. But ultimately, it comes down to designing goods and services during the product development process with attributes that consumers adore and can’t exist without.
Product Innovation With R&D
Kilowott flips the script on conventional product development by beginning with the consumer rather than the product.
If you’ve ever wondered why businesses with low R&D expenditures seem to be in charge of the market these days, it’s because these businesses employ some form of design thinking to create products and services that appeal to customers on an emotional and aesthetic level rather than just through form and functionality.
People with backgrounds in product design, like myself, occasionally ponder why all the commotion is being made.
Of course, you must evaluate a novel product from the perspective of the customer!
For instance, if you are conceptualizing an infrared camera for the military as part of the product development process, you must understand that it is absurd for a combatant to stow the camera before pulling the trigger on a weapon.
When viewed from this angle, you need a monocular ambidextrous camera to produce a seamless combat experience—one that can be operated with the nondominant arm while the soldier is still holding the gun in the dominant arm.
It’s important to note that design thinking identifies the correct thing to do—but technology makes it possible, both in this specific instance and generally.
Or consider Kiva Logistics, which was fervently customer-focused before becoming Amazon Robotics.
It centered its operations, marketing plans, and goods on its clients, such as the warehouse picker who takes merchandise from a warehouse’s racks.
Kiva developed a system in which a robot essentially carried the shelf to the picker rather than thinking about how technology could make it simpler for the picker to move around a warehouse and select ordered products from the shelves.
By considering a product from the perspective of a customer, a revolutionary product innovation was produced.
Of fact, the best product development teams have been using some variation of design thinking for decades, even if not under that name.
However, that hasn’t happened far too often. Numerous examples exist of goods that, despite having a wealth of features and cutting-edge technology, failed to find success on the market.
Consider the Sony MiniDisc, the Apple Newton, or even the Ara modular smartphone from Google. Although those goods were technologically cutting edge, they failed to catch on because the customer wasn’t prioritized during the product’s design and development.
The holistic method of design thinking is another feature. In the past, businesses have used an “over-the-wall” approach to product design and development, in which sets of teams working in silos created goods and services in a series of phased stages.
Companies have long used concurrent engineering as a solution to this issue. Products are created and designed in such a way that various product attributes, such as manufacturability, serviceability, or usability (“X”), are taken into consideration at the outset of the design process rather than in stages.
The so-called DfX (“Design for X”) methods are used in concurrent engineering to evaluate a product’s performance across all of its lifecycle stages and in various contexts.
This shortens the time it takes to create a product and get it to market, increasing productivity and cutting costs.
Concurrent engineering is improved by design thinking, which makes it genuinely holistic. It is similarly applicable to human-centered creative endeavors like architecture, goods, and services.
Phases in Product Innovation That Can Elevate CX
Phase 1: Establish and develop the core.
The first step in conducting customer R&D is to identify key customer groups and create value propositions that benefit both parties and go above and beyond what the customers expect. The value proposition is a summary of the entire client experience, which includes all goods, services, and interactions with the business.
After identifying this core, the customer R&D team methodically finds subsegments to better align customer demands with the company’s offerings and increase profits.
The organization must simultaneously develop the capacities (organizational framework, customer understanding, technology, communications, field sales operations, and logistics support) necessary to develop, convey, and then deliver the new value propositions to the targeted markets.
Phase 2: Extend.
Companies grow their company outside of the core segment in two different ways during this phase.
Customers make use of or encounter goods and services in various unique life capsules.
Customers’ requirements change over time, even within a single capsule, so a business traveler may have different needs as they age or advance in their careers.
The objective is to increase product capabilities to meet these various and evolving requirements.
The goal is to understand the nuances and differences in their needs, modify the value proposition to target these groups, and then tailor products for them based on the existing capabilities of the firm.
These halo segments serve to expand the firm’s core business. Companies can increase their customer base by identifying potential “halo” customer segments, whose needs are similar to those of existing customers.
Phase 3: Stretch.
Once a company has extended its business, it can begin to hunt for opportunities to stretch, again in two directions.
Maintaining Defensiveness in Product Innovation
Companies must pay careful attention to disruption threats from rivals throughout each of these phases.
Here, the customer R&D team actively searches for early signs of changes in customers’ requirements or escalating dissatisfaction with market value propositions, particularly in underserved segments.
Shifts in customers’ expectations can precipitate a need for new value propositions and capabilities.
The goal of Kilowott’s R&D team is to possess the world’s most comprehensive knowledge of the company’s current consumers and to make sure that the business is strategically and operationally ready to anticipate any move from competitors.
For instance, Blockbuster was forced to take a defensive stance by getting rid of its own late fees when Netflix introduced a mail-based movie rental service, essentially doing away with the need for late-return fees.
Before Netflix made its move, Blockbuster should have eliminated late fees knowing that customers disliked them and thus improved its value offering.
The business also looks for changes in technology while operating defensively. A company might not yet be able to satisfy a customer’s requirements because there is no technically feasible solution, but one might be on the horizon.
A company can buy crucial time to react to threats by investing in new technologies or collaborating with other businesses through licensing agreements, joint ventures, strategic partnerships, or acquisitions.
