Competing on price alone is rarely a viable option for today’s businesses. Now companies are creating products and services that thrill customers with graceful form and exacting performance. That in turn gives companies the ability to set themselves apart in increasingly tough markets — and set the pace rather than simply respond to the competition.

Businesses today face an increasingly stark choice: they can provide products and services aiming simply to be the cheapest — and leave themselves vulnerable to being beaten on price; or they can inspire genuine loyalty from customers by giving them products, services and an entire experience, answering needs that not even the customers knew existed.

More businesses are realizing that, with competition all over the world, only one business can be the cheapest — the rest must use design to tip competitive advantage in their favor.

To take the second path and achieve sustainable growth, enhanced efficiency and continuous improvement, businesses need design — not simply giving the makeover treatment to what they already do, but “right at the heart of their strategy, acting as a catalyst for completely new offerings,” says the UK’s Design Council. And that, the organization says, requires “vision, a measure of courage and a willingness to take risks and work in new ways.”

For product makers, industrial design is not about the most extreme, “advanced” or “progressive” idea; no, industrial design is about the right idea.

As noted, design — closely aligned with innovation — is the key to standing out and maintaining competitiveness. That applies to any size business, no matter how large or small. Design helps businesses connect strongly with customers by anticipating their needs. That in turn gives companies the ability to set themselves apart in increasingly tough markets, and allows them to set the pace rather than simply respond to the competition.

According to 2005 research by Design Council, which promotes the vital role of design in making businesses more competitive and public services more effective, about 70 percent of businesses that see design as integral to their operations had introduced new products or services in the last three years, compared with only a third of companies overall. This suggests that innovation is not simply something you’ll get around to when “convenient” — it suggests that it is essential.

If an organization wants to reap the benefits of design, however, it must do more than just hire “hot” designers or declare itself to be “design oriented,” as Fast Company recently noted. It is important to think of design not just in terms of the look and feel of a product or service, and certainly not as something that’s only introduced once all the key decisions have been taken and all the costs have been committed, Design Council further points out.

Rather, it can be seen as a process, a way of thinking and working, that allows organizations to sift through ideas and pursue those that can be developed into products and services people will want to buy. Industrial design is the synthesis of form, function, desirability, manufacturability, affordability, cultural reference, and so on, all interwoven. It requires consideration given to the visual, emotional, functional and cultural — which can repeatedly be packaged and shipped at a price you would pay for yourself, as Gadi Amit, principal of NewDealDesign LLC, recently wrote. It is design that is industrial. And businesses only really get the best out of design when they perceive it as being something of core strategic importance.

By now, design may be looking more and more like a business fad: declare you’re a design-centric organization and — tah-dah! — you’re the next Apple. Obviously, it is not that simple.

As Fast Company recently acknowledged:

Except for a few mavericks such as IBM, Kodak and Xerox, it would take years for design to move in from the fringes of business, But today, companies are creating products and services that delight customers with the grace of their fit and finish, and their exacting performance.

Obstacles remain, one of the gravest being the “awkward romance” between business and design, as Fast Company recently determined:

Many businesspeople have long regarded designers as mere stylists. More than a few designers see businesspeople as Neanderthals all too willing to forfeit quality for the sake of profit. Their mutual pique springs from a fundamental difference in the way each side thinks about creating value: Corporate types, by and large, seek to fuel growth by building from bulletproof, reproducible systems; designers generally attempt to do so by imagining something new, different, better. That difference can be seen as a trust in reliability on the one hand and in validity on the other.

So there’s business-as-usual and business-by-design. Managing the balance means giving people the “freedom to follow their nose, but hold them accountable for their performance,” the article continues. It means setting a high bar but recognizing that failure is an unavoidable consequence of pushing beyond traditional territories.

Simply, in today’s competitive market, wherein businesses are not only desperate to remain relevant but aspiring to be the best of the rest, they must do everything possible not just to thrill their customers but also wring costs and efficiencies out of vendors and suppliers. Or, as Sir Christopher Frayling, Design Council chairman, put it, “One of the great functions of design is to be able to project and embody the future rather than the present: that is where added value comes from.”

Resources

Competitive Advantage Through Design
Design Council

New ideas – why they matter
Design Council

Tough Love
by Roger Martin
Fast Company, October 2006

The Definition of Industrial Design? It’s right there in the title.
by Gadi Amit
Core77, August 2006

Design and your strategy
Design Council

Introducing… The 2006 Masters of Design
by Fast Company staff
Fast Company, October 2006