As economic conditions keep getting tougher, consumers are paying more but have less to spend, which means that value is becoming more important than ever before.
From a business perspective, whether it’s a website, an app or a business process redesign, extracting maximum value from all decisions is the aim of the game. Finding the balance between cost and value is critical in decision-making, and consumers and businesses alike can benefit from having a toolkit that can help them question, assess and decide on which options deliver the best value.
Why is value important?
Businesses can no longer differentiate purely on price. Making a product or service too cheap compromises quality, and it’s not long before it starts becoming worthless to both the company producing it and the person buying it. It is therefore important to understand the difference between cost and value. Oscar Wilde once defined a cynic as someone who knows “the price of everything and the value of nothing”, and this definition holds true today still. The value derived from any decision, or any purchase must always outweigh the cost, but the cost should never be the sole determining factor in any purchase or decision.
How is value determined?
The value of something changes over time, based on the exact scenario in which a consumer or business finds themselves in. If this is the case, how can value be calculated? Strategic Design provides a useful prism through which to consider and assess value. Strategic Design identifies value by taking a user-centred and business-focused approach to problem-solving. Given that any purchase or decision is made in response to a problem or challenge that needs to be addressed, by considering the needs of customers, stakeholders, and end-users, against the business goals of the organisation, Strategic Design can identify opportunities for creating value through change.
Designing value strategically
Strategic Design thinking is applied through a collaborative workshopping approach. Clearly defining the problem or challenge that needs to be solved is the most important step. Once the problem has been articulated, it then becomes possible to determine what it means to the individual or the business to solve that problem, create that product, or tweak that operating procedure. This is the value (measurable as ROI), and the cost then is the money and effort that it takes to solve the problem. However, there is an additional cost that is often overlooked in determining value – the cost of not solving the problem, where money or revenue is lost, for example, as a result of continuing to do business in an unoptimised manner.
Problem-solving approach
This is where Strategic Design can make a significant difference in ensuring that the value derived far outweighs the cost of solving the problem (or not solving the problem, as the case may be). Whether it’s a sales, staff, process or platform problem, Strategic Design provides a structured approach to problem-solving that integrates business strategy, design thinking, and user-centred principles. It involves using design as a tool to achieve specific business goals and objectives, rather than simply focusing on aesthetics or form.
A collaborative workshopping process is used to identify and understand the needs and motivations of customers, stakeholders, and end-users, and to use these insights to develop solutions that align with the company’s strategic goals. Because ideas, information and discussion alone do not generate results, a decision is necessary to move forward. Here, an Impact vs Effort scale (maximum impact for minimal effort is the most effective way to generate value early) provides the backdrop against which ideas can be implemented to become solutions. These ideas have already been assessed for desirability, viability and feasibility, and the goal is to create solutions that are simple and intuitive.
Solving for value
Solutions that look good and meet functional requirements, while driving business results such as increased revenue, enhanced customer engagement, or competitive market differentiation, are the goal. Prototyping and testing of solutions are the next steps to validating and refining design solutions, after which the final design solution can be turned into a tangible product or service through implementation, thereby meeting the needs of end-users and stakeholders, and delivering value to the business. By considering the user perspective and business goals throughout the process, Strategic Design ensures that the final solution meets the needs of all stakeholders and delivers value to the business. This value can be financial (increased revenue), operational (improved efficiency), or strategic (competitive advantage), and measured by how it helps the business achieve its goals and objectives.
Tyrann Burger is managing director of BIGBrave.
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