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  • BCG Digital Ventures

Beyond Delight: Why digital innovation needs a new paradigm for success

Why digital innovation needs a new paradigm for success

Beyond Delight: Why digital innovation needs a new paradigm for success

Focusing on customer centricity and user delight was a perfectly fitting answer to the digital revolution in product design. Digital products and services are fundamentally different, as they can afford thousands of—potentially useless—features. It’s much easier to decide the necessary and valuable features of a pencil than those of MS Word. Honing in on what creates delight for users helped product designers decide what’s truly needed and differentiating.

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The abundance of options is starting to look like a charmingly simple problem to solve. Today, we are forced to realize that customer centricity and delight are not nearly enough to answer the next generational challenge for product and service designers.

The world is looking at the abyss of a collapsing climate system, and individual desires and delights seem badly suited to function as the North Star for protecting this planetary life support system. At the same time, we know far too well that ignoring customer needs condemns products, services, and companies to a quick and early demise.

We Need to Balance Three Dimensions of Value

So, what to do? In order to build the next, sustainable generation of businesses and services, product designers need to understand, deliver, and balance three key values: commercial value, customer/user value, and societal value.

Innovation needs to create commercial value for the stakeholders who are funding it: An increase in sales, profit, and valuation. Without creating outsized commercial value, the inherent risks and costs of innovation can simply not be afforded long-term—neither at the individual, corporate, or societal level.

Customer/user value is just as important. Every successful, innovative business, product, or service is based on a value proposition that answers a previously unanswered need. Tracking metrics like NPS, delight, or churn rates have long given us a good measure of how valuable a solution is for users—in the short term.

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What we’re missing is a lens that informs our work with regard to the value we deliver to users in the long run. We need to manage the relationship between a pleasant user experience and the unpleasant carbon footprint this experience may leave behind. It is unlikely we can solve this exclusively via traditional KPIs and analytics. It will rather become an ethical conversation that acknowledges a deep uncertainty, but steadfastly looks at the implications of our work and the true value we bring to the people who use it.

Finally, we need to dramatically expand our aperture to include societal value. When we deliver individual value propositions, we almost always build a new digital infrastructure in parallel. An infrastructure that starts changing how the rest of us shop, eat, discuss, think, use resources, and live.

We deliver societal value whether we aim for it or not. Many of the big social networks are just waking up to the societal consequences of the individual user delights they are offering. Some are more proactive than others. More and more corporate innovators are looking at tools like the double bottom line to intentionally deliver a desired societal value while keeping their goal of commercial success. 

No One Likes Adding Complexity. But it Pays off.

Commercial value, user value, and societal value have to be balanced for sustainable new businesses, products, and services. But taking on additional complexity as product and business builders feels counterintuitive. For the most part of the last decade, innovators have followed the mantra to be “lean”; to cast away as much complexity as possible in order to quickly launch their product and prove its relevance and viability.

Creating sustainable value along three dimensions will undoubtedly create a heavier load on teams. They will still utilize a lean toolkit. They will still try to get to real customer and market feedback as fast as possible. But they will also have to add new tools, metrics, and conversations. This is not going to be easy.

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So, is it worth it? A 2017 BCG study on Total Societal Impact showed that companies that embrace the United Nation’s ESG goals succeed at an above-average rate: “…All else being equal, companies that outperform in important social and environmental areas achieve higher valuations and higher margins.”

Let’s Redefine What Success Means

Expanding the view beyond traditional metrics and committing to deliver multiple dimensions of value creates competitive advantage. What is true for corporations equally holds for business builders and product designers. From here on out, we need to go beyond user centricity and user delight and expand our definition of what makes us and our work successful and relevant.

Read more from Mario here. To learn more about BCGDV, follow us on Twitter @BCGDV and visit our website.

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