Design Driven Innovation: Changing the Rules of Competition by Radically Innovating What Things Mean

Citation

Lowe, B. (2010), "Design Driven Innovation: Changing the Rules of Competition by Radically Innovating What Things Mean", Journal of Consumer Marketing, Vol. 27 No. 7, pp. 647-648. https://doi.org/10.1108/07363761011086399

Verganti's opening quote from the Chairman of Artemide, a company apparently immersed in the design‐driven innovation process, synthesizes the main idea of the book nicely. “Market? What market? We do not look at market needs. We make proposals to people” (p. 2)

Verganti's book, Design Driven Innovation, offers the reader a new and distinct view on successful innovation, suggesting that managers should not just consider utilitarian aspects of product innovation but should also consider the more affective aspects of innovation. The book surmises that affect is achieved through design and that this creates meaning for customers, which in turn can have transformational effects and overturn existing industries. One such example offered is Nintendo's WII. Rather than having created more power and gaming capability, Verganti argues the Wii defined a new category by creating new meaning for games consoles, coupled with innovative technology in the form of movement sensors; a “technology epiphany”.

In Chapters 2 through 5 Verganti sets up the strategy and concept of design‐driven innovation. Acknowledging the main schools of thought on innovation, and briefly contrasting customer‐driven incremental innovation with radical innovations pushed by new technologies, Verganti offers a new strategy, one for creating radically new meaning. In order to create new meaning that creates new markets, yet does not necessarily push radically new technologies (an example offered was Alessi's home ware products), in Chapter 6, Verganti suggests companies should look to “interpreters”. These interpreters are a broad group of stakeholders including artists, the media, designers, technology suppliers, and others, who share a common interest in the establishment of meaning and are thus key actors in the design‐driven innovation process. These interpreters are “…immersed in a collective research laboratory… engaged, explicitly and implicitly, in a continuous dialogue … ” (p. 119) known as the design discourse. Having established the underpinnings and importance of the design‐driven innovation strategy, the book then describes the three elements of the process as follows.

1. 1.

   Listening. This is the initial step of interacting with key interpreters, who could be many and varied. Verganti distinguishes between successful innovators of new meaning and imitators, showing that innovators have a greater network of interpreters than imitators. Alessi, often cited as an example, apparently listens to around 200 external design firms, whereas imitators listen to around twelve design firms on average. Listening is the focus of Chapter 7, whered Verganti shows how firms can establish and build a dialogue with the design discourse, addressing issues such as how to spot key interpreters, how to attract them and how to establish long lasting relationships.

2. 2.

   Interpreting. Verganti makes the crucial distinction at the beginning of Chapter 7 that design‐driven innovation involves creating dialogue with a multitude of different interpreters, not employing a designer to create new meaning. This he terms the distinction between design‐driven innovation and designer‐driven innovation. As such, the next step in the process, discussed in Chapter 8, is for the firm to interpret and make sense of the information by creating its own vision and proposal; a bit like a broker of meaning between interpreters and the firm's eventual customers. Verganti uses a series of case studies to show the unstructured, yet deep process, that firms must go through to interpret.

3. 3.

   Addressing. Recognizing the inherent risk involved in creating radical new meaning when it comes to consumer acceptance, Chapter 9 shows how firms can transfer this meaning to customers so that the proposal becomes more attractive, rather than customers asking “what is it?” and “how does it relate to me?”. Consider for example, how consumers may have reacted to Nintendo's Wii had the Wii brand not been disassociated with the Nintendo brand and had the communications campaign shown the TV screen rather than the user skiing or interacting with the console some other way.

The book concludes in Chapters 10 and 11 by showing how firms can build and develop the capabilities of design‐driven innovation. The main capabilities are relational assets with interpreters, internal assets, and the internalization of the interpretation process. The important role of the company's top executives and the development of an appropriate company culture are then discussed.

This book is written in an easy‐to‐read, conversational style and is suited to anyone with an interest in innovation. Because the book offers a relatively new and under‐researched approach to understanding consumer response to innovation it will not be suitable as a core text in innovation and new product development courses. Instead it would make excellent supplementary reading on courses in innovation and new product development, and it offers a novel perspective for many researchers and practitioners in the field.

The key contribution of this book is that managers, within the innovation process, should focus on creating new meanings to customers, rather than just focusing on the rational, utilitarian perspectives of innovation. Creating new meaning can create radical innovations, as Verganti argues is the case for well known products such Nintendo's Wii and Apple's iPod, amongst others. Verganti illustrates these ideas through a series of case studies. Verganti also offers a process through which to achieve innovation through meaning, which will be useful to managers and academics alike.

If one was to critique the book, one might ask questions about the generalizability of the cases being investigated, more specifically the heavy bias of Italian companies. To what extent do these processes apply elsewhere? Is there an issue of survival bias? Of course these are all big questions and the book does not attempt to resolve them as that is not its purpose, but these questions and others should be considered. As a whole the book makes a novel and important contribution to our understanding of successful innovation and is recommended to academics, practitioners and motivated students who are interested in innovation.