Most consumer research focuses on learning about what people do, and most innovation projects focus on developing new technologies into things people will buy. Notice the disconnect?

Too little research is focused on how people make decisions, and too few innovation projects focus on developing something that fits better with people's decision processes.

Learning to do this type of research is difficult.  Learning to connect this research to the development process is even more difficult - and rare.  No one would argue that it is important to learn about how consumers make decisions, nor would they argue with the importance of connecting this knowledge to the development process is important.  In fact, many would say they are already doing it.

I have not seen a product or service fail when this is done well, and yet according to Stevens and Burley, at least 1 of 3 products fail  at launch despite research and planning.  Clearly, we can see that doing these activities does not mean we are succeeding at connecting them.

My last post was about the success of Monocle, and how founder Tyler Brule's incessant, immersive research plays a large role in this success.  But it's not the only reason Monocle is successful.  JD asked the question, "Is Brule able to do this because he is part of his target market, and he is providing products and services that he, himself, would want?"  This is a great question, and my answer is that while this may very well be true, it's not enough.  If it were, he could just sit behind his desk all day and dictate what he likes rather than spend time in the market.

Immersive research to get to the heart of what drives the consumer's decision-making process is half the battle.  The other half is the ability to translate what we learn about the market into products and services that actually connect with these drivers.  In my experience, this is where most companies fall down.  The inability to translate these intangible needs into tangible products actually encourages superficial research.  It's easy to make a direct link from what a consumer says they want, to delivering on what was described.  This is great for incremental improvements, but consumers cannot tell you how to disrupt a market.  Tom Martin said it well today in AdAge, "The customer is paying you to solve his problems before he even realizes he has them."

The translation from consumer understanding to the creation of the right products and services is the other area where Brule's team seems to be executing flawlessly.  The fact that he is part of his target market may help him, but being part of his market does not automatically give him the ability to translate.  We are all members of various target markets and may work for companies that make products for people like us, but the vast majority of us do not have this ability.  So, Brule is good at translating in this market.  For him it doesn't matter whether or not he's good at translation in general.  For other companies, this matters a lot.

The ability to translate is equally important for all functions in an organization, yet it is a skill that is difficult to recognize.  Traditional market research techniques often fail to uncover the depth of insight that will guide the development of disruptive products and services, and traditional evaluation techniques often fail to discern whether or not a disruptive idea will connect well enough to succeed.  Brule clearly does this well, and I don't even need to say more than the words "Apple vs Dell" to further illustrate the point.

I fully believe that you do not need to be in a target market to derive the right insights and translate them into the right disruptive products and services. Right now we're seeing success with CEO's who are good translators, but the CEO doesn't have to be the translator.  Is your company recognizing and supporting this role?

I enjoy the weekend edition of the Financial Times, part of which is Tyler Brule's weekly column.  A few months ago, something started to catch my attention.  It appeared that Brule's publication, Monocle, is doing quite well.  It is a lifestyle magazine, and has an associated website with audio reports in addition to the printed publication, and even a recently launched retail concept.  There is no user generated content, and it is obvious that everything, from the website, to the audio reports, to the physical publication itself, are very well produced. That's not cheap. So what is Brule doing that allows him to be successful by going against the current wisdom in the industry?

To satisfy my curiosity, I did a quick search and found an interview with Brule in the Austrailian WSJ that sought out my very question.  What I learned was quite revealing.  While there are several factors responsible for his success, what stood out for me was his statement that they don't do any research at all, and that he doesn't believe in it. He then described what research was to him, and it consists of using focus groups to decide what the cover should be, or other specific executional details.  Later, however, he talked about how he spends time with consumers in the shop, just having a chat with them.  He also mentioned that he watches what magazines business people are buying in the airport, and then how he observes what people are reading on the plane. From reading his weekly column, you can also see that he is spending the bulk of his time immersing in his market. He maintains a grueling travel schedule, and makes sure his reporters and correspondents are in the places they are covering. He then mentioned that they did use a readership survey to confirm some of their assumptions about their readers' habits. It was not to learn what features they might like.

Like most business people, Brule has a very narrow definition of what research is.  Unlike most business people, he knows that research as he defines it is not going to help him to connect with his market and deliver the experience they are seeking but cannot define.  From my perspective, Brule executes brilliant research.  He does whatever is necessary to connect with his market, and fully understand what is driving their decisions.  He knows that it is his responsibility to deliver an experience that will connect with this consumer, and he does not expect them to ask for it.  He also knows that there is greater value in delivering an experience that the consumer wouldn't think to ask for, but suits them perfectly.

What can be learned from his success? There is little to be learned from the execution, as what he is doing is right for his market, and would probably not work for say, the New York Times.  What can be learned is that he is ignoring current consumer, industry, and economic trends, he's learning what is driving his market, and he's delivering a series of products to satisfy their needs in a way that his industry competition has not.

Is your company using research this effectively?

There's an article in Fast Company about Google's design lead, Doug Bowman, leaving the company to take a job at Twitter.  He says that Google's culture of over-reliance on testing and data paralyzes the design function.

This is yet another sad ending to an all too common issue.  Businesses that have to place big bets are typically reluctant to do anything that has not been evaluated to mitigate unnecessary risks.  Exercising this type of caution is good, and I am an advocate of evaluating ideas before they are implemented.

Where it goes wrong is when the evaluation methods used are inconsistent with the types of decisions that need to be made.  While I don't know the inside details, I would suspect that this is largely the issue for Bowman, as it is for most designers who work with large corporations.  In most business disciplines, very linear methods of evaluation can be used to make decisions such as the return on investment of new capital equipment, the potential market effects of price changes, or the usability of web products.

However, it is a designer's job to create new experiences, manage consumer's perceptions, and ensure that products and services are meeting underlying consumer needs.  Design elements are used holistically to acheive these goals, and testing individual attributes (such as Bowman's mention that he had to test a 3,4, and 5 pixel border) can lead to inacurate design decisions.  Does that mean that design cannot be evaluated?  Not at all.  In fact, that's where many designers fall down. 

Design can be evaluated, but new methods have to be used that evaluate whether the holistic design elicits the desired response. The key is to focus on the results, not on the individual elements.  I have had great success with this type of evaluation.  The companies that struggle with this type of evaluation typically have not taken the time to figure out what the ultimate goal of the design should be.  Lacking that information, designers are left to grope in the dark, looking for something that either a consumer, or a company leader, will say they like.  This may work in the short term, but ultimately the wrong evaluation will lead to the wrong results.

How does evaluation happen at your company?  Ultimately, are products evaluated based on how well they will achieve the ultimate goals of the person who will buy them?  By ultimate goals, I mean the basic reasons the customer is buying a product in your category in the first place.  If you're scratching your head wondering what the ultimate goals are for the product you're working on, it may be time to start asking some tough questions.

Today GM and Chrysler are approaching the US Treasury for more aid. They have been preparing their case to prove that they need more money to survive in the current economy, and that they are being responsible in cutting costs, headcount, and negotiating with the unions and creditors.

This leads me to a question.  What are they going to make?  Before you roll your eyes thinking "of course they'll make cars", hear me out.  In reading about what it is they are going to do differently, I have not read anything about how they are going to ensure that the cars they make will appeal to the people they most desperately need to buy them.  I know they have a mandate to make more energy efficient cars, but that is a technology.  What type of car - or should I say, motorized people mover - will the new technology be powering?  Who are the people who will buy these cars, what do they need, and how do GM and Chrysler plan to meet those needs?

Simply cutting costs, or investing in technology is not enough. The car companies are in trouble because they were not able to make cars that people wanted.  Yes, consumer needs changed quickly, and another part of their plan should focus on how they will be more flexible and responsive to rapidly changing conditions. 

These are things that will enable long-term success for any company.  Yet today, we continue to see focus on operational efficiency, cost cutting, and investment in technology without a holistic sense of purpose.  At the end of the day, the wrong product is still the wrong product, regardless of its technical superiority or efficient production.

Let's hope the answers to the questions I'm posing are buried somewhere in the 100 page report that will be presented today, but I suspect they are not.  As part of a network of people who make their living solving problems like this, I can tell you that car companies are not among the new clients calling.

I have to thank JD for keeping me honest in my last post about consumer behavior in this economy.  I was discussing several media reports that consumers were not spending as much during the holiday season, citing a choice to save rather than spend.  My experiences pointed to the fact that there was little inventory to buy, and that this consumer behavior was less a matter of choice, and more a matter of circumstance.

My main point is that it is easy to look at a consumer's action and jump to the conclusion that it is the result of a choice.  Very often, this is only partially true.  I'm sure that there are many consumers who are choosing to spend less.  But there are also many consumers who would have bought more at retail if the items had been in stock.  Likewise, as JD pointed out, there are multiple reasons why inventory levels were low; some retailers are trying to reduce carrying costs, and others are having trouble getting inventory due to the credit crunch.

Why is this important?  Because it leads us to an important consideration when thinking about market segmentation.  Instead of segmenting the market based on demographic or psychographic characteristics, it may serve us well to segment based on the circumstances that are influencing consumer decisions.  In the example mentioned above, the consumers who are choosing to spend less will have different needs than the consumers who found that the items they wanted to buy were out of stock.

When setting innovation goals, it's important to understand the context in which your consumers are basing their decisions.  Segmenting the market by the consumer problems that need to be solved will lead to offerings you may never have thought of otherwise.  That's the key to valuable innovation.

We've all been inundated with media reports about the current (sad) state of the economy.  One that stood out in particular for me was the report that said people were out in malls, but not really buying much in the stores.  It then went on to say that people were spending more online.  The conclusion drawn was that consumers were not spending by choice.  I however, had a very different experience.

Due to a lack of planning on my part, I joined the crowds just before Christmas.  I had to buy two fairly common items - a pair of boots and a pair of slippers, which I decided to buy at the retail store so I wouldn't have to wait for shipping.  Silly me.  Neither item was in stock.  The sales person told me that he would help me to order them online.  He then went on to tell me that he felt badly because they were actually out of stock on most of the commonly purchased items.  When I looked around, most of the sales people were actually just helping people to place online orders.  At the end of the day, I found some great boots at an independent retailer, who actually had products in stock and could sell them to me.  I decided to order the slippers online and wait for the shipping.

I also noticed that Amazon had sold out of the Kindle.  Hmmm...  More people wanting to buy things that are not available, and yet we are told that the consumer is not spending by choice.  My observations are pointing to a very different conclusion.  The consumer is not spending because there are fewer things available for them to buy.

I know that companies are trying their best to avoid a glut of inventory.  I know that everyone is carefully considering their purchases, and companies are carefully considering how they run their businesses.  But I worry that too many business decisions are being made out of the fear of what might happen, rather than the reality of what is happening.  Economics is certainly a field where self-fulfilling prophecies are the rule more then the exception.  We modify our behavior based on what we think will happen.  No matter how prudent it seems to reduce inventory levels, companies cannot post sales on products that are not offered for sale. 

The current weak economy will pass.  The timing will depend on when we can shake our fears and create the economy everyone is waiting for.

A couple of years ago, I was at a conference which focused on the overlaps between design, business, and other organizational disciplines.  It was kicked off with a discussion led by Dr. Richard Farson, who cautioned that the design profession is at risk of devaluing itself as a profession.  His argument was that anyone who was in the business of executing tasks that clients ask for is not a true professional, regardless of how skilled they are at their craft.  A true professional, Farson stated, is a person who works with a client to achieve a goal, and tailors their tasks to realize that goal.  If you don't do that, you are in the business of taking orders, which is a much less valuable endeavor.

He then went on to give the example of Frederick Law Olmsted.  For those who don't know, he was the famed landscape designer in the 1800's who designed Central Park in NYC, the Emerald Necklace in Boston, and many, many others.  Farson stated that if you think Olmsted's greatest achievements are that he designed lots of beautiful parks, "...you've totally missed the point of his role as a professional."  He said that Olmsted was a true professional who was working with community leaders to create egalitarian communities where the environment encouraged people to gather together, and used his skill in landscape design toward achieving that purpose.  That his parks are still achieving those goals today is a testament to his success as a professional.

I mention this story because it applies not only to design, but to people from any discipline.  The world is full of people who are happy to "take orders" from their clients or employers.  Why?  Being a professional means taking responsibility for doing work that helps an organization to achieve their goals.  The client may have an idea for how this should be done, and a professional has to be able to say why those suggestions will or will not work.  Yes, a professional sometimes has to say no.  And good clients and employers will respect this professional opinion far more than the constant yes of an order taker.  This type of relationship requires integrity, trust, and respect for the ultimate purpose that is driving any work that will be done.  It is not as easy, but is infinitely more rewarding.

Today, we need more people to step up to the plate and take responsibility for how their professions can help our organizations to achieve their goals.  It is easy to point fingers at the leaders who have failed to point our work in the right direction.  But I wonder, how many people out there had a chance to influence what was happening, and instead chose to just do what they were told?  And on the other hand, how many leaders chose not to listen to those who did step up to deliver a message they may not have wanted to hear?

Chris Brogan had a great quote on Twitter yesterday.  It read "Technology is never the solution. It's the facilitator. Strategy aligned to goals is the solution." 

I would qualify the last sentence, but considering the 140 character limit on Twitter, I'd say he got the important part right.  Technology is a facilitator.  It's our job to figure out what, exactly, any technology would need to facilitate.  Consumers don't buy technology.  They buy solutions that make their lives better, and typically have little patience for interacting with technology directly.  The more invisible technology becomes, the more it will be embraced.

Last year I was reviewing a proposal with a client who was very concerned with predicting which technologies he should add to his products in the coming years.  It took a while to show him that once we identified the right consumer needs and benefits to deliver on those needs, we would probably find out that multiple technologies would be at his disposal to deliver them.  It's the technology piece that should remain flexible, as his strategy should be based on delivering consumer goals, not defining and protecting the enablers of any one set of solutions.

What is the role of technology in your company?  Does everyone know what goals the current technologies are enabling?  Or is the technology treated as if it is the benefit in and of itself?  You may need to shift a few perspectives to make sure that your strategy is based on delivering what it is that your consumers are actually wanting to buy.

There has been a lot of discussion about Design Thinking lately.  It's an important topic and certainly needs more discussion to achieve better clarity in its meaning as we translate from theory to practice.  However, I want to make sure we don't lose sight of the business value of design as a discipline in and of itself.

The outcome of my work is usually the identification of a market opportunity, a business strategy to realize that opportunity, and criteria for solutions to satisfy that opportunity.  To me, one of the most important functions of the design discipline is to take information that is tacit, and make it explicit; we call it information design.  When an information designer visualizes the relationship between the different aspects of a recommendation, a model is created which makes a holistic understanding possible.  Any flaws in logic or previous assumptions are made clear, as are the implications of the decisions that will be made to move ahead.  As such, any tacit assumptions that people bring to the discussion are made explicit, and the group can truly align on a common understanding.  This is what I mean by "designing" or "visualizing" a business strategy or model, and information design is a critical skill in developing models that achieve this level of clarity.

In many organizations design is used only in the development of the actual product or communication, as done by product or graphic designers.  These too are important design skills, but they happen after the criteria for the solution is established.  Here the design skill is used to translate intangible criteria into tangible offerings.  The extent to which the designer can convey the intent of the solution is what will determine its ultimate success.

How is the design discipline used in your organization?  If the designer's role is to apply their personal aesthetic tastes to make an offering "look" better, then you are missing out on an opportunity to make your organization's tacit assumptions more explicit, enabling better decisions to be made.  It may be time to rethink how you define the quality and value of design in your business.