Do you co-create value with your Customer?

My podcast guest next week is Arne van Oosterom, Partner at DesignThinkers in Amsterdam. He is a Designer in Residence at the Oslo School for Architecture and Design & Norwegian Center for Service Innovation, Founder of the Design Thinkers Network, Co-Founder of the Service Design Network Netherlands, Catalyst at WENOVSKI and Founder of the Healthcare Initiative CareToDesign and Keynote Speaker at various International Universities and Conferences. A preview of the podcast is below:

Joe: I think you have to go deeper than relationships. You have to actually start playing in the customer’s playground. You’ve got to be there with them in the use of the product. Does service design support that theory?

Arne: Well, it’s support service design in the sense that we really believe in what we call a value co-creation. Value is always being co-created, and we are moving away from what we call value in exchange, to a world where value is being used as a center stage. Value in exchange very simply means that you put a lot of value into a product as a factory as a producer, and then you exchange your product for money with a consumer. I buy something for my company, and I give them money, they give me a product. That’s value in exchange. That’s what we are focusing on right now, which is the product?dominant logic.

But you’re moving more towards a service-dominant logic, which is something you can see, for instance, with smartphones. I always say, a couple years ago when you would buy a non?smartphone, a traditional Nokia when we were still buying Nokias, you would buy the phone. But if you put the phone in your closet, Nokia wouldn’t care. The deal was made, money was exchanged, so that’s fine.

Nowadays, if you buy a phone, either the producer of the phone ?? be it Samsung, be it Nokia, be it Apple ?? they will not be happy if you’re not starting to use the phone. You need to have the phone, because it’s connected to all kinds of other stuff, and it’s part of this ecosystem. This ecosystem is only healthy when it’s in use.

So it has to have value for me in use, and that is something that is very much different, because I think what we’ll see is that more and more products will become connected. And data becomes more and more important, because that is actually the way you have your relationships with your customers. That’s your conversation you have with your customers.

I specifically enjoyed the comment, “This ecosystem is only healthy when it is in use.” Do you look at your product or service from that point of view? Do you treat your product/service as an enabler of value? IT frames your perspective entirely different. In fact, it is one of my key theories on how you create demand. Is your product unhealthy because you added more features and benefits to appeal to a wider audience? Would you have been better off increasing the use of your product through additional product/services? To accomplish this, you have to be involved with your customer. You cannot just be observing, you need to roll up you’re sleeves, take off your boots and play in their playground.