The Enabling Service of the Industrial Design Consultancy: A Change of Focus from Goods- to Service Dominant Logic

Abstract: Design has received increased attention not least of all in the business press and journals. The concept of design thinking – how to approach problems in a designerly way – is sometimes attributed as being the savior of business, making companies creative and innovative. This kind of exaggeration does more harm than good to industrial design consultancies (IDCs) and their client firms (CFs). And yet, the renewed interest in design that the concept of design thinking generates has shifted attention away from the artifact to the activity and with it, the competencies and knowledge of the designer. IDCs still have problems charging for intangible components in their offerings, and the value of their work is mainly restricted to those customers who have experience from working with industrial designers. This thesis aims to deepen our knowledge of the logics behind the business of industrial design in terms of how it is organized, the competencies of the industrial designer and the perceived role of the IDCs in client firms. The thesis is built on two research papers and a study based on interviews, workshops and a web survey. The empirical results were categorized according to the structure of a conceptual business model and analyzed vis-à-vis service dominant logic. There is a great interest in the IDCs in growth issues and in raising the profitability of the consultancy. There is a high awareness that this would make the company less vulnerable and provide better margins for development. Large sized IDCs are undergoing a professionalization and have made changes in how they are organized and managed. The literature study described an increased intangible focus of design and an aim to adopt a more strategic role in CFs. Still, the IDC is not giving up any of its previous roles, such as those involved in working with tangible products. The aim of IDCs to adopt a more strategic role in their CFs was confirmed in the empirical study. At the same time, most potential clients, who have little or no experience of working with design, regard the contribution of the industrial design consultancy to be tangible outcomes such as sketches, CAD drawings and prototypes that are delivered at the end of a value chain. This perspective on design is in line with a goods dominant logic and is a constraint for the growth and development of the IDCs. This thesis claims that the IDC offers both relieving and enabling service and hence should be viewed from the perspective of service dominant logic. The value resides not in the tangible end product but in the competencies that the IDC contributes with in a value network. Relieving means that a service provider performs a task or series of tasks for another party, which is the logic behind outsourcing. Contributing with the aesthetic competence of the designer exemplifies a relieving service. An enabling service means that the supplying organization helps the other party to do a task in a new and improved way. An enabling service is to a higher degree relationship-dependent, involving a learning situation where the IDC together with the CF cooperate to co-create new knowledge. The enabling service of the industrial design consultancy would thus create higher and longer lasting value in the CF since new knowledge is created by helping the CF enhance its internal and external processes. Service dominant logic enhances the shift from an operative role to that of the greater strategic significance that IDCs aim for. The focus changes to the activity and competence of the designer and can unlock the mental image of the IDC as a problem solver focused only on physical products.