Companies hoping to be successful in the 21st century need to understand that the relationship between consumers and products has fundamentally changed, say C.K. Prahalad and Venkat Ramaswamy, authors of “The Future of Competition: Co-Creating Unique Value with Customers.” Simply adding more bells and whistles to an existing product doesn’t ensure that consumers will continue to want it. “Thus, the emerging paradox of the 21st century: Consumers have more choices that yield less satisfaction. Top management has more strategic options that yield less value.” The authors urge a reexamination of “the traditional system of company-centric value creation. In the new value co-creation space, the basis for product development changes dramatically; the challenge shifts from meeting a different set of specs to developing unique ways to co-create value with consumers.” To do that, design teams must think of a product as an artifact around which consumers have experiences rather than merely as something they use. The product must be also be designed for evolvability, thus enabling future modifications based on consumers’ changing needs. “For instance, whenever possible, products should contain enough embedded intelligence to recognize an individual consumer’s patterns of use and evolve accordingly, like the most-used features of menu-based interfaces floating to the top, or revealing more sophisticated product functionality as the user evolves. Certain video games already perform in this fashion; why not televisions, mobile phones, kitchen appliances, cameras, or light fixtures?”
Co-Creating the Value Chain
21 years ago • 1 min read