- The-Case: DESIGNING FOR DOLLARS
Great product design is absolutery criticar for most consumer products companies.
BuI, how do these companies know when a design feature wi, pay "off, especiary
when every dorrar counts? How do they make those tough decisions? That,s the chal{enge.-that.faced.Whirlpool,schiefdesigne1,ChuckJones.Heknewhbfiad.to...
come up with a better way.
chuck's realization that the whole process of making design decisions needed to be
improved came after a meeting with whirlpool,s resource allocation team. chuck
wanted to add some ornamentation to a Kitchen Aid refrigerator thai was being
redeslgned, but it wourd have added about $5 in extra cost. when the team asked
him to estimate the reiu rn on investment (that is, would it pay off financially to add
this cost?), he courdn't give them any data. His "trust me, r,m a designer,, argument
didn't sway them either. chuck resorved to improve the approach to investing in
design.
His first step was the survey other "design-centric" companies, including BMW, Nike and Nokia. surprisingry onry a few had a system for forecasting return on design.
Most of them simpry based future investments on past performance. chuck said, "No one had really figured this stuff-out." with so many smart, tarented peopre in
their field why had no one been abred come up with a good way to make those decisions? According to two accounting professor, one reason is that its incredibry difficult to discern designs contribution from all the other business functions (bargaining, manufacturing, distribution and ethics). And even the designs profession couldn't agree on how to approach this probrem_ Despite the obstacres,
chuck continued his quest to find a way to objectively measure the benefits of
design.
what he eventually concluded was that a focus on customer preferences would work
better than a focus on bottom-line returns. lf his team could objectively measure
what customers want in a product and then meet these needs, the company courd
realize financial returns. chuck's design team created a standardized company_
wide process that puts design prototypes in front of customer focus groups and then gets detailed measurements of their preferences about aesthetics, craftsmanship,
technical performance, ergonomic, and usabirity. They chart the resurts against
competing products and the company's own products. This metrics -oaseo approach gives decision makers a baseline of objective evidence from which to
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make investment declsions. Design'investrnent decisions are now based on fact, not opinion' The "you" decision-making approach has transformed the company,s culture and led the boarder designs because the designers can now make a strong
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Based upon the analysis of the case, prepare an essay of approximately g20 words
by doing the following tasks:
1. Analyze concretery the strateg!c decision made by whirrpoor. Discuss judiciously what made the company draw-out successful strategic initiative to compete in the market and how each strategic level has been carefully decided.
2. ldentify and critically evaluate the stnategic developrnent direction opened by Whirlpool to make a wise investment decisions.
