The UK design industry has had a difficult year and it needs to become more flexible if it’s going to survive, writes Henk Koopmans, head of sales and marketing at design house Plextek.
It’s not been an easy time for the UK technology industry, much less the UK design market. Traditionally companies have used design houses when they needed some specific technical expertise within a much larger project or when they were looking for expert consulting to assess a particular challenge.
Now, with project deadlines tighter than ever so as to get products into the marketplace as fast as possible and therefore the pressure to get it right first time, we’ve started to see design houses being asked for more than just pure design. This diversification often includes being brought in much earlier in the concept and system process to consult on aspects from market evaluation and due diligence right through to full manufacture and implementation of full business processes. For UK design to survive in these economic times, it needs to be able to respond to this need, be flexible in its approach and its business model options.
Historically the relationship between a design house and its client was relatively simple, the design house would often be subcontracted to provide a particular component part within a larger system/project, complementing other experts in areas such as development, manufacture, maintenance and support.
These relationships with design consultancies are slowly changing to situations where it’s more of a commercial business partnership. Clients are choosing to work with one company, in order to minimise process management effort and risk, who can move through the whole process with them from market forecasting and future business strategic thinking, through innovation to design, manufacture and supply as well as business channel management.
This shift in the market indicates that design houses must begin to offer not just broader design services, which have always been important, but innovation at every stage in a product’s lifecycle. For those companies who traditionally have specialised in just one area of expertise, are now faced with a difficult challenge, either to diversify their skills and compete with the bigger consultancies, or to develop and improve their expertise to an extent that other companies cannot match their quality.
Another dimension of this broader approach is the ‘platform’ development, where design houses have invested into basic building blocks to accelerate the time to market, music to the ears of the client’s product manager. Whereas previously this tended to be limited to core technology, today you see entire product platforms as the starting point of a product development.
By spending more R&D time on platforms and by getting involved in more aspects of a project, UK design companies are now sharing much more of the risk with their clients.
While clients have always been keen to share risk with their partners, they’ve always been reluctant to share any of the product successes as an incentive. Now though, with time and money spent on platform development and a much closer relationship developed with the client, the design house is sharing much more of the risk and of course there’s never any guarantee that the product will succeed.
The upside to this is that by using platforms to ensure quicker time to market and easier development, the customer is much more likely to return (should the product be successful) for versions 2, 3 and beyond. The initial risk is taken more by the design house, but ultimately the reward can be worthwhile.
Does that mean design houses will change into an EMS (electronics manufacturing services) business? Very unlikely, but through clever alliances and targeted expertise development and acquisition, the design house will be a very efficient business partner. For the client’s strategy team working with such a design house is very powerful indeed as it brings options for business and product innovation and realisation to the table very early.
It’s been a tough few years for the UK design market and the signs show its not looking to change just yet. The margin for error in getting new products to market is now so slim that it’s barely visible at all, so the pressure is on for companies to get things right first time.
As a result of this, the relationship between design houses and their clients are being driven by change with both parties now needing to be much more flexible; not just in what is offered, but how it is offered, how it’s paid for and how it’s developed. For UK design to survive it needs to become more flexible in its approach and work closer with customers to ultimately ensure the success of the final products.