By Ed Orozco in Design Strategy — Mar 8, 2020

What is Design Strategy and Why Do You Need It

Strategy is the intersection between business profitability and value for people.

Originally published on March 8, 2020

Introduction

My intention with this article is to offer business owners and product folks in the tech industry an introduction to design strategy, centered on the tech industry.

Disclaimer: All links to products are Amazon affiliate links.

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What Is Design Strategy

Design strategy is a meeting point between what's valuable for customers, and what's profitable for businesses.

It involves creating a set of guiding principles that articulate the business mission and vision with the design of their products or services.

It helps businesses figure out the question of what to do next.

In other words, it ensures your team produces what your business needs to align its success to its customers' needs.

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Venn diagram depicting the concept of strategy as the intersection between profitability and value. — Strategy is the intersection between business profitability and value for people.

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Why is Design Strategy Important

There are three main reasons why design strategy is essential for your business.

It's cost-effective
It gives you direction
It helps you prioritize

Let's analyze them one by one.

Design Strategy is Cost-Effective

When you don't take the time to define a strategy, you might wake up one day and realize that you've spent two years and $80,000 on building a product that doesn't appeal to your target audience.

Design strategy allows you to clearly define who your target audience is, what they need, and how you can create value for them. Your product launch won't be a shot in the dark. Rather, you'll have a research-backed product upon which you'll be able to iterate to keep improving it.

In his book Zero to One, Peter Thiel underlines the importance of building the right thing. No amount of iteration can fix a product that shouldn't have been build in the first place. And the only way to know you're on the right track is by having a through understanding of your users' needs, and how you'll create value for them.

You will get rich by giving society what it wants but does not yet know how to get. At scale – Naval Ravikant

Design Strategy Gives You Direction

When the goal is clear, you empower every person in your team to make autonomous decisions that are in sync with your company's goals.

There's a phenomenon in psychology called "decision fatigue," which describes the way making many decisions wears down people's capacity to make sound judgments when it matters most.

It's the reason why people like Obama, Steve Jobs, and Mark Zuckerberg became notorious for always wearing the same outfit.

"You need to focus your decision-making energy. You need to routinize yourself. You can't be going through the day distracted by trivia." – Barack Obama.

"Should this be a primary button or a secondary button? Do we use photos instead of illustrations? How many pages should our marketing website have."

A good design strategy takes all the trivial decision-making that surrounds your product out of the way, freeing up your team's time to solve more creative problems. Such as:

"Can we improve our conversion rate by removing this seemingly distracting step from our checkout flow?"

You'll sleep better at night knowing your entire organization is working harmoniously to reach your monthly recurring revenue goals or cutting down your churn rate by half. It will also free up your time to make more higher-order decisions.

Design Strategy Helps You Prioritize

Often, being user-oriented is not enough.

Many user requests can be costly to build, take up a lot of time, and bring you only marginal gains. If you always do what your customers ask for, you may end up becoming a 'feature factory.'

Assuming you're not swimming in cash, this modus operandi will dry out your business' wallet faster than what took that reporter to make the kid cry:

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However, if you have design strategy in place, your team will focus on the features that strike the best balance between high reward and low effort, creating the most value for the most significant amount of your customers. It's a more sustainable way to drive revenue.