"Design to Value" for Emerging Markets

Many companies still aren’t fully aware of how far they must go to differentiate their products for these customers. Top companies, by contrast, are highly disciplined, even relentless, about setting priorities and putting aside existing assumptions. Yet, some companies underscore the difficulty of understanding customers needs in fast-changing emerging markets.

To master the extremes of a fast-changing competitive landscape, challenge your company’s assumptions about designing, developing and manufacturing products for emerging countries. There are developing winning products for these regions!

In some cases, design to value means applying traditional tools in new ways, in others adopting a new mind-set about what customers want and how to deliver it. Here, the McKinsey Quarterly shows three insights for developing winning products for emerging markets:

1. Shake up your thinking

The combination of rapid change and heightened competition in emerging markets puts a premium on useful customer insights, even as they become harder to get. Indeed, poor infrastructure, vast distances, and fast-changing customer segments make traditional fact-gathering approaches (such as ethnographic research or even focus groups) expensive and time-consuming. Therefore, top companies don’t pass up any opportunity, however modest, to sharpen their understanding of customer needs.

An action for this point are the collision workshops, that include customers but primarily convene suppliers, marketers, product engineers and other company representatives. They offer a low-tech way of quickly generating and discussing customer insights and a forum to identify hypotheses that companies can later test more traditionally. An important goal of collision workshops is to challenge ingrained habits of thought by pulling together representatives from functional groups that normally don’t interact.

2. Start from scratch

Leaders start by identifying the most important feature or two and focusing heavily on them, but identifying and prioritizing the right features for emerging markets requires discipline.

The three steps for this point are:

• Step 1: Identify all modifiable features of the product
• Step 2: Categorize all features along three dimensions
• Step 3: Conduct a forced ranking of the top six to eight features

This approach is quite different from the one that many companies tend to have: regarding all features as equally valuable and preferring more rather that fewer of them.

3. Design for manufacturability

A final way top product makers separate themselves from the competition is to go on challenging their assumptions well into the manufacturing process. Surprisingly, perhaps, though most global companies have manufactured products in emerging markets  for years, they typically don’t go as far as they could to design them with emerging market customers and workers in mind. By contrast, clever products makers look for easy opportunities to tweak their products and processes further and thereby lower their capital costs.

Traditional approaches to product development  are coming under strain as emerging markets start to dominate the global economy. Companies that learn to shake up their thinking and effectively challenge the assumptions about how they design, develop, and manufacture products are more likely to master the extremes of this new competitive landscape.

image credit and resources: sparksheet.com https://www.forbes.com/sites/kenrapoza/2013/01/11/usaa-takes-new-shot-at-emerging-markets/ / https://www.mckinsey.com/insights/innovation/developing_winning_products_for_emerging_markets

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Geovanny Romero, is certified NPDP Plant Manager at Renovallanta-ContiLifeCycle, and Managing Director at NPD Strategy in Andean Region. A Member of PDMA International, his main interests are focused in Productivity, New Product Development and Lean In.