The Digital Economy and Innovation

Barbican visitors play 'Donut Pong', by digital production studio Special Moves and Joe Scarboro - Image: Authors Own

Barbican visitors play ‘Donut Pong’, by digital production studio Special Moves and Joe Scarboro – Image: Authors Own

Digital technologies continue to disrupt what was once the core of many businesses: retail has long been shifting to the virtual marketplace, print media has and is responding to the way information is accessed and consumed, and new tools and technologies are re-shaping the way nearly all products are, and can be, designed and produced. More and more, traditional industries and businesses are learning to understand the importance of digital, and with it, their user and audience. With this realisation, the design profession has received much attention for its ability to identify and translate human factors – more specifically the underlying need and desirability – that then drive the digital experience.

Within this landscape of possibilities, design is poised to sit alongside (not behind) technology and science in the research and development of new products and services. How then is the digital economy shaping the way design is being adopted and championed in the non-creative sectors, and what could CSM graduates bring to this new market place?

MA Innovation Management Students running a workshop on Service Design at Tech Hub - Image: Authors Own

MA Innovation Management students running a workshop on Service Design at Tech Hub – Image: Authors Own

The adoption of design into many management consulting firms is ongoing. Recently, several companies have looked to develop their design capabilities, with a specific focus on offering their clients – major multinational corporations – a greater understanding and delivery of ‘digital’. In 2012 the professional services firm Deloitte acquired digital design agency Übermind, in 2013 Accenture Interactive purchased the digital and service design company Fjord, while IBM continues to build their design capabilities under the newly formed division and ‘studio’ known as IBM Design.

Image: Wired

Image: Wired

As University Enterprise Development Manager Alisdair Aldous sees it, there simply isn’t a part of professional practice that digital hasn’t impacted upon. Holding a position that serves as a link between external businesses and the internal talent and research interests across UAL’s colleges, Alisdair explains that the central government has been the bridge between enterprise and the University sector in its push towards digital innovation. With the belief that businesses across the UK need to understand how emerging digital technologies will allow them to scale faster, reach new markets and develop new products and services, the government also faces limitations in directly intervening in enterprise with public money, which they have bypassed by supporting the University sector.

“In these times of austerity when most government department’s budgets are being cut, areas which fund collaboration and innovation between universities and businesses have actually had their budgets increase.

With the government’s recognition that University interaction with business will catalyse faster and more effective adoption of digital technologies by companies there is consequently a lot of public funding available to help businesses do just that. As such, we get approached by more businesses seeking expertise relevant to the digital agenda.”

 

The Roles of Art and Design in the Digital Economy  

The role of art and design in the digital economy is not about the mechanics of emerging and existing technologies, but in unveiling and experimenting with how we consume, react and engage with them. This certainly was the case with projects presented at a recent event focused on Women in the Digital Economy, organised by Creative Works London – one of four AHRC funded Knowledge Exchange hubs for the Creative Economy.

Projects presented throughout the evening included “InBox” by Victoria Mapplebeck, an animated documentary and website which aims to ‘crowd-source’ hidden stories that exist in our mobile phones, and “Beat Woven” by CSM graduate Nadia-Anne Ricketts, a digital textiles label that experiments with algorithms, turning songs into textile patterns.

"InBox" Victoria Mapplebeck

Victoria Mapplebeck presenting “Inbox” – Image: www.whatdigitalfuture.tumblr.com

What these and other projects presented have in common are their ability to make technology human: “InBox” taps into the emotional archives that exist in our mobile devices, illustrating stories, dramas and moments in the lives of the products owners while “Beat Woven” aims to transfer the emotional response we have to music to a physical object. As experimental as they may be, these kinds of projects present real opportunities for digital innovation in their understanding of emotional or human responses a user has to and with a brand, product or service.

Nadia-Anne Rickets "Beat Woven" Textiles - Image: DesignWeek.co.uk

Nadia-Anne Rickets “Beat Woven” Textiles – Image: DesignWeek.co.uk

This same experimentation is what companies look for when wanting to work with the college, as Alisdair explains:

“Some of the really interesting companies that want to work with us are interested in what we can bring to their experiments in digital. They don’t expect us to have the technical understanding, but are very much looking for that understanding of human interaction. Looking at these key questions of desirability, viability and feasibility – much broader human-centred questions.

 

A lot of them are more innovative in nature – they’re not looking to replicate, they’re looking to innovate – and they may not have the expertise needed inside, or may feel they’d like to access a more diverse pool of creative talent. They’re wanting to do something that’s a bit different – something that maybe isn’t technically innovative but conceptually innovative and which engages with their consumer in a way that is more in keeping with their values.”

 

Business Models 

Because the core of digital media and technology is often tied to the services companies offer, innovation in business models have also emerged in this new economy. Alisdair illustrates the point with the example of the Freemium model, which he stresses has “most definitely come out of digital” – a strategy companies use to provide their user with ‘taste’ (or basic access) of their product.

A sector that is commonly used to both warn and inspire businesses of the impact digital can have is the music industry, and an example of the Freemium model in music is the increasingly popular platform ‘Spotify’. Offering their music-streaming service free of charge, ‘premium’ or paid subscribers are able to listen to music ad-free, and off-line. As Alisdair comments, companies are learning that

“if you’re confident about your product or service – by giving people a taster, and allowing them to experience how different the quality is from their competitors is a much easier way to get conversion than a pay wall.

It’s much more about value than money in a way; if you understand where value resides within your particular system and you monetize it in the appropriate places then you can still have a very viable business. A lot of companies have experimented with trying to monetize different parts of their value chain to varying levels of success – and getting that right can be really revolutionary.”

Shifts in value chains, where money is invested, and budgets are allocated in a business are also changing as a result of digital initiatives and an increased focus on design. When recently asked to project the future of design, a member of Fjord’s leadership team – a service and digital design agency – recently speculated that marketing budgets will begin to go into designing better projects and services. If design continues to be embedded across companies and at the beginning of product and service development, this idea isn’t hard to believe, and is already being seen. If desirability is built into a product or service – digital or not – the market will be built in as well, and the need to ‘sell’ the product to a target audience or otherwise will diminish.

A Future Landscape

Even with the help the digital economy’s push has had, design practitioners still have a way to go in embedding the profession into more traditional approaches. The talk is currently not matching the action, which Alisdair potentially attributes to a risk-aversness regarding the design-led process, as it will often not predict an exact outcome, and insists on an iterative and more open-ended problem-solving process.  However, this is often not understood to occur within a very well-managed framework.

However steep the hill may be to climb, Alisdair is hopeful for the future:

“I think the world is waking up to how relevant what we offer is. While the same companies are always rolled out as great innovators – Nike, Apple, Dyson – a lot of the time people that wheel them out don’t recognise that they are companies that put human engagement, not technology, at the helm, with everything flowing out from that (including leading-edge technical innovations). That realisation is dawning on companies more and more and in London we are sitting on the global crown jewels in terms of a creative sector that know how to engage with the possibilities and nuances of digital.”

There is no doubt that digital technology (and with it the digital economy) will continue to change the way we engage with the world and each other, which is why it is important that CSM, artists and designers continue to shape that interaction by experimenting and pushing the boundaries of what is valued and desired.

Many thanks to Alisdair Aldous for his valuable insights into the digital landscape.

Further Reading and Resources 

Government Initiatives and Reports:

Technology Strategy Board Network

Connected Digital Economy Catapult: https://cde.catapult.org.uk/
The European Commission – Design for Innovation Reports: http://ec.europa.eu/enterprise/policies/innovation/policy/design-creativity/