Designing for customers’ needs has always been a priority for product-driven enterprises, but it’s much easier said than done, and especially so in today’s digitally-connected world. Customers have more information, more options, and evolving behaviors about what they buy—and how. Consumers expect innovative solutions rather than just clever or well-designed products.

With customers now looking for solutions, what is the answer to staying relevant and keeping pace?

Connected product innovation
To increase innovation and develop new customer value, the product-driven enterprise can take advantage of IT solutions and strategies for modernizing product development. At the core is connectivity—connecting with your customers, products, partners, and employees to accelerate innovation.

The advancements in connectivity, device options, and software have reached an inflection point that enables The Internet of Things (IoT) to create new kinds of business value, helping to transform product development and drive innovation. And for a product-driven business, the economic benefits are enormous. According to IDC, the potential market size of the IoT will be $7.3 trillion by 2017. During that same timeframe, product-driven companies that take advantage of their data have the potential to raise an additional $371 billion in revenue over companies that don’t. To drive connected product innovation, data is key.

IoT for design
To modernize product development in order to keep pace with consumer needs and drive the evolution from products to solutions, connecting devices to IT systems is only the first step. The real value of IoT lies in the data that is created by and transmitted from those devices as they interact with other devices and human beings, and the compelling business insights this data can enable.

For innovative solutions, this includes insight from both your customers and products—insights into product sentiment and market trends to drive roadmap decisions, and product use and performance telemetry for design decisions.

The smart products of today evolve with the customer and gather insights that help shape how they are used and also how future versions are designed. This is transformational because the days of focus groups to test product relevancy is almost irrelevant. Products are designed with the insights that guide the outcome and therefore closely match consumer needs. This leaves focus groups to concentrate on acceptance rather than validation.

Data-driven design insights
As a product-driven business, data-driven design insights is something Microsoft relies on for the future direction of our products. Take Surface for example. When customers sign up for the Microsoft Customer Experience Improvement Program, our product managers can receive both objective and subjective insights sourced from real-time data as to how the customer actually uses the product (e.g. with or without the keyboard) and how they feel about it.

This type of insight, including usage, customer interaction, product performance, and environment, helps manufacturers like Microsoft fine-tune information to design the next product. This diagram shows all the sources of information and how they interact to accelerate innovation.

IoT for product design is one of two important capabilities for connected product innovation to help turn insights and ideas into innovative products. In my next blog post, I’ll talk about social innovation, the other key capability, and best practices for innovation.

In the meantime, for more information on IoT for design, go here And for questions, please contact