Why vertical specialists are overrated
If you want to create an exceptional user experience for a wealth management app, who do you turn to for help? A firm that ships the same solution for their entire customer base? Or a studio that can tap into leading-edge UX and design solutions being utilized by leading companies across diverse industries?
You might be surprised at how many companies are inclined to pick option A — and while it’s no surprise that this vertical-focused tunnel vision has serious drawbacks, I’m especially concerned about its impact on innovation, critical thinking, and empathy when designing digital products and services.
When you’re overly dependent on vertical specialists, the tunnel vision that occurs puts you in a double bind: not only does it narrow your perspectives and limit your possibilities, but the tunnel can serve as an echo chamber, bouncing back all the conventional thinking you’ve heard a hundred times before.
This effect can hinder even the most experienced in-house product design teams. The company’s entrenched norms, biases, and mandate can constrain their innovative potential, and it becomes difficult to see — and therefore to challenge — the built-in status quo.
But many organizations don’t have in-house design talent to begin with: a well-known McKinsey study on the business impact of design shows that less than 5% of leaders can make objective design decisions, despite the tools, platforms, and data available. That’s why third-party agencies and studios are a popular and effective solution, especially for organizations that don’t have the need or the means to fund a full-time design-focused team.
As soon as the search for a partner begins, or a request for proposals (RFP) is sent out, niche experts are always eager to offer their services — and oftentimes, this leads to problems. I’ve found there are five reasons why issues abound with vertical specialists.
There’s a common misconception, especially among organizations that operate in niche or underserved spaces, that vertical experts are the only ones qualified to meet their specific needs for designing new products and services. Unsurprisingly, the result is a lot of templated, modelistic thinking and run-of-the-mill work.
I see this in several sectors and industries — for instance, in government. There are agencies that can write a great RFP response, touting their previous experience and nuanced understanding of the civil service. Ultimately, this alone can win them the contract and enable them to build an ongoing relationship with stakeholders. They may have a subpar track record, but hey, they do great work in responding to (the sometimes tedious process of) RFPs, so they’re the ones that get through the barriers.
The same thing can occur in any highly-specific market. An innovative people management platform may be drawn in by an agency that has worked with old-school HR consultants in the past, or a cleantech startup focused on renewable power might go with a design studio that has worked for energy companies. Perhaps these credentials look good on paper. But at the end of the day, the thing that matters most is not the past experience in a particular niche; it’s a track record of success in designing products and services that are deeply informed by customers’ desires and expectations, and that meet them efficiently, elegantly, and intuitively.
With legacy knowledge of highly specific markets and niches, vertical specialists bring a lot of baggage with them, and much of it doesn’t stand the test of time. Users, like businesses and technology, are changing at an exponential rate — as are their evolving expectations of digital brand interactions — and a specialist’s strategy may be informed by years, or even decades, of outdated notions. Looking back at the example of building a cleantech app, what’s the point of working with a firm that designed energy management software in the early 2000s? Why not approach the project — and the possibilities — from a fresh perspective?
The most successful projects apply rigorous research and sound methodologies to not only address current needs, problems, and pain points of the end user, but also to identify and solve new ones. This means doing things differently. Defaulting to vertical experts is an exercise in templated, modelistic thinking unsuited to meeting the complex needs of modern users, and allows agencies to pigeonhole their clients within their own limited purview.
One of the arguments we hear again and again is that going to specialists rather than generalists reduces up-front costs. They say that their understanding of the space and its users gives them a head start, eliminating the need for an initial research phase and enabling them to get right down to work with minimal industry onboarding.
I beg to differ. An effective product and service design strategy has to start by talking to your customers, not putting words — or wants — in their mouths. The head start promised by vertical specialists may very well be leading you in a completely wrong direction — and since they’ve cornered specific markets, their “knowledge” often comes at a high premium.
When a vertical expert gives you their opinion, you have to be conscious of the fact that you’re likely getting the same opinion as every other organization they’ve worked with. In effect, this is creating complacency and conformity — a standard set of “how-to” guidelines followed by you and all your competitors — when you should actually be going after differentiation and disruption.
And then of course, you need to question whether a vertical specialist is truly viewing your company — and your customers — as having unique, individual circumstances, or if they see you as interchangeable with their other clients. Are they leveraging their previous portfolio of work simply to boost their own bottom line rather than help yours? To them, you might just be part of a quarterly quota or some other metric they’re expected to meet.
As I’ve mentioned, strong product and service design is all about your customers. And this may be the simplest, but most compelling, case for not confining yourself to vertical specialists.
If you want to disrupt the status quo, you need to work with a team that takes a user-centric approach. With creative problem solving and design thinking, they should help you formulate an informed hypothesis based on a well-laid foundation, and conduct the research necessary to confirm or refute it. This uncovers the white space that you can occupy to set yourself apart from the competition and exceed your users’ expectations. Then they leverage these newfound insights to build the product or service that will take your organization to the next level.
Another McKinsey study found that design-oriented companies on the S&P 500 index outperform their peers by 211% — and while the research has many fascinating takeaways, here are a few of my favourite lessons: Design teams and departments that are cross-functional, and not limited to a singular specialty, are faster to turn their concepts into products and services and get them to market — plus, they generate greater financial returns. Interdisciplinary designers who are willing to break down barriers and master a range of skills and methodologies achieve better results than narrow experts. Full-spectrum research — approaches that combine qualitative field observations, questionnaires, and interviews with quantitative analytics — yields more impactful and applicable understanding of user behaviours. So if you’re looking for a better way to design your next product or service, it’s probably time to escape the singular vertical you’ve been working in. There’s not just a light at the end of the narrow tunnel; there’s an entire world. And that’s where your customers live.
When your ideas are walled in by your industry, a digital design studio can help your team think outside the box. Get in touch to see how we can help.