Design-led innovation as a generative source of competitive advantage

Firms need to reliably identify new sources of competitive advantage ex ante to mitigate the risk of obsolescence in response to changing environments. One approach to addressing this issue is design-led innovation (DLI), which integrates design thinking with strategic management. DLI offers a flexible framework to identify and exploit new opportunities for competitive differentiation. Identifying, formulating, and framing strategic problems drive the DLI process by acting as the catalyst to create awareness and knowledge of value creation opportunities. This study offers a strategic problem classification matrix based on a portfolio approach to identifying value creation opportunities. Two practices are presented: (1) engaging in progressive-problem-solving; and (2) employing DLI catalysts. These practices could potentially strengthen DLI’s application and transform it into a generative source of competitive advantage.