Business Value and ROI

• The law of diminishing returns, a widely used concept in Economics that shows the relationship between investment (time, money, resources) and benefits can help Designers, UXers and Product Owners/Managers make better design, product and business decisions.
• The Law of Diminishing returns is a bell curve:
  • Section 1 – curving upwards: is the fastest growing part of the curve, which means that efforts invested provide a more than proportional return.
  • Section 2 – leveling off: along this part of the curve we still see returns on our investment, and will keep decreasing as we approach section 3, as the curve becomes less and less steep.
  • Section 3 – curving downwards: here the slope starts to go down, meaning that our efforts stop having positive returns. This means it doesn’t make sense to keep investing (effort, resources, etc.).
• Knowing how this curve works and where in the curve your problem lies is key so you don’t invest effort into something that doesn’t make sense to optimize. 

Read the full article to learn more about the different ways that the law of diminishing returns can be applied to design problems.