In the old days, the only driving force for businesses was financial profit but now it has changed. Businesses are facing several crises such as competition, social development, and job creation. To adapt, roles also have had to change and take on more responsibilities.
We cannot predict the future of our business because even the slightest change and event can have a significant impact on the course of the future. So at best, the leaders can only plan for the short term. But with innovation and the internet, we are more connected than before. Design thinking will help us understand these complex connections between people and events better and make long-range plans for the unpredictable future ahead.
When patterns are broken, new worlds emerge.Tuli Kupferberg
The old-fashioned management role, where a manager had to maximize labor and ensure that repetitive tasks were getting done, has changed. Innovation management has shifted its focus from simply planning new products and services to imagining, organizing, and being present with new ways.
|20th Century||21th Century|
|Scale and Scope||Speed and Fluidity|
|Rigid Organization Boundaries||Fluid Organization Boundaries|
|Command and Control||Creative Empowerment|
|Reactive and Risk Averse||Intrapreneur|
|Strategic Intent||Profit and Purpose|
|Competitive Advantage||Comparative Advantage|
|Data and Analytics||Synthesizing Big Data|
In a crisis, we tend to make our poorest decisions by being defensive rather than offensive. We look for the main components of the crisis and try to tackle it and fix it as soon as possible but we forget to see the problem as a whole and miss the other factors.
There is no single definition for design thinking; although a good definition for design would be “the transformation of existing conditions into preferred ones.”
Design thinking involves:
- Using empathy in designing problems
- Balancing between practicality and needs
- A way to solve complex problems
- Accepting curiosity and imagination in design
- Showing designers that they can do more than just design
Design thinking is the search for a magical balance between business and art, structure and chaos, intuition and logic, concept and execution, playfulness and formality, and control and empowerment.
Design does not necessarily associate with science but it is inspired by scientific disciplines. Considering design thinking as a purely rational process is not right; because it is more intuitive than systematic.
The reason that an organization’s plans fail is that there is “no idea behind the plan” or “no plan behind the idea”. Strategy planning is based on the analysis of the information at hand, the big data.
Big data consists of:
- The volume of received information.
- The variety of received information.
- The rate and velocity of receiving the information.
When it comes to design thinking, big data will not diminish the creative part of things. It will even demand more intuition and innovation to use the data to fulfill the needs better.
Data is not a substitution for intimacyRoger Martin
Relying solely on the information will take the intimacy out of the game. Design thinking will help teams to build intimate relationships and lessen their complexity.
Most of the courses in business schools are outdated and based on false theories that we do not see in today’s world. They teach us the value capturing techniques and not value-creating ones and they are all focused on generating economic gains without considering the satisfaction of the people at the other end of the supply chain.
Design thinking reflects the abilities such as communication, empathy, and understanding that have helped humankind survive by working together. Design thinking may be seen as a creative logical tool that can help with innovation and transformation, but to use it, we must understand its main principles.
When talking about design thinking ten key principles refine business management. Design thinking should:
- be action-oriented.
- be comfortable with change.
- be human-centric.
- integrate foresight.
- be a dynamic constructive process.
- promote empathy.
- reduce risks.
- create meaning.
- bring enterprise creativity to the next level.
- be the new “competitive logic of business strategy”.
Using Design Thinking to Solve Business Challenges
Challenge 1: Growth
Growth is the first thing on the mind of any business leader. It is largely based on economic activities. Earth’s resources are finite so sustaining growth is becoming a challenge and we have to think of new ways to support our growth plan.
Approach 1: Storytelling
Stories engage our creative and imaginative side. Storytelling is a technique that a leader can use to show a company’s past, present, future, needs, problems, hopes, and desires more engagingly.
Design thinking believes that numbers alone cannot reveal the whole story so to put people on the same page, make them understand the problem, and work together towards fixing it, we can use storytelling.
A great story must be collaborative, structured, engaging, performative, tangible, real, and fun.
Challenge 2: Predictability
The best way to predict the future is to create it.Peter F. Drucker
Finding the balance between predictability and malleability is what business strategy is about. The only way to have insight on what to predict is to be consistently engaged in the “making” of your company’s future.
Approach 2: Strategic Foresight
A company must be able to face and manage the uncertainties of the future. Strategic foresight is not planning but an input for strategic planning. To have foresight means to be able to imagine what a possible future can be like and make a road map that leads you to those desirable futures.
Strategic foresight can be useful to:
- prevent or prepare for surprises.
- establish and maintain a competitive advantage.
- positively influence and support innovation.
Challenge 3: Change
The world is full of unexpected events that force organizations to change so they can survive or grow. Organizations need to be able to react and adapt to changes when they arise and use the opportunities that each change brings to their advantage.
Approach 3: Sensing
Sense-making takes a clouded and complex concept, simplifies it, and makes it more understandable for decision-makers. This requires a certain level of awareness and understanding of the concept. With this, organizations can, for example, get a better sense of when to release a product.
Challenge 4: Relevance
All brands need to establish visibility, purpose, meaning, and credibility to be considered relevant in a category.
Maintaining relevance, in the long run, is a challenge. The companies must rethink and redefine the value they give to their customers but still manage to be true to their roots and main purpose.
Approach 4: Value Redefinition
Redefining values starts with the people and studying them on emotional, social, and cultural aspects and is not about products. Value is based on several factors including personal experience, needs, wants, desires, and expectations.
Challenge 5: Extreme Competition
Business competition is shaped by creativity and innovation and not by objectivity. Every company must deal with the commoditization of their products and services and look for better ways to offer them.
Approach 5: Experience Design
Focus on the journey, not the destination. Joy is found not in finishing an activity but in doing it.Greg Anderson
By using design thinking practices, experience design will satisfy your customers and make them loyal to your brand and asking for more. It is not about the product or the service but the experience of the customer using it. Design thinkers must observe and analyze the user experiences and feedback and try to make it better each time.
Challenge 6: Standardization
Standardization means reducing operational costs and generating more efficiency by using technologies, streamlining activities, and maintaining employee workflow. But we must remember not to lose touch with the people and alienate the customers.
Approach 6: Humanization
When standardization takes place, humanization in experiences might get lost. Customers do not care about a company’s efficiency but they care about the experience they have with the brand. Design thinkers must consider a customer’s values and needs and find the balance between standardization and efficiency, and user experience.
Challenge 7: Creative Culture
Creativity cannot be taught and having a creative culture does not mean having a funky workplace with strange and odd-looking designs and chairs. It is about the mindset of each worker and their passion and skill to come up with ideas and find solutions.
Approach 7: Prototyping
Every output of design thinking becomes a prototype before it gets taken more seriously. Prototyping an idea will allow you to experiment with it with others and make feedback loops to test the idea before implementing it.
Prototyping has some benefits. It:
- increases team ownership.
- sees the possibilities.
- deepens insight.
- promotes cross-functional collaboration.
- improves visibility and predictability.
Challenge 8: Strategy and Organization
Leaders are expected to be able to see the future of the company and adjust the company’s strategy, but relying on one person is not right because they might be wrong. So now companies rely on specialized planning departments that use data systems instead of assumptions to plan their strategy.
Approach 8: Business Model Design
The power of a business model depends on how its value creation is matched to its value capture. To make a better model, we must understand the previous one and study its flaws and acknowledge the paths of improvement that we have. A good model makes the customers hooked to the brand and increases their loyalty by serving them better than other competitors.
Strategic planning consists of two words: Planning and Strategy.
Planning is about analysis, facts, people, and operations. It is a consideration of the possibilities that we think will happen and the way they will happen. Whereas strategy is about synthesis. It requires creative thinking about the competition, the company’s capabilities, and customer needs. It is the “continuous renewal and sense-making” of the ways we deal with today’s problems and prepare for tomorrow’s.
Design thinking helps leaders deal with these paradoxes and drive strategic dialogues and decisions around a new value system and tomorrow’s possibilities.
Changes are happening at a very fast rate and this makes predicting the future and making long-term plans harder than ever. But by using design thinking and implementing its practices to strategic plans, we can have a clearer vision of the future with fewer disturbances and surprises, because we are the ones making it.
Design Thinking for Strategic Innovation: What They Can’t Teach You at Business or Design School by Idris Mootee