Design thinking and its place in the enterprise

Design Thinking. Sounds like another fashionable popularised group-think trend that some hipster from the Bay area in California has come up with, right? Some millennial’s attempt to try to look smart in front of his older, wiser stakeholders and managers.

And you’d be totally wrong.

As with many things in our information age, its roots date back to the emerging need to improve the way products were created and brought to market in the post-WW2 era in the USA. 

The term “design thinking” was first used in 1959 by John Arnold in his book, Creative Engineering when he was trying to encourage his colleagues and contemporaries to think more holistically about the way they innovate, renovate, reduce costs or improve saleability of the products they work on.

David Kelley, a Stanford University professor and one of the founders of the design and consulting firm IDEO, formalised design thinking for business purposes in the 1990s and shared it with the world, providing the platform for the current state of the art business techniques to grow from.

And this is what we’re talking about: the processes that can be used by businesses to innovate their products and services to have an additive, positive impact on the bottom line.

It’s important to note that the terms ‘products’ and ‘services’ don’t just refer to what the business does for its external customers. More importantly it’s essential to understand that any business has internal customers as well as its external customers. It’s only when the leaders of an enterprise embrace this knowledge that the business starts to recognise just how many more products and services it does in fact provide.

If we take a look at the principles of design thinking it might help show how it fits into the world of the enterprise as a tool for getting things done:

  1. Wicked problems

One of the primary goals of design thinking is to deal with what are known as wicked problems – not meaning morally or legally bad problems, but rather ones which are hard to define or come with a series of knock-on effects which also need to be considered. 

  1. Problem framing

This is the opportunity to look at the business issue being tackled from different angles and explore its context. This can, and frequently does, lead to the problem being reframed in order to find a way forward, with one or more possible solutions  apparent. 

  1. Solution-focused thinking

Once you know what the problem is you can begin to think about the solution. By focusing on the solution, rather than the problem, it’s possible to explore multiple ways of reaching a better outcome.

  1. Abductive reasoning

Unlike Sherlock Holmes’s deductive reasoning (once you eliminate the impossible, whatever remains, no matter how improbable, must be the truth), abductive reasoning looks for an answer based on inferred reasoning, using experience, analogies and other indirect methods to deduce the most likely solution to the problem, the simplest answer. It doesn’t require empirical proof that the answer is the right one, only whether it’s highly likely to be so. This removes the need for absolute certainty in order to move forwards.

  1. Co-evolution of problem and solution

As part of refining the solution it’s quite desirable to be able to flip between looking at the solution and the problem, and to consider each in the context of the other. As each solution option is reviewed it may throw up other issues, requiring the problem to be reframed again getting closer to the real issue at the core of the work. It means we can ask my personal favourite question: Are we tackling the right problem?

  1. Representations and modelling

Visual designers constantly try out ideas to see how they look – the architect sketches, the graphic designer will try mock-ups, the product designer makes prototypes. This allows solutions to be initially visualised to see whether they’re worth pursuing – prototyping especially allows users to get hands on and provide valuable feedback for moving forwards.

In terms of applying this to a business problem it can be thought of as a series of overlapping endeavours:

  • Inspiration: finding out what the problem is, thinking of what the routes forward is likely to be
  • Empathy: understand the user’s needs and desires in how to do their job properly
  • Ideation: idea generation to come up with solutions
  • Prototyping and Implementation: trying out one or more of the solutions, testing them and refining them before putting out a workable response to the problem

This focus and refocus on problems, both inward facing and external, in software and services leads to a culture of constant innovation, of being able to develop beneficial change that improves the business. And trying out those ideas before they reach maturity allows the business to discover dead-end solutions, weed them out while learning from them, and redirect to better, more adoptable, more fit for purpose end points.

Regular use of design thinking inspired exercises, such as the 5-day Design Sprint created by Google Ventures, allows a structured way in which to employ the principles and get great, even unanticipated return on investment. Although there is one thing that most enterprises need to do to let this work – allow staff to be actively involved in creating the solutions. This means ensuring their people are empowered to be away from their day-to-day job periodically to take part in these innovation workshops, to allow them to be the seed of the growth that drives the enterprise onto its next evolution.

Success by design

As with all things I’m not asking you to take my word for it. Instead it’s worth looking at a study created by the Management Institute in 2016 that looked at 10 years’ worth of performance data of companies that employ design thinking in their work and their ways of running, and compared them to the Standard & Poor 500 index of top performing businesses. By 2015 the businesses using design thinking had outperformed the S&P500 by nearly twice as much, making them the businesses with the most market capitalisation. It also showed that in the 2008/2009 financial crisis companies that used design thinking to solve their problems were less affected than those in the S&P500 that didn’t.

When you also take into account that Apple has a market capitalisation of over $2 trillion it becomes quite clear that design thinking definitely has its place in enterprise.

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