Design thinking in the business context is a quiet, revolutionary idea because it turns traditional business thinking on its head and is easy to implement.
It is a natural part of the worlds of building and product design, and its potency lies in breaking down big questions into small tests and inviting users, customers and clients into the process as co-designers.
Just as architects design buildings for people, design thinking in business seeks insights from end users to deliver the products and services they want. It seems an obvious approach until you consider how far down the development path many businesses travel before involving the end user.
It has taken off in business education in recent years because it is a tool to help organisations innovate and a way for leaders to respond to complexity and even shift organisational culture.
Implementing design thinking in practice can be very rewarding, if you keep it simple. A colleague at Melbourne Business School, where we include design thinking in many of our executive education programs, told me about an insurer who wanted to create a new low-cost online product for electricians, plumbers and other tradespeople.
The company wanted to know if it could establish what tradies were prepared to pay for the new product by using crowd-sourced data rather than costly policy consultants.
It invited in a group of tradies but, just before they submitted their answers, asked them if they wanted to know what their peers recommended paying for similar products and, knowing that, if they wanted to change their submission. Surprise, surprise, about 80 per cent did.
Testing is the key to design thinking, and good testing requires turning big ideas into small experiments, which don’t have to be costly.
My colleague and co-design thinker at Melbourne Business School, Cameron Houston, says one way to stay focused and within budget at this point is to aim to design tests that cost less than $100, take less than an hour to complete, produce good information and can be repeated.
To give you an idea of how simple a test can be, a service station client realised they had two basic types of customers – pit stoppers in a hurry and lingerers, who could annoy the pit stoppers by wanting to clean their windshield or browse in-store.
Borrowing from Formula One racing, they came up with a simple fast- and slow-lane test with a chalk board, saying to go left if you just want to fuel up and pay or go right if you want to stick around. It helped them to keep both customer types happy.
The point about design thinking is to get inside the end user’s head, to see the world through their eyes, which means suspending your previous knowledge and opening your mind to divergent thinking. It’s not about imposing your big idea on others. I often see people willing to share their idea but then trying to convince everyone how good it is.
Testing is not about salesmanship but looking for genuine customer experiences, pain points, frustrations and unmet needs. It requires putting your idea in the hands of other people and being curious about their response.
And you don’t have to get the right answer first time. You just need to run enough experiments to tell you if your hypotheses are moving in the right direction.
If they are, great. If they’re not, great too because it’s OK to fail and learn.
Inside the heads of everyone
Design thinking allows managers to approach work with an experimental and growth mindset rather than keep doing what might be comfortable but less and less relevant. It’s a way of overcoming outdated behaviour and practices across a whole organisation.
It doesn’t require taking a big leap but simply adjusting the way you think and where you place your focus – then testing the reactions of the people you’re trying to influence in a methodical way. It’s a low-risk strategy for achieving positive change and delivering real value. It’s like learning a new skill that rewards by replacing outdated thinking and behaviour.
I recently delivered a design-thinking workshop at Netball Australia’s Leadership Conference, where one of the attendees explained how they discovered design thinking the hard way.
“I learnt I didn’t have the answer for what my customer wanted initially. It was only as I regularly spoke to them and involved them in the process that I could meet their needs. This seems simple in logic, but my day is so busy that I usually come up with an idea and then push on with it,” said the attendee.
This anecdote hints at why design thinking is finding its place in so many aspects of business practice. It’s not just about creating products and services that customers want. It’s about getting inside the heads of everyone involved in a process or project you’re driving – whether that’s a meeting, having a performance conversation, developing and communicating a strategy or any other part of organisational life.
The output can be new mindsets and ways of relating and behaving across your organisation. It can even lead to a complete cultural shift.
We incorporate it into our customised executive education programs for clients, who include Orica, Transurban and Viva Energy. My colleagues also use design thinking in our MBA programs. In the week-long Innovation Bootcamp unit, for example, our full-time students use it to test a commercially viable idea before they pitch it to a panel of judges.
And our part-time MBA students use it in their BioDesign unit. For nine months last year they worked with University of Melbourne engineering students and Royal Children’s Hospital doctors to develop commercial devices that improve medical procedures.
The result was several award-winning ideas that continue to attract interest, including one that brings greater accuracy to a delicate catheter procedure on babies, previously performed the same way by doctors for 60 years with limited assistance and high risks.
I teach the Design Thinking for Managers executive education program at Melbourne Business School, where I help senior leaders develop the creative confidence and ability to build teams of design thinkers who can help their organisation’s focus on customer, client and user needs.
This content has been produced by Melbourne Business School in commercial partnership with The Australian Financial Review BOSS magazine.
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