Organizations that implement design thinking see 56% higher returns than those that do not, McKinsey research shows. Companies with top-quartile McKinsey design index scores beat industry benchmarks two to one.
What Is Design Thinking?
The term design thinking was first popularized by the design company IDEO to characterize "a human-centered approach to innovation that draws from the designer's toolkit to integrate the needs of people, the possibilities of technology and the requirements for business success." It offers collaborative problem-solving that is part scientific inquiry and part art. Think of it as crowd sourcing empathy for the customer and creativity in action.
Professionals with a variety of skills can apply their imagination, intuition, logic and systemic reasoning as creative tools to innovate solutions for consumers' unmet or unarticulated needs. The latter is especially important and requires more engagement with markets, plus a synthesis of qualitative and quantitative data. Finished product design no longer connotes structure and aesthetics alone. As Steve Jobs said, "It's not just what it looks like and feels like. Design is how it works."
What Innovations Can Result?
Solutions are more than just products and services; they can encompass customer experiences, corporate systems and protocols. Design thinking can reinvigorate everything from product features to corporate and governmental operation principles. Benefits can include lower costs, reduced risks, improved speed, a re-invention of business models, shifts in market trends and behaviors, and a positive culture change in organizations.
Numerous iconic products, services and experiences were born of design thinking, including:
- Apple mouse
- Google search
- Nike footwear and apparel
- Pepsi beverages
- IBM hardware and software
- Uber and Uber Eats
- Target shopping cart
- Oral-B electric toothbrush
- PillPack online pharmacy
How Does This Influence Innovation?
Design thinking starts with new contributors and tools. A fresh approach is likely to result in new solutions. Market researchers, designers, product developers, and the marketing and sales teams all receive input from real customers to kick-start the process. Immersion in the customer experience is the goal. Many top-performing, design-driven companies incorporate this methodology more and more into procedures until it becomes intrinsic to company culture.
Reframing problems in unconventional ways, asking novel questions, doing ethnographic research, conducting experiments and using diverse teams are some of the ingredients behind innovative solutions. These approaches create opportunities for fresh ideas and also help eliminate status quo thinking and the biases that stifle creativity.
Focusing on what customers want is another primary driver, which works by connecting collaborative teams with the ways customers think. This occurs via interaction with customers through social media, in panels, surveys and focus groups. What method acting — actors getting inside a character's head — does for film, design thinking does for product and service innovation.
Organizational Changes Needed to Implement Design Thinking
To incorporate this methodology, companies must hire people comfortable with problem-solving and customer-focused approaches. Design, product development and marketing teams must listen to customers, absorb their insights and iterate new ideas. Engineering and product development groups must work more collaboratively, from doing customer research to going to market. Individually, professionals involved in organizations that are making this transition need to accentuate customer experiences, facilitate discussions and find new ways to add value to customers' lives.
Why Is Design Thinking Important?
It takes more these days to develop experiences, products and services that resonate with customers. Increased competition, rapidly expanding technology and process innovation continue to raise consumer expectations. Today's consumers share experiences online and in person. They expect immediate gratification, instant solutions and more access to information. Delivering on these expectations requires dedication to continual improvement and intellectual trailblazing.
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