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Design thinking: Improving the customer experience and boosting innovation

17 November 2017

Author

Berlitz

Today more than ever, companies need to develop innovative products and services. The competition never sleeps, and international challengers are increasingly ramping up the pressure. Customer needs also change over time – and they can express these needs more easily on social media.

Alongside other agile methods such as scrum or Kanban, major companies are increasingly moving toward design thinking – prominent examples being SAP, Bosch, and IBM. After all, these methods promise a fast track to innovative solutions that actually help customers, also making them more likely to gain acceptance. Design thinking is clearly an important trend, and is currently one of the most promising creativity techniques.

What is design thinking?

Design thinking was developed by David Kelley, founder of the U.S. design agency IDEO. Stanford University’s d.school then took the idea and ran with it. It is important to understand that design thinking is more than just a methodology or a creativity technique. It also requires a specific mindset, hence the ‘thinking’ aspect.

Typical for design thinking is its interdisciplinary approach. When working with the methodology, the experts – who may also be the users – are supposed to come from a wide range of fields so that they can look at a specific issue from many different angles.

This is based on the idea that solutions – products or services – can only be good if they actually solve a real problem experienced by the user or the customer. The focus is on the needs of people – as opposed to companies who first develop a product and then try to convince people that they need it. Terms such as user-centered design (UCD) and human-centered design (HCD), which are often used in the context of design thinking, hint at this approach.

Design thinking is an iterative process

How does the innovation process work under design thinking? Usually it consists of the following six phases:

1. Understand:

The first step is to understand exactly what problems the users and customers are really experiencing. As part of this process, the experts look for answers to questions, such as:

How and in what contexts do people use a product or service today?
What problems arise during use?
Why is there no solution to these problems yet?

Beginning at this point underscores the fact that design thinking starts with the user, not with the completed service or product.

2. Observe:

Now it is time to start perceiving things. Ideally, this phase will be very intensive. And it is also important that the experts keep asking themselves critical questions about whether the assumptions they defined in the first phase really do apply. This may include conducting in-depth interviews.

They might also ask customers to keep a diary of their experiences and observations regarding a particular problem. Or companies might invite their most important types of customer to a workshop held in-house. Another key aspect of design thinking is diving into the everyday lives of the customers or users, for example by observing them on the job or at home. What behaviors can be recognized and how are they expressed?

To find test subjects, companies can work with specialized agencies or reach out to their regular customers through their newsletter and ask for their help in exchange for a small thank-you gift. The necessary foundation of trust can be built by writing a personal letter to respondents explaining the design thinking project. The firm should be transparent about what it is trying to do, what the customer’s role is, and how much time respondents should plan to invest in the project. Regardless of the method of observation, the point is not the quantity of the material it generates, but rather the quality.

3. Insights:

Observation leads to certain findings that design thinking refers to as insights. Let us take the example of a company that wants to use design thinking to improve a poorly performing online application process.

During the observation phase, its expert team determines that potential applicants often give up on the online application form when they come to the part where they have to upload their photo. So here the insight might be that applicants are scared off by having to upload their photo right away. Or that users have problems uploading their application photo, e.g., because it takes too long.

4. Ideate:

Only now can the process of brainstorming begin. This often takes the form of a moderated session during which the experts simply throw all their ideas into the ring without worrying about how good they are.

The important thing is that the process is co-creative. This means that ideally, it does not just involve the company’s own employees, but also external experts and users as well.

To return to the previous example, some ideas might be to completely do away with the uploading of photos, to make the upload optional instead of required, or to find a way to make uploading photos easier for users.

5. Prototype:

Next comes prototyping. The way this term is used in design thinking is often misunderstood, because when people hear the word “prototype,” many think of an initial functional product. And design thinking may be referring to such an object, but the term is certainly not limited to the classic prototype. Sticky notes, sketches, or schematic diagrams can also be prototypes.

Some design-thinking experts even use Lego Minifigures, because these fun characters can improve communication within the group and can be used to model something like a service process in a way everyone can understand. First and foremost, the aim of a prototype is to demonstrate how a future solution might look, feel and function.

6. Test:

The prototypes are then tested as soon as possible on the target group. Even if the prototype is just a sketch or an idea which has been noted down, it can already facilitate intensive discussions among users about a key aspect or a specific term. More advanced prototypes make it possible to test the functionality of a product immediately.

If a prototype does not pass muster, it can be abandoned and the group returns to the prototype phase. What is important here is the mindset. Instead of clinging to their own idea and trying to convince the user of its validity, the experts need to be able to let go of any concepts that do not work.

Iteration is a key aspect of design thinking – meaning that at any given point, it is possible to jump back to any of the previous phases. If the testing of a prototype reveals that the group’s assumptions were incorrect, they simply move back to the understand or observe phase.

This may sound time-consuming and inefficient. However, prototyping and testing do not typically involve a lot of resources. This makes sure that costs are not sunk into production before everyone knows that a solution should genuinely work. So iteration actually functions as a kind of quality control loop – ensuring that in the end, the product or service is created not to please the CEO, but because it is the one that customers like best or that offers them the most value.

An example of design thinking in Human Resources

Design thinking is not just effective for developing innovative products, but can also be applied to the design of innovative services and even to improving processes within a company.

In a Human Resources department, for example, design thinking could be used to improve a poorly performing application page on the company website. With the aim of developing an innovative solution, all stakeholder groups – in this case potential applicants, HR managers, department heads, company executives, programmers, designers, and others – would be involved in the process.

First, the company would observe people submitting applications online and ask them how they were using the current application portal- Which points were not clear? Where did the applicants have to double back? What aspects were potentially not covered at all? And what else would HR and the departments like to see on the page?

These findings would then be applied to the development of prototypes. A possible first step could be a large sketch showing which information would be shown to website users during each step, and what actions they would be requested to perform. This would then be tested with real users. Their feedback from this iteration loop would be applied to the next prototype, which in this case might already be a functional test website. Ideally, at the end of this process the company would have a page that optimally meets all the needs of every involved stakeholder.

Innovation and its role in leadership

Design thinking often represents a challenge for the workforce. Because its creative methodology always places the user at center stage, employees must be willing to dial down their own personal expectations and quickly let go of any ideas that do not work for the customer.

But with the right mindset, design thinking opens up a wide range of applications – and turns innovation and creativity into permanent features of the corporate culture.

It goes without saying that senior management support is essential. Managers must have the courage to change structures and adapt the way the organization works – offering employees the freedom to develop their full creative potential.

It is also important to note that design thinking only really works when it is not simply applied sporadically, but rather when it becomes a lasting aspect of the corporate culture. In such cases, this customer-centric approach can become an important tool in an array of agile methodologies used to develop innovative solutions.