Besign Thinking: A simple framework for incorporating “Design Thinking” into the traditional “Business Thinking” for innovation!

Ever since I got introduced to the concept of Design Thinking, I had this feeling that this could be a game changer for how business innovation is done. In a nutshell, because it starts with the customer as sole for finding innovations.

This may be obvious for anyone knowing about Design Thinking fundamentals, but it may be not fully true for people coming from a Business Thinking background, where the norm is how opportunities are projected to make money, not how it will solve a customer problem.

I will try in this blog post to bridge both worlds and suggest a framework for change when it comes to innovation. How can we introduce Design Thinking in a seamless manner in current today Business Thinking.

What is wrong with the traditional business thinking approach when it comes to  innovation?

The problem here is that with current traditional business thinking we have in most of big organizations, management are always insisting you have all the financial stuff figured out before taking any deciding decision.

This may be valid for predictable evolutionary type of innovation opportunities where you can anticipate, but for me it did not make any sense for uncertain and still unknown innovation opportunities, but this was what Business Thinking have always implied.

One nice quote about business thinking that summarize how it structure its thinking:

“Business schools tend to focus on inductive thinking (based on directly observable facts) and deductive thinking (logic and analysis, typically based on past evidence), …”, Proctor & Gamble CEO A.G. Lafley

As you can see, its a  school where its starts from old patterns and try to justify everything based on facts and figures.

Design Thinking, a different approach ...

For me innovation is always about finding a quantifiable gain as an enterprise but for this to happen a value need to be created for the intended receiver.

What we have been missing in our traditional business thinking is to get "real" customer insights that could drive the exploration of new and unique opportunities for innovation. This is where Design Thinking comes to play.

Design thinking is all about immersing in the customer world and trying to find the frustrations, problems and unarticulated needs that could open the door for a whole set of "will be adopted" opportunities.

“Design schools emphasize abductive thinking—imagining what could be possible. This new thinking approach helps us challenge assumed constraints and add to ideas, versus discouraging them.”, Proctor & Gamble CEO A.G. Lafley

As you can see from the quote, Design Thinking is a constructive way to find new opportunities, where you have a certain goal and you try to learn your way till you reach it, its a postcard for  better future!

Business Thinking meets Design Thinking, a frame for change ...

The question then arise, how can we make design thinking more appealing to the business world? How can we make it more quantifiable for those Excel savvy's?

This is why I will try to propose a simple framework that could incorporate Design Thinking in our everyday Business Thinking!

This framework for change builds on a very nice change framework I had read about in the book "Switch, How to change things when change is hard" by Chip Heath and Dan Heath.

In this book, the authors introduced a very easy and pragmatic framework for change that can be used in many contexts. The framework states that there THREE steps to make any change happen:

1. Direct The Rider, lack of clarity often leads to resistance, so we need to provide crystal clear direction to get everyone's on board. This is why we need to avoid over analyzing our Design Thinking efforts and for that to happen, we need to make Design Thinking integrate as 1-2-3 crystal clear process and show people what they will get!
2. Motivate The Elephant, it's important to engage people at the emotional level to get there support. This is very important to fuel the support and the wellness to make the change. Think of this as someone who work for a cause, the fuel of making an impact generate the energy to continue the journey. This is what we need to add to everyday Business Thinking.
3. Set The Path, to change someone's behavior, you have to change the situation surrounding him / her. For example, to let people eat less popcorn in the movies, all we need to do is to give them smaller containers, thats it! What looks people problem is often a situation problem. This is why changing the context and surroundings would help people to change for the what we are pushing for, in general.

I will try to use this framework to build a clear direction on incorporating Design Thinking into Business Thinking, so bear with me :)

"Besign Thinking", the essentials!

Quick note: Besign Thinking, this is not an spelling error by the way. It's by intention.

Using this simple framework above, I will try build a pragmatic version that can be used to "Enhance" the current business thinking about innovation for the better.

The main objective is to find a way to mix Design Thinking with Business Thinking, which in the end yields for a better results when it comes to pursuing innovation. But this have to happen in an easy and easy going manner to avoid any hard resistance that may cause a hult down for this initiative.

Step 1 || Direct The Rider

1. Set clear goals from customer point of view:

   Although it may be a an obvious thing to be done, but setting goals where the customer value is mentioned along side the enterprise value can make the big difference.
   
   For example: we can state in our opportunity goal that we are going to make 100 Million in five years, but also adding that we are going to have a clear change the customer situation, let be having less or no queue times at our outlet with our upcoming mobile payment solution. Stating clearly what are the current customer frustrations or unarticulated needs and build on that.
2. Describe the steps that will affect the customer:
   
   When trying to incorporate Design Thinking in your regular business thinking process, make sure that you clearly specify the additional steps to be taken when you add the Design Thinking flavor. The less the additions in the beginning the better to avoid the resistance!
   For example: We shall start with an initial business case, following that shall add customer feedback as step to validate our assumptions after words we shall craft the final (usual) full fledge business case… Etc.
3. Show success stories:

   Executives always love success stories. If it worked somewhere, then the probability that it works with them is much higher (A number game!). Try to show success stories but add to that the customer view, what have been solved and how their lifestyle have changed to be better and do not forget the numbers!
   
   Example: company x in our field have managed to make 10 Million $ in one year. Not that only, but the customers experience and expectations have raised which yielded in to 20% increase in the brand value. This all because they started with the customers and ended with them.
4. Use their terminology:

   One thing that can reduce the changes and make it more easier, is to use existing regular business terminologies to avoid any extreme resistance and to make change as a familiar thing.
   
   Example: instead of saying that you shall do an immersive research, our putting yourself in the customer's shoes and do a user shadowing! Simply say that we shall extend our primary research to get more information about our customers (period!).
   
   

Step 2 || Motivate The Elephant

1. Craft a story:

   Everyone love stories, so use them as a weapon for you. Start your business case or presentation with a 2 min story where you show the future and describe how this opportunity will change the customers life and how it will make a quantifiable gain for your company from that.
   
   I would highly recommend to watch this short movie, titled: “The Fiction of the Science” which tells you how valuable is storytelling for crafting a future vision.
   
2. Add emotions by adding real customers pictures:

   All most every presentation in the business world contains those smiley people with the shinny teeth (where you can find them in iStockPhoto or something similar).
   Although, optimism is good. I would say that if you put real customers photos (from real life) declaring their real frustrations, showing how they are struggling that may have deeper impact on the executives that are packing your initiative.

Step 3 || Set The Path

1. Tweak your presentations:

   Embrace the design part of the Design Thinking. Try to make your presentations fancier so they can feel the change. We all hate those enterprise templates that we use for our presentations, but to make the change obvious, you have to do something new. This may seems weird for some in the beginning from others, but with time they will get used to it.

2. Include everyone, at every step:

   When you are doing your Design Thinking stuff, make sure to show the people each step and include them in it. Be it a design research, ideation or prototyping. This way, you will pave the way for a change in attitudes that could be crucial later.

At the end, try to make what ever changes you have done as regular thing. Make it a habit!

One More Thing, What's Dilbert View On Business Thinking?

At the end …

Both Design Thinking and Business Thinking are both sides of the same coin. What we need to do is make every one of them appeal to the other, and this as the purpose of my post.

Hope you like it, and kindly feel free to criticize or complement what I have said. Its good to have other views to make the picture even better.

One last thing, If you have implemented any or all of the guidelines above, I will be more than happy to hear your story, comment it please :)

How to be BIG, MEAN and LEAN? A framework to applying Lean Thinking in BIG organizations

Lets face it. No one denies the rough times businesses are facing nowadays! Shirking market shares, declining of profits, demanding customer needs, customer un-loyalty, scare of operating resources and last but not least the lack of good opportunities that can change the face of competition.

All the above factors put a massive pressure on businesses to create viable pipeline of opportunities that can bring growth and differentiation, but what reality states, its not as easy as it sound! This is due to the current conditions of uncertainty that businesses work in nowadays, which make companies more exposable to being obsolete without any prior notification.

For example, a 500 fortune company life expectancy at the 50’s and 60’s where 60 years, where in the current days its no more than 18 years! Apply this to even lower scale businesses and the life expectancy numbers will shrink down dramatically.

So in this article, I will try to distill how lean thinking can be used as a mindset and as a methodology to change the face of competition, enable existing businesses to find what they are missing and survive the uncertain times we live in. My focus will be on established startups not new ones, the big guys not the small ones, the mature ones not the early comings.

So what is a startup, really?

Its worth while noting that this report is all about applying lean thinking in startups, but!

What is a startup? Is it two guys sitting in a garage doing code? can startup definition be attached to large corporations? Eric Ries defines a startup as:

“A human institution designed to create something new under conditions of extreme uncertainty" ~ Eric Ries

Looking at the above definition with an eye of thought, its clearly does not exclude any organization based on its size, maturity level, industry it operates at or any other factors we may programmed our self to take for granted as part of a startup definition.

This is a fundamental building block this article is building on, where the working knowledge out of it can be utilized in different business maturity levels, be it an early startup or a mature organization but with more focus on the former.

Now, going to uncertainty!

Demystifying uncertainty in the business context.

When looking at uncertainty from high level business point of view, it can be defined as:

“Situation where the current state of knowledge such as the order or nature of things is unknown, the consequences, or magnitude of circumstances, conditions, or events is unpredictable, and credible probabilities to possible outcomes cannot be assigned” ~ Business Dictionary

So taking from the definition we can try to visualise uncertainty into levels, where its starts very low (aka simple) and to be very high (aka chaotic). The following diagram explains uncertainty by showing what to do, how to behave and listing some examples for that.  

Figure1: Uncertainty levels

We can see clearly that the area of startup / entrepreneurship is an area of exploration and learning, this is where its different from the current “Ship It!” traditional thinking of new opportunity development.

The "Ship It!" conventional development (aka product development).

“There is nothing so useless as doing efficiently that which should not be done at all.” ~ Peter Drucker

What happens in today mature businesses world is what called the the “Ship It!” syndrome. In this, enterprises trying to make sure that there are efficiently delivering what they think that customers wants using a good planning, solid strategy and efficient execution. That all is great, but this all fly when the problem is known and the solution is also known!

Mature businesses are building on practices which are pile of years and years of doing the same things efficiently using product development methodologies, but in finding new opportunities (that contains uncertainty) this all does not make any sense, since the fundamental problem is unknown and logically also the solution.

What I mean by the fundamental problem is, what are the “real” needs that we are building our compelling value for? Are we are providing customers something that will really match their needs? To know this, we need to start from the customers not from our intuition.

This is where the concepts like product development falls apart and we need a better way to approach our new opportunity development efforts. No offense to product development, but it works well for incremental type of opportunity development where you have the problem is already know and the how we approach solution also.

Figure 2: Areas of product development

Lean development to the rescue (aka customer development).

Now is the time to give an answer to our stated problem, how businesses can find new opportunities in the current uncertain situations utilizing the least resources possible?

By applying lean development to their new opportunity development. Lean development is all about about applying a scientific methodology to validate a certain hypothesis or a theory. Its all about having the mindset to accept the changes in the enterprise that shift the thinking from the “Ship it!” or the organization driven opportunity development mindset to a more customer driven opportunity development mindset.

It requires changes both at the process / methodology level and the enterprise level to accommodate such type of thinking. For example, a culture of embracing failure and taking it as a learning opportunity must be established for such type of shift to work within enterprise.

Lean is a mindset change that takes development effort to answer the question: should we build something NOT can we build it! As it tries to find a validated customer learning in the minimal efforts possible to optimize the resources utilization for further learning and explorations.

Lean thinking, a primer.

Lean thinking builds on couple of concepts that are once understood they are very easy to apply if the right will is in place.

The first and the most important concepts is the term pivot, which is building block for lean thinking as a whole. Pivot defined as:

“Structured course correction designed to test a new fundamental hypothesis about the product, strategy, and engine of growth.” ~ Wikipedia

For a pivot to happen, we have to have a certain hypotheses where we start from and then try to go in one direction and see if its that direction takes to achieve our goals. This happens by quickly and fastly by validating our hypothesis against our potential customers and accessing both qualitatively and quantitatively if we are on the right track or not. If we feel we are not on the right track, we stay grounded to what we have learned but we change our direction trying to find a better course of action.

The whole concept of pivot is about learning and quickly, since the main unit of success in lean thinking is how many pivots we can achieve before we run out of our assigned resources (ex: money).

Figure 3: Failing as learning process

The second important concept in lean thinking is minimal valuable product (MVP), which is defined as :

"version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort." ~ Wikipedia

So in contrary to what we have learned in conventional business / development schools, an MVP can be anything like an explainer video, a landing page, a 3D printed sample or even can be a crowdfunding campaign in Kickstart or so. The goal of a MVP is to test the fundamental hypothesis and to help entrepreneurs begin the learning process as quickly as possible.

The third more important concept in lean thinking is the concept of actionable metrics or innovation accounting as Eric Ries likes to call it. Where its a set of metrics that are defined from a customer point of view and track the customer behavior while interacting with our MVP. The sole purpose of these metrics is to provide a way to lead to more informed business decisions and subsequent actions.

The fourth concept is the concept of preserving, which is sticking to a certain course of action after seeing that the actionable metrics are complying to the business defined thresholds.

On important aspect of lean thinking also is to have regular decision meetings to decide on when to pivot and when to preserve a course of action.

This helps to validate the current learnings and build on it for a better situation of to be developed business opportunity. Another important thing is to iteratively check the and validate the MVP with the customer in continuous development matter as highlighted in the image below.

Figure 4: Continuous development / learning lean process

How to apply learning thinking / development in your company?

Now comes the real interesting part, how we can apply lean thinking / development in an established sizeable company?

The first and foremost important step is to prepare your mindset to accept the lean thinking as whole package. Yes! you should accept that failure is keystone in your learning process, you should accept that kitching your development upfront won't work, you should accept that customers only know really what they want, you should accept that finding innovations is not a linear process and finally you should accept that what works best for you today may not work for tomorrow, so be ready!

So here is an action plan for incorporating lean thinking into your established company:

1. Find the passion for applying lean thinking in your company: applying lean thinking in conventional business is a change, and with any change it has to have reasons that engage people emotionally before rationally. Let it be declining revenues, declining market share or decreased customer satisfaction index. All you need is to find the right trigger in your case to liue the road for introducing lean thinking in your company.
2. Define a vision of what you want to achieve with lean thinking: Lean thinking is not a vision, its a way to reach what you want to achieve. Set clear goals for your lean thinking, what do you want achieve out of it and what is the future post card you want to pursue.
3. Avoid entreprise politics and define a clear sandbox for applying lean thinking experiments: To minimize the internal resistance for your lean thinking efforts, find a sweet spot where you can play freely and have the chance to explore. This will need a window to access customers but with expectations set upfront, which is the next point.
4. Set the customer expectations right: For your efforts to not damage your current business image, define a BETA brand for exploring and executing your lean thinking efforts. This will help in setting the customer expectation about what you're providing are not a full fledged solutions or market ready ones.
5. Discover the real customer problems: Always start with the customer, understand what their real needs are! Its fine that you start with a hypothesis but validate it from there. Whatever you think is the problem may not be the right one. remember, when you go lean you need to know "what is the right to do" first before "doing things right!" As Steve Blank said “Get out of the building!”.
6. Create minimal value products / services and ship early: There are many ways to have validated customer feedback without ever building the full product / service at all! Select the best method that suits your customer base, be it a teaser video, a landing page or so.
7. Define the right customer behaviour measurement metrics: Before putting your MVP in your customers hand, define what behaviours you expect from them and how you will measure it. In this phase you will need also to define certain thresholds that you need to pass to continue to the next phase in your lean iterative development.
8. Validate your proposed solutions: Expose your minimal value product to your customers often to learn and get insights about where to go next from here.

9. Pivot or persevere: Do regular meetings with your team to validate if your metrics against current and real customer behaviours. It may be the time to pivot or persevere you current course of action.
   
10. Create a transition monumentum and plan: If everything goes well with your lean efforts, align your business unit how will be scaling the solution into a commercial one. Show them customer feedback and happiness about your solution, and dont forget to build a mini business case about what need to be done (A business model canvas may be a good option here).
    
11. Back to square zero, start again! Time to go back to a new exploration journey! Well done :)

Do big enterprises do lean?

One company Intuit managed to implement lean thinking in its development process. The result, reduced development cycle time and an improvement in the overall quality of their products due to higher levels of customer involvement. After spending tremendous efforts into the development of products that never really took off, the company pivoted its own R&D processes to be more lean.

Bonus, where lean fits in the bigger picture?

A question that may arise, where does lean thinking fits with concepts like business model development, Design Thinking and iterative development. The following diagram attempts to give you an answer!

Figure 5: Lean thinking in a full picture

As you see design thinking process can be used as vehicle to generate idea insights and ideas that can be later validated using the lean thinking approach and methods.

Conclusion

Its clear that lean thinking and practices are not just for those in a garage! We all have to know and practice such methodology in these turbulent uncertain times.

It all start with a mindset and then a action. Make sure you fit a slot in your development efforts for practicing lean thinking even at smaller projects scale. No one knows, it may turn into a habit for you.