For businesses to succeed they must be adaptable and well equipped to manage change on an ongoing basis – especially if they are looking to improve their products, services, and interactions with their customers and workforce. The Design Thinking methodology is not only helpful but necessary, for any business that is looking to remain competitive.
Aspects of Design Thinking have been used by organizations for some time – specifically persona development and customer journey mapping – typically used to better empathize and understand customers. BUT – this is just the tip of the iceberg with respect to truly understanding your customers, workforce, and your overall business. Although empathizing is a very important tool – there’s so much more you can gain by fully embracing the power of Design Thinking.
Understanding your customer is critical, but it’s only a piece of the puzzle when it comes to propelling your business forward. By fully embracing the Design Thinking methodology across your business, you are setting yourself up for successful visioning, compelling value propositions, enhancing workplace culture, and reframing challenges – all of which are essential to improving products, services, processes, and creating business models that stand the test of time.
Design Thinking feeds strategy and drives innovation. The Design Thinking methodology supports the development and execution of business strategy and positively impacts business outcomes. To develop an effective strategy for your business, you must first have a clear picture of the overall business and customers. Design Thinking will help you identify your customer base, support market segmentation, and show you whether/when to pivot – all important when creating a successful strategy.
After you’ve used Design Thinking to develop a killer strategy, you need to execute it. To effectively roll-out a business strategy across an organization, all employees need to buy-in and participate. Design Thinking is highly participatory – and by using this approach to roll a strategy out, people will better understand what the business strategy means for them at an individual or business line level and take ownership. In other words, instead of withering or feeling unsure – or even resentful that a new strategy is being pushed on them – they will have a clear picture of how they can contribute, add value, AND they will feel engaged throughout the entire process.
Without a clear vision, a business is doomed to struggle. The business landscape is changing and having a well-known brand in a regulated industry is no longer enough. Emerging tech, endless choices for customers, and the gig-economy are challenging businesses to assess their current vision and business model.
To create a vision that’s both powerful and relevant in today’s market, businesses must look towards the future and reframe the problems they are solving for their end-client. The empathize phase of Design Thinking will shed a light on what you can do better and what more you could deliver to provide additional value to your customers. By combining this information with insights gleaned from future-mapping with your teams, you will be well-positioned to build a strong vision.
A compelling value proposition is a must. Design Thinking provides businesses with an opportunity to evaluate what they think their value proposition is and understand what their customers think their value proposition is. This information will help to understand your TRUE value proposition and what your aspirational value proposition could be.
Furthermore, the Design Thinking process will help identify opportunities to better deliver on your value proposition, highlight what your customers believe your value proposition is in a more impactful way, or even redefine your value proposition altogether.
Design thinking is participatory by nature, creates a culture of collaboration, and embraces progressive iteration. These things alone support a healthy workplace culture. Once a business embraces Design Thinking, and as people start applying Design Thinking methodology to projects, it shifts the way they think and relate to one another.
Design Thinking becomes especially impactful when it’s applied internally – turning the employee experience into a “customer experience”. By integrating Design Thinking into the overall strategy of a business, an environment of innovation, learning and human centeredness is created. Who wouldn’t enjoy a workplace culture like that?
Reframing in business is critical to the evolution and growth of your business over time. We reframe constantly in life – maybe you’ve had a mattress mailed to your home in a box to avoid shopping in-store, dealing with a sales rep, delivery people, set-up, etc., or maybe you build more time into your day by using a meal delivery service vs. growing and preparing your meals from scratch.
Businesses that are able to reframe will continue to grow as technologies, society, and demands change over time. Reframing means looking at the challenge in a different way, or, looking at delivering solutions in a different way. Design Thinking will identify where to consider reframing – at the end of the day companies make money by solving their end client’s problems better than anyone else. In order to continue to generate revenue and thrive, you need to be able to either solve more of your client’s problems or do it in a way that is better than your competitors. Design Thinking can get you there.
Target Market/Market Segmentation
For organizations design thinking can help in identifying target markets as well as understanding whether and when to pivot.
Many organizations either see their clients as one large group or understand the types of clients they have at a high level. Design thinking is about getting in the minds of each of the market segments and truly understanding how they might behave.
Allowing businesses to create not just products and services catering to each type of clientele but also being able to target each type of client.
Because DT has a large aspect of talking to and working with end clients you can better understand what they need and who will use (and value) your products and services.
Defining Solutions/Product and Service Creation
Understanding your customers and providing solutions to their challenges (with different solutions or a different business model) is easier to do, especially in a systematic way, with Design Thinking.
Design Thinking involves customers throughout the development process when creating products and/or services; providing you with built-in customers once the solutions are rolled out. This process will ensure you know the exact features and functionalities your customer wants, meaning you won’t waste resources on developing things you think are cool but that your customers don’t want or are unwilling to pay for.
This built-in market research will help you determine what you can charge; because if you ask, your customers will tell you what the value of your solution is to them. This doesn’t literally mean your pricing structure based on hard costs and mark-up – it means you can better gauge how big a particular challenge is for them and how much they would be willing to pay to not have to deal with the problem anymore.
Identifying When to Pivot
Not all ideas or implementations will succeed in the market. What strong businesses and great business leaders are good at is determining if and when to pivot. Design Thinking helps you recognize when it is time to pivot – this is because:
- you are already working with your customers to understand if the problems you’re solving are their real problems;
- whether they’re willing to pay to have these problems solved at the price you want to charge; and,
- if they are going elsewhere for these solutions now (and why).
Traditionally businesses do competitive analysis and market testing of product and services BEFORE developing them, Design Thinking, however, involves customers THROUGHOUT the development process (before solutions hit the market) allowing for continuous iteration. Meaning, you will know earlier whether your solutions are worth developing further or if you need to pivot.
As you think about your business to enhance vision, value propositions, workplace culture, or to reframe challenges and business models, design thinking is a great tool for both changing mindset and getting clarity on all of these whether you are a B2C, B2B or a non-profit organization.