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Why design thinking – not designers – creates more value for shareholders

Luminary genius and designer, Steve Jobs once said, “Design is not just what it looks like and feels like. Design is how it works.” and Arne van Oosterom, founder of the Design Thinkers Academy, said “Design Thinking is a mindset, not a toolkit or series of steps.” 

While both quotes include the word “design”, there is far more to it. They speak to different skill sets and approaches – but fundamentally at the core – it starts with ‘design thinking’. 

Design and design-led thinking is not as cut and dry as you might think or a one size fits all approach. There is so much to explore. It’s why we partnered with Nevo Hadas, partner and co-founder of the leading digital transformation and innovation consultancy DYDX and our industry expert and knowledge partner on our Design Thinking online short course to unpack it further.

Here’s what he had to say, full of incredible insights on why businesses need to adopt a design thinking approach to all they do.

I like well-designed things, from cars to kettles. However, this is not a thought piece about design that designers make. This is about how businesses need to use design thinking to increase shareholder value by being more customer-centric. It’s a focus on human centered design, and how we can apply it to innovation, problem-solving and most importantly, a general way of thinking.

Human Centered design in business 

Stakeholders will all agree on how amazing packaging for a design is (Apple), or how great an experience is ( Zappos). Why? Because experiences are also designed. These broad consumer brands create the iconic standards that other businesses strive for.

What a lot of businesses don’t understand yet, is that the most important aspect of a good design is developing empathy for the person that it’s intended for. This means the context, and the problem that it is going to solve for the user/customer/person who pays.  While aesthetics are an important element (in some markets – like apple –  critical), they’re  not as critical as the underlying fundamentals like the glass/processors/internet connectivity etc.  In some instances, how the customer perceives how others see them solving the problem is important  (i.e. social value of the product) and in others, not so much.

Studies from Harvard, Mckinsey and many others show that firms who employ a design led approach increase revenue and shareholder value at more than double the speed of their counterparts. The same research also tells us that the design team is often isolated from the rest of the organization, which reduces its effectiveness and increases the chances of failure. The solution? An integrated team approach and an organisation (as a whole) that adopts design thinking as the optimal way to reach collaborative solutions for the best business outcomes.

A quick logic test tells us that the most beautiful interface that is useless won’t sustain user interaction, but an unaesthetic interface that is inherently useful, will gain traction. Facebook as an example – is not aesthetically great, neither are banking interfaces, but both are very popular because of their easy usability and convenience.

But what is design thinking and how does it fit in?

Design thinking is about building empathy with the user/customer. Empathy means a deep understanding of the customers  context, experience(s) and future goals. Most importantly, you need to consider how they’re trying to solve the problem you want to fix and how your “solution” can and will be able do that better. Design thinking, based on Human Centered Design (HCD), puts empathy and problem solving at the core and is instrumental to know before any disciplines to bring the ideas to life. 

Design thinking has very little to do with “design” as it is currently bandied about by marketers, consultants and digital doyens. Design thinking is first and foremost NOT a visual modality..For example: traditional ‘Graphic Designers’ experience in only visual solutions restricts the answers they could come up with for a problem. It is a limited canvas for creativity, with the risk of great potential avenues not being explored. Understanding and developing a ‘design thinking’ methodology would open up far better solutions that would ultimately benefit the outcome. The same research that highlights the importance of design to increase shareholder value also warns about the dangers of isolated design departments which reduces the effectiveness and increases failure of new projects.

Design thinking and innovation

Design thinking is about unleashing more creative solutions in the workplace, whether you’re in procurement or in actuarial sciences. It promotes diverse ideas developed by cross functional teams, thereby increasing the validity of solutions BEFORE they get into the development phase and incur extra investment. 

So I find it uncomfortable when visual design is considered more important than research, analysis, features, experience planning and other key components that make up a product or a service. First and fundamentally, we should know what problems we want  to solve –  for whom, why, how, when etc. – before we apply the lipstick. User interface led “digital” solutions and user experience (ux) are not indicative of design thinking processes.

This isn’t a tirade against designers. It is a call to make everyone designers – or at the very least, design thinker practitioners. It poses a question, considering “design led” has accelerated in corporate culture, is design even a relevant term? If design circles round to being ultimately all about the customer,  is it then not a process of ensuring that the company is customer led. Would a “customer-led” business not make more sense than “design-led” business? However, by the same token, shouldn’t  design thinking be the most important tool used to solve problems that all employees use, versus departments and job titles? 

In the firms of the future, design thinking will no doubtably be as commonly accepted as analytical thinking. Is your business ready for that?

Author:  Nevo Hadas.

Nevo is a partner and co-founder of DYDX (formerly &Innovation). DYDX is a digital transformation and innovation consultancy that uses this skill to solve tough business challenges for a diverse array of clients. He works with global leaders to unlock innovative concepts. He helps develop powerful digital products and services for consumers and businesses in emerging markets.

PS: At Red & Yellow, we get the importance of design thinking and recognise it as an essential skill for future success. It’s why we have a course and an accredited qualification that will teach you all you need to know about design thinking and user-centred design. Check out our 10 week Design Thinking online short course and 1-Year National Certificate in Design Techniques specialising in User Centered Design, that we developed with Nevo Hados and the clever minds at DYDX and other industry gurus, to offer original and up-to-date content that is delivered with our uniquely human touch. Have any questions – our team are always up for a chat. Get in touch with a career advisor by phone or email.

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