By Bennett Voyles
From the beginnings of modern business education, managers have been trained to think analytically about their strategy. This dispassionate approach works well in a lot of ways, but ignores one important fact: the biggest gains in value are often not the result of bottom-line management.
Consider Xerox: the American photocopy pioneer had refined an “x-y position indicator” in the 1970s, but failed to turn it into a profitable idea, concentrating instead on its hit photocopiers. In the end, the company that profited from Xerox’s work was Apple Computer: Steve Jobs took the concept for the personal computer mouse he saw demonstrated at Xerox PARC, the now-legendary research lab in Palo Alto, California, and challenged a small local design firm, Hovey-Kelley Design, to develop a version that would be cheaper and more reliable—and they did.
A decade later, one of the founders of the firm, David M. Kelley, came up with an explanation of why Xerox and many other companies overlooked such seemingly obvious opportunities: they didn’t think like designers.
Unlike many other professionals, designers are trained to think about a number of different constraints at once—technical (what is feasible), human (what is desirable), and financial (what is viable). Kelley believed that by teaching non-designers how trained designers solve those kinds of problems, he could help create better products, better experiences, and, ultimately, better institutions.
Kelley concluded that finding a solution should begin by first defining the problem. “The way we used to do it before was by sitting around the room and figuring out what was a cool idea and then we’d talk people into wanting it. Much better to know what people want and then use your talent to design that,” he recalled in a 2012 interview.
Twenty-five years later, Kelley’s idea has won wide-ranging acceptance in organizations all over the world. A number of businesses made remarkable gains by integrating design thinking into their development process—not the least of which was Hovey-Kelley, which morphed in the early ’90s into IDEO, the international design giant. Some universities are even beginning to include a mandatory course in design thinking in the general curriculum: at Shanghai Tech University, for example, design thinking is now a required course for all undergraduates, according to Charles Hayes, Managing Director of IDEO China.
Some corporate strategy experts even argue that design thinking is nearing the kind of inflection point that the Quality movement reached in the late 1980s, when the total quality methodology became an inescapable part of doing business.
“Every decade or so, management invents or discovers a new paradigm or framework. Design is the latest one of those.... It’s very similar to the movement on quality we had in the ’80s,” says Jagdish Sheth, a professor of marketing at Emory University’s Goizueta Business School, and a noted corporate strategist.
The Quality movement had one key idea, Sheth says: the strength of the whole chain was only equal to its weakest link. “Design is similarly parallel thinking about all the components in a system, and making sure that you are taking everything into account,” Sheth says.
Design thinking is particularly useful for resolving extremely complex issues where many stakeholders need to be satisfied, according to design thinking authority Jeanne Liedtka, a professor of business administration at the University of Virginia’s Darden School of Business. One case she is writing up now: how the US Food and Drug Administration streamlined its byzantine approvals process.
“You’ve got the manufacturers, you’ve got a host of different government regulators, you’ve got industry associations around healthcare, you’ve got patient advocacy groups—an incredibly complicated collection of people who don’t really necessarily share the same approaches or the same beliefs about what makes something good—and we’re seeing people using design conversations to facilitate much better conversations that help them to find higher ground rather than negotiate compromises that don’t really deliver the best value to anyone,” she says.
In its approach to complexity, Sheth says, design thinking also reminds him of an earlier movement—systems dynamics, which was pioneered by Jay W. Forrester at MIT in the 1960s. “What he did was show that there are moving parts... when you move one part, it has an impact on all the other parts,” he explains.
Empathize – Observe the customer’s needs and motivations.
Define – Define the problem that you want to solve.
Ideate – Come up with a variety of solutions, without judging which are good or bad.
Prototype – Make models of the most promising possibilities.
Test – Test the models.
Design thinking proponents believe that anyone can be trained to become a creative problem solver but people don’t develop their creativity because they are either discouraged or trained out of it. Kelley, for example, argues that people can learn to be more creative.
However some critics have begun to argue that design thinking can’t meet the high expectations that have been heaped on it. In 2011, a long-time proponent, Bruce Nussbaum, long-time design thinking advocate and author of Creative Intelligence (HarperBusiness, 2013), declared that design thinking was dead. He argued that IDEO and the other consultancies that promoted design thinking had promised a process that delivered creativity. They had been “hoping that a process trick would produce significant cultural and organizational change,” he said, but had really just earned designers a greater role in corporate life. Instead, Nussbaum argued, companies should train their employees to be more creative.
Other design critics also believe design decisions will always need to be limited to a distinct group. “Design has to remain a distinct profession because you need to have somebody who’s able to make the synthesis happen. There needs to be somebody in control,” says Paola Antonelli, Senior Curator, Architecture & Design, at the Museum of Modern Art, New York City. “It’s a little bit like the director of a movie.”
But Liedtka believes that difficulties of implementation don’t invalidate the underlying concept. “This is what organizations do: they take concepts and they muddle them up and they try and lay them in on top of values in the organization that don’t work with them or reward systems that don’t reward the new behaviors and so they don’t work,” she says, “but the problems aren’t a function of the idea. Look at something like The Learning Organization, Peter Senge’s work, which, I hardly ever in my life as a consultant saw implemented well, but if done well was probably one of the most powerful frameworks I’ve ever seen, and continues to be,” she says.
In the end, the practice of design thinking may matter less than the worldview it encourages. Sheth argues that its key value lies in its encouragement of the habit of thinking not just about the shareholders, but all the stakeholders. “How can you add value for your suppliers, your distributors, your community and your employees?” he asks.
And the importance of this holistic view may not end at the factory gates: Forrester, now 97, was not available for an interview, but in a 2013 interview, he predicted that the course of the century will depend on how well people became aware of just how complex the world has become.
“The coming century, I think, will be dominated by major social political turmoil and it will result primarily because people are doing what they think they should do but do not realize that what they are doing are causing these problems,” Forrester said. “I think the hope for this coming century is to develop a sufficiently large percentage of the population that have true insights into the nature of the complex systems within which they live.”
Also in this series:
This article is part of a series on design thinking. Other articles in the series include:
- Design and business: The substance of style
- Design and business: Jeanne Liedtka on how to think like a designer
- Design and business: Practicing design thinking in China
[This article has been reproduced with permission from CKGSB Knowledge, the online research journal of the Cheung Kong Graduate School of Business (CKGSB), China's leading independent business school. For more articles on China business strategy, please visit CKGSB Knowledge.]