The Promise and Pitfalls of Business Design

Business design works best when your organisation is prepared to transform from within so as to act as a good host for sustained innovation.

The favourite buzzword these days: Design thinking. And the biggest consultancy associated with its rise is IDEO; deemed the coolest consultancy in the world. Top executives all over the world are now suddenly caught up with this frenzy of design thinking and business design; they all want to be part of the action and be seen as thinking creatively. But like any hot stock on the market, think carefully before buying it or be prepared to get burnt.

Before we go any further, we like to declare upfront that we believe in the power of design thinking and the process of business design, being practitioners ourselves. But what we can clearly see is this: design thinking is not for every firm and not for every solution. No method should ever claim to be the cure-all for the world’s challenges. Given the growing hype, it might be good to share the necessary conditions so as to profit from this approach. The following insights came from our years of helping companies in Asia redesign their business models for innovation.

Business Design requires a new process for ideation

For the uninitiated, business design is the process of creating a new business unit or experience by combining the hard skills of business and the soft skills of design. The smartphone category – as redefined by Apple – through the iPhone, is a classic example of what happens when great business strategy and design comes together. Apple created an intuitive user-experience and implemented a great business strategy through the App store with quality 3rd party developers, resulting in an unprecedented distribution model for software. The Apple case study is well-known but if business design can get us commercial success, then why are so few companies profiting from it?

The answer lies in the way an idea is developed in most companies. In Asia for example, ideas are generally developed in a linear fashion, as in, it is usually sparked off by a single department, perhaps the product or marketing department. Then it is brought up to higher management to secure a budget before bringing in other departments. Along the way, as other departments come on board, they will add their own agendas to the programme. Over time, it diminishes the focus on the idea itself, reducing it to a mere outcome that is seen as innovative but in fact has little impact on the business process hence limiting results. In this situation, if you attempt to use business design, you will achieve very little. To profit from business design, Asian companies need to redesign organisational processes for ideas development to get better results.

Tim Cook always say that only Apple can bring different talents together to create a product experience that is thoroughly reimagined and delivered in a seamless manner. From our experience, Tim might be right. Most organisations in Asia do not have the ability or the will to put different talents together to solve problems over a prolonged period of time. For business design to fulfil its potential, it requires a multi-dimensional view of the issues from the beginning. Concept development cannot be simply pushed down the line and has to be open to a variety of outcomes, sometimes unexpected. It is akin to going on an adventure together, leveraging on the eyes of the other to build on each other’s ideas and insights. This require teams to have trust in one another, built over time through failures and understanding. The reason why Apple was able to achieve the kind of breakthroughs that it did, had less to do with just ‘thinking different’; the teams at Apple have been working together for a long time. They had the maturity to ask difficult questions and patience to pursue ground-breaking ideas. In other words, business design works best when team members trust each other. It is just like how top teams at F1 races operate: you need faith in each other, the clarity of roles and purpose in order to win.

The typical failure to profit from business design is therefore, not due to the lack of ideas. The challenge is, how do nurture confident and comfortable team dynamics that appreciates and respects the expertise of the other? How do you get teams to realise the value of random conversations about life, aspirations, personal stories, things that may not have a direct relationship with the project, but yet, are so necessary to build trust and synergy in order to create an environment that will nurture and groom an idea to fulfil its greatest potential. This is when the CEO is key, not just as the sponsor of such a project, but as a participant and the cheerleader of the initiative for a sustained period of time.

Unfortunately as few Asian companies have the will and patience to develop an idea over a long period of time like 5 - 10 years, they tend to limit design-thinking methods to showcase projects such as a better retail or service experience. These are mere trophies and will not go far in reshaping their industries like what Apple did for smartphones and the PC business.

Ways for Asian Companies to profit from this method

Business design approach is common sense and a necessary step for any business to move up the value-chain. But what we are advocating here, is realism and patience. Do not expect a quick-win simply because you have just hired some brand name consultant to conduct a design-thinking workshop or project for you. If that were true, then we should see Apple-like disruptions every other day. This is not happening because it requires a mindset shift at the organisational level to create a sustained and transformative effect. For companies considering adopting business design to transform their operations, here are three things you ought to consider:

1) Your industry is ripe for change

If you are in an industry where the phrase, “We have always been doing things this way” is often repeated, and you have entrenched leaders who have sold their product in a similar fashion for the last ten years, then you are in luck. Business design achieves the greatest impact in industries that have not really thought differently about their industry . Just look at how Apple has changed the mobile phone business and how Tesla is challenging the auto industry through electric cars. There are lots of industries that are ripe for change in Asia, so we suspect that there is plenty of room to apply business design approaches.

2) Your CEO believes in participating in the process

Business design, like any project about innovation, has its risks and can fail. No consultant should ever claim that it is fail-proof because it is just not possible. Therefore, it is important for the CEO to learn about the process and be part of any idea development. We have found that when CEOs are involved in the development and testing phases, it makes it easier for the top management to understand why additional time is needed to allow the idea to develop further. When the CEO participates in the process, he/she will realise the importance of redesigning the organisation in order to best maximise the benefits from business design.

3) Your culture is ready to host the ‘core’ of business design

Business design is a contagious process; once the right people are involved and are used to it, they will be able to form an organisational core to help others profit from it. For an organisation to profit more from this method, it is necessary to give different departments more opportunities to work together and develop ideas collectively. You will also discover that personal excellence matter less in a ‘design thinking’ environment as it is always a team effort. So remuneration policies, in addition to recognising the individual, must move towards rewarding teams with the best synergy and willpower to see an idea from start to completion.

Profiting from business design requires clarity of purpose, the will to stay the course and unity to make it happen. We may use different labels but the same principle still apply; there are no shortcuts to great things.

What is your experience with business design? Share your thoughts here.

Graphic: Consulus

About Consulus

Since 2004, we have redesigned countless businesses and organisations to embrace innovation in over 18 cities in the world. Read about our PurposeCore programme if your organisation is looking for change so as to shape the world. In 2014, we launched an enterprise sharing app called CastleUp to strength sharing of ideas to enhance team work. To know more about PurposeCore or CastleUp, Contact us

About Lawrence

He is the Co-founder and CEO of Consulus, an Asian innovation consultancy with business management and multi-disciplinary design capabilities. He is a featured Speaker at global events such as World Marketing Summit and World Brand Congress. He is the Immediate Past President of Design Business Chamber Singapore. His thoughts on Asian innovation and creativity appear frequently in regional media such as Marketing Magazine, andVTC10. In his personal capacity, he is a member of Religions for Peace and theFocolare, working for peace through dialogue among people of other faiths.