Design and thinking

Welcome to my LinkedIn Newsletter to get your dose of entrepreneurial inspiration! I will share some intriguing facts, captivating stories, research insights, and ideas on entrepreneurship that I personally find fascinating and inspiring. Who knows, it may also spark your curiosity!

The essence of design thinking

The first step in developing a great product is simply noticing. We often get so used to the way things are that we don’t question them and we don’t challenge the status quo. We tolerate or ignore small annoyances in our daily lives, like constantly cleaning a glass table to keep it transparent, struggling to squeeze the last drops of toothpaste or cream from a tube, or being surprised by a door that opens the opposite way you expect. And who hasn’t struggled with that pesky gold foil on a Nutella jar??

This process of getting used to things is called “habituation” and it is a survival instinct we’ve developed over time. It conserves our brainpower for more important tasks and relieves us from the burden of constantly processing the myriad of signals in our surroundings. But hidden in these everyday routines are opportunities for making something better, and that's where the concept of design thinking comes into play.

Design thinking has gained popularity in business circles since this century, thanks to the design company IDEO and Stanford’s d.school, among others, who showed that design thinking is not just for designers. In a nutshell, design thinking involves a few key steps :

• Fully understanding the problem by talking to customers and observing their behaviors,
• Exploring a broad range of possible solutions,
• Focusing on the most important first, and then
• Making prototypes,
• Testing them, and
• Refining/iterating until you have a version people want to use and pay for.

To break it down further, we work in three spaces:

1. Inspiration (thinking about the problem or opportunity that motivates the search for a solution);
2. Ideation (the process of generating, developing, and testing ideas); and
3. Implementation (the path to bring a project to life, or people’s lives).

The “thinking” part of design thinking is crucial here. David Kelley, one of the founders of Stanford’s d.school, started using the word “thinking” to explain what it is that designers do, and that’s how we got the term “design thinking” .

Today, it is not just another fancy concept. Airbnb’s journey from a struggling startup to a billion-dollar business is a testament to the power of design thinking. Similarly, Uber Eats has used this approach to make its services customized to the needs of users in different countries and cities. There is evidence that companies underutilize design talent which could create more business value. Design transcends the conventional limits and today you may notice job openings for Chief Design Officer or Chief Creative Officer who can play a crucial role in driving innovation and customer-centricity.

Where design thinking meets AI

In today’s world, using the design thinking approach becomes essential. As the IBM Institute for Business Value put it,

“Value increases when technology meets design”.

We live in an era where almost everything is a digital product, and businesses are focused on selling digital experiences. No matter your industry, you are in competition with other companies that are reshaping customer expectations through digital experiences. This competition is fierce, pushing all players towards hyper-personalization. Customers now expect precisely targeted offers, relevant recommendations, and seamless experiences. Basic human interactions are no longer enough, and that’s where Generative AI comes in and gives companies the tools to meet these elevated "standards".?

In fact, 62% of global executives anticipate significant changes ahead. They recognize the need to revamp how their organizations design experiences – with personalization at the core. Indeed, the design thinking approach starts with empathy, a guiding principle for developing better customer experiences. For instance, financial services can use customer data to target the right customers with the right financial offers. Online retailers can move beyond traditional filters and categories by using natural language to understand and address customer searches in a personalized way.

Using Gen AI is becoming easier. According to an Adobe Blog post , it’s a great way to unlock creativity. We can reinvent creative workflows, ideate and develop concepts by telling Generative AI what we want to create, and quickly experiment with forms, colors, and textures to find new different directions.

AI tools like ChatGPT can amplify our efforts to create better solutions. They can help with generating personas, simulating customer responses and listing potential pain points and expectations, brainstorming, and generating ideas, analyzing data and images, and offering diverse perspectives on solutions, among other things. It looks like is a magic wand in our hands!

According to McKinsey’s research on design practices in 300 publicly listed companies across multiple countries over five years, high-performing companies in design also have better business performance metrics, twice as high as those of their industry peers. PwC forecasted that by 2030, AI would contribute a staggering $15.7 trillion making it the largest commercial opportunity in a rapidly changing world. This estimate demonstrates the immense potential of AI in reshaping our economy. Approximately 75 percent of the value is concentrated in four key areas: customer operations, marketing and sales, software engineering, and R&D. Andrew Ng, a Chinese-English computer scientist and entrepreneur, aptly stated ,

“AI is the new electricity. I can hardly imagine an industry which is not going to be transformed by AI.”

However, the integration of AI in design thinking raises many concerns, reinforcing the need to use data ethically. IDEO has outlined several principles as an ethical compass for AI usage in design thinking:

• Remember that data is not inherently truthful, it is human-driven and can be biased;
• Don’t presume the desirability of AI, monitor changes in people’s needs to determine when and if it is worth integrating AI;
• Respect privacy and the collective good; and, finally,
• Consider unintended consequences of AI as opportunities for design and innovation. Sometimes, the unknown can become a starting point for iterations which can lead to new solutions.

What academic research thinks about design thinking

Design thinking (DT) plays a significant role in problem-solving and fostering innovation within organizations. In a recent article titled “Design thinking for innovation: Context factors, process, and outcomes” published in the European Journal of Innovation Management, the authors explore the evolution of design thinking research, from its defining characteristics to research methodologies and attempts to measure its impact.

For this study, the researchers conducted a systematic literature review, where the articles with “design thinking” in their titles within the business domain were collected from reputable sources (Web of Science and Scopus). Remarkably, this search yielded around 6,000 articles, indicating a certain degree of maturity of design thinking as a field of research. After a rigorous selection process, the sample included 164 academic publications for the final analysis.

The findings were organized into several categories: context factors, process, and outcomes, which formed the overall design thinking framework. Notably, it was confirmed that the common design thinking process typically consists of three key stages:

1. Data gathering; it involves understanding user needs, building empathy, and creating customer/user personas;
2. Idea generation; it is about developing hypotheses for potential solutions, often through divergent and convergent thinking, brainstorming, visualization, and other creative techniques; and, finally,
3. Testing; in this stage, ideas are transformed into prototypes and tested iteratively to find the best solution.

What is also interesting is that context factors were included in the framework. For example, strategic vision, organizational culture, leadership styles, and team composition, embedded in the context of organizational factors, can influence the success of design thinking initiatives. Undoubtedly, to utilize and benefit from design thinking, people in organizations need to be trained and familiarized with the design thinking process and tools.

Additionally, the study uncovered the positive outcomes of implementing design thinking: it not only enhances organizational performance and promotes innovation, but also fosters team creativity and organizational ambidexterity. What is more, it can have individual-level effects as well, boosting our creativity, self-confidence, and entrepreneurial skills.

So what?

What practical steps can we take today to start developing our design thinking skills? I found the approach suggested by Google quite curious and easy to apply.

Google promotes the application of design thinking through three areas known as the 3 E’s, encompassing:

• Empathy,
• Expansive thinking (brainstorming), and
• Experimentation.

For a comprehensive guide on implementing these principles and conducting design sprints, Google provides valuable resources at thinkwithgoogle.com and designsprintkit.withgoogle.com . And, of course, Canva also offers an array of excellent templates for design thinking.

I believe this approach has a huge potential not just in marketing or software development but also in education, art, entertainment, and various other areas. As one person put it,

“Everybody is making design decisions”.

Whether it is about improving toothpaste tube design or shaping the ways we live our lives.

Until next time!