Digi Transformation & Design Thinking

“Digital transformation” is one of the latest buzzwords plaguing companies around the world. It’s been a massive focus since the onset of Covid-19, but was something leaders emphasized before (even if it took a global pandemic for it to actually happen). We keep hearing how this will upgrade the company or increase customer value. It joins a crowded list of overused marketing refrains like “new normal,” “platform as a service,” and “artificial intelligence." But what does it actually mean? And what should we focus on as we try to transform...digitally?

Digital transformation is the process of using digital technologies to create or modify business processes, culture, and customer experiences to meet changing demands and market requirements (thanks Salesforce for that handy definition). Still sounds vague. Let’s simplify: companies need to evolve how they work and what/how they deliver to customers, and they need to use new digital technology to do it. It is behavior and organizational change on a large scale, catalyzed by software, IoT, and digital automation advances.

The real challenge here is that the change is constant. This is an infinite “game.” Technology is always changing, customer needs are always changing, and the world is always changing. This will only continue; we must learn to deal with it.

So how do you “win” a game that has no end? You don’t! The point is not about winning, it is about evolving.

As advocated by Eric Ries in The Lean Startup, the critical piece is for organizations to learn how to better learn and adapt in quick cycles. In that way, we can navigate change while the technology, customer needs, and market change around us.

Far too often, companies focus all efforts on technology. We obsess over new algorithms, AI, digital twins, system intelligence, or technological advancements that might save the day. A technology focus means we shift focus away from the essential element for all organizations: people. We forget that the best technology is meaningless if it doesn’t fulfill ground-level needs of human beings and if they don’t know what to do with it. We stumble along this infinite game looking at technology first and then seeking actual customers to use our “game-changing” stuff; or we deal with stressed-out colleagues overwhelmed by all of the new software & systems.

Fortunately, two facts can help us navigate this infinite game:

1. Human nature has changed very little in thousands of years
2. Technology is meant to benefit humans, not the other way around

From these ‘facts’ it becomes clear that effective digital transformation requires us to focus on people and their needs, with technology in a supporting role.

How can design thinking help us navigate this transformation?

Design thinking is a mindset and structured process for solving problems and innovating in human-centered ways. It is an iterative approach to understand user needs, define concrete problems, and use visual methods to prototype & test solutions. And it is extremely useful for tackling the complex organizational problems that arise during digital transformation.

It is not a new methodology and it is not revolutionary. Design thinking follows the age-old wisdom of understanding a problem before trying to solve it, and the notion that a picture is worth 1000 words. Its iterative loops and push toward tangibility are perfect for the “fuzzy” challenges that pop up when organizations try to change. Design thinking complements ‘traditional’ transformation approaches because it helps individuals create tangible results within a broader framework.

As companies do this digital transformation, common approaches include building roadmaps or backlogs for specific topics to improve. Visualizing a strategy or a “map” for how you want to transform is great! But these boards can be overwhelming. Often these initiatives involve developing new tools or solving complex challenges that span many stakeholders. Complexity and scope build fast. In these moments, it’s very helpful to act using a structured framework for creating quick, tangible results, then get feedback and improve.

Design thinking is a terrific mindset and process for balancing between the strategic thinking and hands-on doing required by digital transformation. In my organization, we’ve found the following simple “flow” to be helpful in moving from abstract digital strategy to concrete results:

This kind of approach is simple but difficult, because it forces groups to intentionally choose NOT to focus on certain things. Step #2 in particular is challenging when senior managers pressure groups for results on every initiative to happen “yesterday.” But true prioritization is always a challenge in large companies. It can also be a challenge to convince leaders to give the "freedom to operate" that is required when working with such creative approaches, since avoiding perfect is a critical part of iterating over time.

There are many advantages to this kind of approach. It is highly collaborative and forces people to actually think about problems before they start suggesting solutions. We've worked with this type of approach on hundreds of use cases in our organization. I'm consistently amazed at how beneficial it is when teams get more visual with their work (i.e. show what they mean, not just say it) and when they stay focused on user needs (rather than focus on what they think is a good idea).

What can we take from this into our daily life?

In March, I spoke with a number of agile experts across Siemens, and they had many ideas about opportunities to try this approach. Some of those areas included:

• Improving new employee onboarding (particularly now that it is happening virtually)
• Cultivating new business models
• Reimagining ways of working in virtual & hybrid settings
• Empowering sales staff with better tools for in the field
• Building alignment and cohesion with how groups shift to more agile ways of working
• Improving data management?
• Building a more holistic view of key business challenges
• Improving service processes & journeys

There were many, many more topics. The main point is that user-focused problem solving is highly useful for complex organizational challenges. This approach is also useful in our daily lives - no matter what our role is. Here are four simple steps for applying design thinking to any challenge you’re facing…even in an afternoon:

Voila! You’ve generated actionable ideas on a fuzzy problem in a short amount of time.

Design thinking isn’t complicated (but it’s certainly not easy). It’s a wonderful tool to help our teams navigate complex problems and change. Digital transformation is all about evolving people’s patterns and behaviors using technology. Companies need to do better at keeping human needs at the center of their thinking if they want to succeed in the midst of all this change.