Secrets of CX: 3. Design Thinking and Human-Centered Design

With the advent of e-commerce, cloud computing & start-ups, things like design thinking and human-centered design have gained prominence. These are actually CX tools, since the service economy and platform businesses are largely growth businesses, these are very helpful in customer acquisition and retention by creating unique and unmatched user experiences. I’d like to discuss these methodologies and how they will redefine the CX to make digital transformation stick.

What is Design Thinking

Design thinking is a problem-solving approach that puts the needs of the user or customer at the center of the design process. It is a human-centered approach to innovation that involves understanding user needs, defining the problem, ideating potential solutions, prototyping and testing those solutions, and iterating until a viable solution is reached.

Design thinking achieves balance amongst desirability, feasibility, and viability by taking a user-centered approach to problem-solving. Here's how:

• Desirability: Design thinking begins by understanding user needs and wants. By empathizing with users, designers can gain insights into what users really need and what they find desirable. This helps to ensure that the solutions that are developed are not only functional but also meet the user's emotional and psychological needs.
• Feasibility: Design thinking also takes into account technical feasibility. Designers work closely with engineers, developers, and other technical experts to ensure that the solutions they develop are technically sound and can be built within the constraints of the available resources.
• Viability: Finally, design thinking considers the business viability of the solutions that are developed. Designers work with business experts to ensure that the solutions they develop are financially viable and can generate revenue for the organization.

The key components of design thinking are as follows:

• Empathy: Design thinking starts with understanding the needs, desires, and challenges of the people who will be using the product or service being designed. This is done by empathizing with users through observation, conversation, and research.
• Define: The next step is to define the problem or challenge being addressed, based on the insights gained through empathy. This involves clearly articulating the problem and identifying any constraints that may impact the solution.
• Ideate: In this phase, a wide range of ideas are generated for potential solutions to the problem, without judgment or evaluation. This can be done through brainstorming, mind mapping, or other ideation techniques.
• Prototype: Once ideas are generated, the most promising ones are selected and turned into low-fidelity prototypes. These prototypes can take many forms, such as sketches, models, or mockups.
• Test: The final step is to test the prototypes with users and stakeholders, to gather feedback and validate assumptions. Based on the feedback, the prototypes can be refined, and the design thinking process can be iterated until a viable solution is reached.

Origin & Use Cases

Design thinking originated in the field of product design in the 1960s and 1970s, with the work of designers such as Horst Rittel and Herbert Simon. However, it was popularized in the 1990s by David Kelley and Tim Brown of IDEO, a design and innovation consulting firm based in Palo Alto, California. Today, many companies around the world use design thinking to drive innovation and improve customer experiences. Some of the world leaders in design thinking include:

• Apple: Apple is known for its innovative product designs, which are driven by a user-centered approach to design. Apple's products are known for their simplicity, ease of use, and aesthetic appeal, which are all hallmarks of design thinking.
• Airbnb: Airbnb has used design thinking to disrupt the traditional hospitality industry, by focusing on the needs and desires of travelers and hosts. By understanding the pain points of both groups, Airbnb has been able to create a platform that is more convenient, affordable, and enjoyable than traditional hotels.
• IBM: IBM has been using design thinking to drive innovation in its products and services, as well as in its internal processes. IBM's design thinking approach is focused on creating a culture of innovation and collaboration and has resulted in many successful new products and services.

What is Human-Centered design?

Human-centered design (HCD) is a problem-solving approach that puts the end-user at the heart of the design process. By empathizing with users' needs, desires, and behaviors, HCD creates more relevant, effective, and delightful solutions. This, in turn, leads to better customer experience (CX), which is critical for business success.

Human-centered design (HCD) brings several key values and benefits to CX:

• Empathy: HCD puts the end-user at the heart of the design process and fosters empathy for their needs, desires, and behaviors. This leads to solutions that are more relevant and effective.
• Relevance: By understanding the end-users' needs, HCD creates solutions that are tailored to their specific requirements, leading to a more relevant customer experience.
• Usability: HCD ensures that products and services are easy to use and navigate, making the customer experience more seamless and enjoyable.
• Delight: By considering emotional responses, HCD creates solutions that not only meet functional requirements but also delight customers, leading to increased satisfaction and loyalty.
• Continuous improvement: HCD is an iterative process that allows for continuous improvement and refinement of the customer experience.

HCD helps identify customers' pain points, understand their emotional responses, and provide tailored solutions that address their specific needs. This results in increased customer satisfaction, loyalty, and advocacy.

IDEO, a leading design firm, has developed a three-step process for HCD:

• Inspiration: The first step is to gain insights into the needs and desires of the end-users by conducting user research, immersing oneself in the end-users' experiences, and observing their behaviors.
• Ideation: The second step is to generate ideas and concepts based on the insights gained in the inspiration phase. This involves brainstorming, sketching, and prototyping ideas to test with end-users.
• Implementation: The final step is to implement the best ideas and concepts into the final product or service. This involves refining the design based on feedback from end-users and stakeholders and iterating until the final product or service delivers an unmatched customer experience.

How SBI used HCD in their branch operations to improve customer experience

State Bank of India (SBI) has also used a human-centred design (HCD) to improve its branch operations and customer experience. In 2017, SBI partnered with a design firm, Fjord (Accenture), to implement an HCD approach to its branch operations.

The HCD process began with user research to understand branch customers' needs, desires, and behaviors. Based on these insights, SBI and Fjord developed a new branch design that was more user-friendly, accessible, and responsive to customers' needs. The new design incorporated digital signage, interactive screens, and customer lounges to enhance the branch experience.

The new branch design was launched in 2018, and it resulted in a significant improvement in the customer experience. The new design was more welcoming and accessible, making it easier for customers to navigate and access banking services. The HCD approach also led to a 20% increase in customer satisfaction and a 30% increase in cross-selling opportunities.

Design thinking vs. Human-Centred Design

Design thinking and Human-Centred Design (HCD) share many similarities and are often used interchangeably. Both are user-centered approaches to problem-solving that focus on understanding the needs, desires, and behaviors of users in order to create innovative solutions that improve their experiences.

While design thinking and HCD share many similarities, there are some key differences between the two approaches. Specifically, design thinking tends to be more focused on developing innovative solutions that meet unmet needs, while HCD is more focused on improving existing products and services. Additionally, design thinking tends to be more focused on ideation and creative problem-solving, while HCD is more focused on understanding user needs and behavior. Ultimately, both design thinking and HCD are valuable tools for creating innovative solutions that improve user experiences and can be used together to achieve even better results.

Design Thinking & HCD in Manufacturing B2B Environment

Bosch is one of the leading global manufacturing companies that has applied HCD and design thinking principles in Industry 4.0 initiatives. They have an inspirational vision consisting of growth across the entire value chain leveraging Industry 4.0, thereby creating new jobs and focusing on 3 pillars of people, machine & data. They started with lean and expanded the standard work, flow, & pull applications with Industry 4.0. Here are 5 key points that highlight how Bosch approached this:

• User Research: This helped Bosch to understand the needs and pain points of their customers and employees and to identify key areas where digital transformation could create the most significant impact. This helped them to define the deliverables with empathy.
• Co-Creation: Bosch involved all stakeholders, including customers, employees, and partners, in the digital transformation process for idea generation. They created cross-functional teams that worked together to design and implement Industry 4.0 solutions.
• Agile Development: They used agile development methodologies to quickly develop and deploy digital solutions, often with a workable prototype. They adopted an iterative approach that allowed them to make continuous improvements based on user feedback from these tests.
• Continuous Improvement: Bosch did not stop at the implementation of Industry 4.0 initiatives. They continued to gather feedback from users and make improvements. This approach allowed them to achieve ongoing benefits and continuously improve customer experience.

While in all my articles in this series, I have reserved a special space for the B2B and manufacturing applications, here I take the opportunity to explain my views on the much talked about Industry 4.0 initiatives. In my opinion, it’s the human component and the user experience that will take precedence over the technologies in the maturity journey. CX, HCD & customer journey will be the key differentiator as clarity is emerging over the technology ecosystem.? Don Norman Bosch Arundhati Bhattacharya IDEO Airbnb 博世力士乐