Design-Thinking: A framework for consistently generating disruptive innovation

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Imagine you're assigned a new project: increase MRI customer satisfaction. You're told that for years engineers have tried cracking this problem, but effort after effort seems to only makes things worse. In the past they've tried reducing sound, reducing time in the machine, but time after time these efforts fell short.

That is until one day you walk through the wrong door and find yourself face to face with a little girl in tears, petrified as she clings to her mother while waiting for her MRI. As you drive home you can't get this off your mind. Why was she so scared? What was scaring her? Then as you open the door to get out of your car it hits you... what if she was petrified of the whole experience? What if it's not the machine, but rather the bleak walls, hard seats, and monotone faces draped in lab coats that are causing such low satisfaction scores?

If you're like 99% of us, you know you have a problem, but you have no idea where to start with a solution. If you're a marketer you find a better way to market the experience, if you're in finance you find a cheaper way to build/deliver this, if you're an engineer you find a "technically" better way to build this, and if you're a consultant you solve all these problems by creating elaborate decision trees. Yet no matter the discipline you'll realize that unfortunately none of these formulas can explain the tears on this little girl's face. So what do you do? Do you get more technical? Or do you search for something outside of the box?

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For Doug Dietz, a designer at GE Healthcare, when he saw this little girl he knew he had to step outside of his comfort zone and thus decided to enroll at an Executive education course taught at the Stanford d.school. Here they challenged him to a human-centered design thinking approach that enabled the creative confidence to turn the MRI machine into an adventure with the patient acting as the central character. They painted the machine as below, had a script for the technician's to lead the patients through this journey, and low and behold the results were phenomenal. Patients were happier, hospitals were happier, and the final affirmation came when a patient asked her mother, "can we come back tomorrow"?

But how was Doug able to tap into such an outside of the box solution while staying significantly below most budgets?

The Answer: Doug tapped into a creative problem-solving framework called design thinking

What is Design-Thinking?

Design thinking has no doubt become an over-used buzzword, but at its core it is a problem-solving framework that leverages empathy & creativity to develop solutions at the intersection of viability, desirability, and feasibility.

A good way to think of it is as a spark plug to innovation, in that companies can innovate without it, but the generation of idea's in terms of their usefulness (impact & relevance) is accelerated (or sparked) in response to design-thinking.

Design Thinking generates revolutionary solutions at the intersection of viability, desirability and feasibility.

Who Should Use Design-Thinking?

The success of design-thinking is less about standard metrics (company size, industry), and more about the structure & mindset of an organization.

What does this mean? You'll see further the overlap with design-thinking and lean/agile methodologies, but to truly implement design-thinking organizations must have an open, flexible & agile structure that allows for rapid experimentation and continuous improvement. They must not only have a culture that's open for change, but have the resources in place to act on this change.

We'll get into this in step 3 & 4 as well as subsequent articles.

Why are we hearing about it now?

If you were to use the phrase "design-thinking" thirty years ago you'd be speaking to pretty deaf ears. The reason is not only that it wasn't prevalent, but rather it wasn't as useful. Why? We could spend a full book on this, but the core answer is that technology had not evolved to where it has today, and in the wake of this technological evolution came a complete paradigm shift within the rules of value creation. Where value was once created through incremental top-line/bottom-line efficiencies, today it's created through disruptive breakthroughs.

One visible macro trend resulting from this is the shift in demand away from finance/accounting functions and towards programming & design. I've personally had a front row seat for this as I started with the traditional finance/accounting path and transitioned into a high growth technology track. I'll never forget, on my first day at a big 4 accounting firm, I opened up the paper (digital obviously) and on the same page was a headline that one of the large reputable banks was laying off a thousand people while another headline was about how companies couldn't hire programmers and data scientists fast enough. I didn't understand it at the time, but this represented the paradigm shift away from those taught to optimize on set processes and towards those who could physically build products/services of unknown disruption.

The takeaway from this paradigm shift is as follows: it is imperative to understand that design thinking is quickly becoming the strategy of the future. As far-reaching technologies aggressively and uniformly disrupt traditional business models, the sustainable competitive advantages of optimizing known processes have been replaced by the creativity to ideate, develop, and launch never before seen products/services/business models. The new rules of this disruption game thus necessitate a framework built off creativity rather than logic.

As value creation transitions from logic to creativity, design-thinking provides the foundation to release this creativity

How to Apply

For an outsider looking in, design-thinking looks more like Harvard's liberal arts undergraduate curriculum than it's renowned HBS.

The reason is because it is. Where-as common management best practices pull from logic & reason, design-thinking looks to pull from emotionally charged inspiration and concentrated reason/logic. In the MRI example with Doug, Doug physically felt the fear of the little girl in tears, and as the d.school taught him how to channel this empathy he was able to come up with a creative solution that logic wouldn't have been able to think up. Thus going forward we need a robust process that enables this inspiration in a way that augments rather than replaces logic/reason.

There's no "set" implementation, but what we'll be doing next is showing you one possible framework through a 4 step process outlined below. This process is NOT an end all be all, but what it should do is kick-start creativity in everything you do.

This is not a set process, rather a framework to pull from emotionally charged inspiration and concentrated reason/logic

Step 1: Feel (Natural Habitat)

Estimated Time: Anywhere from hours to months.

Little did Doug know that when he walked through that waiting room he'd be engaging in step 1: physically feeling the journey of the customer by observing them in their natural habitat.

We can describe this through two tools:

Tool 1: Being a Psychologist/Anthropologist - The job of a psychologist & anthropologist is to simply observe leveraging empathy over preconceived notions/bias.

Example: McDonald's & Milkshakes

When Clayton Christensen was engaged to increase milkshake sales he didn't realize he was jumping onboard a sinking ship. Prior to Christensen, milkshake sales were slipping and when they took the traditional route and hired a well-known consulting firm sales only dipped further. Unphased, Christensen's first move was to leave the luxury confines of an office and sit for weeks in parking lots from open to close. As his team jotted down all the raw and unbiased data points they started observing patterns, and what most strongly piqued their interest was that the peak hour for Milkshakes was 8 in the morning. Beyond surprised yet understanding the importance of being an anthropologist/psychologist, they asked hundreds of the 8 am customers open questions and repeatedly heard things like:

"I've tried many options to help with my commute, apples, bananas, but only with this milkshake can I sip it for the full 45 minute commute and feel full as I walk into work."

From this they were able to infer that it wasn't taste nor price, but the convenience & feel that necessitated people to buy a milkshake, and after McDonald's allocated their resources to these factors milkshake revenues significantly spiked.

So what exactly happened? By camping out in the parking lot for weeks they were able to go into the natural habitat of their target market and observe all they could without any preconceived notions. And through this they saw patterns that observations with bias wouldn't pick up on.

Tool 2: Being a Tourist - What's the difference between a tourist and a local? On the surface, one looks totally out of place and primed for paying extra, but beyond looking ridiculous the tourist is noticing anything & everything whereas the local knows where to look and glances over everything else. While the local may take pride in this (ahem most large companies), the best way to describe this property is through the infamous gorilla test showing the pitfalls of selective attention. I won't ruin the surprise if you haven't seen it, but let's just say if you're the local you're missing out on a lot of opportunities.

Example: Google Drive vs. Microsoft Office

In 2012 Google launched their Google Drive, a central drive that allowed users to collaborate & share files such as docs, PP's and spreadsheets. At the time (and arguably still today), these were all significantly weaker versions of Microsoft Office's Word, PP & Excel. So why did they waste the time and resources developing something of inferior quality? The answer is that Google understood something traditional wisdom didn't. Although Microsoft Office from a technology perspective was far superior, the average user was only using around 10% of the functionality. Think about Excel specifically, how much of the advanced functionality do you actually use? For Google, instead of trying to out strengthen Goliath, they instead looked to out-understand the user experience and used a travelers mindset to understand that for the average user there was a glaring inefficiency. What they saw was that the general use looked something like this:

• User 1 makes a word doc, calls it version A and emails it to user 2. While user 2 is editing version A, user 1 is also editing it and makes corrections he didn't notice before. When user 2 sends back the revised version A, user 1 notices that sections he corrected were taken out entirely, meaning user 1's revisions were a complete waste of time.

I'm sure we can all relate to this, and while the solution seems simple (put the doc online), the Microsoft Office team was too focused on the technical requirements to see how something simple could make such a big impact. Sound like the MRI example? Or the milkshake? In each case the solution was NOT better tech, but instead the ability to apply a travelers mindset and notice things no one else did.

Step 1 is the application of two tools - being a psychologist/anthroplogist and being a tourist

Step 2: Think (Analysis)

Estimated Time: Days to weeks.

Once we've acquired enough data to associate patterns we can start to apply concentrated logic/reason with the purpose of building a framework to answer the following questions:

             A: What problem are we attacking?

             B: Where do we spend our energy?

To piggyback the Harvard analogy, this is where we transition from Harvard's undergraduate curriculum to HBS. Here we can leverage a plethora of logic tools, but the core data should be distilled into 3 deliverables:

1: Customer Persona's - Further than having market segments, these put a name, a face, and a personality to a user.

2: User Stories - These are generally called Journey Maps or Storyboards. No matter the terminology, these lay out the full customer experience both with & without your product/solution. In my experience creating a full user journey map has been the most effective exercise in identifying all relevant pain points and narrowing these pain points into core competencies.

3: Use Cases - Use cases are the specific instructions of how users/agents will interact with your product/solution. They generally follow a format of "As an X user, I want to be able to Y, so that I can Z", and although they are imperative in the product life-cycle, their effectiveness is only as strong as the user stories generated above.

Step 2 is applying concentrated logic to understand the problem we're attacking & where we should be allocating our energy.

Step 3: Act (BML Feedback Loop)

Estimated Time: 2-3 Week Sprints

If we've done all this research then whatever we build should just work right? Not quite...

No matter how much planning we do, the hypotheses developed from steps 1-2 will most likely be wrong. Enough so that at the renowned Stanford d.school, students are encouraged to fail repeatedly as failure is a pivotal part of the innovation process. As the authors of Creative Confidence put it:

“Many d.school classes demand that student teams keep pushing the limits of possibility until they face-plant. The personal resilience, courage, and humility born of a healthy failure form a priceless piece of their education and growth”

This is further supported by Eric Ries of The Lean Startup as he says, “The only way to win is to learn faster than anyone else”, with learning being the result of failure.

So how can we accelerate failure to the point that we sustainably foster innovation? For this we look to lean/agile methodologies, specifically the build-measure-feedback loop in which we accelerate through 2-3 week sprints of building a prototype, putting it in front of an early adopter audience and measuring the results, learning from the results, then iterating until we've achieved our target results. The prototype is what we commonly refer to as an MVP (minimum viable product), which is simply whatever you can use to test in the cheapest & fastest way possible whatever hypotheses you need to confirm/deny. The objective is not a go-to-market product/service, but rather a medium used to learn. My favorite example of this is if you want to open up a restaurant, find creative ways to have people try your food first like a farmers market, or a food truck, or even bringing it door to door. We can have a separate post just for MVP's, but to keep it simple just think of it as any medium used to test the hypotheses discovered in steps 1 & 2.

We take action on steps 1 & 2 by accelerating through the BML feedback loop

Step 4: Implement

Estimated Time: Continuous

By the time step 4 rolls around you've eclipsed ideation and are ready to scale.

How do you know you're here? Most likely you'll be too busy fulfilling orders to be asking the question. If you aren't, keep strong through step 3. If you are, keep pushing my friend!

Summary

As we transition to an ever-increasing technology-centric economy, the conventional strategy of optimizing known processes through reason/logic will give way to one that fundamentally re-writes the rules of the game through the application of creativity.

This strategy is human-centered design-thinking, and while the implications will be ubiquitous and far-reaching, the application will have a foundation to that of the 4 step process above.

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About the Author

Matthew R. Mottola builds the Future of Work, a paradigm shift in the way we leverage technology to match & manage labor. At Microsoft, he owns user experience for the on-demand/freelance economy, and drives a number of key initiatives including product strategy and enterprise execution of freelance programs. At Georgia Tech, he teaches this future. Globally, he speaks on this future. And for early stage ventures, he advises on & invests in this future. He is the author of university-level textbook StartUp not StartDown and upcoming book Ready For It: Automation & the Future of Work.

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More From Matthew:

Why We Must all Prepare for the Future of Work Today

The Future of Work, Part 1: The Convergence of a Gig Economy & Talent-Management Platforms

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