Why do executives need design skills to digitally transform their organisation?

Thomas H. Davenport and Bala Iyer (Harvard Business Review) advise that with companies’ hierarchies becoming flatter, the efficient use of digital tools is crucial for the success of any transformation project.

One of the daily challenges that executives face in the current market landscape in which organisations operate is the dilemma of adopting the much-cited innovation in business strategy. Innovation is a concept that is currently in all circles of discussion in society, having taken proportions of global scope. But how to make innovation a tangible and applicable process?

Before talking about any methodology, it is necessary to analyse the typology, that is, the different categories of the concept. Innovation can be defined as: to have an idea, bring it to the real world, and generate results with it. These results can be profit for a company, improved welfare for people, etc.

Innovation is still strongly associated with the launching of new products, however, the concept of innovation is much broader. Innovation could take the form of adopting a novel approach to problem-solving. For example, the Toyota production system using the PDCA (plan-do-control-act) approach to quality control, initially developed by Deming, from an understanding of the root causes of a problem.

However, the solution of contemporary problems often transcends a linear methodology that, as a rule, generates improvements or incremental innovations. The element that adds complexity to the system is the human being, who demands a more robust methodology and a more systemic approach. This context of problem-solving in social contexts led to the development of Design Thinking, a methodology that originated at Stanford University in the 1960s and has been evolving ever since. It arose from an experiment joining students of mechanical engineering and students of the school of arts, uniting logical-analytic reasoning to intuition in a discipline of product development.

Design Thinking uses participant creativity as a basic input in approaching and solving complex problems. This is another important aspect to emphasise, that is, innovation is an activity that must be carried out in a group, with its participants adding styles and formations, as diverse as possible, as this complementarity helps to bring different interpretations and contributions about the problem to be solved. Design, is an attitude of problem-solving, integrating multiple perspectives.

Where does the difficulty of implementing innovation in companies lie? One of the aspects that hinders its application in organisations is that Design Thinking has a design approach and requires some commitment at managerial level, and from the stakeholders involved as well. How can executives incorporate Design Thinkings in their everyday tasks to efficiency and quality in the company?

As with every innovation, the widespread adoption of Design Thinking requires an element of change management. Its successful incorporation as a business strategy tool translates into a slow process of culture change in the organisation whereby staff will be able to manage their time taking into consideration the time needed for Design Thinking. It is important to act on mental models, that is, on people's perception and beliefs, rather than on innovation management per se. Such a change can be learned, and, as the Kelley brothers discuss in their new "Creative Confidence", this is an approach that can be relearned, because over the years we are losing our ability to approach problems more creatively.

An increasing number of companies across the world are applying Design Thinking across multiple areas such as innovation, strategy, and product development. It has proved to be an almost essential tool towards user-centricity.

The basic premise of Design Thinking is to not accept the problem of how it was initially designed and to invest a good deal of time in understanding the real problem to be solved. At this stage of identification of the problem a detailed survey of the space where it is occurring is done, using techniques of empathy, observation and ethnographic interviews until the problem is redefined. The next phases involve the generation of possible solutions, prototyping the best ones, and test them with “real” users. Like the PDCA model, the process is iterative and must be repeated as part of an ongoing process of improvement.

Innovating in services means training and empowering the people who will provide them, and understanding of the needs of the people who will consume them. Design Thinking is the foundation for any user-centred approach. The most successful companies in the world, especially in the digital arena, have all adopted this approach in one way or another, as part of their business strategies.

Author: Irene Melo.