Is failure penalized in your company? Is every new idea required to commit revenue? Do resources get pulled off from innovation projects during year ends? Does your company try to use a linear stage-gate funnel approach for innovation? Does your company’s vision/mission statement say ‘Shareholder value’ in bold?
If the answer to any of these questions is yes, then chances are that your organization’s culture is creating roadblocks for implementing design thinking.
Unless you have been living under a rock, you must have heard about ‘Design Thinking’. It is a creative process that uses Designer’s approach to bring rapid innovation to the market. It uses empathy, conceptualization and quick prototyping in iterations rather than a linear stage-gate (waterfall) process. In a connected world, large corporations are losing their core differentiators to make cheapest, fastest and best products. Does your company’s vision sound something like “we are the world’s best in…”? Guess what. Your competitors are claiming the same thing. They have access to the same resources to make cheaper, faster, better products like you. In current times when companies are losing differentiation and traditional innovation tools are failing to deliver, Design Thinking has the promise to bring a positive change. Bring disruptive ideas faster to market. Possibly be game-changing leaving your competitors way behind you. However, this is easier to preach than practice. After working in several Fortune 100 companies across many industries here are my top 3 take -away as to why Design Thing will fail in your company and what can your company do about it.
Culture is defined by Principles, Processes and People. Any of these three can cause Design Thinking to be ineffective in your organization.
Principles: Most Fortune 100 companies are guided by wall street and investors. Executives here are measured and rewarded on monthly, quarterly and annual goals. The fancy word for this is ‘shareholder value’. Every year during the annual strategic cycle, executives spend a lot of time building vision to innovate but when it’s the time to close then these innovation projects are immediately deprioritized. Sometimes killed. The focus shifts back on matured product lines and execution tactics leaving the innovation projects and processes completely abandoned.
The trick is to have different set of management KPIs for innovation projects and processes. Maybe it’s time to fine-tune your company’s guiding principles: shift focus from ‘Shareholder value’ to ‘Customer value’. Amazon has built an exceptional culture of operating like a group of small start-ups without the fear of failure. Successful implementation of Design thinking requires a shift in guiding principles or company values. Treat these projects separately rather than a big portfolio alongside with your current products.
Processes: Many Fortune 100 companies have been around for few decades and their existing processes are hard wired in company’s DNA. In fact, even start-ups after a few years start behaving like corporations that they were originally trying to disrupt. What has worked in the past is expected to deliver again. When Design Thinking is introduced to a company, it is force- fitted into some existing traditional framework that the company is familiar with, eg. stage-gate. Design Thinking or any Creative process is iterative and requires frequent experimentation and quick prototyping. If your product feels perfect at the time of launch, then you have perhaps waited too long. Treat Design thinking as a creative process focusing on 3 fluid stages: Empathy, Conceptualization and Prototyping. It is also important to measure success of teams implementing design thinking differently. Cross-functional team members on these teams should have different set of performance indicators compared to your more matured product lines. Eg. If you measure Design thinking on delivering a perfect product at the end of the year that generates $X revenue, then it will not work. Be creative. Focus on the 3 stages of design thinking. Can a KPI be incremental customer delight from focus groups? Or increase in customer engagement from beta tests? Approach it fluidly and not as another rigid- boxed process.
It is also important that people are full time on these projects. Have you ever heard “x% time on a project”? The problem is that; one it is hard to measure and two x% becomes 200% adding stress or 0% during year ends when numbers must be met. The trick is to be creative around designing performance metrics and let people work full time. Treat it like a start-up. Give freedom to operate but demand full accountability like an investor in a start-up.
People: Have you been in workshops or off-site training events where everyone brainstorms and comes up with action items but when you go back there is no one to execute on this as people have ‘day jobs’. Design Thinking cannot be injected in by a 3-day off-site event. It requires dedicated resources to sustain the process. You don’t need bean bags and hipsters with nerd-glasses to implement Design Thinking rather you need people with right kind of skills who are capable of leading cross-disciplinary teams. Design thinking needs dedicated resources to sustain effectiveness. It cannot succeed as a ‘nice’ side project or a 3-day team building exercise. It needs champions with the right skills who can lead cross-disciplinary teams and mentor others. They don’t have to be great designers themselves but rather people who are good with managing creative tensions between cross functional teams and ideas.
Design thinking requires ‘doing’. It needs cultural shift to be effective in all 3 areas: Principles, Processes and People.