The Bank of America did not like the dwindling number of customers using their savings accounts.
Despite all of the marketing efforts, things were still not going well. When everything else failed, the Bank decided to ask for ideas directly from the consumers.
They uncovered that people wanted a debit card that would “keep the change”.
People were rounding up to the next dollar when they paid for things. But doing so didn’t create value for them.
Combining that habit with a debit card created a completely automatic, invisible way to save… as a result, Bank of America has gotten 10 million new customers and $1.8 billion in savings for them. [1]
The Bank of America succeeded in launching its “Keep the Change” Program by applying Design Thinking.
“Thinking like a designer can transform the way you develop products, services, processes – and even strategy.”
— Tim Brown
Design thinking is a process of creative problem-solving. It is often used to design user-centric products, services, or experiences.
The methodology gained traction when Tim Brown wrote in Harvard Business Review. Tim, then CEO of design consulting firm IDEO, talked about how businesses can use design thinking for innovation.
He referred to design thinking as —a methodology that imbues the full spectrum of innovation activities with a human-centered design ethos.
By this, I mean that innovation is powered by a thorough understanding, through direct observation, of what people want and need in their lives and what they like or dislike about the way particular products are made, packaged, marketed, sold, and supported. [2]
Design Thinking is based on the human-centric model. Meaning that it takes into account how humans actually engage with a product or a service, rather than how an organization thinks they will engage with it.
For this purpose, designers observe closely how humans interact with a particular product or service. This enables them to work on the innovation process to improve the consumer experience.
This iterative part of the design thinking process favors the quick initiation of the prototype into the market rather than wasting countless hours on guesswork based on research.
The Five Stages Of Design Thinking
- Empathize:
In this stage, designers try to understand the user’s needs and requirements. They do so by observing users, talking to them, and looking at data.
The observations must happen with empathy, which means withholding judgment and not imparting preconceived notions of what the consumer needs.
Observing with empathy is powerful because it can uncover issues the consumer didn’t even know they had or that they could not themselves verbalize.
From this point, it’s easier to understand the human need for which you are designing. [3]
- Define:
In this stage, designers define the problem they are trying to solve. They articulate the user’s needs and requirements.
- Ideate:
Ideation sessions are all about creativity and innovation. The team comes up with different ideas for solutions. They brainstorm and come up with many potential solutions.
- Prototype:
Now is the time to turn ideas into reality. The team creates a prototype of their solution. The prototypes are not meant to be perfect. This is usually a simplified version of the final product or service.
Prototypes should command only as much time, effort, and investment as are needed to generate useful feedback and evolve an idea. The more “finished” a prototype seems the less likely its creators will be to pay attention to and profit from feedback.
The goal of prototyping isn’t to finish. It is to learn about the strengths and weaknesses of the idea and to identify new directions that further prototypes might take. [4]
- Test:
Once the prototype rolls out, the team will observe how users interact with it. They gather feedback and iterate on the design.
Since design thinking is iterative and not linear, your team will likely have to go back to one or several of the previous stages to come up with the final product.
Why Is Design Thinking Important?
Design thinking is as effective and implementable for complex systems as it is for design systems. Using this approach organizations can create a lasting user experience for customers because:
- Aims To Solve the Actual Problem
Since the process eliminates the need for guesswork, teams can uncover customer pain points. Design thinking helps in identifying and solving those problems.
- Introduces Innovative Solutions
Sometimes teams uncover pain points that even the consumers were unaware of. Such revelations can drive new and innovative ideas by looking at problems from different perspectives.
- Improves Organizational Efficiency
Rather than wasting too much time on research without devising a plausible outcome, design thinking works on efficiency. It favors quickly introducing prototypes by observing customers in real-time and then testing to see how effective they are.
How does Design Thinking Improve Creativity and Productivity?
Design thinking is a process that can be used to solve problems and create new solutions.
It is a creative and logical approach that involves understanding the problem, generating ideas, and testing the solutions. Design thinking has been shown to improve productivity and creativity.
Before Indra Nooyi came along, PepsiCo was struggling to retain its investors or sales. She applied design thinking to every product and service related to the brand.
PepsiCo not only captured the market but grew 80% in sales over the 12 years Nooyi served as CEO.
Starbucks approached its dropping sales and profit margins with the same approach. They interacted with customers to better understand what they wanted from their coffee shop.
The predominant insight gained from these interactions was that customers actually wanted an atmosphere that provided a sense of belonging and relaxation.
Building on these insights, Starbucks positioned round tables strategically to make solo coffee drinkers more comfortable and less self-conscious. [5]
Design thinking can help you…
to better understand the problem, generate more creative solutions, and test the solutions to ensure they are effective.
In recent years space exploration is driven not only by scientific genius but by artists and designers. They collaborate with astrophysicists to create visuals that explain the concepts of a certain mission more clearly.
Some of NASA’s scientists have also established a “storytelling initiative” that empowers their colleagues. By understanding and articulating the bigger picture behind their concepts, scientists ground their genius with human needs.
“So, when these missions materialize for the rest of the planet, these ideas are not alien abstractions, but public admiration”, points out an article in Digital Surgeons. [6]
By taking the time to understand the problem and generating multiple solutions, you are more likely to find a successful solution.
GE Imaging Machines is one such example…
MRI Scans are an uncomfortable experience for adults but for children, the process can be downright traumatic. The Chief Designer at GE was shocked to hear about it.
By applying Design Thinking, he decided to observe children going through the scanner while also having conversations with not just children but doctors and educators.
Through the conversations and observations, he found that rather than being seen as an elegant piece of technology, the MRI Scanner was seen as a scary machine by young children.
As a result, CT Pirate Island Adventure was created…
The MRI scanner was made to look like a pirate ship and it transformed the traumatic experience into a kid’s adventure story where the patient had the starring role.
Prior to the transformation, approximately 80% of children needed to be sedated prior to getting their scan and after the change, this dropped to 10%. The MRI scanner transformed from a terrifying experience to a creative journey for children. [7]
Design thinking can also help you…
to think outside of the box and come up with new ideas that you may not have considered before. That is how Nordstrom came up with the idea of its in-store app.
A small team from Nordstrom spent a full week in their flagship store and leveraged real customers to help build the app.
They started off by building a paper version of the app in-store and received immediate feedback from customers passing through. Based on the feedback, they iterated and then showed that new prototype to customers, and so on.
At the end of the week, they produced a fully functioning app that customers actually wanted.
Here are some of the insights they gathered:
- Customers wanted a way to compare photos of themselves with different sunglasses on (in real-time)
- Customers wanted to have the option to zoom in on pictures
- Customers wanted to tag each image and also link them to the sunglass model number
All these insights were key in driving the development of the product. [8]
Resources such as Google Scholar, ResearchGate, LearnTeachLib, and other Learning Management Systems…
all came into being as a direct result of design thinking
The education sector suffered a lot during the initial days of the lockdown due to COVID-19.
However, design thinking helped many schools and universities across the globe to adopt creative solutions to make the education process smoother for their students.
Schools adapted to the policies of promoting playful learning and nurturing creative confidence that gave birth to STEM and STEAM concepts.
Apart from education, fashion and retail brands have also adopted Design thinking approaches for their products.
Nike used the process to break into the market of skateboarding…
It appointed a team of designers who interacted with skateboarders to learn their preference and also their attitude toward Nike.
Nike Dunk SB was the result of this engagement and became a huge hit among the skateboarding community.
The impact of all the buzz around design thinking today is that people are realizing that “anybody who has a challenge that needs creative problem solving could benefit from this approach,” Eppinger said.
That means that managers can use it, not only to design a new product or service, “but anytime they’ve got a challenge, a problem to solve.”
Applying design thinking techniques to business problems can help executives across industries rethink their product offerings, grow their markets, offer greater value to customers, or innovate and stay relevant. “I don’t know industries that can’t use design thinking,” said Eppinger. [9]
A few years ago, Airbnb’s sales were dropping…
Although they started looking for cracks in the business strategy. It turned out that the listings had low-quality pictures attached to them. When the company replaced amateur photos with high-quality images, their revenues doubled within a week in 2009.
The company also focused on the user and provided all kinds of product details to help them make an informed buying decision, sales and revenue shot up. In fact, co-founder Joe Gebbia says that it was design thinking that helped the company grow from a struggling startup to a billion-dollar company. [10]
Final Thoughts…
Design thinking can be used in business and everyday life to solve problems and create new opportunities.
A study showed that around 75% of organizations say that they are engaging in design thinking processes to find consumer-centric solutions.
By applying design thinking principles, businesses can innovate and create new products, services, or processes that meet the needs of their customers.
Design thinking can also be used to improve existing products or services, or to develop new ways of addressing customer needs.
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References:
[1]. Dr. Saj-nicole Joni, Forbes Magazine, 14th Jun 2010, Why We All Need More Design Thinking
[2]. Tim Brown, Harvard Business Review, June 2008, Design Thinking
[3]. Graham Tuttle, WeWork Ideas, 24th February 2021, What is design thinking and why is it important?
[4]. Tim Brown, Harvard Business Review, June 2008, Design Thinking
[5]. Shay Namdarian, Creative Campus, 6 Companies that have successfully applied Design Thinking
[6]. Fabrica 360, 17th September 2020, 11 sectors that have been revolutionized by design thinking
[7, 8]. Shay Namdarian, Creative Campus, 6 Companies that have successfully applied Design Thinking
[9]. Rebecca Linke, MIT Sloan Magazine, 14th September 2017, Design thinking, explained
[10]. Fabrica 360, 17th September 2020, 11 sectors that have been revolutionized by design thinking
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