The first time I came across the design approach to business it was thanks to Julian Hirst, who later became a partner in LiNXEO.
It has been a kind of “coup de foudre” – “love at first sight’ – that, over time, deeply changed the way I conceive of and perform my job.
I was fascinated by a practice that still feels fresh despite already being in its full maturity (the concept, rooted in design thinking, dates from the 1960s), and by the promise it holds: more focus on human concrete needs and behaviors, faster results, and better control of development costs due to prototyping.
My recent practice alongside service designers confirmed for me the added value of the approach: early and frequent interaction with customers and users, agile process design, a learning-by-doing method, and significant added value creation.
We do not ask often enough: “What are our clients’ –or future customers’- needs? What are their challenges?”
At LiNXEO, we believe that developing a business design can be truly useful, particularly for SMEs or medium cap companies (but not only those), in order to successfully bring their value proposition to market. And this is also why we have adopted it in our own company.
In fact, too many SMEs and mid caps (as well as large companies and public organisations) fail to really communicate with customers, even as they invest heavily in innovation.
There are two possible explanations among many for this:
- Lack of understanding of the users’ needs. We do not ask often enough: “What is our client’s need? What is his/her challenge? What does she/he want to achieve?”
- The high costs of innovation means companies are not able to generate a sufficiently fast return on investment
This is where design practice can help.
How business design can help to better respond to our clients’ needs
How does it work in practice? The process comprises 5 steps, presented below. Two conditions are essential: the process requires strong involvement from the client at each stage, and it requires our readiness to mix teams and competencies.
- Profiling: i]In the first stage, we focus on our client’s needs: what is her/ his DNA – values and identity”? What does she/he want to achieve? What is her/his objectives? What are her/his challenges?
- Immersion: Who are our client’s clients? We conduct interviews and observe actual and potential user behavior, and listen to their expectations
- Value proposition: How can we lighten the load for our client, produce short-term wins, and design new services and/or products?
- Business modelling: How do we translate the new value proposition into a viable business model? The Business Model Canvas helps to shape a robust Business Model; there can be no value creation without a strong business model and business plan
- Prototyping and testing: Finally, we prototype and submit the product/service to a quick “crash test” which leads to the most appropriate improvements
What are the main benefits of business design?
The method is proven effective and brings significant benefits:
- Focus first on needs and problems and only afterwards on solutions
- Co-construction of the solutions
- Involvement of end users
- Multi-disciplinary approach to answers
- Test, test, and test again, leading to effectiveness and efficiency
- Time saving
- Last, but definitely not least, added value
Obstacles that can hamper adoption of the business design approach
Despite the undeniable advantages of the approach, it is not applied as often as it could (or should) be. Based on our experience, the answer to why that is depends on both the size of a company and the organisation’s culture.
Large companies have shown strong interest in the design method recently, in order to enhance corporate innovation process. However, they can encounter obstacles to its implementation. Predictable internal processes, a failure-adverse culture, high team specialisations, strong hierarchical organization, and a lack of agility are all elements that can reduce the impact of business design in a large company.
Similarly, in large public organisations, where “user-centered” approaches would be particularly appropriate in shaping new services, all the elements listed above can hamper the introduction of agile, results-oriented, multidisciplinary creative methods – sometimes even more problematically than in a private company.
For SMEs, which are more flexible by nature, the challenge lies in lack of time and the necessary focus on current day-by-day business – and as a result, on the lack of information about such an approach.
And yet business modelling, via the Business Model and the Value Proposition Canvas, is the most successful method used by start-ups to create their business. The time has come for adoption of this approach by more “traditional” companies too. Innovation and competitiveness are a must for all companies today, not just for start-ups. It’s time to change the culture everywhere. Let’s start together.
MITSloan: “Why Design Thinking in Business Needs a Rethink”, FALL 2017 ISSUE
Key words design, design thinking, business design, ideation, value added, customer-centered approach, users, prototyping, time to market
Gabriella Fiori, Partner , LiNXEO Ecosystem Architects
Friday the 12th of January, 2018