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Innovation Management

How to Use Design Thinking to Guide Your Company’s Innovation

Featured image: How to Use Design Thinking to Guide Your Company’s Innovation

All great innovations start with a key question: How can you make life easier for your users or customers?

No matter what industry you’re in, one of the best ways to approach problem solving is to start the innovation process by looking at what the user needs to have a great experience with the product or service. If you make that the top priority, it’s hard to go wrong. 

A great way to guide this process? Use design thinking. 

By focusing on human experience above all else, design thinking can help companies of all kinds to develop world-changing innovations. The iPhone, the home printer, even the humble revolving door - each of these great innovations started with a clear focus on design thinking. 

With our help, you’ll soon be able to use this creative problem solving approach to discover and develop new ideas for your users. 

Let’s jump in! 

What is design thinking? 

At its core, design thinking is an ideation process with a human-centered focus. 

Design thinking encourages organizations and businesses to focus on the human point of view above all else, and to build this focus into each step of the product development cycle. This means designing products and services with people’s needs and preferences firmly in mind.

Let’s think for a second about a company designing ATM interface software. In this example, the priority should be to design functional, dependable, and secure software that allows users to complete their transactions in a clear, simple, and intuitive way.

ATMs are a great opportunity to consider design thinking in practice. Source: Cemacsoft

By using design thinking to guide this software development, the company would start by putting themselves in the shoes of the user and imagining a perfect interaction with an ATM. Then, they could work backward from there to design software to ensure this seamless experience.

This is the value of design thinking in action. Using design thinking allows innovators to empathize, and to focus intensely on what is likely to have the greatest positive impact for users and customers. 

As innovation theorist Jeane Liedtka says in her Harvard Business Review article ‘Why Design Thinking Works’, design thinking has the potential to “unleash people’s full creative energies, win their commitment, and radically improve processes.”

So far, so good. But what does design thinking look like in practice? What are the necessary steps companies need to complete to guide their innovation process with design thinking? And how can companies translate design thinking into their business models? 

It all comes down to five key steps. 

Design thinking in five steps

As an approach to innovation, design thinking offers companies of all shapes and sizes a way to place user experience at the forefront of the innovation process. If you’re starting with an idea in its very earliest stages, then design thinking is a great way to get things off the ground. 

In practice, design thinking involves five key steps guiding companies and businesses: 

  1. Empathize
  2. Define
  3. Ideate
  4. Prototype
  5. Test
Design thinking involves five key steps to develop innovation. Source: CX Network

Now, let’s take a look at these one by one, with examples of the specific practices and milestones to expect at each stage. Follow these five steps, and you can unlock amazing new solutions to benefit your users and customers.

Step #1: Empathize

When using a design thinking innovation process, your first step is to develop an empathetic understanding of the problem at hand. 

This involves collecting as much information as possible about the day-to-day user experience, and doing whatever you can to understand what your customers go through when interacting with your products and services. 

Often, this means physically placing yourself in your customers’ shoes. You need to do what you can to understand the motivations and experiences of your users in order to develop a personal understanding of what it means to use your products. 

Ask yourself these questions:

  • What do your users and customers go through when interacting with your products?
  • What are the most difficult aspects of this process? What are the smoothest? 
  • How would you describe the ideal experience for your customers? And how does the status quo differ from this?

Let’s stick with the example of ATM software. In this case, you and your team would oversee user testing to determine how easy your interface is to use, and where the pain points are.

This should be a collaborative process, with representatives from different business units. Often, the best insights can come from those who don’t deal with the product every day. Don’t be afraid to get your finance team involved, either! 

As a result of the empathize step, you can then draft a customer experience report detailing the practical demands of the product, and how the status quo can be improved to fit these demands. Now, you’re in a position to define the problem at hand.

Step #2: Define

Once you’ve completed the empathize step, you can pull together the information you have to define the core problems and identify potential solutions. 

In practice, this means moving from a customer experience report to a problem definition. For the ATM software company, this means turning a lengthy report on the shortfalls of status quo ATM software into an aspirational problem definition. 

In the ATM software example, this could be something like: “Bank clients need a quick, dependable, and secure way to access bank services via ATMs. The status quo product is slow, confusing, and demands too much from the user.” 

The define step is crucial to help your design team select great ideas for the functions, features, and interactive elements that will enable your business to solve the problem facing your customers. By addressing each of these issues, you can generate a better user experience. 

As a milestone for the define stage, you should work towards having a detailed problem definition to guide the ideation step. 

You may also wish to call this an opportunity definition - it’s up to you! 

Step #3: Ideate

Next up, it’s time to take your in-depth knowledge of the customer experience and the problem definition and start generating ideas.

Thanks to your hard work during the empathize step, you now have an in-depth understanding of where your existing products and services are falling short. You now know the problem at hand, including the exact limitations of the status quo.

Now, the fun part can begin! 

During the ideation stage, you can search for creative new ways to plug the gaps you’ve identified, and can throw around outside-the-box ideas for new products and services. It’s crucial to get as many ideas or potential solutions on the table as possible, so don’t be too picky. 

As a result of the ideation process, you should have a range of detailed innovation proposals ready to be assessed for potential prototyping. Once you have these proposals on hand, you can sift through them and determine which of them you want to develop. 

When developing innovation proposals, be sure to focus on the following questions:

  • What are some of the ways you could solve this problem and provide an even greater customer experience? 
  • What are the limitations and constraints for these ideas? 
  • What does conventional wisdom say about these products or services? 
  • How can you challenge and subvert this conventional wisdom
  • What are some of the unmet needs that your product could address?

Once again, let’s return to the ATM software example. As a result of the ideation step, the company would have a suite of high-level design concepts to test for potential prototyping. 

Step #4: Prototype

Now you’ve completed the ideation process and assessed the suite of high-level design concepts, you and your design team can now turn the frontrunners into a series of prototypes: inexpensive, bare-bones versions of the product or service.

Prototyping involves developing a series of inexpensive trial products. Source: Unsplash

The prototyping stage is all about experimentation. Your aim is to identify the most suitable solution to match the problems, opportunities, and pain points identified in the first three steps. You need to take the time to explore a range of different options to determine which is best. 

The details of how you do this will depend on the nature of your business and the outcomes of your earlier exploratory work. For example, the ATM software company would turn a range of design concepts into bare-bones software schemes to show how they would work in practice. 

The prototyping step is where you can turn ideas into practice, focusing on product design, practical demands, and the capabilities and limitations of existing technology. 

As a result of completing the prototyping step, the company should have a range of functional prototypes on hand ready to test. 

Step #5: Test

With a range of prototypes developed in accordance with the empathize, define, and ideation steps, you’re now ready to rigorously test the potential solutions. 

Once again, how exactly you wish to test these prototypes will depend on the nature of your business model. In the case of the ATM software company, the testing stage would involve customer focus groups, followed by alterations and refinements as needed.

This step is all about harnessing the power of customer insights and market research, and seeing how your potential products are likely to work in practice out in the market. 

As a result of the testing stage, you can expect to have a validated solution report highlighting the strengths and weaknesses of specific proposals. 

Once you’ve completed the testing phase, you’ll be in a position to get started with turning one or more of the prototypes into functional products. 

Or, if you’re not quite happy with your solutions yet, you can always go back a step or two and take another look at your ideation results, then work ahead to come to a different prototype.

Pros and cons of design thinking

There’s a simple reason why market leaders like IBM, Google, and Tesla all use design thinking as an innovation methodology to guide their product development: it helps them see the world through the eyes of their customers. 

However, that’s not the only advantage when it comes to design thinking:

  • Cost-effectiveness: Design thinking is a great way to test ideas without committing resources. Companies can establish how helpful a new product or service is likely to be, without having to go through the entire process of product development.
  • Non-linear problem solving: The design thinking process is non-linear, meaning companies can jump from step to step as needed. For example, if the prototyping step didn’t yield a working solution, the company could re-start at the ideation process.
  • Managing complexity: Above all else, design thinking gives companies a great way to solve complex problems by focusing on user needs and the limitations of existing products and services.
  • Market discovery: Design thinking can help companies discover entirely new markets, for example, the iPhone. This world-changing innovation started with the simple question of how to avoid customers juggling multiple devices. By drilling deep into how to make things easier for people, Apple basically invented the smartphone market.
  • Tailored solutions: Design thinking ensures a focus on user experiences by capturing the mindsets of the customers you have in mind during the design process. This results in highly tailored customer-centric solutions.

Despite these advantages, the design thinking process isn’t suitable for every product development project. 

For example, innovations that aren’t customer-facing (e.g. background software coding) wouldn’t require the level of customer empathy and responsiveness built into the design thinking methodology. In these cases, starting with a customer experience report would be overkill.

Given how involved the design thinking process is, it isn’t as suitable for solution refinement, either. Instead, it should be used from the early stages, when a company needs to gather customer experience information and use this information to identify potential solutions.

As with other ideation processes, design thinking can’t completely address the risk of innovation, either. This means no matter how rigorously you focus on your users’ needs, you could still emerge from the process with a less than perfect solution. 

Now, let’s take a look at a modern example of design thinking in action: AirBNB. 

Design thinking in action: Airbnb

It may come as a surprise, but accommodation platform Airbnb is one of the best examples of design thinking methodology out there today.

Set aside some of the gimmicky aspects of the app (we’re looking at you, Idaho Giant Potato Tour), and you can see the basics of design thinking at work: a relentless focus on user-centric solutions grounded in a deep understanding of the pain points when it comes to travel.

Airbnb's world-changing innovation is driven by a thorough understanding of the travel and accommodation experience at the user level. Early in its development, the company realized how fed up travelers were with expensive hotels, impersonal services, and bland, underwhelming cookie-cutter travel experiences.

AirBNB is a great example of design thinking at work. Source: Nice Matin

To overcome these limitations, Airbnb used design thinking skills. As a result, it built a platform to allow anyone to enter the travel and accommodation industry, and to offer users personalized, memorable experiences - no matter where in the world they wanted to go.

This deliberate business design shows how design thinking works in practice. By putting themselves in the traveler’s shoes, AirBNB found a way to solve a number of pain points at once. This way, they could reframe business opportunities and change the market.

The nature of Airbnb’s solution, and the unbelievable popularity of the app, reflects user dissatisfaction with the status quo. This is a great example of design thinking in action, and a great example of a great innovation focusing on the customer journey above all else.

By focusing on the pain points and difficulties faced by users around the world, design thinkers can unlock significant competitive advantages for their businesses. Like Airbnb, they can even generate entirely new business models.

Conclusion: Put the user first with design thinking

Using a design thinking approach is a great way to find world-changing innovations, and to focus on satisfying the needs of end-users and customers.

After all, there’s one common thread running through every single successful innovation in history: a smart understanding of the real-world needs of customers, users, and fans. 

In practice, it’s not all that complicated to put a design thinking methodology to work. Companies just need to follow the simple five-step design thinking process:

  1. Empathize: Put yourself in your customers’ shoes. What can you offer to make their lives easier? 
  2. Define: Now that you know what your customers are dealing with on the ground, how can you define the business opportunity at hand? 
  3. Ideate: Get whiteboarding! What are some potential solutions to the pain points faced by your customers? How can you subvert conventional wisdom in unexpected ways?
  4. Prototype: Now, select a handful of those innovative proposals and turn them into bare-bones prototypes. Don’t worry about making them perfect just yet. 
  5. Test: Finally, take the most promising prototypes and submit them to intensive customer testing, including focus groups and expert review. Fingers crossed, you’ve got a winner.

By focusing on real-world usefulness, design thinking allows businesses of all stripes to put the user first, and reap the rewards of customer-centric innovation. 

So, get cracking with these five steps, and see what design thinking can do for you!