First off, design thinking. Give us the elevator pitch.
Design thinking is really about using the sensibilities and methodologies that designers have developed to create new choices, new alternatives, new ideas that haven’t existed in the world before. But it’s being applied today much further upstream and to a much broader set of problems than it has been traditionally. It’s the same skills that designers developed literally for decades, but [those skills are now] applied on a much broader canvas than they used to be.
What’s a good example of a service that’s come about using this approach?
Bank of America is a great example. We worked with them to use this human-centered, observational approach to understand how people save or don’t save their money. We noticed that people have these mechanisms for automatically saving. They would take the change from a transaction, stick it in a jar and then every so often take it to the bank. We’ve all seen that behavior. Other people would round up their utility bills so that they’re always ahead of the utility company.
We took that idea and developed a new service called Keep the Change. So now, with this account, whenever you make a payment with your debit card, Bank of America rounds it up to the nearest dollar and puts the change in your savings account. So people are automatically saving as they spend money.
This is a service product based a human behavior, and that’s really what for me is the core of design thinking — understanding how people operate in the world, understanding how they behave, and using that as the inspiration for new ideas.
In your book, you talk about how it requires a culture of optimism. Is it hard to promote design thinking in a bad economy?
You certainly get companies changing their objectives in a downturn; they tend to be a little less long-term. But design thinking can be applied in short-term ways and in long-term ways. In fact, the imperative for doing this is even greater in a downturn. The opportunity to capture more market share is greater because many of your competitors have taken their eye off the ball.
Who does a good job innovating quickly?
Toyota is famous for using essentially a design-based approach to constantly improving the way they do things. If you look at what they do, it’s all design thinking. It’s observing what’s happening, quickly prototyping solutions and then implementing them. And they do this constantly and consistently all the time and create hundreds of improvements in a month or so. And it’s in the hands of the guys on the factory floor to do this. This isn’t a bunch of senior people coming in, seeing something’s wrong and changing it. These tools are in the hands of the shop-floor workers.
The smartest innovators find ways to make ideas bubble up from the floor
Right. Look at Kaiser Permanente, the healthcare organization. They’ve got this whole approach to design thinking to improve the quality of the patient experience. They have teams of nurses and other professionals, other healthcare workers, working on projects consistently.
One example: A team of workers focused on how nurses change shift and realized that too much time is being spent with nurses hidden away in the nurses’ station at the end of every shift while they exchange information about the various needs and states of patients. And by using observation — seeing what really was happening — rapid prototyping, and brainstorming, they came up with a new approach, whereby now they change shift on the ward in front of patients.
They’ve developed a simple software tool to help them do it, and they’ve brought the time in between shifts that they’re away from the patients from 40 minutes on average down to 12 minutes. And that’s increased the confidence of the patients because the patients can see the information’s getting translated and transferred.
And everyone can actually have an effect on how a place is run
Exactly. That’s the tremendous opportunity of design thinking, particularly in the world of services. It’s the opportunity for the people who are actually delivering the service to spot needs, develop new ideas and implement them, and kind of have some level of control and influence on the way that they interact with customers.
One of your rules is that ideas should not be favored based on who creates them. This happens everywhere, and it’s a morale killer. How do you rectify that if that’s ingrained in an organization?
Well, I think to some degree that has to be based on the culture. I mean you have to have a culture where respect is given to the idea. And you can have that by making the ideas as tangible as quickly as you can.
How do you do that?
The important thing is to make ideas tangible, to make them real — say, using storyboards if it’s a narrative idea, using a model if it’s a physical idea, however you want to do it. You can act it out.
The quicker you do that, the quicker the ideas start to speak for themselves rather than the person who’s promoting them.
As you point out, sometimes great ideas happen on cocktail napkins and solitary environments. So how does a company create an environment where ideas can flourish in all sorts of ways?
It has to be an experimental culture. There has to be an enthusiasm for new ideas. You have to have a culture that’s willing to explore new ideas, test them and then get rid of them if they’re not good ideas.
If ideas get shut down, if they’re only allowed to happen in some little corner, or if only certain people are allowed to have ideas, then you’re failing to tap into the innovation potential of an organization. So this notion of experimentation is thoroughly important.
You’re describing an ideal culture.
Proctor & Gamble is a good example of this culture. A.G. Lafley recently retired as CEO, but whenever I met him, wherever in the world we were, he would be going into a supermarket and hanging out with customers. And by doing that he had so much a deeper understanding of the people he was trying to serve. And I think it doesn’t matter whether you’re the CEO or the youngest brand manager in an organization. If you’re not spending time hanging out with your customers, preferably in the places not only where they shop but where they live, then I don’t see how you’re going to have the sorts of insights that allow you to have the best kinds of ideas.
I don’t know how we can do this interview without asking about Apple. Is Apple’s design success really all Steve Jobs?
You have to give a huge amount of credit to Steve Jobs for having built a culture where certain things are allowed to trump everything else. Simplicity, elegance, the sort of delight in bringing technology to people in a way that not only they can understand but they kind of embrace. And they’ve become steadily more sophisticated about the way they do that.
You know, these are principles that that culture has had at its heart right from the beginning. And Jobs is somebody who just does not let all of the stuff that businesses tend to let get in the way, get in the way. The lesson in leadership is not to try and be Steve Jobs. The lesson in leadership is to understand what allows your organization to really make a difference.
My message for business leaders is always, if you want to be more innovative, if you want to be more competitive, if you want to grow, you can’t just think about what your next product’s going to be or what your technology’s going to be. You have to think about the culture that you’re going to build that allows you to do this over and over and over again.
How does one create that when it doesn’t already exist?
Cultures are basically built around value; they’re built around what people think are important. And if you evolve what you think is important, you can evolve the culture. I mean IBM is a great example of a company that went from being a highly technocratic technological culture to being essentially a management consulting culture today by changing what they thought was important.
You can’t expect to change it overnight; it takes a lot of effort by a lot of people over a lot of time. But I absolutely believe it’s possible to do. I think it’s essential. I mean, let’s face it, the world is changing so dramatically today that hardly any organization is set up for the future. And so if we can’t change our cultures, then essentially we’re accepting that the organizations we have today will disappear and other ones will emerge to replace it. It’s not a very optimistic view and it’s also not one that shareholders will probably get very excited about.
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