Design Thinking Explained

Design thinking is a method for producing practical improvement to businesses and other organisations.   It combines empathy, creativity and rationality, typically to better meet customer needs and hence drive revenue, but is also used to meet operational needs where it can deliver impressive cost reduction.   Unlike analytical thinking, design thinking is a creative process capable of delivering radical new solutions.

Design Thinkers cause the future.   Design Thinking is a powerful skill for transforming the operations of an organisation, delivering a quantum jump in performance, or creating an entirely new and novel business.   It is usually applied to businesses as a whole or a business operation, but could just as easily be applied in the public sector, voluntary sector, or club.   I used the word transforming because this is not about making incremental improvements, it is about completely rethinking the way that things are done.

Product designers sometimes produce radically new designs for everyday items that 'break the mould'. Products might include Apple's iPad, or the Dyson vacuum cleaner.   Designers create revolutionary products by rethinking the product in its entirety, or imagining a product for which there is no direct ancestor.

The concept of Design Thinking is to take the mental skills of the best designers beyond the product and apply it to the business as a whole.   Every aspect of the business will be questioned and compared with the desired objectives.   Even the objectives, and measures of business success might be reconsidered; does success mean profitability, cash flow, market share, revenue, long term viability, successful transition to something else, employee satisfaction, etc?

Design Thinking is not be confused with product design or communications design, useful though those skills are.   If a business is transformed through Design Thinking, it's products and communications may be radically redesigned as a part of the overall exercise.


The concept of redesigning a business from a new perspective is not new.   A previous incarnation was Business Process Reengineering, where an organisation, instead of being seen as a number of departments or silos running vertically through an organisation, is visualised as a number of processes running horizontally through the organisation.   This was a useful perspective, especially when combined with the increasing use of information technology (specifically work-flow) to link up each part of each process.

Kanban is a simple example of horizontally linking departments that was extensively taken up by Japanese industry.   It views each department or activity as a customer of the previous department or activity.   Each activity is directly governed by the demand from its 'customer's', so that only work that is actually in demand is performed.   Kan-ban led to the rapid growth of its pioneer, Toyota, and other Japanese car makers.

Business Process Reengineering or BPR employs analytical, reductive thinking.   Each process is analysed to see which bits are needed and which bits are not.   Special software can be used to allow corporate processes to be mapped onto a graphical model of the business.   Companies using BPR mapping discovered that outputs of some processes did not feed the inputs of any other process; they were wasting effort on something that was not required.   Use of BPR allows companies to re-engineer their processes to fit the real needs of the business.

Although analytical thinking methods can produce significant efficiencies that can make the difference between business success and failure, it does not take the big leaps that creative thinking can deliver.   For that we can use the skills of the Designer; imagination coupled with practicality and the ability to model multidimensional solutions in the mind.   With Design Thinking we can change the entire business model.

The effect of using Design Thinking

Companies that successfully adopt Design Thinking will outperform their rivals, just as Toyota outperformed its rivals using an earlier step forward.   Apple Inc has a positive design ethos coursing through its veins.   Apple used the Design Thinking approach to promote a new way of selling music; the iTunes Store, the iPod portable media player and the iTunes application are parts of a new business channel.   Today, Apple is the number one music vendor in the United States with an estimated 88% of the legal market, eclipsing music vendors who relied on analytical thinking.   If that were not enough, Apple is also the number one movie vendor in the World, and according to Fortune magazine, the most admired company in the world for the last three years.

Defining Design Thinking is difficult.   To fit our business lexicon it is often described as a 'methodology' or a 'process' but it is neither methodical nor procedural.   We call it a skill. Rather than neat lines on a conventional management chart, the Design Thinking activity might be more correctly drawn as a bowl of spaghetti.   That is most certainly not to say that the activity is undisciplined.   It is precisely because it is a creative and difficult to define activity that it needs effective discipline.   Management grants thought processes enough latitude to generate insight and creative answers while ensuring that the work goes in the right direction, coalescing into a practical solution.

You will know a Design Thought business when you see it.   It's product or service will create a positive impact on you.   Every encounter with the company will be designed to give a positive impression, meet your needs, and operate efficiently.   You will know when you don't see it.   A company that is difficult to work with, or at best, is 'satisfactory'.

Analytical thinking makes choices from an existing set of alternatives.   Design Thinking creates new solutions that imaginatively solve or avoid difficult problems, and/or generate fresh opportunities.

Design Thinking is looking at the operation holistically, ie seeing every aspect of a business, its stakeholders, its industry, and technology as linked to every other aspect.

Design Thinking is a skill for designing end to end business functionality, or more correctly, ends to ends since Design Thinking does not limit itself to linear processes, but sees all the ends of the operation.   Assessing the entire customer experience, from first contact through to ongoing loyalty (or not) will reveal opportunities for improvement.   Designing a business around the needs of customers and other stakeholders produces world class companies.

Business processes can be improved with design thinking, cancer treatment at the University of Pittsburgh Medical Centre is an example, and our Chief Design Thinker will shortly publish a book on Design Thinking Deadliest Catch; design thinking applied, for illustrative purposes, to Alaskan crab fishing.

GlaxoSmithKline brought in a Design Thinker for their diet pill project.   A pill is only effective if people take it; the human factors that prevent people from taking their pills needs to be addressed.   For instance, when people go out to a restaurant for dinner, they don't want other people to know that they are on medication.   Design Thinking on the GlaxoSmithKline project came up with a new pill container that people are happy to use in a restaurant.   The starter kit that comes with the pills provides advice and motivational material, and access to online resources.   One resource allows patients who enjoy online social networking to communicate with and motivate each other, improving medical outcomes.

Design Thinking Article

Article by Ed Bernacki

Design Thinking courses

Universities still teach Business Administration, but more are now teaching the more radical Design Thinking, including The Rotman School of Management (Canada); in the USA, the universities of Stanford, Washington, North Carolina, Carnegie Mellon, Pittsburgh, Louisiana, Indiana, Virginia, and the Wisconsin School of Business; Delft University (Netherlands); University of Sydney (Australia), University of St Gallen (Switzerland); Hongkong Polytechnic University (China), Helsinki University (Finland) and in the UK include the Universities of Strathclyde, Plymouth, Middlesex, Lancaster, and Cambridge.   Next year SAP cofounder Hasso Plattner will launch a Masters Degree for Design Thinking at his institute in Potsdam, Germany.

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