design thinking in business

Design thinking in Business is a way of implementing or designing new products based on human-centered philosophy. It is a way of designing that focuses more on the solutions and accordingly reflects upon the problem.

Today, leading international brands are to employ the approach of design thinking in business to develop the best products in the world. Ergonomic designs and low-cost options with maximum features are possible because of this approach.

Design thinking is also being taught in top educational institutions all over the world. Students need to take over problems with the stress of having to contemplate it from different angles. With each idea as a possible solution to the problem students do the following:

  • Sketch an outline of the plan of execution
  • Prototype the product based on the plan
  • Test the product and carefully study it
  • Collect the data and then execute other plans by repeating the steps

Slowly build an ideal and optimized solution

The concept of design thinking was first approached by Nobel Laureate Herbert Simmons in 1969. In his book ‘The Science of the Artificial’, he talks about a design methodology founded on the needs of the customers. This was the basis for design thinking.

The five primary steps that promote Design thinking in business is:

  1. Empathizing – with the customers.
  2. Defining – the challenges, needs, and wants.
  3. Forming Ideas – different approaches are taken to come up with solutions for the problem.
  4. Prototyping – products are made based on the different approaches 
  5. Testing – here the prototypes are tested and the faults plus benefits of the products are carefully studied

These five steps are continuously repeated to get the ideal products for customers.

Customers at the head of all decisions

Design thinking’s most important aspect, which is at the center of this principle, is the customer. All decisions should be taken such that it benefits the customer’s needs. Doing this can automatically decrease the chances of making a product that is not at all popular or profitable in the market.

Sometimes individual groups of the industry may support alternative easy ways to a task. These tasks together may prepare a product that is easier to manufacture or a service that is easier to provide. The problem is that customer needs are not a priority when such decisions are taken. 

Adding different perspectives for solving a problem is a great way to harbor design thinking. Teams of individuals from an organization when thinking from the customers’ perspectives and empathizing with them can come up with innovative ideas for a product or even improvements for a service. Then with rapid prototyping, the products made can be tested before moving on to the better or final iteration. 

Businesses should find individuals in the organization who strive to provide customers with the best service and products. Such employees are the ones who harbor design thinking potential and can be valuable in further product and process developments.

Also Read: How Design Thinking can solve complex problems of the IT Sector

Defining a Problem

To get the correct answers one needs to ask the right questions. Organizations cannot just succeed in design thinking by paying individuals who think of and value customer’s needs. The other important part of the process is to define the problem.

  • Exactly what the enterprise or the customers would like this new product to be. 
  • In what particular way will this product help the customers.

These are the few questions that need to be answered. And to get the answer the company must study its demographic. 

What are the demands of the customers? What age, ethnicity, sex they belong to? What kind of products already exist addressing the demands? How do these products fail to function? Everything should be carefully studied. 

Each input from the customer is a data essential for making a successful product. The individuals in the organization must empathize with the customers. Stepping in the shoes of the customers can help the teams look at the needs objectively and find the right questions. These questions can then be gathered to form a cohesive problem. Once these questions are, you can create a successful product profiting the company and helping the customers.

Giving a Direction to the Solutions Available

An important aspect of design thinking in business is that it gives opportunities to individuals in an organization to come up with ways to solve the problem. This, in turn, increases the participation among the team members and increases a team spirit within the group. Also, it helps people brainstorm. 

Coming up with different ideas with a common goal of helping customers by solving the problem is a good way to increase creativity in the house. Brainstorming different ideas can help the organization find some of the common solutions people come up with. It may also lead to finding some out-of-the-box answers. 

At the outset of this task, no solution is over-analyzed or discarded. Ideas are discussed by the members and shortlisted. Everyone is tasked with further refining the solution. It also involves a lot of discussion within members on why a particular solution outweighs the other.

This streamlines the ideas and forms cohesive conclusions. Several rounds of the process might be repeated to ultimately get the few most practical and helpful solutions for the customers.

The last step is to take those solutions and form a pathway by allocating resources to achieve goals. Prototyping is an integral step in this process. When a solution has been executed, a prototype of the product can be tested to find the uses and shortcomings.

Accordingly, the data can be used to refine the development process and move on to the next prototype for further testing until the best version is made.

Also Read: How Design Thinking can improve sales

Design Thinking and Value Chain 

To know about the topic, the first value must be defined. Value creation can be anything, be it a product or a service that eases the life of people and adds value to their lives.

Value chain analysis was introduced by Michael Porter in 1985 at HBS. This is an especially popular way of looking at business models with a very customer-centric approach. The analysis looks at the:

  • supply relations
  • distribution relations, and
  • customer relations

of an organization. The first two capture all the processes and delivery systems are needed to set up a particular commodity. The third, customer relations, encompasses how the product interacts with customers and thus includes customer experiences.

Reducing customer friction with the company and helping them is a good way of value creation by an enterprise. This is where design thinking is applied.

Value generation is a non-stop process that keeps demanding more from the organization with time. Design thinking is a systematic approach that helps companies create value consistently for their customers.

Understanding the needs and problems of the customers to target the development of products and services is the core principle of design thinking. In this way, design thinking not only adds value but also betters the future of society.

Final Thoughts

Design thinking engages the company to think critically and out of the way. Instead of just taking a problem and using machines to solve it, it allows companies to come up with different solutions and approaches. These are then factored in to decide on an ideal solution for a problem.

Such approaches might seem impractical at times. However, if you still focus on the human need of the product, they may be relevant. At the end of the day, profits should always come second for a company or industry; the first should be customer needs and their satisfaction.

If you are looking to upskill and would like to learn more about design thinking, join Stanford GSB Executive Education’s Design Thinking course in collaboration with Great Learning.

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