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CEOWORLD magazine - Latest - CEO Agenda - Why You Need To Care About Design Thinking

CEO Agenda

Why You Need To Care About Design Thinking

Nathan Baird

Design is the ‘in’ word — but what does it mean? And should you care? The word ‘design’ has become a substitute for what we called ‘insight-led innovation’ when I was starting my career at Unilever. (And it was probably a substitute for an even earlier term before that!)

I cut my teeth on product innovation or new product development (NPD) in the FMCG industry. Back then design was a specialist field that mostly required a tertiary qualification and creativity of the creative arts type. Designers were graphic and brand, or product or industrial designers. While any marketing or innovation team worth its salt would involve designers early in the process of brand development and innovation, their role pretty much was to apply their creativity and design skills to bring the ideas to life in the concept phase for testing, and then to design the final solution. This was design as form, function and styling. For example, if you were developing a new beer to launch, the bottle design would be done by the industrial or product designer and the graphics for the brand, label and packaging would be designed by the graphic designer.

Here is an example of the front end of our NPD process from back then. These were the key steps post innovation strategy and prior to business case, development and launch:

  1. Project Initiation
  2. Customer Research
  3. Insight Generation
  4. Idea Generation
  5. Concept Development
  6. Concept Research
  7. Product, Packaging and Brand Development briefs.

If you are already familiar with Design Thinking (and its different guises, such as Human Centred Design and Customer Centric Design) you’ll recognise the similarity in the processes. In fact, apart from a few new or evolved tools, the steps are exactly the same. Just replace some of the words, e.g. ‘customer research’ with ‘empathise’, ‘concept’ with ‘prototype’ and ‘concept research’ with ‘test’. So why is Design Thinking seen as this great new methodology when it is merely a new name for something that has existed, at least in some industries such as FMCG, for a long time?

First of all it’s because, while it may have been mainstream in FMCG, it wasn’t in other industries. So why was that? The FMCG industry, with the likes of Procter & Gamble (P&G) and Unilever, created the practice of building products into brands and moving from being manufacturing led to marketing led. Marketing done well in FMCG was always about being customer or consumer centric, which is the central pillar of Design Thinking. Continuous innovation and the development and launch of new products each season or year was (and still is) central to the prosperity of FMCG companies. In the early 2000s retail power was increasing, consumers were becoming more demanding and sophisticated, and media and markets were fragmenting. The two most successful ways to counter these threats were by building strong brands and innovating new products. Many other industries, including the service sector, weren’t so marketing- or customer-centric. They focused on service, but not the higher order experience design.

And then there were the designers themselves. They were involved in the innovation process to apply design to the specific stages relevant to their skills, for example concept design and final product design. They were using many of the elements of Design Thinking, but were not responsible for or oversaw the full process, for example elements such as the upfront strategy, customer research and marketing. It wasn’t until product design companies such as IDEO started moving upstream into strategy and research and broadening their offering that the term ‘Design Thinking’ got coined. And I believe IDEO openly acknowledge that it is a new term for something that has existed for a long time, albeit only in some industries. So prior to this the likes of IDEO were predominantly still product design consultancies and the Institute of Design at Stanford (, a famed hub for evangelising and popularising Design Thinking, didn’t even exist.

So we’ve seen design evolve from styling, form and function to design as a process — and it hasn’t stopped there.

Design takes over

So ‘design’ started to represent the entire innovation journey: not only the design of better products, services or experiences, but also better systems, processes and even business strategy and business models. Design was increasingly becoming the means for innovation — to such an extent that in the last decade ‘design’ has become the verb and ‘innovation’ the noun. Design is starting to get a seat at the upper management table, with some organisations now having a Chief Design Officer. This evolution or journey is well illustrated by the Extended Danish Design Ladder. I was first exposed to it by Professor Sam Bucolo, who was heading up University of Technology Sydney’s Design and Innovation Research Centre, which I was partnering with on some projects. In his book Are We There Yet?, Sam explains how the ladder was developed by the Danish Design Centre in 2003 ‘as a tool to measure the level of design activity in businesses’. While the original Danish Design Ladder stops at ‘design as a business strategy’, Sam has adapted it by adding two more steps: ‘design as organisational transformation’ and ‘design as a national competitive strategy’ (see below). From my observations most organisations and industries are in the stage of moving from step 2, ‘design as styling’, to step 3, ‘design as an innovation process’. And of course there are still many at the bottom rung of the ladder, at ‘non-design’. But, while there is still so much potential for design in business, industry and society as a whole, my focus in this book is to help organisations first master design as an innovation process for creating new products, services, experiences and better ways of working. From experience once this is mastered it can then be applied progressively up the ladder to strategy, transformation and economic development.

The six steps from the Extended Danish Design Ladder (Source: Sam Bucolo, Are We There Yet?, BIS Publishers, 2016):

STEP 1 – Non-design
This company does not use design systematically

STEP 2 – Design as styling
Design is used for styling and finishing of company products.

STEP 3- Design as an innovation process
Design is an integral part of the company’s innovation process.

STEP 4- Design as a business strategy
Design is an integral part of the company’s business strategy.

STEP 5- Design as community and organisational transformation
Design of the organizational structure and business models.

STEP 6- Design as national competitive strategy
The role of design to transform entire sectors.

Design as a process, or ‘Design Thinking’, borrows from and builds on many older fields and disciplines to encapsulate an integrated approach to innovation from:

»» strategy to determine where to play and how to win
»» qualitative research to observe and interview customers to identify what is important to them and then distill these into needs and insights
»» innovation and brand facilitation to generate ideas and facilitate workshops
»» traditional designers to prototype and qualitative research again to test these prototypes with customers
»» business strategy to develop the business models for realising these prototypes and making them feasible and viable.

Good design and innovation requires strategic thinking, curiosity, empathy, insightfulness, creativity, experimentation and business acumen plus much more! But a Design Thinker alone cannot do all of this themselves. I’m a passionate Design Thinking advocate, but I always stress to the teams I’m working with that there is a difference between being trained in Design Thinking and being a specialist in each of the stages and the tools. I still prefer (and encourage you) to engage researchers, designers, developers, financial analysts and other specialists and experts to play their roles. Success in innovation requires you to work with a cross-functional team and work alongside and learn from other functional and subject matter experts. So while Design Thinking has borrowed from the designer’s toolbox, it has also borrowed many others.

Innovator’s Playbook shares how to integrate the latest design methodologies for a winning customer-centric approach to innovation.

Written by Nathan Baird. Have you read?
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CEOWORLD magazine - Latest - CEO Agenda - Why You Need To Care About Design Thinking
Nathan Baird
Nathan Baird is the founder of customer-driven innovation and growth firm Methodry and author of Innovator’s Playbook: How to create great products, services and experiences that your customers will love! (Wiley; 1st edition; April 13, 2020) He is one of the world’s leading Design Thinking practitioners, a former Partner of Design Thinking for KPMG and helps teams build their innovation mastery and works alongside them to create new innovations. Nathan Baird is an opinion columnist for the CEOWORLD magazine. Follow him on LinkedIn.