Design Thinking  | 3 MIN. READ

Shareholders Celebrate The Business Impact of Design Thinking

ExperiencePoint, February 27, 2019

Shareholders Celebrate The Business Impact of Design ThinkingDesign thinking is more than 50 years old, yet many people still find it to be a “new” and unfamiliar concept. A recent report by McKinsey and Company found many business leaders are still trying to get their collective heads around design thinking. If you are one of them, it is useful to take a look at what McKinsey uncovered about some of the most successful design-led companies out there, how they’re using design thinking, and why they’re succeeding.

In the report they looked at a number of S&P 500 organizations, including Amazon, Apple, Netflix, Disney, Nike, and P&G, and found those that are the most invested in leveraging a human-centered approach outperformed everyone else on the index by a whopping 211 percent. It is a staggering figure. How have these companies managed to harness design thinking to increase shareholder return by twice as much as those that don’t?

McKinsey identified 10 practices that they determined deliver value to any business, whether you sell shoes or smart phones — and which practices are definitely not value-adding. Here are a few that stood out:

Silos are out. Cross-functional teams are in. When tackling any project, it’s extremely valuable to get fresh ideas and viewpoints that do not come from the usual suspects. Create teams from all across your organization, and if you’re working with other businesses, bring them in too. McKinsey found cross-functional partnerships resulted in 10 percent faster time to launch of the product or service, and a 30 percent higher success rate.

Narrow experts are out. Interdisciplinary designers are in. Whatever you’re developing or bringing to market, customers are going to expect experts with physical, digital and even service knowledge and design expertise. Cross-train teams if necessary, keeping customer expectations firmly in mind.

Qualitative research alone is out. Full-spectrum research is in. User groups, focus groups and field research are great. But it is time to augment all of that with additional data, including online customer reviews and customer behavioral data that, when combined, can show a more complete picture of customer needs and wants and ultimately lead to a pathway to a solution.

A single prototype is out. Ongoing prototypes are better. In other words, prototype early and often. Keep refining and defining based on customer need, feedback and other testing methods.

Perspectives are out. Metrics are in. Personal opinions and preferences are powerful, but they rely on instinct and frames that may not represent your extreme users — those customers on the opposite ends of the purchasing spectrum. Time spent with these extreme users, paired with other qualitative and quantitative data tell a more accurate and in-depth picture of customer needs, wants and pain points.

Financial incentives are out. Customer-centricity-based incentives are in. The best performing companies investigated by McKinsey measured the long-term bottom-line impact of customer satisfaction, and tied senior management bonuses and other incentives to customer satisfaction.

If these facts don’t convince you of the power of customer-centric design thinking, we don’t know what will!

  

Learn how to enable innovation skill-building at scale here or download our free ebook Kickstart Innovation: A Guide for Organizations.

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