Investing in Innovation with Design Thinking
Since the internet went public around two decades ago, there is not one sector in the world that hasn’t been disrupted. Digitalization or being digital-first became one of the main agendas for almost all companies. Until today, many are still trying to find the right footing in this parallel world of online and offline. The commercial and retail industry, including home and living, is no less disrupted. In that regard, it’s not uncommon to find in these past five years people saying that retail is obsolete in these past five years.
The era changed, the customer demand changed too, and it became more sophisticated. The pandemic and geopolitical crisis created a new breed of demand from the customer. Business as usual is shifting quicker than ever before. Adding to the promising revenue from digital touchpoints and the OPEX of retail going up every year, this created a very complex business landscape and pushed the business to innovate with agility.
We often see companies boast innovation as their new middle name. Still, when we see carefully, many were misled to focus more on the digitization tools rather than creating new values. Indeed, technology has an inevitable appeal, but it’s actually just an enabler for brands and services to elevate customers' pain points or open doors for brands to show and prove their values.
Investing in innovation is not an option if a company wants to thrive in this increasingly complex landscape. And it doesn’t mean only preparing a budget but also a mindset. The mindset includes openness of a company’s teams for creative confidence to create a morale of trusting the process and solutions.
This investment should not be distributed solely to customers. To provide value to customers, the internal working of the companies must be invested too to have the two factors break even in value.
Many of the companies we worked with often have difficulties seeing the actual values they can bring with their existing operation or have problems exerting more. This is the kind of situation where investing in a mindset makes the whole difference, and design thinking comes to play.
Create a morale of trusting the process and solutions.
In innovation, design thinking helps teams look at problems from different angles to see opportunities. The principle process of design thinking also ensures that everyone on any level can bring assumptions, knowledge, and ideas to the table, including the customers. Because usually, there are new angles from the most unexpected person on the team.
Design thinking also puts an efficient structure to the innovation process by utilizing assumptions and imposing inward and outward questions. Inwardly, we can assume things such as, “Do we need to create new products to exert more value?” “Has our lounge chairs become obsolete?” “The technique we did to create our sofas is already the best, aren’t they?” While outwardly, we can begin by truly understanding who the customers are, what their needs and pain points are, and tackle assumptions in these areas by engaging with them. The balance of both worlds means design thinking will have businesses create values with—not for—their customers.
Without carefully looking inward and outward, many home and living companies we observed resorted quickly to creating new products, while retail having a new screen shopping mirror, which both called it innovation when it’s actually only the same old stuff covered in a different stylistic shell. But customers are observant human beings. They can see and feel the benefits and values that a company has to offer. A mere stylistic effort can only last for a while. Like thirst quenched with saltwater, at some point, customers will try to find genuinely refreshing water; Brands that provide their needs and align with their values.
The process of design thinking can be applied in various stages of business processes, and usually, it doesn’t touch only one area of the business. From production to marketing. Distribution to branding. Because, often a client thinks that they need to change or innovate their product to appeal to the market, while the answers lay in the way the products are communicated. The role of an innovation consultant applying design thinking is to lend an unbiased view of a problem as an outsider and invite the client’s team to see through their perspective. But consultants will also equip themselves with an empathic attitude to understand the mapping of the problem and its contexts.
We’ve said that today’s fast-changing era requires companies to innovate with agility. Will design thinking help in this matter? Yes. We mentioned that design thinking provides structure. This structure also ensures that a team doesn’t dwell too long on a project, which is usually caused by endless research and decision-fear. The structure invites those on the project’s boat to move to phases and iterate while moving. Understanding and accepting this opens the mind to the opportunity for beneficial failure, or we can simply refer to it as feedback.
To increase revenue, investing in innovation with design thinking has been proven by the world’s best companies such as Apple, Toyota, Starbucks, Nike, and many others. They’ve understood that innovating is not a “once-in-a-while” project, but it should be flowing in every second as the bloodstream of a business.