When we talk about Apple’s Competitive Advantage (CA), we’re talking about what Tim Brown, CEO of IDEO, calls “design thinking” what’s behind the eco-system of products it develops, the physical design of each product, the strategic relationship between its suppliers and itself, and finally the connection between consumers and the product and eco-system.
In his book, “Change by Design”, he’s not talking to designers, but to the rest of us who want a new approach to creative problem solving. He notes that creative organizations are interdisciplinary (not multidisciplinary) in gaining insights. Borrowing from ethnography, researchers “walk” in the shoes of our customers/clients in order to understand not what they do,, but what they don’t do and listen to what they don’t say in order to really understand what’s behind their thinking. And then adapt it to meet or create the customer need.
Let me share one example. Financial Savings. We know that it’s hard to get young people to save money for their future “retirement” for several reasons (e.g., “It’s so far away”; there are so many “good” uses for the money now.). Design thinking asks how people save now and how could that be adapted. Bank of America (BofA) wanted existing clients to save more with them and encourage new clients to bank with them. Studying how people save, the realized that lots of people “overpay” a bill (e.g. a utility bill) so they always paid their bill and at the end have this pleasant surprise of a small amount needing to be paid. BoA introduced “Keep the Change” a program which automatically rounds up debit card purchases to the nearest dollar and transfers the difference in to the customer’s savings account. In the first year, the program attracted 2.5 million customers – (i.e.,700,000 new checking accounts and one million new savings accounts).
Grafting this service on an existing behavior was much more powerful than trying to launch a behavioral-change campaign. Similarly Amazon’s 1-click service was integrated into the normal customer’s buying process, and made it easier. With its patent, it became something competitors couldn’t copy – making it a Commanding Strategy!
The key to IDEO’s goal of unleashing our design thinking, instead of the traditional ‘new product” innovative thinking we often pursue, is to ask “How might we….?” How might we improve our customer experience – go beyond simply asking them, since many may not really know. We need to study what they are doing now, why, and at what stage might something simply be grafted. For instance, Airline loyalty programs, were grafted on purchasing decisions; but when purchase decisions make the original purchase unwise, even loyalty programs won’t change that.
Think about places like hospitals – are they designed to help staff do their work or to help customers/patients’ feel more comfortable? What kind of changes might accomplish the latter and by doing so actually help staff do their job better?
How would design thinking change the way you approach your company’s goal of improving services for customers or employees? Share the challenge, and let’s use design thinking to come up with innovative solutions!