Setting up for innovation success

In part 1 of this article, I talked about the economic upside for Australian companies to push an innovation agenda, as well as the barriers that present themselves when trying to go down a breakthrough innovation path. This post explores how to overcome some of those barriers.

Creating a truly innovative culture has to be all encompassing of your organisation; top down, bottom up and right through the middle. Pockets of innovation in an organisation can have trouble breaking free from the weight of the status quo; soon becoming disenfranchised and taking their passion elsewhere.

I’m a firm believer in the designer's toolkit being a key enabler for product innovation, as are ustwo. That toolkit has changed and evolved over the years, but at its core, it has always been about designing for people first. The value of that as an ethos hasn’t always been easy to pin down. A recent Mckinsey report into the Business Value of Design has been able to put a dollar value against that as a statement. It found that 4 key pillars will put you in good stead against your competitors, to the (potential) tune of 30% revenue upside. To anyone who has worked in a creative agency or studio before, these pillars are quite common design principles.

The 4 pillars of the Mckinsey Design Index are:

  1. Treat design outcomes with the same rigour as costs and revenue, at the c-suite level.
  2. Make design everyone’s job, from the top to the bottom of your organisation.
  3. Talk to your customers before coming up with an idea or a requirement.
  4. Evolve your products, don’t just launch a new thing and leave it alone.

What was interesting is that the research shows you need to be doing all 4 to unlock the total value. Doing only 2, for example, won’t give you 50% of the benefits. The HBR article ‘How Samsung became a design powerhouse’ goes into great detail about how Samsung embraced design at all levels of the business. When thinking about the future, Samsung realised after the GFC that an emphasis on design and design thinking would help them plan strategically.

The Customer Design Centre (CDC) would help guide Samsung’s innovation effort. The model described in the HBR article looks like this:

- Looking 12 months out: Designers are embedded within the business units, to shape near term product enhancements and potential new offerings.

- 18 - 24 months out: The business units take a front seat, collaborating with the Customer Design Centre, on product and interfaces, along with material design.

- 2 - 5 years out: The Customer Design Centre takes the front seat, in collaboration with the business units, looking at emerging tech and trends, looking at investment plans and new platforms.

- 5+ years out: The Customer Design Centre ride’s solo on the way out over the horizon stuff, helping leadership envision the distant future and shape long term investments.

I like this model as it encompasses a whole-of-organisation philosophy, with clear guard rails for accountability of innovation efforts within time frames as well as product scope. That whole of organisation mentality and approach to innovation is the key enabler of sustainable success. A single department or area doing it is bound for failure, empowering your people without leadership passion (Not just buy-in) will lead to disillusioned people, and not giving your middle management permission to make innovation work, will ensure the status quo remains.

What is critical though, yet seems counterintuitive, is to start small. The Mckinsey Business Value of Design report found “...that one of the most powerful first steps is to select an important upcoming product or service and make a commitment to using it as a pilot for getting the four elements right.

This approach showed far better financial results than trying to improve design as a theme across the whole company—for example, conducting trials of cross-functional work in isolation from real products or services.” This echoes our experience here in Sydney when working with clients on holistic digital strategy uplifts. Focusing on a real product, and the team working on that product and evolving the mechanics of how that teamwork on that product.

The value of desirability

The corporate landscape is littered with products that flunked and business cases that sailed pretty wide of reality. This isn’t a problem unique to corporates, however.

CB Insights, the leading data insights company, focused on tech and startups globally, analysed 101 startups that failed, to understand why they did so. 42% of them failed because of no market need; they were solving something that didn’t need solving. It’s important not to mistake usability with desirability.

That someone likes what you’ve put in front of them, doesn’t mean they’ll use it!

In order to build better products and services that don’t fail, companies often look to capability uplifts through Digital Transformation programs, usually introducing Agile methodologies. Agile is seen as a way of increasing productivity of their delivery teams while giving the ability to change tack quickly based on various inputs (Business, end-user feedback etc.)

Agile may help build the thing right (And quicker), however, if you’re not creating the right thing, the chances of failure are still very high. Companies may roll out a Human Centred Design capability to identify what the right thing is, talking to customers and diving into the ‘why’.

Agile methods + HCD is the core of what ustwo do and centred on a product or service. It enables us to work at speeds that often surprises our clients, on something real rather than theory in a classroom. That said, it’s essential to be able to test and learn about new concepts quickly, covering desirability as early as possible.

Feasibility and viability come a little later, as to how the concept manifests in those early iterations is very different from what is likely to reach the hands of users through the development journey. It’s entirely possible to validate concepts as desirable in less than five days.

Start Small

The designer's toolkit needs to be at the heart of companies in 2019 to start, continue and evolve their innovation ambitions and create a massive competitive advantage for themselves over their competitors.

If you’re only starting your design and innovation journey, starting small initially helps iron out the quirks of your organisation, and will accelerate your journey in the long run out to the business at scale. Only through a holistic approach to design throughout your organisation will you give yourself the highest chance to see the returns that the Mckinsey design index research found.

At the core of innovation, however, is solving a problem that people have. By identifying the right problem first, and only then figuring out how to solve it, you lift your likelihood of success significantly. A beautifully executed experience that is super easy to use and looks impressive is still going to fall on its face if it’s solving something no one has or cares about. So don’t confuse “This looks amazing, I love it!” to mean “I’d buy this!”

ustwo can help you identify the right problems to solve for your users and then solve those problems with a beautiful experience that makes a difference.

We'd love to hear your thoughts on the importance of the 'Designer's Toolkit' in fostering innovation and creativity. Say hi to stevebrown@ustwo.com.