7 Elements of Design Innovation
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The 7 Elements of Design Innovation™

The Practice of User Centered Business Design

Design Innovation Overview

For design innovation to succeed, it has to be Desirable, Possible and Viable. Desirable – wanted by users. Possible – technically feasible. Viable – able to support future business goals. We’ve been doing innovation consulting for more than 20 years. We’ve learned that it’s critical to understand, explore, and prioritize the overlaps between these three lenses to successfully innovate.

We call this the 7 Elements of Design Innovation™. It’s a tool to ensure that every new design innovation, or human-centered offering, is integrated into business strategy.

Download the Framework

The Key to Successful Innovation: Systemic Thinking

In traditional corporate structures, it’s common for teams to focus on just one or two of the seven elements in isolation. At IA, we consider all design innovation elements systemically — helping our clients collaborate across their organizations to create new offerings that end users value, stakeholders can feasibly implement, and leadership can be confident will deliver business impact.

User Experience

What to ask: What are the user’s wants, needs, and potential?

What it is: User experience design begins with determining our most important users and then diving deep to understand their wants and needs. By observing patterns of current activities, workarounds, and aspirations, insights are derived to guide the creation of new offerings.

Whether insights prescribe entirely new business models or re-tooled elements, a foundational user understanding enables concepting, design, and mapping of ideal future experiences.

User Experience Owners: Consumer Insights, Digital & User Experience

Process & Capabilities

What to ask: What systems and internal capabilities will we leverage or evolve?

What it is: Process and capabilities design are paramount in building a culture focused on design innovation. Through capabilities design, a company’s financial, physical, intellectual, and human resources can be connected in more agile and elastic ways to inspire dynamic and unexpected value creation, improving core functions and driving a healthier workplace.

A company’s core process design can also leverage a user-centered approach to challenge organizational conventions and prototype new approaches to corporate strategy, R&D, knowledge management, and skills development.

Process & Capabilities Owners: Engineering, Manufacturing, IT/Technology

Profit Models

What to ask: What will users value and how will we derive profit?

What it is: User-centered profit models are based on a rich understanding of what users truly value. By uncovering genuine motivations for purchases, new and tailored revenue models can be established. Often, multiple models are created to provide users maximum access to offerings while keeping competitors at a distance.

Considerations around pricing are driven by user value creation and willingness to pay, versus competitive pressures. Because this framework is user-centered, rather than competition-driven, typical purchase patterns are routinely disrupted, delivering new options and opportunities for buyer engagement.

Profit Models Owners: Corporate Strategy, Finance

Brand

What to ask: What relationship will users want to have with us?

What it is: Strong brands are based on establishing meaningful relationships with users. The scale of most corporations necessitates a broad range of brand interaction methods — from one-to-one conversations to mass communication.

Regardless of tactic, a company’s communications, language, imagery, and iconography must be consistently aligned with user values. Key innovations in the Brand element explore brand position, brand image, customer relationship management, and customer engagement.

A coordinated, user-centered brand practice will distinguish offerings, maximize recognition, and drive preference among current and future users.

Brand Owners: Brand Management

Partners & Resources

What to ask: What user needs will be served if we leverage other’s capabilities and profit models?

What it is: The value we create for users should not be limited to our own process and capabilities. From infrastructure to open innovation, collaboration with complementors or competitors can disrupt a market by quickly enabling access to new expertise, customers, capital, and other resources.

Networks can be short term alliances to execute a special project, or enduring partnerships to establish new entities. These relationships can reduce cost and risk or enable the creation of otherwise unfeasible offerings. The Partners & Resources element seeks to tap latent marketplace potential to deliver lasting user and business value.

Partners & Resources Owners: Strategic Partnerships, Sourcing

Channels

What to ask: Where will users engage throughout their purchase journey?

What it is:  Of all seven elements, user expectations are perhaps changing most rapidly in Channel. Physical stores are polarizing: some becoming physical showrooms for their e-commerce competitors; others, highly immersive flagships for powerful brands. Users demand both speedy self-empowered check-outs and highly tailored consultation.

Through the right mix of technology, experience, brand, and commerce, channels can deliver on users’ fragmented tastes and time constraints. This element considers trade-offs of owned versus partner; direct versus indirect; physical versus digital; as well as earned versus paid media to build awareness and motivate user purchase.

Channels Owners: Sales, Strategy

Offering

What to ask: What platforms, products, and services will be rewarding to deliver?

What it is: User-centered offerings span products and services that align to deliver compelling and seamless experiences. Each product or service within an ecosystem executes against one or more specific unmet need. Individual offerings deliver a quality experience, yet they become better together.

Whether delivering product enhancements or truly disruptive offerings, this platform approach drives ongoing sales, establishes competitive barriers, increases presence in channels, builds brand equity, and enables the company to create longer-term customer relationships.

Offering Owners: CEO/Senior Leadership, Product Management

A Practice of User-Centered Business Design

IA Collaborative’s Seven Elements of Design Innovation™ combines human-centered, iterative design thinking with holistic, rigorous corporate strategy to engage and connect all areas of company leadership.

By activating this systemic framework, leaders can confidently place strategic bets on future options, better serve their users, and enable new business growth.

Download the Framework

Interested in learning more on how IA Collaborative enables innovation for some of the leading businesses in the world? Contact us.

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Working at the Forefront of Design: Insights from IA’s 2018 Summer Interns

Insights from IA Collaborative’s 2018 Summer Interns

Every summer, IA Collaborative invites a class of multidisplinary interns to join the ranks of, collaborate with, and learn from the design consultancy’s diverse talent. Below, two of those interns, Divya Iyengar and Jack Gerber shared their unique perspectives on the experience.

Divya Iyengar: Design Researcher in Training

After graduating from the University of Illinois – Urbana-Champaign, Divya found herself working at a software engineering firm, where she grew into a product management role. Her interest in developing an understanding and advocating for design lead her to the IIT Institute of Design graduate program, where she studies design research and strategy.

During her time as a Design Research & Strategy Intern at IA Collaborative, Divya developed an understanding of the strategic design process, working on a client project that exposed her to research planning, synthesis and video storytelling. She also used her research background and completed benchmarking activities to uncover unexpected innovation opportunities for clients.

When asked how the internship affected her outlook on her profession, Divya discussed the importance of understanding not only her own discipline, but also how it relates to and empowers human-centered design more broadly. “I was drawn to the fact that IA works on projects that require end-to-end execution, as I wanted to experience different aspects of the design process all the way from ideation to implementation,” she said.

IA was the consultancy I wanted to work with because of their innovative approach to research…I (also) wanted to experience different aspects of the design process all the way from idea to implementation.

– Divya Iyengar, Research & Design Strategy Intern

Jack Gerber (center, left) and Divya Iyengar (far right) celebrate their final day of their IA internship program with fellow interns.

Jack Gerber: Exploring Design’s Impact on Business Growth

After earning a history major at the University of Colorado, Jack began his career teaching philosophy and social studies to high school and middle school students. He transitioned into a management consulting role where his innate curiosity and creative problem-solving skills resonated most. He learned how to apply creativity to business and became fascinated with design thinking. In 2018, Jack enrolled in the Chicago Institute of Design’s dual MBA program to earn his Master’s in both business and design.

As a Business Growth Intern, Jack worked with IA teams to identify and propose design solutions to address the complex, and sometimes ambiguous, business needs of potential clients – as well as to evaluate and optimize internal processes.

“One of the most important things I learned at IA was to have a bias towards action,” Jack said. During his internship, he learned that projects move very quickly at IA Collaborative, and often the key to success is in a team’s ability to prototype, learn and iterate in real-time throughout the project.

“If I had to describe IA in three words, I’d say they’re collaborative, fast-paced and supportive. I was able to work with and learn from a lot of different people with unique backgrounds to accomplish my projects. Not only that, but everyone was willing to sit down for coffee and discuss my program or their expertise. Everyone wanted to help, and I was able to learn so much in just eight weeks,” Jack said.

One of the most important things I learned…was to have a bias towards action. I was able to learn so much in just eight weeks.

– Jack Gerber, Business Growth Intern

 

Although their roles and projects differed, both Divya and Jack said IA Collaborative helped evolve how they think about design and hope to better integrate design thinking practices into their future endeavors. If you’re interested in learning more about career opportunities at IA Collaborative, check out our open positions here.

09.26

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Design + Healthcare: IA Collaborative Headlines at Mayo Clinic Transform 2018

IA Collaborative Founder and Chief Design Strategy Officer Kathleen Brandenburg is taking the stage at the Mayo Clinic’s 2018 Transform conference at Mayo Civic Center in Rochester, Minnesota. There, she will join the company of leading healthcare innovators and give Thursday’s keynote focused on leveraging design for transformational change in healthcare.

Additionally, a team from IA Collaborative consisting of Matt Alverson, Partner, Business Growth, Jeff Gershune, Research & Design Strategy Group Director, and Amy Wicks, Principal Researcher & Design Strategist, will host a workshop on how to “Design Your Next Competitor” in the healthcare industry.

 

When

09.26.18
08:00 am

Where

Mayo Civic Center
30 Civic Center Dr SE
Rochester, MN 55904

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3 Design Thinking Initiatives Every Company Should Be Leading

Launch Your Disruptor, Eliminate Bad Profits, 
and Break Out of Your Business Model

All around us, there is evidence of how design is shaping the future of business. Design isn’t purely about aesthetics or asking tactical questions – it’s about thinking systemically and answering big, complex and interdependent challenges. “Design thinking” has risen to prominence – and become an imperative in many companies – because things like disruptive growth, brand evangelism, and breaking into future markets are required for every company’s long-term survival.

But how do you achieve these complex and lofty goals? There are 3 Design Thinking initiatives I believe every company should be leading right now…because the future won’t wait. 

Initiative #1: Launch Your Next Disruptor

This initiative is about getting leadership to fund and incubate the company that will put you out of business. It starts with asking two simple questions:

First, where is disruption coming from in your industry? We conducted research with Fortune 500 and global companies like State Farm, Intuit, Honeywell, REI and GE Healthcare, and we got responses ranging from e-payments and robo-investing to subscription retail and AI-powered logistics, pharma and business services. It’s clear that organizations can readily recognize the disruptions around them. But how many are taking action right now to future-proof their organization?

Second, what is your biggest vulnerability in the customer journey? The majority of disruptive new companies and start-ups today were born out of identifying a low point in the customer experience. Imagine if the companies they disrupted had been honest with themselves and gotten ahead of the turning tide? You don’t have to wait for a new business to crop up – you can start building it yourself. From within your own company.

How it Works

Here’s an example of how to incubate and pilot a new business model from within your company – before someone else does.

We worked with a global logistics company to identify and create a new opportunity / product offering within the lowest point of their customer’s journey: the last mile of delivery. Everyone has been a victim of a door tag (“we’ll be here tomorrow, at the same time, when you’re still not home!”), and non-traditional competitors were popping up to create a more personalized, “high touch” experience for customers. To guard against disruption, we prototyped a company that would enable us to learn more about how resolve this specific customer pain point in a differentiated way, at scale, through experience design and a right-sized business model solution.

The goal of the project was to define business models, user needs, and operational strategies to scale – and win. In just 6 months, we stood up a fully functional business prototype, and launched a pilot in two selected diverse locations to learn, iterate and refine the model. Key to developing the business prototype was a digital app experience, which at first was very low fidelity but moved to high fidelity as we tested and iterated the UI/UX; identity and brand collateral to iterate messaging and brand intent; a website with analytics to iterate pricing structures; and educational and training modules to test the value proposition. Then, we isolated the most attractive operating models, prioritized the opportunities and sized key markets, and ran profitability scenarios all through the live pilot. From this, we were able to definitively project platform extensibility to unlock new revenue, customers, and offerings over a 5-year time horizon.

Ultimately, the global logistics company launched the new service offering – now available to more than 34 million people in 1,800 cities – and successfully put its startup competitors out of business.

How to Get Started

Identify your biggest vulnerability, whether that is coming from emerging competitors, new technologies or better user experiences. Conduct human-centered, immersive research to learn your own customer’s workarounds, pain points, anxieties and unmet needs.

Build a better solution from the inside. Prototype new experiences with low-fidelity tools at first, and learn, adapt and iterate to the point that you can prove the desirability, feasibility and viability of your offering. Pilot your new business offering. Make it real, with real employees and real technology, and use the pilot to learn just how much people are willing to pay and what the market opportunity is.

Initiative #2: Eliminate Bad Profits

First, let’s level-set. What do I mean by “bad profits?” When a company makes money at the expense of customer relationships. Think about it: bad profits are all around you. It’s things that you are annoyed to have to pay for, like baggage fees and extra legroom on flights; increased insurance premiums when you have an accident; service fees on your financial transactions. Psychologically, this erodes and destroys brand loyalty over time.

Eliminating bad profits starts by asking a simple question: what do your customers hate paying for? Again, we received a range of answers in our research with top companies: everything from late payment fees to digital subscriptions to software. There was no shortage of things people wished they could stop making customers pay for.

Why do bad profits happen so frequently? First, it happens from a lack of evolution in business strategy. When markets mature and margins erode, its easier just to cut costs, add fees, and charge for things that used to be free. Second, it happens because there’s a lack of connection with end user: When companies scale, it’s easy to lose connection with customers and users. It’s design’s job to continually stay connected. That’s what the “Eliminate Bad Profits” initiative is all about.

How it Works

Here’s an example of how to identify and eliminate bad profits within your organization.

We helped Dexcom—a startup that has grown into a $6B market cap company—eliminate bad profits from diabetes management: specifically, redundant doctor’s visits and unnecessary “pill burden.” Redundant doctor visits happen because of billing codes. Each doctor visit is billed to a specific code; so if you’re at a “disease management” appointment, and you want to discuss “prevention,” you’ll be asked to come back for, and pay for, a different appointment. It happens far too often. Unnecessary pill burden is caused by over-medicating, vs. addressing lifestyle management: most diabetics are paying for and taking way more drugs than they need. In fact, a recent American Diabetes Association study states: High pill burden results in poor adherence, morbidity and pre-mortality.

Dexcom invented a tiny electrode, inserted under the skin, to measure glucose and other biometrics. Wirelessly, it collects blood glucose data including levels, speed and direction. Before we engaged with Dexcom, the data was meant to help you adjust your diet, making you less reliant on medication. But there were two challenges: #1—he data were too complex for patients to decipher. Certainly, doctors could translate the data for patients, but that leads to problem #2: most patients only meet with their doctor a couple times a year—and yet, most patients eat every day.

We had to create actionable data to help users make smart, in-the-moment decisions about what to eat and when; therefore eliminating redundant doctor visits and unnecessary pill burden.

To design a more desirable experience for Dexcom, we became the users; implanting sensors, injecting placebos, observing ecosystems of care, between patient, doctor and caregiver. We found bright spots that inspired our design: folded up pieces of paper – “love notes” – written by a patient’s husband as a reward for taking her medication.

Ultimately, we co-created with doctors and patients to deliver a new, “positive profit” experience for the company: Dexcom CLARITY diabetes management software.

A quick scan of the hashtag #DexcomClarity on social media illustrates the enthusiasm people have for the tool. The financial results are strong, too – following the launch of Dexcom Clarity, Dexcom achieved YOY revenue growth of 42%, and reached $600M in sales.

How to Get Started

Figure out what your customers would be happy to pay for. Become your user. Do what it takes to live their experience. But don’t just look for pain points, look for the bright spots. Discover what is motivating your users to act the way they do, as an indicator of what solution will best channel and amplify that motivation.

Determine how you’ll make money from the new experience, and prioritize positive impact. Build out the business model, and test and iterate to determine what – and how much – people will actually pay for the new experience before broadly launching.

Initiative #3: Break Out Of Your Business Model

Oftentimes, organizations become so engrained in their existing business model that they can’t imagine any other way – or don’t see a reason to change course. But this is a costly mistake; continually re-evaluating who your most important customer is, and who influences their choices, can lead you to unexpected shifts in how you go about reaching those audiences.

In our research, when we asked, “Who is your most important customer?” everyone answered without hesitation. But when we asked them, “are you in complete control of how those customers engage with your brand?” almost everyone said no. Figuring out how to gain more control can help you break out of your business model.

How it Works

This initiative starts with identifying your most important customer – the one that is crucial to the future growth of your business. For example, take Nike. For them, a crucial target audience is the teen athlete. Nike wants to supply all of their uniforms, gear, and shoes. It’s a small industry, but during this formative time, if you put a swoosh on every teen athlete, you’ll see a swoosh on every adult athlete. High school is the key to brand loyalty.

In Nike’s high school business, the model is that local dealers sell uniforms to coaches, and booster clubs raise money to buy them. In this model, dealers have control over how Nike’s brand is presented, and Nike isn’t able to engage directly with high school athletes, fans, and boosters. Nike broke out of their business model and is driving brand loyalty by building a creative digital solution that enables teams to build and create their own uniforms, keeping Nike’s brand at the forefront of the action.

From uniform customizers to completely tailored marketing communications, Nike is delivering a branded experience that makes teen athletes feel like the pros. In the future, a logical extension of the platform could include individual school-branded store portals on Nike.com, where players and fans can design their own uniforms aligned with Nike’s brand standards, vote on them, and directly purchase gear. Other future features could include sales tracking and fundraising platforms for coaches and boosters, custom booster campaigns and robust back-end sales data and analytics.

How to Get Started

Determine who your most valuable customer is for long-term business growth, and identify who influences their choices. Create new platforms for engagement and commerce.

Determine who stands between you and your customers. Eliminate interference and take control of your brand.

Take Action & Lead Your Industry

These three initiatives will help your organization stay at the forefront of your user’s needs, your competition and your capabilities. As you seek to lead, champion or sponsor these initiatives, keep in mind the most powerful way to achieve “buy-in”: capture and document user-centered insights, interviews and observations through highly visual mediums: video, images and compelling storytelling. Create an irrefutable narrative and build a network of internal evangelists that will support your case for bold new direction.