DESIGN

THINKING
FOR NEW
BUSINESS
CONTEXTS
A Critical Analysis through
Theory and Practice

Yujia Huang
David Hands
Design Thinking for New Business Contexts
“Yujia Huang and David Hands offer us a very accessible and straightforward insight into theory
and practice of Design Thinking and beyond, this book will be useful for all who are looking for a
guide to this topic and its application in all organisations.”
—​Professor Rachel Cooper OBE, Director of ImaginationLancaster
and Distinguished Professor of Design Management
and Policy at Lancaster University

“Most design and business scholars and strategists only grasp some aspects of Design Thinking,
yet only few have a comprehensive understanding of its principles and applications. I herewith
express my gratitude to Yujia Huang and David Hands for updating me and for sharing their
expertise and insights to enable the sustainable transformations that we need in businesses as well
as in society.”
—Professor Cees de Bont, Dean of School of Design
and Creative Arts at Loughborough University
Yujia Huang • David Hands

Design Thinking for New

Business Contexts
A Critical Analysis through Theory
and Practice
Yujia Huang David Hands
University of Dundee Lancaster University
Dundee, UK Lancaster, UK

ISBN 978-3-030-94205-2    ISBN 978-3-030-94206-9 (eBook)

https://doi.org/10.1007/978-3-030-94206-9

© The Editor(s) (if applicable) and The Author(s), under exclusive licence to Springer Nature
Switzerland AG 2022
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Acknowledgements

This book is dedicated to the many hundreds of individuals drawn from both aca-
demia and industry who have shaped and informed the direction of discussions
presented within the interrelated chapters throughout this textbook. Benjamin
Franklin once remarked, “either write something worth reading or do something
worth writing”. As such, we aim to provide a fuller and richer account of design
thinking as a maturing branch of design that demands closer attention by its vocal
critics and also to curious minds as to the vast untapped potential of design as a
driver for common ‘good’.
Conversations, debates and the free sharing of ideas over countless years with
many inspiring and thought provoking people has allowed Yujia and David to
explore the emergence of design thinking as a recognised and invaluable agent for
transformational change. In particular, Yujia would like to thank ‘Design’ for being
so fascinating and meaningful that it keeps inspiring and driving her to discover and
develop the world of endless possibilities and long-term sustainable futures. David
would like to thank the amazing people he has worked within a variety of university
settings; especially the students who he had the privilege to teach (yes even you
Zunaira Mahmood!). Through the questioning of design, students have made us re-­
think our practice and understanding of design and of how it could be utilised in a
diverse range of often unfamiliar contexts.
Furthermore, thanks to all the contributors for sharing their rich knowledge and
detailed perspectives offered within their respective chapter contributions: In no par-
ticular order, we would like to extend our gratitude to—Dr Beatriz Itzel Cruz Megchun,
Dr Xinya You, Dr Sotiris T. Lalaounis, Dr Bijan Aryana, Ir Ehsan Baha, and Dr Radka
Newton. We would like to thank the Commissioning Editors at Palgrave Macmillan
who have been continually patient in the development of this textbook. Without their
support, this book would never have been possible. Final thanks go to all our readers
of this book for being interested in design and using it as a way of reimagining desir-
able futures and also as an engine of creative practice for societal good.
You are the designers of an egalitarian future, committed to ensuring responsible
business practice; shared and inclusive communities that values all individuals as
equals; and importantly, custodians of our fragile and beautiful planet for genera-
tions to come.
Thank You
Yujia & David, 2021

v
Contents

1 Introduction������������������������������������������������������������������������������������������������   1
1.1 Introduction����������������������������������������������������������������������������������������   1
1.2 Background to Design Thinking for new Business Contexts ������������   2
1.3 Structure of Content����������������������������������������������������������������������������   3
1.4 Using the Book: A Reader’s Guide����������������������������������������������������   6
2 Evolution of the Relationship Between Design and Business Activities  9
2.1 Introduction����������������������������������������������������������������������������������������   9
2.2 Design Thinking and Design[ing]������������������������������������������������������ 12
2.3 Design Thinking and Business Planning Activities���������������������������� 13
2.4 Design Thinking and Business Strategy �������������������������������������������� 17
2.5 Design Thinking in SMES������������������������������������������������������������������ 19
References���������������������������������������������������������������������������������������������������� 25
3 Crossing Boundaries: Design into Business and Management�������������� 27
3.1 Introduction���������������������������������������������������������������������������������������� 27
3.2 Design for Business: The Critical Imperative������������������������������������ 28
3.3 Teaching Design in Design Schools �������������������������������������������������� 31
3.4 Teaching Business Management in Business Schools������������������������ 33
3.5 Academia and Industry: Design Alliances������������������������������������������ 36
References���������������������������������������������������������������������������������������������������� 49
4 Organisational Complexity and Change by Design�������������������������������� 53
4.1 Introduction���������������������������������������������������������������������������������������� 53
4.2 Managing Complexity and the Organisation�������������������������������������� 54
4.3 Managing Uncertainty in Unpredictable Times���������������������������������� 61
4.4 Organisational Change Management�������������������������������������������������� 63
4.5 A Designerly Approach to Organisational Change���������������������������� 68
References���������������������������������������������������������������������������������������������������� 74
5 Business Thinking Through Design���������������������������������������������������������� 77
5.1 Introduction���������������������������������������������������������������������������������������� 77
5.2 Economic Systems that Shape Business Environments���������������������� 78
5.3 New Economic Systems Reshaping the Business Environment�������� 81

vii
viii Contents

5.4 Types of Organisations������������������������������������������������������������������������ 84

5.5 Business Structures ���������������������������������������������������������������������������� 89
5.6 Business Composition������������������������������������������������������������������������ 91
5.7 Design Thinking: Tensions and Challenges���������������������������������������� 94
References���������������������������������������������������������������������������������������������������� 97
6 Design Thinking for Sustainable Futures������������������������������������������������ 101
6.1 Introduction���������������������������������������������������������������������������������������� 101
6.2 Mission Impossible? �������������������������������������������������������������������������� 102
6.3 Sustainable Futures ���������������������������������������������������������������������������� 104
6.4 Corporate Social Responsibility �������������������������������������������������������� 109
6.5 Social Enterprises—A Hybrid Business Model���������������������������������� 111
References���������������������������������������������������������������������������������������������������� 125
7 Design Thinking for Branding������������������������������������������������������������������ 127
7.1 Introduction���������������������������������������������������������������������������������������� 127
7.2 Brand Audit, Consumer Ethnography, and Design Thinking ������������ 131
7.3 Identifying Branding Problems and/or Opportunities������������������������ 134
7.4 Design Thinking and the Development of Branding Strategies���������� 138
References���������������������������������������������������������������������������������������������������� 145
8 Design Thinking: Practice and Applications ������������������������������������������ 149
8.1 Introduction���������������������������������������������������������������������������������������� 149
8.2 Design Processes, Methods and Tools������������������������������������������������ 150
8.3 Case Example 1: Hitachi ABB Power Grids�������������������������������������� 151
8.4 Case Example 2: Maas Global������������������������������������������������������������ 154
8.5 Understanding the Student Learning Experience Through a Design
Methods Approach������������������������������������������������������������������������������ 159
References���������������������������������������������������������������������������������������������������� 174
9 Design Directions and Future Trajectories���������������������������������������������� 177
9.1 Introduction���������������������������������������������������������������������������������������� 177
9.2 Design Influences and Contested Territories�������������������������������������� 179
9.3 Democratic Design������������������������������������������������������������������������������ 182
9.4 Data and Design���������������������������������������������������������������������������������� 185
9.5 Design Directions in an Era of Uncertainty���������������������������������������� 190
References���������������������������������������������������������������������������������������������������� 196
10 Summary���������������������������������������������������������������������������������������������������� 199
10.1 The Design Nexus: Reflections and Reorganisation������������������������ 199
10.2 Design Values������������������������������������������������������������������������������������ 201
10.3 Design Commonwealth�������������������������������������������������������������������� 201
10.4 Design Perspectives�������������������������������������������������������������������������� 202
10.5 Design Transformations�������������������������������������������������������������������� 203
10.6 Design Futures���������������������������������������������������������������������������������� 204
10.7 Final Reflections ������������������������������������������������������������������������������ 205

Index�������������������������������������������������������������������������������������������������������������������� 207
List of Figures

Fig. 2.1 Lawson’s design process (adapted by authors) 13

Fig. 2.2 The cycle of design thinking (adapted by authors) 14
Fig. 2.3 IDEO design thinking process (adapted by authors) 15
Fig. 2.4 Double-diamond model (adapted by authors) 16
Fig. 2.5 3 Gears of business design framework (adapted by authors) 17
Fig. 2.6 Danish design ladder (adapted by authors) 21
Fig. 3.1 West coast industry (developed by author) 40
Fig. 3.2 Educational institutions offering join programmes (developed by
author)42
Fig. 3.3 Twenty-first century skills for a new vision of education
(developed by author) 43
Fig. 3.4 Design thinking—semester overview (developed by author) 47
Fig. 4.1 Kurt Lewin’s change management model (adapted by authors) 65
Fig. 4.2 Kotter’s 8 step change model (adapted by authors) 66
Fig. 4.3 The McKinsey 7-S model (adapted by authors) 68
Fig. 4.4 Richard Buchanan 4 orders of design (adapted by authors) 71
Fig. 6.1 The Triple Bottom Line (TBL) (adapted by authors) 105
Fig. 6.2 InGAME’s business sustainability triangle model (developed by
author)116
Fig. 6.3 Business-Modelling Blueprint (developed by author) 118
Fig. 6.4 Business Model Evolution Journey Canvas (developed by author) 120
Fig. 6.5 Business Model Evolution Journey Canvas–application example
(developed by author) 122
Fig. 7.1 Design thinking and brand management (adapted by author) 130
Fig. 7.2 Stages of brand development (based on Keller 2001, adapted by
author)135
Fig. 7.3 Customer-based brand equity pyramid model (Keller, 2001,
adapted by author) 135
Fig. 7.4 Achieving brand ambidexterity through design thinking
(based on Beverland et al. 2015, adapted by author) 141
Fig. 8.1 Van Erp’s total experience model with designer roles and the
range of developments and experiences they can offer
(Van Erp, 2011; adapted and elaborated by authors) 158

ix
x List of Figures

Fig. 8.2 Design-led annual programme review process (adapted by author) 161
Fig. 8.3 University ecosystem (developed by author) 163
Fig. 8.4 Management school ecosystem (developed by author) 164
Fig. 8.5 Student persona (developed by author) 166
Fig. 8.6 Visual persona example—Alex Wolf (visualisation by Joy Wang) 167
Fig. 8.7 Visual persona example Joy Zhang (visualisation by Joy Wang) 168
Fig. 8.8 Emotional journey map extract (visualisation by Joy Wang) 171
Fig. 10.1 The five interrelated dimensions of design thinking (developed by
authors)200
List of Tables

Table 3.1 The contribution of design to business success 29

Table 3.2 Twenty-first century design activities and outcomes 44
Table 5.1 Size of businesses definition 92
Table 6.1 Mission statements from leading brands 103
Table 6.2 Key findings from the Social Enterprise UK, 2019 survey 112
Table 9.1 ENoLL living labs—examples of living labs by area of focus 186
Table 9.2 Marketing traditional products versus Marketing IoT devices 189

xi
Introduction
1

1.1 Introduction

“Time is not measured by clocks, but by moments” is a truism that reflects the
essence of ‘design for new business contexts’ and the extraordinary conditions that
shaped its development. With unforeseen events and changing circumstances occur-
ring on a regular basis since early spring 2020, the world has dramatically changed,
where the terms ‘unpredictability’ and ‘uncertainty’ have and will continue to fea-
ture heavily in our everyday lives. The origins of this book are rooted in a time and
place where some sort of equilibrium was maintained; design thinking for business
was incrementally gaining traction and organisations were slowly and comfortably
moving into this newfound ‘space’. The primary intention of the authors was to
review, reflect and examine the rise of design thinking and its wider adoption
throughout organisational life.
Due to the sudden and impactful nature of Covid-19 restrictions, the authors had
to significantly reappraise content of the discussion over the subsequent chapters
and the way in which they developed their ideas. Disruption was significant in both
content and delivery of the final publication. This profound impact led the authors
to consider the following two interrelated issues: if this change has had a huge
impact on two authors regarding the way they conceive and structure a single text-
book and the manner in which they produce it, how would multi-national organisa-
tions and businesses respond to this ongoing pandemic crisis? Mainly taking into
account, their business operations span huge geographic and socio-cultural bound-
aries, with operational divisions and departments (let alone hundreds of thousands
of employees to coordinate) responding to perpetual change and crisis brought
about by Covid-19? Widely held practices, established orthodoxies and assump-
tions have been consigned to the waste bin of history within a matter of weeks as
opposed to decades. We want to be explicit here; this book is not primarily about the
pandemic, but examining its ongoing influence in the way that it is continually shap-
ing the malleable contours of the organisational and business landscape. Agility and

© The Author(s), under exclusive license to Springer Nature 1

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9_1
2 1 Introduction

resilience are terms increasingly discussed in business circles where the need for
speed of response to unforeseen events are now featuring as integral elements of any
proactive business strategy plans.

1.2  ackground to Design Thinking for new

B
Business Contexts

The origins of this book arise from three main areas of influence—industry practice,
design research and teaching. What connects these three interrelated and comple-
mentary domains is the author’s innate passion and curiosity surrounding the world
of design. Design and designing are widely misunderstood outside of its disciplin-
ary boundaries, regarded as a superficial activity ‘often used to make things look
good’. Or, ‘design is simple and easy’ not requiring much hard work and effort. On
both accounts, these widely held assumptions are completely wrong; however, in
order to dispel these common myths, the design profession has worked tirelessly to
gain acceptance and recognition by its peers, both in industry and academia.
Management guru, Peter Drucker famously once said, “You can’t manage what you
can’t measure” and for many, this applies to design; however, you can measure the
benefits and impact of design; the way design is ‘valued’ is one such means to mea-
sure it. For instance, a basic form of measurement could be to audit the return on
investment (ROI), through the increase in sales of products/services; or improving
market position whilst strengthening customer loyalty. Softer benefits could include
reducing customer complaints on poorly performing products, and improving com-
pany image. Each of these benefits is of more importance to some companies as
opposed to other—the value of design is relative to the particular context in which
it is being used. However, as the world has moved considerably on over the last two
decades, so has the role and influence of design.
Our research activities have taken us into new and unchartered areas of discov-
ery. David has worked extensively in the emergent area of ‘designing against crime’
seeing how design can reduce (sadly not ‘stop’) opportunist crime such as theft and
residential burglary. Design drawn upon in these contextually important situations
is more concerned with behaviour change and raising awareness of particular behav-
iours that give rise to criminal opportunity. Meanwhile, Yujia has extensive industry
experience, working on a wide variety of design and business strategy related proj-
ects. Now working in academia, she has identified the frequent misunderstanding
and differing interpretations of design and design thinking between what goes on in
industry practice and what academics critically debate. Regarding this ambiguity,
both authors aim to provide clarity as to what constitutes design thinking for new
business contexts whilst articulating the complexity of design thinking beyond sim-
ple definitions of its nature. Furthermore, both authors are also heavily involved in
teaching, mainly at undergraduate and postgraduate levels, focusing upon design
management, design for business and other closely connected themes where design
is a central element to drive organisational competitiveness. We never ceased to be
amazed by our students as to how they regard design and where it can be intelli-
gently applied within the pursuit of business success and social ‘good’. We hope
1.3 Structure of Content 3

this book offers the readership a set of distinct and diverse ‘lens’ to view and under-
stand the world and how design can be a driver for equitable prosperity. It does
indeed give rise to an interrelated set of questions ‘who is leading change? Who are
the beneficiaries of change’ and ‘what role can design play in leading this change?

1.3 Structure of Content

The following outlines key themes by each chapter, taking the reader through salient
aspects of design for new business contexts.
Chapter 2: ‘Evolution of The Relationship Between Design and Business’ offers
an expansive overview of the ongoing development of design thinking from its early
origins in the late 1960s. It introduces the leading figures that were firm advocates
for the value of design as an agent for transformational change. With the growing
influence and recognition of design, businesses started to look towards design as a
strategic resource to support the development of new and innovative products. The
Harvard Business Review in 2015 dedicated an entire issue to design thinking, rais-
ing attention of design to the wider business community, lending further support to
its adoption in industry. In addition to large multinational organisations, SMEs
started to view and regard design as an integral element of company culture and
planning activities. To raise awareness of design to the business community, design
advocacy agencies (with the UK Design Council being one such notable example)
began to offer design support programmes to provide specialist support and exper-
tise to enable organisations to embed design within company culture. To date,
national Design Councils are on the rise around the world, providing businesses and
organisations vital skills and knowledge, in order to remain competitive whilst driv-
ing innovation in highly globalised markets.
Chapter 3: ‘Crossing Boundaries: Design into Business and Management’ pro-
vides a detailed account of the key differences between the way design and business
programmes are devised and delivered within their own respective institutions and
departments. It is time to explore contemporary design and business curricula that
best prepare young graduates to compete in industry, and the critical skills do they
need to flourish in their respective careers. Are higher education institutions keeping
pace with fast moving developments in industry, and what are the skills and attri-
butes that are required for workplaces of tomorrow? With the rise of digital tech-
nologies, these have afforded new ways to access learning and education provision.
The growing ubiquitousness of online courses allows the upskilling of management
executives to gain exposure to design thinking and the way it can inform and under-
pin their own practice within the workplace. In essence, critical design thinking
skills and associated creative tools and techniques are featuring in numerous online
courses far beyond the close confines of traditional design schools. It concludes by
Dr Beatriz Itzel Cruz Megchun with a case study drawn from a leading business
school in the USA reflecting on the challenges of implementing design thinking
within established curricula.
4 1 Introduction

Chapter 4: ‘Organisational Complexity and Change by Design’ explores the

management of complexity of large organisations and how, if not managed effec-
tively, can hinder the desired pursuit for long-term competitiveness. Organisations
are re-appraising their existing structures, procedures and governance systems to
manage efficiently their day-to-day operations. Set against recent events at the start
of 2020, the global pandemic and ongoing environmental crisis has delivered a stern
wake-up call to both governments and industries to prepare for, an accept instability,
with market disruptions as a fact of corporate life. The chapter then turns its atten-
tion to the theme of ‘change’ and to the reason the process of change management
is effectively implemented. It examines three established and widely used change
management frameworks, highlighting their own respective strengths and weak-
nesses. Finally, it offers a designerly alternative approach to fostering change,
through the guise of Richard Buchannan’s work outlining the ‘4 Orders of Design’
and how the fourth order of design can offer and effect comprehensive cultural
change to a wide variety of organisational contexts.
Chapter 5: ‘Business Thinking Through Design’ contributed by Dr Beatriz Itzel
Cruz Megchun at the University of Portland, USA, discusses how economic sys-
tems shape, direct and support business activity and lays down the foundations for
innovation. It begins by examining the four mainstream economic systems that por-
tray the whole economy with just one minimal image that reinforces a neoliberal
narrative of the state and the domesticity of the household. However, there is an
array of alternative economic systems that challenge the status quo, such as the
sharing economy, circular economy, doughnut economy and social economy.
Following this, the discussion introduces three main types of business and their
basic forms, which are based around offering services to customers, merchandising
business within the high street retail sector and manufacturing. It concludes with an
extensive discussion on the way in which design thinking approaches can be embed-
ded within these diverse range of business structures to accommodate long-term
commercial success.
Chapter 6: ‘Design Thinking for Sustainable Futures’ takes an exploratory
approach to a wide variety of interrelated themes that encompass the communica-
tion of organisational values and how these can be used as an effective means of
competitive differentiation. The intertwined themes of sustainability and corporate
social responsibility are taking prominence in policy development activities, com-
pany strategy formulation and consumers purchasing decisions; as such, many
organisations are now meaningfully engaging with these ongoing and timely critical
agendas. It then moves onto the emergent theme of social enterprises and how they
place greater emphasis on ‘purpose’ as opposed to pure profit. In essence, they pro-
vide business solutions to social problems, whereby all profit is re-invested for the
pursuit of greater social impact. Chapter 6 concludes with a comprehensive case-­
study discussion provided by Dr Xinya You at the University of Dundee, by examin-
ing young start-up companies within the local Gaming industry, and the manner in
which design thinking methodologies and tools can be used within business plan-
ning activities to ensure their future survival.
1.3 Structure of Content 5

Chapter 7: ‘Design Thinking for Branding’ Dr Sotiris T. Lalaounis, based at the

University of Exeter Business School offers an extensive and highly detailed account
of the contributions of design thinking to brand management by presenting a con-
ceptual framework which explores the connections of the design thinking process
with brand equity and its management. From a consumers’ perspective, a brand is
important because it provides consumers the ability to identify the organisation pro-
ducing the product or delivering the service, and in consequence, assign responsibil-
ity to this organisation. Over time, consumers who purchase a brand develop their
own brand knowledge, that is, their own brand meaning stored in their memory
leading to trust towards the brand. Ultimately, design thinking provides the organ-
isation immense power to balance brand consistency and brand relevance, and con-
tinuously manage and enhance brand equity. Most importantly, this is undertaken
with a human-centred approach, placing the target consumers at the heart of the
process to deliver products, services, experiences that they embrace and develop a
relationship with.
Chapter 8: ‘Design Thinking: Practice and Applications’ is mainly focused on
examining the application of design thinking in practice—the doing. It offers three
diverse contexts where design thinking tools and processes are utilised to foster
meaningful change within the organisation. The chapter starts with two detailed
case examples provided by Dr Bijan Aryana and Ir Ehsan Baha who outline how
both international companies demonstrated a strong commitment towards fostering
closer end user relationships through a designerly approach. Here, the authors
examine the design process and tools used within these processes to achieve the
strategic aims of the companies under review. Dr Radka Newton provides an inter-
esting case example where she led a team of academics to examine current student
attitudes regarding their undergraduate studies. However, tried and tested approaches
traditionally used by universities to glean student feedback were not sufficient as to
the detailed and personalised information that she needed. To overcome this chal-
lenge, she looked towards the realm of design thinking and in particular the many
differing tools at her disposal that she could draw upon. The discussion takes the
reader through salient aspects of the research process that shaped her insights and
recommendations for adoption by the university department.
Chapter 9: ‘Design Directions and Future Trajectories’ begins with a brief reflec-
tion as to the current state of design, especially its role beyond the traditional design
studio and the limited confines of aesthetic application and promotional activities.
However, design is increasingly playing a greater role in society, and one such ini-
tiative is the DESIS Lab network, founded by Ezio Manzini in 2009, an interna-
tional network of design schools and related organisations working on initiatives in
the design for social innovation and sustainability fields. It then turns attention
towards the theme of participatory design as an inclusive approach to yielding
detailed user insights, and how the designer would create a democratic framework
for the meaningful inclusion of end-users in which to collect data throughout the
design development process. Regarding data and data driven innovation, the discus-
sion explores the exponential growth of the ‘Internet of Things’ (IoT) coined by
British entrepreneur Kevin Ashton in 1999, referring to the billions of physical
6 1 Introduction

devices that are connected to the internet, sharing and collecting data in real-time.
With IoT offering the huge potential to disrupt established markets, companies now
need to radically re-think their business models and operating procedures to exploit
fully this new technology.
Chapter 10: ‘Summary’ provides a succinct overview of the themes raised and
debated throughout the chapters. It concludes by offering a set of alternative futures
as to the direction of design and its growing influence in many and often unexpected
areas of activity. It presents five dimensions of design thinking that has been identi-
fied and critically debated through the chapters, offering an alternative understand-
ing of design thinking as a powerful tool to re-imagine new and desirable
organisational futures.

1.4 Using the Book: A Reader’s Guide

Design thinking for new business contexts is the primary focus of the author’s inten-
tions to illustrate the way in which a ‘designerly’ thinking approach can be drawn
upon to engage with critical and emergent organisational challenges. These chal-
lenges can be viewed from a diverse range of dynamic forces from within the organ-
isation or external macro forces beyond organisational boundaries affecting business
activities, or both. At the time of writing this book, a whole of industry sectors and
organisations around the world are struggling to adjust their operations and plan-
ning activities set against a backdrop of Covid-19 pandemic restrictions. Profound
change is being brought about through the continual and ever-changing restrictions
that frequently change on a daily basis. As such, the authors aimed to identify and
discuss these challenges within and throughout the overall book, highlighting how
design can support the organisation to respond to these challenges. Each chapter is
based around critically exploring distinct themes and sub-themes closely connected
to the main area of particular focus. The themes explored are not exhaustive, argu-
ably a small selection of the many emergent areas of business activity that we are
currently witnessing.
When viewed in entirety, we aim to offer a kaleidoscopic portrait of design and
design thinking in action, with the overall intention to build an open-ended aware-
ness on what design thinking represents. It is anticipated that the reader can draw
upon these multiple perspectives to inform and develop their own critical under-
standing of design thinking relative to their own field of enquiry or disciplinary
background. Each chapter starts with a list of keywords, affording the reader a brief
glimpse of themes explored within that particular part of the book. You may wish to
read the book from beginning to end or consult specific chapters based on both time
and need; we have aimed to accommodate both approaches when structuring the
overall narrative and discursive flow of the chapters.
To conclude each chapter, we have included extra elements to aid your under-
standing of what was discussed. These learning aids include ‘Review questions’ that
invite you to reflect upon specific topics discussed. In a way, these questions serve
the purpose of deeper introspection as to your understanding of the discussion at
1.4 Using the Book: A Reader’s Guide 7

hand. Then, ‘Project questions’ form the basis of potential projects that could be
developed as part of your educational studies (be it undergraduate or postgraduate)
based on time availability and suitability to your subject area. To complement these,
‘Chapter tasks’ are more practical in nature, whereupon you could turn a project
idea into one with more tangible outcomes. Set against Covid-19 travel restrictions
and available access to libraries, both authors had to heavily consult online resources
to overcome these limitations; these can be found in the ‘References’ section.
Evolution of the Relationship Between
Design and Business Activities 2

Learning Objectives

• To develop an understanding of the scope, nature and role of design in a

variety of dynamic business contexts;
• To introduce the reader to the origins of design thinking as a business asset
that can also assist within strategic planning activities;
• To introduce and develop an understanding of the role of design in achiev-
ing organisational goals and strategic vision;
• To examine the role of design as an interventional and propositional busi-
ness tool through established design process models.

2.1 Introduction

A common question designers frequently get asked is “what is design thinking”?

Whereby, a straightforward and digestible answer could be returned that would
encapsulate its entire essence and meaning in one single sentence. However, design
thinking is far too a broad holistic term that requires greater scrutiny in terms of its
value and relevance within its wider application; be it either within a commercial
context or the not-for-profit sector. Rather than asking, “what is design thinking” we
propose to re-frame the question to “how does design thinking work”? As such, it
allows a different interpretation and discussion to its inherent value whilst also
removing its vagueness towards a more meaningful definition.
The leading design theorist, Richard Buchanan, raises an interesting point, argu-
ing, “in general, design is continually evolving and the range of products or areas

Supplementary Information The online version contains supplementary material available at

[https://doi.org/10.1007/978-­3-­030-­94206-­9_2].

© The Author(s), under exclusive license to Springer Nature 9

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9_2
10 2 Evolution of the Relationship Between Design and Business Activities

where design thinking may be applied continues to expand” (Buchanan, 1995,

p. 25). With the changing remit of design in terms of its relevance, it is now being
utilised and drawn upon in diverse environments far beyond the development of new
products. Since the late 1990s, design and management literature have presented the
concept of ‘design thinking’ as a path for innovation and growth. Likewise, design
organisations and European innovation policies include design as a way to improve
businesses, add value and gain competitive advantage. Design thinking has been
presented as a method to develop business strategies (Drews, 2009; Fraser, 2009;
Lockwood, 2009, 2010; Clark & Smith, 2010). It is defined as a user-centred, prob-
lem solving, collaborative approach influenced by the ways designers think and
work, involving a combination of divergent and convergent thinking, rapid proto-
typing, testing and iteration, visualisation techniques and acceptance of constraints
to discover needs, find new opportunities and creating effective solutions (Martin,
2007; Brown, 2009; Lockwood, 2009; Norman, 2013).
Consequently, design thinking has been recognised as a strategic resource mainly
in large, global corporations developing design-led organisations such as Apple,
Google, IBM, Barclays, Samsung and Pepsi (Brown, 2015; Ignatius, 2015; Kolko,
2015; Yoo & Kim, 2015); in small and medium-sized enterprises [SMEs] there are
some barriers and the concept is not widely known yet (Cox, 2005; Acklin, 2013;
Gulari & Fremantle, 2015). European design organisations have been creating aware-
ness and measuring the benefits of design when is used on a strategic level (McNabola,
2014; Micheli, 2014; Melander, 2015; N&WRA and CIRCA Group, 2015).
Accordingly, design programmes in the UK have been created to support the incorpo-
ration of the strategic role of design in businesses of all sizes, with an emphasis on
SMEs (Ward et al., 2009; Design Council, 2012a, 2012b). However, the results of the
programmes do not discuss the SMEs’ context, the criteria for eligibility of SMEs,
further development of the programmes or how to reach more SMEs.
Given the importance of SMEs for the European economy (European Commission,
2015), the aim of this chapter is to identify the aspects that must be considered for the
incorporation of design thinking as a strategic resource in organisations, such as
context specific characteristics, opportunities, challenges and obstacles. By explor-
ing how design thinking principles are applied in similar size companies—small
design firms—key aspects are identified about the design process as a way to inform
and set strategic decisions in ‘non-design’ SMEs as well as opportunities and barriers
for the design sector to better demonstrate the value of design.
In order to understand design thinking as an intellectual field of enquiry, perhaps
it would be beneficial to pause for a moment and identify the origins of the term and
its subsequent evolutionary development. It could be argued (and many have con-
vincingly done so) that the origins of design thinking can be traced back to the
American Economist and Political Scientist Herbert Simon and his seminal book
The Science of the Artificial (1996) where he argues “everyone designs who devises
courses of action aimed at changing existing situations into preferred ones” (Simon,
1996, p. 55). This sentiment provided a seismic shift in the understanding of design
as a professional activity, in particular the role of design within the architectural
design and engineering professions. With careful reading, the second and third
2.1 Introduction 11

editions of his book (Simon, 1996) offers a comprehensive shift away from the use
of design within a limit range of professions, through to designerly ‘practice’ being
embedded within a diverse range of activities. The following chapters discuss this
development of his thinking and understanding of the role of design in greater detail.
It is worthwhile to note here another contemporary of Simon, namely that of
Professor Bruce Archer, who led the Department of Design Research [DDR] at the
Royal College of Art until 1978. Archer was an instrumental figure in the develop-
ment of critical enquiries into design and its relationship to science. However,
Archer’s systematic approach to design methods was not without its critics; John
Christopher Jones challenged the methods and rigidity of conventional design meth-
ods offered by Archer. In 1970, he published the seminal book Design Methods that
offered an alternative to establish design theory put forward by his contemporaries.
Over subsequent editions of the book, Jones provides numerous design methodolo-
gies to assist the designer with emphasis on the user and the thoughts that precede
the designed outcome, in essence, moving focus away from the product to the pro-
cesses and methods that led to the product.
It is noteworthy to say, the emergence of academic journals focusing upon design
research and methodologies, in particular ‘Design Studies’ (1979); ‘Design Issues’
(1984) and the ‘Journal of Design Management’ (1990) by the North American
based Design Management Institute happened at this point. In 1972, Rittel and
Webber presented their seminal academic paper Dilemmas in a General Theory of
Planning, at the Institute of Urban and Regional Development, University of
California, who identified 10 ‘Wicked’ problems in urban planning and design.
These wicked problems required new approaches and forms of understanding that
traditional science and engineering based methodologies were unable to address. It
may be worthwhile Rittel and Webber did not first use pointing out here that the
term ‘wicked’ problem, they borrowed the term from the Austrian-British philoso-
pher Professor Karl Popper, and as such, popularised its usage within the realm of
design theory and practice.
The wicked problems raised by the authors included:

1. There is no definitive formulation of a wicked problem.

2. Wicked problems have no stopping rule.
3. There is no immediate and no ultimate test of a solution to a wicked problem.
4. Every wicked problem is essentially unique.

For a fuller and exhaustive discussion of these wicked problems, refer to their
academic paper that was published a year later (Rittel & Webber, 1973). Buchanan
(1992, p. 5) raises an interesting point regarding the concept of design thinking in
his seminal paper, suggesting that:
Despite efforts to discover the foundations of design thinking in the fine arts, the natural
sciences, or most recently, the social sciences, design eludes reduction and remains a sur-
prisingly flexible activity. No single definition of design, or branches of professionalized
practice such as industrial or graphic design, adequately covers the diversity of ideas and
methods gathered together under the label.
12 2 Evolution of the Relationship Between Design and Business Activities

Having acknowledged the breadth of its application and scope (which negates
reduction), Buchanan raises the primary challenge of its adoption and value given
that it can be used “to remarkably different problems and subject matters”.
Followed by publications in the 1980s by design researchers (Rowe, 1987;
Schön, 1983), design thinking attracted wider acclaim by 2009, probably due to the
affirmations by Tim Brown (2008) on how thinking as a designer transforms organ-
isations and leads to innovation. However, it has been argued that there are different
definitions of ‘design thinking’ according to the context where the term is used.
Johansson-Sköldberg et al. (2013) make a distinction between the management and
the design realms. In a similar way, Kimbell (2011) presents the origin of the term
in design research and its adoption by the management discourse in business
schools. To gain a comprehensive understanding, this chapter critically discusses
the concept of design thinking from both perspectives.

2.2 Design Thinking and Design[ing]

Although Simon never used the term design thinking, his definition of design as
devise “courses of action aimed at changing existing situations into preferred ones”
(Simon, 1996, p. 111) by the creation of artefacts, is one of the first contributions
towards a cognitive approach of design. Another key point is the diverge-and-test
notion or what he calls the ‘generator test cycle’ where a series of alternatives are
generated and tested, informing the impact of each cycle. Rowe (1987) provides a
description about the process of designing in architecture introducing the activity of
design as a combination of rational enquiry and ‘impulses’ where the nature of the
problem-solving process shapes the solution. Rowe introduces a simplified version
of the Archer’s model of design. In a similar way, Schön (1983) presents design as
a process of reflection-in-action, enabling a constant improvement of the profes-
sional practice and solutions. Such process is described as the essence of the design
process in which reflection-in-action is applied, tested and developed with the pur-
pose of finding possible solutions to problematic situations. In other words, both,
the problem and solutions might not be clear from the beginning, but they are
defined and redefined during the process. Lawson (1997) draws attention on the
design process as a combination of convergent and divergent thinking. Convergent
thinking refers to a rational and logical approach while divergent thinking is intui-
tive, imaginative and focused on seeking alternatives. In these terms, designers need
to develop the perfect balance between convergent and divergent skills (Fig. 2.1).
Cross (2006, 2011) adopts the term “designerly ways of knowing” and on a case-­
based approach aims to develop an understanding of the nature of design ability and
what designers do when they design. Cross refers to a model based on three steps:
(1) clarifying the task, (2) searching for concepts and (3) fixing the concepts. Lastly,
from the cognitive sciences, Norman (2013) defines design thinking as the process
in which an original problem statement is taken as a suggestion to later think about
the issues underlying the problem statement might really be. It is the search for the
real problem, and once found, the development of a wide range of potential
2.3 Design Thinking and Business Planning Activities 13

Fig. 2.1 Lawson’s design process (adapted by authors)

solutions. Norman (ibid) argues that Human Centred Design (HCD) and the Double-­
Diamond Model of Design—developed by the UK Design Council—are two of the
powerful tools of design thinking.
The focus of HCD is on solving the right problem and doing it in a way it meets
human needs. These two aspects give rise to the two phases of the design process.
The first phase is to uncover the right problem; the second is to find the right solu-
tion. The HCD process takes place within the double-diamond process containing
four activities: (1) observation, (2) idea generation, (3) prototyping and (4) testing.
Norman (ibid) explains that it is not only practiced by designers, but by all great
innovators. The reason it is attributed to design firms is that designers pride them-
selves on their ability to innovate and be creative. Norman’s work focuses on design
and the way humans interact with it, however, it is important to notice that he also
reflects about the role of design in the world of business by discussing how the HCD
process describes the ideal but in the reality, businesses are forced to act in a differ-
ent way, often because of time and budget constraints.

2.3 Design Thinking and Business Planning Activities

Martin (2007) reflects about the tension between business and design to state that is
precisely the integration of both types of thinking, analytical and intuitive, the defi-
nition of design thinking. Such balance is necessary for an optimal business perfor-
mance and for gaining competitive advantage (Fig. 2.2). Based on an interview with
Martin, Dunne (Dunne & Martin, 2006) synthetises three aspects of design thinking:

1. Cognitive: Design thinking is an on-going cycle of generating ideas (abduction),

predicting consequences (deduction), testing, and generalising (induction);
14 2 Evolution of the Relationship Between Design and Business Activities

Fig. 2.2 The cycle of design thinking (adapted by authors)

2. Attitudinal: Instead of considering constraints as barriers for the implementation

of ideas, embrace them as triggers to find creative solutions;
3. Interpersonal: Encourage collaborative kills to learn to understand other people
and their reasoning.

Based on IDEO’s practices, Brown (2008, 2009) articulates the framework of

design thinking using an extensive amount of examples and case studies as a disci-
pline that applies the designer’s skills and methods to match people’s needs consid-
ering what is feasible, desirable and viable in order to get customer value and market
opportunity. The key aspects include:

1. A combination of divergent and convergent thinking as a way of problem solv-

ing where the convergent phase drives towards solutions and the divergent think-
ing multiplies options to create choices;
2. ‘Building to think’ or the ‘power of prototyping’ to generate better results by
quickly seeing limitations and possible directions;
3. Empathy and a human-centred approach, based on finding the needs of users
using field observations, prototyping and visual storytelling;
4. Acceptance of constraints, which should be seen as an opportunity for innovation;
5. Collaborative work, drawing attention in the importance of multidisciplinary
and interdisciplinary teams.

Brown raises two interesting points: the first one is to make the designers’ skills
accessible to professionals from a non-design background in order to accomplish
innovative results. “Design thinking can be practiced by everybody” (Brown, 2009,
2.3 Design Thinking and Business Planning Activities 15

p. 149). The second, that design thinking should move into the organisations, the
service sector and the public sphere since it has the potential and tools to embrace
global issues. Also with an IDEO background, the Hasso Platter Institute of Design
at Stanford (headed by IDEO’s founder, David Kelley), commonly known as the
‘d.school’, developed their 5-stage design-thinking model. This model takes first on
the definition of the problem and then the implementation of the solution consider-
ing the needs of the user at the core of concept development. The process is focused
on finding needs, understanding, thinking, and doing by a bias towards action. It is
cyclical and iterative since continuous testing is key to improve the initial ideas
(Hasso Plattner Institute of Design at Stanford, 2010) (Fig. 2.3).
Similarly to Brown, Lockwood (2009) argues that the term design thinking is
referred as the application of a designer’s sensibility and methods to problem solv-
ing, no matter what the problem is, turning out to be a methodology for innovation
and enablement. He defines design thinking as a human-centred innovation process
that emphasises observation, collaboration, fast learning, visualisation of ideas,
rapid concept prototyping and current business analysis, influencing innovation and
business strategies. In essence, it is a tool to imagine future states and to bring prod-
ucts, services and experiences to the market. The key attributes are:

1. Deep understanding of the user by using ethnographic methods;

2. Collaboration, with users and involving multidisciplinary teams;
3. Accelerate learning through visualisation, hands-on experimenting and
prototyping;
4. Visualise, by becoming tangible the intangible;
5. Business analysis integrated during the process.

It is key the combination of creative ideas with more traditional management

aspects in order to have a comprehensive point of view. One of the most useful con-
tributions by Lockwood is the differentiation between design thinking and design
management. He argues that design thinking is an innovation process related to

Fig. 2.3 IDEO design thinking process (adapted by authors)

16 2 Evolution of the Relationship Between Design and Business Activities

discovering needs, opportunities and creating new solutions, while design manage-
ment lies in the integration and improvement of design into business. A key aspect
stated by Lockwood is the incorporation of design thinking as a strategy method
because design thinking helps to reframe problems and to connect people and
business.

Introducing the Design Council Double Diamond Process Model

“The double diamond diagram was developed through in-house research at the
Design Council in 2018 as a simple graphical way of describing the design pro-
cess” (Design Council, 2019). As discussed earlier, despite how the concept of
design thinking is used according to the context, it could be argued that all the
models regarding the process of design agree on four similar stages, well repre-
sented on the model developed by the Design Council in 2005. The model was
further tested against the results of a study conducted in 11 leading global com-
panies with the purpose of understanding their design processes, the key ele-
ments involved and how these processes take a product or service from an idea
through implementation (Design Council, 2018) (Fig. 2.4).
This model identifies four stages: Discover. The first stage is about exploring
issues, gathering insights and identifying user needs by, for example, asking
questions, posing a hypothesis or analysing market data. It is phase of divergent
thought where keeping a wide perspective is key to develop a broad range of
ideas. Define. The second quarter represents the phase in which all the possibili-
ties found in phase one are refined to formulate the problem to be addressed. In
a strategic level, it refers to the interpretation and alignment of the needs with the
business objectives. Develop. This stage indicates the period where solutions are
developed, iterated and tested. Feedback from each round of development
informs improvements as well as additional considerations arise. Deliver. The
last quarter represents the time when the resulting outcome is finalised, produced
and launched. It also includes the final testing and evaluation of the impact by
collecting data from diverse sources to inform future projects. ◄

Fig. 2.4 Double-diamond model (adapted by authors)

2.4 Design Thinking and Business Strategy 17

2.4 Design Thinking and Business Strategy

One aspect surrounding the controversy of design thinking as a business strategy is

given by Gianfranco Zaccai, President and Chief Design Officer of Continuum. He
explains that this ‘phenomenon’ occurred probably because executives started to
look for other ways to look at their businesses since they realised the pragmatic,
linear, analytical and quantitative approach was not having the expected results
(Lockwood, 2010). Zaccai articulates design as “a way of thinking that creates
insights that inform what and how you execute, as well as how you communicate,
market, support, and service once the product is introduced” (Lockwood, 2010,
p. 18). Thereby, design informs the whole business strategy. However, the decision
by an organisation to become more design centric depends on the personality of the
company leadership. Zaccai suggests that a gradual implementation of design-­
driven approaches could be the first move. If it is first applied in one part of the
business, it could learn from the mistakes and lately transfer it into the entire organ-
isation (Lockwood, 2010).
Fraser promotes a formal framework (2009) introducing design as a path to
understand stakeholder needs, a tool for visualising new solutions and a process for
translating novel ideas into effective strategies. Fraser proposes a methodology
called “The Three Gears of Business Design”:

• Gear One: It refers to get a deep user understanding where new opportunities are
revealed. This helps reframe the business challenge through the eyes of the end
user and set a human context for innovation and value;
• Gear Two: This the phase of development where there is a broad exploration of
possibilities to meet the needs found in gear one; New solutions are generated
and visualised through prototyping.
• Gear Three: This phase aligns the new idea with the proposed future by design-
ing the business itself (Fig. 2.5).

Fig. 2.5 3 Gears of business design framework (adapted by authors)

18 2 Evolution of the Relationship Between Design and Business Activities

It is about exploring what it takes to take the idea to the market, identifying the
strategies that will drive success and prioritising the activities the organisation must
do. The final step is the integration of the new concept into the current operation as
well as the identification of the barriers and how they will be surmounted. In addi-
tion to this methodological framework, Fraser proposes a mindset for the individu-
als in the organisation consisting of: (1) mindfulness, (2) open-minded collaboration,
(3) abductive thinking, (4) permission to risk early failure, (5) imperfection and
iteration early in the process, (6) creative resolution of trade-offs and constraints.
The combination of both is what drives breakthrough strategies for enterprise
success.
In a similar perspective drawn from a series of interviews, Drews (2009) articu-
lates the nature of design thinking as a mindset pointing out three key points: (1)
consumer-centricity, (2) orientation towards the future and (3) challenging the form.
One of the advantages of design thinking discussed by Drews, is that visualising and
early prototyping engage stakeholders since having something to look at facilitates
discussion and allows the idea to evolve. It also helps to decrease the high-risk fac-
tor of radical ideas. Likewise, Fraser, Drews (2009) presents the value of design
thinking in a way businesses can understand their customers and their future choices,
ensuring the company has the capacity to manage the innovation of their products,
services and ways to do businesses.
Business people and educators might find a common point of interest with design
thinking when they want to create something new and discover new opportunities.
“Design thinkers are good not only at finding the answers but also at asking the right
questions” (Drews, 2009, p. 41). Clark and Smith (2010) offer the term ‘innovation
intelligence’ to describe design thinking to an executive audience. They argue that
the type of intelligence, which supports innovation and provides an organisation
with multiple ways to solve problems, drives design thinking. At the end, it allows
to discover the best possibility that best delivers competitive advantage. Lockwood
(2009) approaches design thinking in a similar way. Design thinking is defined as an
innovation process. They key value of design in business lies on the discovery of the
right problems and solving the problems for both, customers and businesses. It is
about the process, the final solution and the design outcome. More recent perspec-
tives illustrate design thinking as a well-established practice in global corporations,
generating the terms ‘design-driven’ organisations and ‘design-led’ cultures.
The September 2015 issue of the Harvard Business Review reflects about the
evolution of design thinking. In the article Design for Action, Brown and Martin
(2015) explain how design thinking can help strategic and systemic innovators to
build new futures. The best way to build strategy is by having an iterative interaction
with the decision maker. By building on empathy with the decision maker and dis-
cussing the ideas in progress, the final step of introducing a new strategy becomes
easier. Kolko (2015) argues that large organisations and professional are working on
the development of design-centric cultures. There are five key aspects:

1. Focus on the user’s experiences, especially the emotional ones;

2. Create models to examine complex problems;
2.5 Design Thinking in SMES 19

3. Use prototypes to explore potential solutions;

4. Tolerate failure;
5. Exhibit thoughtful restraints.

The same edition makes reference to Samsung and Pepsi as organisations that
turned design thinking into corporate strategy. The case for Samsung shows the
progress of several years where a corporate design centre was established to work
on future design: visualise the distant future and develop new business concepts
(Yoo & Kim, 2015). The case for Pepsi highlights the relationship between design
and innovation and the facts for design to thrive: (1) having a leader with a holistic
approach of design; (2) sponsorship from the top; (3) external endorsements such as
business leaders, design/business magazines and awards; and (4) quick wins
(Ignatius, 2015). Regarding the challenges still to be faced by organisations, Drews
(2009) argues that one of the reason of design thinking has not reached its full
potential is the well-known gap between the quantitatively business people and the
qualitative creative ones.
The gap is attributed to a system education focused on ‘right’ and ‘wrong’
answers, which confronts the science students against the ‘arty’ ones. The result is
professionals who love to measure ideas as soon as possible, opposed to others who
avoid limits and challenge the problem they were asked to do in the first place. The
key will be to overcome the hierarchies between both areas in order to get the
designer’s ideas incorporated into successful business propositions and the business
people open to learn their minds to perceive unseen opportunities. Another impor-
tant argument is that design thinking might not be the answer to every business
challenge, but is an excellent approach for the some of the business issues related to
setting markets, sustainability and re-shaping of the economic system. In times
when reinvention seems a ‘must have’, design thinking is a skill for doing it.

2.5 Design Thinking in SMES

Several case studies show evidence that design thinking was deployed as a strategic
force, transforming the vision of large and global organisations. There is no doubt
about the success of innovative companies such as Google, IBM, Samsung and
Pepsi. Even Brown (2015) reflects whereas design thinking is a competitive advan-
tage when everyone is doing it. While such statement might be valid for large cor-
porations, for owner-managers of small businesses the incorporation of design
thinking entails a different context. “The category of micro, small and medium-­
sized enterprises (SMEs) is made up of enterprises which employ fewer than 250
persons and which have an annual turnover not exceeding EUR 50 million, and/or
an annual balance sheet total not exceeding EUR 43 million” (Article 2 of the annex
to Recommendation 2003/361/EC European Commission, 2015). SMEs represent
over 99% of all businesses in the UK and in Europe. Thus, they are an important
part of European economy as a source of employment, economic growth, entrepre-
neurial skills, and recognised as a key role in innovation (European Commission,
20 2 Evolution of the Relationship Between Design and Business Activities

2015). Given their importance to the European economy, SMEs have become a
focus of European innovation policies that recognise and encourage the value of
design as a driver for growth and competitiveness. Commission of the European
Communities (2009) emphasises that companies that invest in design tend to me
more innovative, more profitable and grow faster. However, some of the barriers
relate to both, design companies and non-design SMEs.
Barriers for SMEs

1. SMEs often have little experience of design, do not know how to find profes-
sional help or integrate design into their innovation processes.
2. SMEs located in small cities might not have access to quality design advice since
large design consultancies are concentrated in big cities.
3. SMEs often lack the resources, expertise and methods to evaluate the risk and
the rate of return on design investment.
Barriers for Design Firms

1. The average small size of design companies weakens their influencing power in
governments and the reach of new markets into a wider circle.
2. Many designers do not have sufficient business knowledge and skills necessary
to be better integrated into the business and innovation community such as stra-
tegic design, design management and design-driven innovation.
3. Designers have not organised themselves as a profession resulting in a low levels
of networking, coordination and influence.

The Northern and Western Regional Assembly and CIRCA Group (2015) high-
light the importance of design-driven innovation for SME competitiveness and pro-
pose a change of attitude towards a design-driven approach. Alongside the report
offering the benefits of design thinking and that introducing design thinking can
influence positively on economic growth, productivity, competitiveness and employ-
ment in Irish SMEs, the research shows similar barriers compared with the report by
the EU Commission: (1) SMEs do not understand the value of design and take new
ideas on board slowly. (2) Few graduates entrepreneurs undertake basic courses on
design processes. (3) The design industry is fragmented and not doing a good job at
promoting itself. Moreover, Acklin (2013) concludes that the use of design as a
strategic resource entails a learning process by SMEs on how to manage such new
knowledge and minor attention has been given on the way the companies with little
or no design experience build capabilities to execute design management.
Similarly, Gulari and Fremantle (2015) point out that SMEs’ design needs and
design capabilities are different from large enterprises. For example, SMEs avoid
taking risks, probably due to lack of capital, insufficient human resources and lim-
ited time. In this way, a design thinking approach through experimentation, iteration
and cheap prototyping is relevant and can help them build innovation capabilities.
In contrast, SMEs often have a good understanding of their customers since they use
their close relationships with their clients and observations to generate new ideas.
2.5 Design Thinking in SMES 21

However, the knowledge used for innovation and growth is tacit and shared by a
reduced number of people; therefore, the innovation methods should support SMEs
to externalise such knowledge. Lastly, whereas design has a positive impact in an
organisation when it is embedded in its culture, a design-led culture drives a cultural
change that requires organisations to go out of their comfort zone, adopt new ways
of thinking, commitment to action over the long term, and inspirational leadership.
The Danish Design Centre developed in 2001 the Design Ladder, a tool to mea-
sure the level of design activity in Danish companies. It is centred upon the premise
that the idea of a positive link between settings design in a strategic position in the
company and obtaining higher earnings (Melander, 2015) (Fig. 2.6).
The highest stage represents design used as a strategic medium to accomplish
business objectives, which could be understood when ‘design thinking’ is applied
thoroughly. It became a reference to present the progression of the incorporation
and use of design in an organisation (McNabola, 2014).

Case Study: Design Support Programmes for SMES in the UK

Organisations in the UK have been facilitating a link between designers and

SMEs and launching design support programmes. The Design Council, the UK’s
national strategic organisation for design championship, has extensively
researched about the role of design in UK businesses and is the main advocate
about the value of design (Design Council, 2012a, 2012b). Ward et al. (2009)
review the results of ‘Designing Demand’, a programme undertaken by the
Design Council, between 2006 and 2010. The reasoning behind the programme
is that the skills that designers have used to create successful products, commu-
nications and services can also be applied to the design of businesses themselves.

Fig. 2.6 Danish design ladder (adapted by authors)

22 2 Evolution of the Relationship Between Design and Business Activities

In this way, the programme connected experienced designers with SMEs to

guide them through the process of investing in design and innovation strategi-
cally and using it effectively. Additionally, the programme brought design think-
ing into the company and their staff through games, workshops and team tasks.
One of the conclusions is that ‘vision and strategy’ is a key area where design
adds value. “If design thinking can help companies put the strategy into their vision,
it can also help them put the vision, or more explicitly, the visual, into their strategy”
(Ward et al., 2009, p. 80). The programme continued under the name Design
Leadership Programme (Design Council, 2012b) and the report shows:

1. Businesses grew. For every £1 invested in design, businesses can expect over
£20 in increased revenues, over £4 increase in net operating profit and a return of
over £5 in increased exports.
2. Design helped businesses to identify their biggest strategic challenges and create
new opportunities to overcome them by using design effectively.
3. Design changed the way businesses work, resulting in an improvement of organ-
isational cultural and performance.
4. Businesses became clearer about the integral role of design and that it should not
be sidelined for other strategic requirements.
5. Businesses showed that once they have been exposed to design tools and good
design management practice, they are equipped to do it again themselves.

The Design Council continues giving support to businesses through design

consultancy by way of ‘Business Growth Service’ as well as by providing online
resources such as case studies, guides and reports. UK Research and Innovation
(2021) developed an innovation strategy placing design at its core as a methodol-
ogy that can be applied for creating better products, services, processes and busi-
ness models. The document points out the lack of awareness by businesses in
exploiting the value of design as a strategic scoping and planning tool. The key
argument is that by using the design process as a framework, the creative process
allows businesses to progress 32 Design Thinking in SMEs from a contextual
understanding towards new propositions and development opportunities. This
innovation strategy includes business of all sizes and no specifics considerations
are presented for SMEs.
Design for Europe (2021) is a three-year initiative to support design driven
innovation across Europe. In general, it brings together information about user-­
centred design thinking and the application of design tools and methods in ser-
vices, systems and organisations that enable business-model and other forms of
innovation. Whereas there is not a section addressed to SMEs, the platform col-
lects a set of resources available to businesses such as case studies, tools, design
toolkits, guides, articles, reports, links, and events. However, there is no evidence
if they are used, thereby measured or how to get feedback. Past initiatives worth
of being highlighted are ‘Design Service Programme’ in Northern Ireland run by
Invest Northern Ireland between 2008 and 2015 and ‘Service Design Programme’
in Wales run by the National Centre for Product Design and Development
Research (PDR) between 2010–2013. Both worked on delivering support for
2.5 Design Thinking in SMES 23

strategic design. The programme in Northern Ireland focused on providing four

service elements: awareness, advice, capability and support, while the Welsh
programme worked at a strategic level with 90 companies to support the develop-
ment of service design in industries in the manufacturing sector and expertise in
the design companies (N&WRA and CIRCA Group, 2015). Overall, it is sug-
gested that the support to SMEs is given through a specialised consultancy and/
or online resources. Nevertheless, the programmes reports do not evidence the
discussions about SMEs’ context, the process on how SMEs incorporated design
knowledge or how they were reached. As Cox (2005) expressed, “experience
shows that smaller companies do not respond well to generalised awareness pro-
grammes…. SMEs need to be reached on a local basis, with active support and a
practical demonstration of the benefits on offer”. ◄

cc Chapter Summary This chapter has established the status of design

thinking as a vital tool (or a philosophical approach) for organisations to
draw upon in these uncertain times. It is by no means a definitive account
of the subject area as its growing complexity is testament to its vibrant
nature as a leading change agent, be it within or beyond the organisation,
or as a subtle means to change people’s perceptions and behaviours.
The authors introduced a series of design thinking frameworks and
models that have been widely adopted and applied when developing
business development strategies. If unfamiliar with these commonly
used frameworks, there is a dearth of literatures freely available that
critiques the effectiveness and value of these process models. The Design
Council Double Diamond model is premised on two basic aspects: first,
the four differing stages of idea development, beginning with discovering
the opportunity, then taking the ideas to fruition in phase four. The
second element is based around modes of creative thinking, that is,
divergent and convergent approaches to problem solving and solution
development. This generic model is comparable to Fraser’s ‘The Three
Gears of Business Design’ but features a stronger emphasis on the end-
users as opposed to business strategy development which lies central to
Fraser’s model. Even though they are similar, there is a distinct nuanced
difference between the two process models, which is not that explicit to
readers unfamiliar with these two systems. Finally, when exploring the
Danish Design Ladder in terms of application, this is quite different to
the other two process models. Here, the Design Ladder is intended for
use by the organisation to establish ‘how and where’ they currently use
design (be it for superficial styling activities or more pronounced at a
strategic level of application). Having established where the company is
positioned on the Ladder, they can then implement strategies for further
design ‘augmentation’ within the organisation. All the process models
and design positioning frameworks discussed within this chapter are
highly malleable in nature, thus being able to be applied in contexts that
are broad and far reaching in nature. For instance, if a design process
24 2 Evolution of the Relationship Between Design and Business Activities

model was tailored to a specific industry or organisational set-up, then its

wider applicability would be greatly reduced; hence the generic nature of
the models examined within this section.
Set against global challenges and macro-economic uncertainty, it is
worthwhile to critically debate and explore the role and value of design
thinking as a meaningful agent of change. Its gradual journey towards
maturity is relentless and carefully orchestrated with industry practice
informing current academic theory—and vice versa. It does indeed give
rise to an interrelated set of questions ‘who is leading this change? Who
are the beneficiaries of change’ and ‘what role can design thinking play
in leading this change?

Review Questions

1. The role of Design Thinking has many different definitions as to its value and
application within contemporary industry practice; how would you define the
unique value of Design ‘Thinking’?
2. What would you consider the key attributes of Design Thinking that makes it
distinct from other established problem solving techniques?
3. The Design Council Double Diamond model is widely acclaimed as a leading
design thinking process model—what would you consider its limitations in
terms of wider application?
4. Fraser proposes a methodology called The Three Gears of Business Design—
would you suggest that another gear be added and if so, what would the focus of
the fourth gear be?
5. What are the common barriers to design adoption by the organisation, in particu-
lar to SMEs?

Project Questions
1. Design can make a meaningful contribution to the company in a wide variety of
ways; could you identify and list three key areas where design can add real value?
2. Design thinking as a problem solving approach is subject to fierce debate within
the design profession; as such, create a taxonomy of leading design thinking
process models that outlines their similarities and differences. Following this,
could there ever be one successful generic design thinking model?
3. If you could expand upon or refine the Design Council Double Diamond model,
what, where and how would you modify it to be of value to organisations beyond
the commercial sector?
4. On the Danish Design Ladder, identify four leading companies that you consider
to be located at each of the four stages of design maturity?
5. The Cox Report (2005) was regarded as a comprehensive report into the value of
design; now in the 2020s, what aspects of it would you update or include to
reflect current industry developments?
References 25

Chapter Tasks

1. Public Sector organisations and departments are now embracing design think-
ing, how can it be used to improve end-users ‘experiences’ in the delivery of
public services?
2. Can you identify a series of Design Support Programmes in your country and
outline their strengths and weakness in terms of value and appropriateness to the
organisations that they are targeting?
3. The Danish Design Ladder has 4 primary elements—if you had to add another
level at the top (5) what would it focus upon?
4. Outline the primary aims and objectives of an internal design audit within a prod-
uct-based SME identifying their current strengths and weaknesses regarding design.
5. How can designers or design thinking activities contribute to the corporate strat-
egy development process? Where and how does design meaningfully contribute
to long-term commercial ‘vision?’

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Crossing Boundaries: Design into
Business and Management 3

Learning Objectives

• To understand the relationship between strategic design adoption and com-

mercial competitive advantage.
• To examine common elements of university design degree programmes
and their influence on transferable skills development.
• To develop an understanding of the challenges of implementing design
thinking within business school curricula.
• To introduce the rise of online executive design thinking programmes to
support continuing professional development.
• To critically examine the introduction of a design thinking programme
within a leading North American higher education institution.

3.1 Introduction

Over the last decade, we have witnessed practitioners and academics from the realm
of business and management valuing design as an invaluable means of dealing with
complex innovation challenges. Design in its broadest sense, is a multidisciplinary
activity that transcends traditional disciplinary boundaries, moving into areas of
critical engagement that were unthinkable during its formative stages of continual
development. The eclectic nature of design is a broad church of ideas, diverse atti-
tudes, and different agendas; when viewed in entirety, the dynamic interrelation-
ships of these elements are embedded in the way organisations develop new
products, services, systems and interactions in order to enrich the lives of the

Supplementary Information The online version contains supplementary material available at

[https://doi.org/10.1007/978-­3-­030-­94206-­9_3].

© The Author(s), under exclusive license to Springer Nature 27

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9_3
28 3 Crossing Boundaries: Design into Business and Management

peoples ‘experiences.’ With this inherent agility and wider applicability, design
humanises scientific and technological advances, which continually shapes our
lives. The quest for continual innovation drives business vision in the relentless
search for differentiation and competitiveness in highly challenging marketplaces.
Business leaders of tomorrow need to be equipped with the skills and ability to
inspire, motivate and encourage employees to achieve visionary goals, of the indi-
vidual and the organisation. When we look at the world’s leading brands, often you
find a key individual central their success; Tim Cook (Steve Jobs predecessor) at
Apple, Huateng ‘Pony’ Ma, elusive entrepreneur who created the technology com-
pany in China—Tencent, and Marrisa Mayor, CEO and President of Yahoo as nota-
ble examples. Training and developing visionary business leaders for tomorrow
takes us to one single point of discussion: education. Where and how do we equip
business leaders with the abilities to lead and deliver projects, encourage initiatives,
build a sense of common purpose, and empower others? This chapter aims to con-
tribute to the ongoing debate of critically examining the role and nature of business
schools and their teaching curricula in best preparing graduates for leadership posi-
tions in industry. Having set the scene as to how design can offer many strategic
benefits to the company, we turn our attention to exploring the strengths and weak-
nesses of current business/management education, set against the need for continual
change in both teaching planning and delivery.
The discussion explores the differences and similarities between design and
business curricula currently on offer in a wide variety of degree programmes, illus-
trating how critical thinking, problem solving and teamwork skills are developed
within the students. Current debate in business/management schools shows the
many parallels between design and business pedagogy and how the primary ele-
ments of these two disciplines could be embedded within teaching practice. If suc-
cessful, a future thinking curricula would provide business educators with a number
of important designerly concepts, tools and methods that could be directly inte-
grated into existing courses. Design Thinking is an engaging way for students to
learn about customer development, problem solving, product-solution fit, creativity,
divergent and convergent modes of thinking, iteration, failure, resilience and team-
work. It allows students to develop their creative confidence and shift their beliefs
about what skills they need in order to become business leaders of tomorrow. The
chapter concludes with a guest contribution in the form of a small case study from
Dr Beatriz Itzel Cruz Megchun, Assistant Professor of Design & Innovation at
Pamplin School of Business, University of Portland, USA. Here, Dr Cruz argues
that design thinking principles and practices can both enrich and complement exist-
ing business programmes and the many benefits far outweigh the risks of signifi-
cantly re-designing tried and tested teaching curricula.

3.2 Design for Business: The Critical Imperative

It is widely acknowledged that design can add many benefits to business profitabil-
ity and overall long-term success (Nomen and BCD Barcelona Centre de Disseny,
2014; Cox, 2005; The Design Council, 2015; Kotler & Rath, 2013). Thomas Watson Jr,
3.2 Design for Business: The Critical Imperative 29

Table 3.1 The contribution of design to business success

Design activity Design as process Design as strategy
Develop innovative products and services 85% 86%
Develop higher quality products/services 83% 86%
Differentiate products and services 73% 86%
Penetrate into new markets 65% 84%
Provide more added value to customers 81% 80%
Make better decisions based on customer insight 61% 74%
Support the marketing of products/services 59% 74%
Build a brand and image 61% 70%
Achieve cost reduction 53% 66%
Accelerate the innovation process 59% 64%
De-risk the innovation process 60% 56%
% of company respondents interviewed

the second Company President of IBM, famously remarked, “good design is good
business” which still holds true today. Businesses can draw upon the full power of
design in a wide variety of ways, ranging from graphic design right through to
organisational change (based on research findings by Cooper et al., 2016). Table 3.1
identifies how and where design can contribute to increased business success.
As we can see from Table 3.1 the wide variety of applications that design can
take and the impact that it can provide. Design can offer far more benefits than
anticipated; however, design is still largely misunderstood by business in terms of
what it can offer. There is a commonly held assumption by businesses that design is
mainly used for aesthetic purposes such as logos and simple graphics—which sadly,
still prevails today. In order to raise its value as a strategic business asset, design
councils/associations such as the Danish Design Centre (DDC) in Denmark right
through to Korea Advanced Institute of Science and Technology (KAIST) in South
Korea are continually working with businesses and organisations to communicate
the many benefits of design that it has to offer. Referring to Table 3.1., design can
play a significant role at a strategic level through:

• The development of innovative products and services: design connects creativity

to innovation which can lead to the creation and commercialisation of innovative
products/services. New markets could be opened-up to the company or new mar-
ket segments could be exploited within existing markets. This is turn, can lead to
sustainable business growth through design.
• Developing higher quality products/services: design would enable the company
to reposition its present product/service offerings, either by enhancing product
attributes via adding design value to ensure premium status; or alternatively,
offering the product to a mass market audience at a lower price position.
• Differentiate products and services: to establish a clear difference between com-
pany offerings against rival products. Design is an excellent means of differentia-
tion and can be a powerful tool to secure market share.
30 3 Crossing Boundaries: Design into Business and Management

The consideration and application of design at a strategic level requires senior

levels of support and authority in order to be effective. As such, this takes design
into the highest echelons of corporate decision making which is now becoming a
strategic asset. To adopt this approach towards the use of design, senior managers
and CEO’s need to have a good understanding of design in order to unlock its full
potential. However, an interesting question arises here; how do senior decision mak-
ers in business gain exposure to the many benefits of design? It would be sensible to
assume that design, design management and design leadership would feature within
business and management school curricula (either as a core or as an elective optional
module). Sadly, that is not the case; design thinking within business schools is still
a relatively rare phenomenon, often only touched upon a superficial level if at all.
Formosa and Kroeter (2002) based at Parsons School of Design, New York under-
took a review of 19 top-tier American MBA programmes and found that “not a
single one addressed or incorporated design into its curricula in any significant way.
Even in those programmes focused on marketing and branding, curricular attention
to the principles or theories of design is cursory, at best”. Which is odd, given that
the world’s leading brands use design throughout every aspect of application, such
as Louis Vuitton (superior product quality); BMW (precision design engineering);
Disney (design experiences); Taobao (user experience design) and so forth. Many of
these companies are cited as excellent examples of business success, but yet the way
they use design is predominantly overlooked in the majority of teaching within
management/business schools. These visionary companies (amongst many others)
operate in highly complex and competitive postmodern marketplaces where design
is vital to their ongoing success.
The world of business and commerce is undergoing radical transformation, with
social and technological changes relentlessly disrupting traditional business models
on a daily basis. Set against this turbulent backdrop, it has left numerous business
schools teaching outdated curricula and pedagogic practices that do not respond to
these dynamic and emergent challenges of the third millennium. However, a grow-
ing number of business schools have acknowledged shortcomings in their curricula
and teaching provision (Glen et al., 2014). With this in mind, design orientated
modules or short courses could provide business students with exposure to creative
problem solving techniques through cultivating confidence via new types of learn-
ing activities. Matthews and Wrigley (2011) argue, “Australian universities show
some early experimentation with design thinking, often with in units on innovation
where interest in design thinking may be of longstanding interest. Within Australian
business schools there is some recognition are realising the area of design thinking
in business is a growing and necessary field and some initiatives have begun”.
Carefully considered and taught within a business school setting, design thinking
can meaningfully contribute to a number of core business modules/programmes of
study. For instance, the commonly featured modules management and strategy, are
heavily weighted towards ‘process’ that rely on rational planning and analysis type
activities, leaving considerable room for the adoption of design thinking.
Furthermore, marketing lies in having a deep understanding of customers and end-­
users needs which is consistent with empathic design which could significantly
3.3 Teaching Design in Design Schools 31

benefit from tools and techniques such as user journeys, empathy maps and perso-
nas—the basic elements of design thinking. In addition, these designerly techniques
would allow students to explore and understand business principles outside of a
traditional classroom setting (i.e. ‘chalk and talk’) and learn from real business
world problems, connecting theory with contemporary industry practice. One com-
mon approach to connect classroom learning to industry practice is through work
placements or internships; however, internships often would not engage with or gain
exposure to design thinking practices.

3.3 Teaching Design in Design Schools

In order to understand as to how design thinking could be embedded within man-

agement and business schools, let us briefly turn our attention to design schools and
their approach to delivering design and creativity skills. Firstly, due to the large
number of design degree courses offered, there will be a large amount of variation
between each university course—even though basically they will be teaching the
same subjects, that is, interior design, fashion design and so on. However, the fol-
lowing elements of curricula and learning principles generally remain consistent
throughout the design education sector.
Entry onto design degree programmes: virtually all design courses will require
the applicant to demonstrate their creativity and suitability for study onto their
respective course; this is predominantly demonstrated by a creative portfolio of
work (be it the large traditional A0 black portfolio or an online portfolio of work
that is widely used now). There needs to be a significant body of work that aligns
with the particular degree course that the applicant is applying to, such as product
design which demonstrates three dimensional thinking and so forth. In the UK, a
general Art and Design foundation course is a preparatory course where the appli-
cant can over the duration of their studies, build a comprehensive portfolio of work
in order to apply for higher study. More often than not, this entry route onto a design
degree is commonplace across the West.
Types of design courses: traditionally there used to be two types of design
degree courses—2 dimensional design that covered—graphics, illustration and
publishing type disciplines; and 3 dimensional design that focused upon—interi-
ors, products and fashion. However, with the rise of digital, we are now witness-
ing the increasing amount of courses that teach web design, gaming and design
interactions; hence now becoming the third aspect of design study. We have
omitted architecture from this discussion, even though regarded 3D design, it has
its own specialist requirements in terms of teaching and learning outcomes that
are regulated by professional statutory bodies such as the Royal Institution of
British Architects (RIBA).
Teaching Methods: This is the key difference that separates design education to
comparable courses in more traditional disciplines and the sciences. Design courses
are heavily orientated to skills development in a practical sense, with lesser
32 3 Crossing Boundaries: Design into Business and Management

emphasis on formal lectures and seminars. Rather than the main element of learning
in the lecture theatre, greater attention is paid to learning in the (design) studio,
where the tutor(s) would have greater contact with the students through learning ‘on
the job.’ In practical workshops, students learn and become familiarised with the
different types of methods commonly used within their discipline. Furthermore, the
use of formative design presentations and subsequent critical feedback (‘crits’)
from tutors and peers forms a continual basis of learning that reflects industry prac-
tice. Lectures do feature on design degree courses, mainly used to develop the stu-
dents understanding of historical movements in design and critical contextual
studies that underpins contemporary design discourse. Finally, skills development
regarding the use of software and digital technologies is increasing in prominence
on design courses, thus reflecting the move towards digitisation in studio practice
and industry. Guest lectures from external design experts are frequently common-
place in teaching, thus affording real world insights from leaders drawn from their
own respective disciplines.
Transferable Skills Development: Are an integral part of the majority of degree
programmes, and design is arguably one of the most critical disciplines where skills
is fundamental to its professional development. There are two types of skills devel-
oped; firstly—subject specific for instance where a fashion design student would
learn in the workshop, skills in making and crafting garments; or industrial design
students using specialist tools, techniques and equipment to create prototypes and
physical models. Secondly, the development of transferable skills is as important to
subject specific skills. Due to the broad range of skills developed over the duration
of study, transferable skills are developed that are critical to the design discipline
that they wish to enter into; but also to careers outside of design. Main transferable
skills achieved during design study include: (1) problem solving; (2) creative think-
ing; (3) communication; (4) project management; (5) teamwork; (6) independent
research abilities.
Postgraduate Specialism: Following on from undergraduate design study, a stu-
dent may wish to specialise further within their own discipline or use postgraduate
study to explore a complementary study to that of their first degree. Postgraduate
degrees can be roughly divided into two distinct camps—(1) PGT ‘taught’ which
are generally more structured, with a large dissertation/research project at the end
which allows specialism within its own subject area. (2) PGR ‘research’ that requires
the student to undertake most of the study independently via research, often super-
vised by one or two academics in support over the study period. This study route is
an excellent means of preparation if the student wishes to continue their research
study to Doctoral (PhD) level. Alongside these standard postgraduate courses, there
are also highly specialised master’s programmes, professions for which by law you
need to be properly qualified to practice, for example, medicine, dentistry, law and
social work.
Regarding postgraduate design courses that feature a strong orientation towards
business and management themes, these vary, but predominantly sit within the
3.4 Teaching Business Management in Business Schools 33

realm of design management and strategy, design for business, design and branding
and so forth. Loosely speaking, these types of courses strongly feature on process
for developing new products or services, however, with the advancement of design
touching upon many other related disciplines, the breadth and content of these
courses has advanced significantly over the last decade. As touched upon earlier,
even though universities offer the same types of courses, the variation between them
is often quite significant. For instance, Lancaster University offer a postgraduate
design management course that develops modes of thinking critical to the chal-
lenges design managers face across a range of real-world situations. It explores
design management from a range of future-oriented perspectives, including service
design, design for sustainability, right through to design policy development.
Birmingham City University, have a long established MA Design Management
course that focuses heavily upon creative skills development to support entrepre-
neurial and business capabilities through design. Although these types of courses
are quite diverse in nature, there are some common elements or themes that run
throughout them. These would often include:
Creative research methods: that develops an understanding of a range of design
research methods and their application within real world contexts. The focus would
be to develop analytical and creative design thinking through theoretical investiga-
tion and practical activities. This type of module introduces and develops research
approaches, methodologies and tools used to inform design research, as well as
ideas about how and when to deploy these research tools appropriately, frequently
within a business setting.
Critical and contextual studies: exploring the complex relationship between
design and business and explores this relationship in both historical and contempo-
rary contexts. Usually a core module of this nature, considers how design can con-
tribute to sustainable and commercially viable propositions and the resultant
relationship to organisational agendas.
Design for business: would focus on the origins of design management/design
leadership, its past, present and emerging forms; its functions and purposes; and its
relationships with policymaking. It would provide the historical and practical con-
text for design management in general and the role of the design manager in particu-
lar. Furthermore, topics and themes would explore the meaning of designing versus
managing and the many ways design managers can contribute to organisations.

3.4 Teaching Business Management in Business Schools

In this section, we turn our attention to examining common elements of curricula

that features in a wide variety of business management schools. For the sake of
brevity, this discussion only focuses upon postgraduate study as opposed to under-
graduate, mainly due to the wide breadth of undergraduate courses offering business
management studies. Furthermore, postgraduate courses tend to be more
34 3 Crossing Boundaries: Design into Business and Management

specialised, offering a narrower range of taught modules, which allows easier com-
parison across the higher education landscape. We have identified common modules
where and how design thinking could make a significant contribution to learning
outcomes; currently though, design is rarely mentioned nor featured in the taught
elements that we highlight.
Entry onto business degree programmes: Generally speaking, entry into the
majority of postgraduate courses requires a set of strong qualifications that feature
(in particular) Mathematics and English. The undergraduate degree should be com-
plementary to associated disciplines that sit with business and management (i.e.
finance, accountancy, marketing etc.). Like the majority of postgraduate courses, a
comprehensive personal statement that covers evidence that you have an enthusiasm
for the subject, ideally supported with evidence of work experience/voluntary work
and additional reading and research around contemporary business themes are
required.
Types of business management courses: Alongside general business management
courses such as Master of Business Administration (MBA), specialist areas of study
often include International Business Management, Accounting and Finance,
Business Analytics, Marketing Communications, and Charity Marketing and
Fundraising. These in a way, demonstrate the breadth of business management
courses on offer and their rich variety of disciplinary specialisms.
Teaching methods: Mainly take place in the form of traditional lectures and
seminars. Seminars are smaller interactive workshop type sessions where discrete
learning groups are formed to allow exchange of ideas and concepts. Due to
emphasis on team working, much of the learning takes place via group projects
and assignments, often working with companies drawn from industry. In order to
provide industry insight and relevance, it is not uncommon to see guest lectures
from leading academics and business leaders sharing personal insights based on
their own experience.
Elements that could feature design thinking: common modules (or learning units)
that could benefit from the inclusion of design thinking to afford a series of alterna-
tive perspectives, include:

1. Corporate strategy—where design could greatly contribute to the formulation of

business strategy development. For instance, corporate strategy is predominantly
deployed to identify, plan and achieve long-term business objectives and goals.
A designerly approach would yield a solution-based means of solving problems
via the inclusion of end-users or developing a deeper understanding of users’
needs and values. Furthermore, this approach could also raise the value of design
as an invaluable way of increasing efficiencies within the product planning pro-
cess through the reduction of time and resources on poorly defined ideas and
concepts.
2. (International) Marketing—is arguably the closest business function to design,
but yet design is rarely touched upon in this core element of learning. The rela-
tionship between design and marketing is becoming increasingly more strategic
3.4 Teaching Business Management in Business Schools 35

and business-driven, with primary emphasis on understanding user needs. This

symbiotic relationship covers areas ranging from consumer behaviour to market-
ing research, customer relationship management right through to marketing
communications. In addition, internationalisation and evolution of markets have
created opportunities for companies to focus on marketing from a global per-
spective and central to this is the role of design that can make universal product
offerings country specific.
3. Digital Innovation—or put simply, the application of software technologies to
existing business problems or practices. With the rise of digital, companies are
re-orientating their business strategies to increase their online operations; design
provides an enhanced series of user experiences that reinforces brand values.
Also, design can be an ideal means of differentiation in highly competitive mar-
kets; as such, its prominence as a strategic resource in corporate strategy and
decision making should be widely promoted within business school curricula.
4. Entrepreneurship—in an unpredictable world, innovative minds are constantly
searching for new commercial opportunities. Thinking and acting entrepreneur-
ially is as valuable in a large organisation as it is to a new start-up venture. Both
leading companies and start-ups must develop new ideas, products and services
that create real value for the customer. Primary aspects of the entrepreneurial
process include creativity, opportunity recognition, sales, finance, leadership and
effective communication—design influences and embraces all these interrelated
activities, transforming ideas into tangible products for marketization.

However, embedding design and creative thinking within business school curri-
cula is not as straight forward as one would first imagine. There is a considerable
cultural divide between the two disciplines that in some aspects are diametrically
opposed to one another. However, this clash of cultures could create a contested
space between the two disciplines, whereby design thinking connects decision mak-
ers to creators. It is widely acknowledged that curricula in business management
school are tightly bound, with many conflicting demands placed upon the students.
Adding more modules to an already packed curriculum could present challenges to
the educators, given that if something extra is added, something needs to be removed
from the teaching programme. One quick and effective way of introducing design
into business schools is through offering design thinking as an optional module that
could arouse curiosity and an opportunity to explore something novel within the
student learning journey. If enrolment on design orientated modules proves success-
ful, these optional modules could then become a permanent core feature of the cur-
ricula. As discussed earlier, with the emphasis on soft skills (i.e. communication,
teamwork, problem solving) that strongly feature in design practice, these attributes
could influence and inform (creative) teaching practices on other business manage-
ment centric modules. Over time, with the increasing recognition of design, more
design focused modules could be offered or the inclusion of a distinct design man-
agement programme to existing curricula. This would allow modules to be shared
across the suite of courses, whilst a distinct stand-alone course in its own right.
Interestingly enough, one of the early pioneers of design management in the UK
36 3 Crossing Boundaries: Design into Business and Management

was Peter Gorb, who introduced design management to the London Business School
in 1976, which then later was formally established as a Design Management Unit in
1982. Seminal papers arising from work undertaken at the DMU formed the iconic
design management publication in 1988, titled Design Talks! (Gorb &
Schneider, 1988)

3.5 Academia and Industry: Design Alliances

With the rise of online learning gaining a foothold, we are witnessing an increase of
executive education aimed at management professionals who can undertake short
courses (usually between 6–8 weeks) based around design thinking/strategy related
themes. There is a wide variety of formats that these courses take; some are a com-
bination of academic institutions and business partners; alternatively, a select num-
ber of courses offered solely by leading businesses such as IBM, and other
partnership programmes a mixture of both. Below is a range of common examples
of short design thinking courses currently on offer:

(1) London Business School (2021) (UK): Innovation through Design Thinking
[Duration: 6 weeks online; 4–6 learning hours per week]. This short course
introduces the student to the basic principles of design thinking that could be
applied to creative challenges within their own workplace. Learning units
include the importance of innovation to the organisation; understanding cus-
tomer needs; problem framing within an organisational context; idea generation
and creative thinking techniques; prototyping and developing ideas. Case
examples to aid learning are drawn from real life industry examples based on
themes of new product development and service innovation.
(2) Rotman School of Management (Canada): Business Design Thinking: From
Insight to Innovation (Rotman School of Management, 2021) [Duration: 6
weeks online; 4–6 learning hours per week]. This intensive short programme
introduces a 4-step framework to frame and solve business problems via a
designerly approach to innovation. Key elements of learning include defining
business problems through sense-making; effective multi-disciplinary team
working; navigating the four stages of innovation and mastering design think-
ing tools and techniques. What is interesting about this programme is the diverse
learning strategies that are on offer. These include live webinars, interactive
workbooks and peer review sessions that take learning distinctly away from
traditional lecture based format.
(3) MIT Management Executive Education (USA): Mastering Design Thinking—
Create Value through Systematic Innovation (MIT Management Executive
Education, 2021) [Duration: 12 weeks online, 6–8 learning per week] This
ambitious programme confidently states that on completion of study, the learner
will have mastered design thinking. To support this bold statement, study takes
place over three months, navigating the vast terrain of new product develop-
ment with specific emphasis on defining for and developing solutions based on
user-centred needs. Ten course specific modules are offered, each one focusing
upon a key component of design, creativity and NPD.
3.5 Academia and Industry: Design Alliances 37

(4) IBM Design Thinking: IBM’s Enterprise Design Thinking Framework (IBM,
2021) is a free online resource where individuals can draw upon and utilise
design thinking resources to aid design thinking in their own respective organ-
isation. Three main principles form the core of this expansive framework—(1)
a focus on user outcomes; (2) restless reinvention; (3) diverse empowered team-
working. On successful completion of the study units, participants can earn
digital ‘badges’ that demonstrate that they have achieved learning outcomes
from completing their suite of online courses. Recently, IBM (2020) announced,
“what started out as a simple idea to attract talent has turned into the most influ-
ential IT credential program in the world. Now, IBM has issued its three mil-
lionth badge and hosts about 2,500 activities where badges are issued”.
(5) IDEO & Tsinghua University. Lead a Creative China 2030 (ideo.cn, 2021) is a
joint venture between IDEO and Tsinghua University through its PBC School
of Finance and Academy of Arts & Design. It is a 12-month executive pro-
gramme aimed at leading decision makers in China, with the ambitious aim to
transform China’s national economy through a design thinking mindset.
Drawing heavily on the work and tools developed by IDEO, the programme
covers business strategy, organisational design, industry analysis and techno-
logical innovation. Notable contributors to the course has included—Masayuki
Kurokawa, a Japanese architect and industrial designer; David Kelly, the
founder of Stanford d. school; Jake Knapp, the inventor of Sprint; and Liu
Guanzhong from Academy of Arts and Design of Tsinghua University.

Case Study: Embedding Design Thinking Into Business School Curricula

The following case study offered by Dr Beatriz Itzel Cruz Megchun, Assistant
Professor of Design & Innovation at Pamplin School of Business, University of
Portland, USA.
This section will briefly introduce an example of how design thinking can be
embedded within business school curricula and its value to developing student’s
creative problem-solving skill sets. It will start by discussing the shifts in busi-
ness school activities to understand the integration of design as an agent for
transformational change. It will start by offering a descriptive overview of the
classroom setting, intended learning outcomes, teaching methods and subse-
quent transferable skills. Finally, it will conclude with a reflection on the chal-
lenges of implementing design thinking within a business school context.
Across the world, academic institutions have struggled to offer programs that
reflect on (or challenge) the politics of the time, the social fabric, the fluctuating
state of the economy, and the environment’s increasing devastation. In addition,
they need to integrate the skills and competencies that are critical to face the
challenges imposed in the twenty-first century. A report detected a gap between
the skills that people learn and the skills people need to thrive in this new econ-
omy (WEF, 2015). It is vital to enhance new forms of learning, using existing
and emerging pedagogical approaches (project-based, experiential, inquiry-­
38 3 Crossing Boundaries: Design into Business and Management

based) with adaptative learning methods. It requires collaboration among policy-­

makers, educators and education technology providers to implement an
instructional system that could help close the twenty-first century skill gaps.
Business schools in particular have a bond with wider industry. It affords them to
regard their curricula, global business contexts (globalisation, leadership and
innovation), the ethical practice of management and the development of gradu-
ates’ responsibilities.
Management education emerged alongside educational institutions, as it was
not regarded as being properly academic. Its materialisation occurred in the late
eighteenth century and early nineteenth century in Portugal—the School of
Commerce in Lisbon 1759, France -École supérieure du commerce de Paris,
1819, and Germany—Cameralism. Business schools flourished after World War
II, preparing managers with scientific and analytical components and skills that
had proven useful and relevant in administering post-war corporate enterprises
(Khurana & Spender, 2012). They concentrated on implementing higher stan-
dards and the development of rational-analytic problem-solving abilities coupled
with analytical tools. This over-emphasis of analytic techniques, led managers to
divert their attention away from social aspects such as reticence to other perspec-
tives, become detached from other actors, and fail to appreciate the impact that
business decisions have on people’s lives (Baker & Baker, 2012; Starkey &
Tempest, 2009). The current business education system does not always prepare
future business leaders and managers to address complex issues that often lack
definitive solutions, such as the diversity of stakeholders, climate change, inclu-
sion and equity. This situation leaves future professionals ill-equipped to deal
with uncertain and risk situations where the process is unknown and the ends to
be sought, unclear. Likewise, there has been an increasing demand for profes-
sionals with high cognitive and interpersonal skills as they are more effective in
processing information and conveying what that information means. These indi-
viduals train to speak about the desirability, viability, and feasibility of new
ideas, bringing together multiple information streams, distil key trends, and iden-
tify new opportunities. Furthermore, business schools need to confront the chal-
lenges businesses and society faces to orient their programmes and research
accordingly. Datar et al. (2011), argue, “business schools need first to reassess
the facts, frameworks, and theories that they teach (knowing). Second, focus on
developing the skills, capabilities, and techniques that lie at the heart of the prac-
tice of management (doing) and the values, attitudes, and beliefs that inform
managers world views and professional identities (being).”
Over the past decades, the importance of design thinking in management
(Boland & Collopy, 2004; Brown, 2008; Dunne & Martin, 2006; Martin, 2009;
Liedtka, 2018) and management education (Beckman & Barry, 2007; Kimbell,
2011; Liedtka & Ogilvie, 2011) has been widely acknowledged. Many pioneer-
ing business schools have integrated design thinking as a much-needed approach
to deal with complex, ill-defined problems through the ability to think critically,
decide wisely, communicate clearly and implement effectively. Design has a
long research tradition complete with fundamental concepts, methodologies, and
3.5 Academia and Industry: Design Alliances 39

distinct epistemological assumptions that can assist business schools in address-

ing and connecting the knowing, doing, and being within their curriculum.
Johansson-Sköldberg et al. (2013) divide the design field into five discourses:
design as the creation of artefacts (Simon, 1969); design as reflective practice
(Schön, 1983); design as a problem-solving activity (Buchanan, 1992); design as
a way of making sense (Kruger & Cross, 2006); and design as a meaning of cre-
ation (Krippendorff, 2006). The design process involves an iterative cycle of
synthesis, generation, analysis and evaluation through which design require-
ments and specification co-evolve along with the solution (Johnson et al., 2007;
Johnson, 2001; Dorst & Cross, 2001). People that use design thinking are able to
think via three different dimensions: (1) thinking of (e.g. imaging, visualising, ad
dreaming up); (2) thinking about (e.g. consideration of, reflection on, and delib-
eration about), and (3) thinking through something (e.g. understanding, grasping
and figuring out) (Cooper et al., 2009). Bringing design pedagogy into business
schools is not new however, as Herbert Simon (1969) argued for such integration
over four decades ago. He argued that professional schools concern with “what
ought to be”, and pure science focus on explaining “what is”, and thus the busi-
ness curriculum should integrate both a discipline-based science as well as prac-
titioner orientation. In the twenty-first century, Findeli (2001) proposed creating
design programmes that taught design as a meta-practice concerned with human-
istic values within complex systems. He proposed a discipline centred on the
practice of design as a process, as a way of knowing based on processing an
intervention. Design courses are consolidating capabilities and skills from mul-
tiple disciplines related to design practice and processes—artistic techniques,
scientific principles, and social theories- to promote humanistic values.

Design Thinking Curriculum Design in the University of Portland, USA

The University of Portland (UP) is a private Catholic, non-profit teaching-­based
institution with various competitive majors at the undergraduate and graduate
levels. It has a cohort of around 3741 full-time undergraduate students and 350
graduate students per academic year. The University has five schools: the College
of Arts and Sciences, the Dr Robert Pamplin, Jr. School of Business (PSOB), the
School of Education, the Shiley School of Engineering and the School of
Nursing. PSOB was founded in 1939, and it is one of five business schools in
Oregon accredited by the Association of Advanced Collegiate Schools of
Business (AACSB). The school offers undergraduate majors and graduate pro-
grammes (MBA and MS) and executive programmes. Its graduates work in
global organisations such as Daimler, Providence, Intel, Adidas, Nike, US Bank,
Columbia, Boeing, among other organisations. UP serves the thriving commu-
nity of Portland and states located on the West Coast of the United States, also
known as the Pacific Coast. It has cities such as Los Angeles, San Francisco,
Seattle that attract industries based on technology, healthcare, creative work and
athletic/outdoor apparel (Fig. 3.1). Portland is considered a strategic location as
it offers relatively low energy costs, accessible resources—north-south and east-­
west interstates, international air terminals, extensive marine shipping facilities,
and west coast intercontinental railroads. It hosts multiple local and global
40 3 Crossing Boundaries: Design into Business and Management

Fig. 3.1 West coast industry (developed by author)

3.5 Academia and Industry: Design Alliances 41

organisations in the athletic, creative, education, healthcare and technology sec-

tors. The Portland metro area has become a business cluster for tech companies,
athletic/outdoor gear and breweries. These businesses have access to multiple
education providers from state and private education institutions, such as Portland
State University, Oregon State University, University of Oregon, Oregon Health
and Science University, Portland Community College, Reed College, Pacific
Northwest College of Art, and so on. Most of these institutions offer p­ ostgraduate
courses, executive education and research programmes that strengthen collabo-
ration with industry in different areas of activity.
PSOB identified design as an opportunity to enhance their value proposition
on the West Coast. They wanted to increase the number of courses that best pre-
pare students with integrated decision-making skills relevant to industry. They
aspired to follow the steps of Ivy League institutions and renowned institutions
that offer joint design programmes in their college of engineering and school of
business. Across the US, there are twelve academic institutions with MBA or MS
joint programmes which are focused on design, innovation, business design,
leadership and integrated design, business and technology (Fig. 3.2). The largest
number of programmes (seven) are on the East Coast, then followed by three
programmes hosted by a state on the West Coast and two programmes in another
state on the Midwest. The programme directors and academic leaders from
Carnegie Mellon University, Massachusetts Institute of Technology, Northwestern
University, Stanford University and the University of Pennsylvania have joined
efforts to promote the IDI degree. It is a collaboration of graduate programmes
that bring together design, engineering and business through a human-centred
design process approach. Each programme has its own identity, but all apply an
integrated design innovation process and mindset at the heart of the teaching
philosophy. They provide highly immersive opportunities for students to work on
a wide range of projects in studio-based environments. In addition to the five
programmes, they have collaborations with related programmes and individuals
in the US and around the globe. Projects can vary from 24-hour design hacks to
multi-semester projects and thesis work that focus on real-world challenges.
Another avenue that professionals have for career development is the certifica-
tions provided by continued education providers. In the US, there are seven uni-
versities, Stanford University, UC Berkeley, Northwestern University Segal
Design Institute and SDI at the McCormick School of Engineering, TUFTS,
Parson and Cornell University, offering (executive) certificates. The last avenue
is professional certifications from consultancies such as IDEO, Park + Grow,
LUMA Institute, DMI workshops, SMART design, and Fjord.
In 2017, PSOB appointed a design academic to the entrepreneurship and
innovation management department. The mandate for the academic was to
develop innovative learning experiences in current classes, design new courses at
both undergraduate and graduate levels and build connections with the local
industry community in Portland. First, there was an analysis by PSOB and uni-
versity core competences, capabilities and infrastructure that were available.
Then, it was defined design and its potential implementation at undergraduate
 42
3

Fig. 3.2 Educational institutions offering join programmes (developed by author)

Crossing Boundaries: Design into Business and Management
3.5 Academia and Industry: Design Alliances 43

and graduate levels in the business school (and other schools). The academic
then analysed the business context and the academic offerings of other educa-
tional institutions in the metropolitan area and wider west coast. The outcomes
identified multiple areas of opportunity. The academic started designing a com-
prehensive series of classes and devised courses as early interventions until they
could be embedded into the curricula and assess their impact on the innovation
(and entrepreneurship) minor and marketing majors. PSOB integrated into the
curricula seven design classes: brand design, design management, innovation,
design thinking, design in business and society, creativity, innovation and design,
designing innovative brands, service marketing and design thinking in health-
care. These classes aimed to provide students with the opportunity to acquire
knowledge, capabilities and skills to undergo an approach to deal with complex,
ill-defined problems through the ability to think critically, decide wisely, com-
municate clearly and implement effectively in their respective fields. The nature
of the courses offered the possibility of implementing experiential learning by
integrating support systems—standard and assessments, instruction, profes-
sional development, and learning environment—that encouraged foundational
literacies, competencies, and character qualities (Fig. 3.3). The courses were
designed to address and exercise how students apply core skills to everyday tasks
(foundational literacies), how students approach complex challenges (competen-
cies), and how students approach their changing environment (character quali-
ties). They used high-impact practices through different assignments that allowed
students to share common intellectual experiences, collaborative assignments/
projects, writing-intensive work, co-designing with learning communities, and
diversity and global learning projects. As a result, they were able to apply ethno-
graphic and design methods, information and technology application, work in

Fig. 3.3 Twenty-first century skills for a new vision of education (developed by author)
44 3 Crossing Boundaries: Design into Business and Management

teams and collaborate, use critical thinking and problem-solving approach, pur-
sue oral and written communication and focus on ethical approaches.
A multidimensional approach, allows designers to explore spaces of possibil-
ity, use emergence, co-evolve with their artefacts and their sciences, create a new
order, engage in collaborative development, and utilize creative cognitive pro-
cesses to explore, generate, and evaluate hypothetical possibilities (Alexiou
et al., 2010; Buchanan, 1992). This perspective contrasts with the structured and
focused business approach based on history, business rules (learning and
­implementation), facts and delivery. The implementation of design thinking in
marketing creates collaborations that unveil users’ behaviours, habits, and desires
to achieve outcomes that address functional, social and emotional dimensions. It
also assists brands in collecting, analysing and inferring data that will inform
their positioning strategies. Design thinking in innovation focuses on generating,
managing and introducing technologies that benefit wider society. It also broad-
ens cross-functional skills and negotiation strategies necessary to be a responsi-
ble and ethical innovative leader in a contemporary global business environment.
Teaching followed a generic design thinking process to map design activities and
outcomes that benefit students’ learning goals and experience (Table 3.2). The
process guides students to understand their actions, identify where they are in the
process and define the outcomes that they can obtain. The design activities fea-
tured observation, contextualisation, definition, conceptualisation, prototyping,
implementation and post-assessment. The results would depend on the design
activity, and these can be tangible or intangible -artefacts, activities, knowledge
source and core values. Artefacts refer to the tangible outcomes of the design
activity. Activity regards the processes that designers undergo to understand the

Table 3.2 Twenty-first century design activities and outcomes

Design activity Outcomes (innovation) Outcomes (marketing)
Observe Artefacts Artefacts
Noun Representation
Representation Objects/things
Objects/things
Contextualise Activity Activity
Question Industrial and business process
Business process Puzzle like process
Define Puzzle like process Knowledge source
Image make process Research activity
Serendipity process Inquisitive process
Conceptualise Knowledge source Social engineering
Prototype Research activity Core value
Inquisitive process Interdisciplinary
Social engineering Multidisciplinary
Problem solving Myth
Implementation Core value
Post assessment Discourse
Multidisciplinary
Myth
3.5 Academia and Industry: Design Alliances 45

phenomenon that they need to deal with in their project work. Knowledge source
considers the different capabilities and approaches to comprehend the socio-­
technical paradigm. Students study and apply design as a medium to question
how they know the world (epistemology), what the world is (ontology) and how
they practice (methodological). It is more important than ever that prospective
professionals consider different worldviews, critique knowledge and have the
appropriate instruments to works towards creating desired futures.
The inclusion of design thinking is an elective class open to all majors hosted
in PSOB. It offers an introduction to working with human-centred design to
address business challenges, social problems and complex systems. Students
were able to learn to use a set of tools that they could apply in their workplace (or
everyday activities), as they might collaborate and communicate with clients,
stakeholders, and co-workers to reimagine and solve problems or generate new
ideas. They used experiential learning to combine theoretical knowledge with
social and emotional proficiency skills to respond to real-life scenarios. This
learning approach allowed students to become familiar with learning, reflecting,
experiencing, thinking and doing.
The learning goals concentrated on:

• integrating cross-functional knowledge to solve concrete business problems;

• becoming an effective and professional communicator;
• recognising opportunities, problems and risks;
• making and defending decisions in structured or unstructured contexts; and
• making ethical and socially responsible choices in business and community
settings.

The course featured four sections that provided students with theoretical founda-
tions of design thinking, its critical role, and in particular, the context of use. The first
section (introduction) introduces students to design and the intrinsic relationship
between design thinking (DT), human-centred design (HCD), innovation and cre-
ativity in contemporary business contexts. It explores how DT supports the design of
new solutions that are tailor-made to respond to people’s needs. The second element
(looking) concentrates on providing a series of instruments, tools, and techniques that
help students understand a given problem or need. They observe, engage and
empathise with people to understand their experiences, needs and motivations. Then,
they immerse themselves in the physical environment to gain a deeper personal
understanding of the challenge at hand. The third section (understanding) helps stu-
dents collect the data to facilitate its subsequent analysis and synthesis. The informa-
tion assists them in identifying core problems and in generating ideas, as they will
have become familiar with the users and their latent needs. The fourth section
(deliver) introduces students to different tools and instruments to translate ideas into
tangible outcomes, be it, products, services or entirely new systems.
Every semester, a different challenge and partner organisation was selected.
New students were able to learn about design thinking throughout the semester
via introducing its theory and praxis in a natural context. Furthermore, they were
able to draw upon and use multiple instruments, methods, and frameworks based
46 3 Crossing Boundaries: Design into Business and Management

on design, ethnography, marketing and business considerations to negotiate solu-

tions that will benefit multiple stakeholders. The goal was to utilise business
knowledge competencies, problem recognition, prioritisation, decision-making
competencies and relationship management in both real and hypothetical learn-
ing scenarios. The semester project featured three main stages: (1) immersion,
(2) inspiration and (3) articulation, which facilitated the introduction of different
methods (Fig. 3.4). Firstly, students were immersed into the challenge; then they
contacted the community, organisations, and other stakeholders who were
involved in the decision-making to document and appreciate different perspec-
tives. Finally, the students established user profiles of the stakeholders to under-
stand their needs, motivations, behaviours and habits (activity map). Once they
reframed the challenge(s), they adopted a five human factors methodology that
included ‘people, objects, environments, messages, and service’ (POEMS) to
build a deeper emotional engagement with the users. The second stage (inspira-
tion) focuses on learning methods to collaborate and co-design with different
actors to create a diverse and inclusive dialogue. The utilisation of POEMS and
brainstorming (Fig. 3.4) were to address biases and transform abstract ideas into
realisable actions. The third section (articulation) concentrated on devising a
plausible set of solutions that included and benefitted the diverse range of stake-
holders. Students developed one idea sheet to define their concept/idea/proposal
to create an action positioning strategy. The project employed multiple learning
activities and assignments to ensure that students achieve each learning outcome
throughout the duration of the project.
These included:

1. The use of a new human-centred approach that enhances innovation activities

in terms of value creation, process performance, and market impact;
To understand innovation beyond the design and development of new
products, services or systems to other fundamental sources of value creation;
2. To use various forms of research to explore problems from different perspec-
tives and including various stakeholders;
3. To develop individual and collaborative capabilities to identify customer
needs to create sound concepts and hypothesis, to collect appropriate data and
to develop prototypes that allow meaningful feedback in a real-world environ-
ment; and
4. To translate broadly defined opportunities into actionable innovation possi-
bilities and recommendations for client’s organisations.

The introduction of design (and design thinking) within the business school,
provided students with an educational experience that allowed them to develop
foundational literacy, competencies, and character qualities required in the
twenty-first century. Educational institutions need to facilitate experiential learn-
ing by creating dynamic learning spaces, pedagogical content, and learning
instruments to foster the integration of creative problem solving methodologies.
 3.5 Academia and Industry: Design Alliances

Fig. 3.4 Design thinking—semester overview (developed by author)

47
48 3 Crossing Boundaries: Design into Business and Management

Integrating an interdisciplinary approach facilitates building a growth mindset to

embrace new challenges, try new things, learn from mistakes, be accountable
and develop an ability to negotiate and empathize regarding ethics and social
decisions. The second change deals with developing competencies and character
qualities that allow students to be critical thinkers, creative, collaborative, and
communicative, and also, curious, persistent, flexible, and socially and culturally
aware. The third change concerns a deeper understanding of the intrinsic rela-
tionship between business and community networks to achieve sustainable
development. ◄

cc Chapter Summary In order to best prepare visionary business leaders of

tomorrow, we need to reappraise our teaching practices in higher
education; none more so than in business and management schools. To
develop risk-taking, entrepreneurial minds who have the innate ability
to inspire teams and individuals alike, the way we view current teaching
curricula and delivery needs to adapt in order to produce leaders who
will be operating in highly challenging and complex markets and
industries. One strategy at achieving this is to critically examine core
aspects of creative teaching methods and tools in traditional design
schools, and see the transferable elements that could be adopted into
other disciplinary contexts. This chapter has raised the issue of how and
where design schools teach creativity and design thinking methods and
map them against established business school curricula. The case
example offered by Dr Beatriz Itzel Cruz Megchun goes some way in
illustrating how design thinking can form an integral part of business
school activities and how these new approaches can inform the
development of business leaders of tomorrow. Chapter 4 takes an
expansive overview of organisational structures and dynamics, and of
how organisational systems need to change in order to become more
agile and responsive in times of uncertainty.

Review Questions

1. Design can offer the organisation many benefits; identity where and how design
can make a meaningful contribution to business competitiveness.
2. It is widely acknowledged that design is an invaluable source of differentiation;
how can design enable this?
3. Potential employers are demanding that applicants demonstrate that they have a
broad range of transferable skills, what ‘soft’ skills are developed within design
education?
4. What are the unique benefits of executive design thinking programmes offered
by joint education and industry partnerships?
References 49

5. Referring to the design thinking programme within the case study discussion,
what other aspects of design thinking would you consider needs to be included
within the teaching schedule?

Project Questions

1. Identify a particular product differentiation strategy where the company could

distinguish their product from competing products.
2. Name three leading brands where they have successfully used a product differ-
entiation strategy; how has this made their offerings unique in their respective
marketplaces?
3. IBM Skills is a comprehensive programme of skills development. What other
short courses do you think they could provide to attract new users?
4. The creation of user personas are a common feature of design thinking activities,
as such, devise a persona based around the lifestyle characteristics of a Generation
Z customer.
5. Identifying latent user needs is a core element of design thinking. Identify a set
of tools that could enable the identification of undiscovered user needs; what
makes them suitable for this type of research activity?

Chapter Tasks

1. Take a simple household washing detergent as an example and devise a differen-

tiation strategy to make it unique as compared to a rival product; list the value-
added benefits that it could offer to customers.
2. List three transferable skills that design education focuses upon, how does a
design approach make these distinct from other non-design teaching methods?
3. Make a list of traditional marketing methods which are not successful in attract-
ing the attention of Generation Z consumers.
4. Select two common examples of creative problem solving techniques; use these
to solve a problem of your own choice. Identify and list elements that worked
and also aspects that were not so successful.
5. In a group setting, identify a series of formalized design thinking process mod-
els, then rank the attributes that unifies them and also the elements that makes
them markedly different.

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Organisational Complexity and Change
by Design 4

Learning Objectives

• To develop an understanding of the complex nature of organisations and

traditional management structures;
• To explore a range of contemporary issues in the management and gover-
nance of large organisations and their strengths and weaknesses;
• To examine external forces and unforeseen challenges that impact upon the
organisation and the rise of unpredictable socio-economic environments;
• To introduce to the reader the role of change management and commonly
used change management frameworks;
• To develop an understanding of design beyond traditional disciplinary
boundaries whilst acting as a means for organisational change.

4.1 Introduction

The contemporary business environment is witnessing considerable change and

uncertainty; as such, regardless of size and market activity, organisations have
become increasingly vulnerable to external forces and market disruptions.
Furthermore, set against the backdrop of Covid-19 and the massive challenges that
it has presented to organisations and society, a radical reappraisal of established
business models and organisational systems is urgently required. Many organisa-
tions, as well as national governments, swiftly realised that they were not prepared,
reactively having to improvise due to their crisis response capabilities being too

Supplementary Information The online version contains supplementary material available at

[https://doi.org/10.1007/978-­3-­030-­94206-­9_4].

© The Author(s), under exclusive license to Springer Nature 53

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9_4
54 4 Organisational Complexity and Change by Design

rigid and inflexible. Alongside this unprecedented event, globalisation, deregulation

of trade and global markets have equalised organisational competitive environments
in terms of access to human resources, information, and technological expertise. In
order to remain competitive in these unpredictable times, organisations have to con-
tinually reinvent themselves through reappraising their structures, systems, and
strategic objectives. Organisational agility and resilience are the new mantra influ-
encing boardroom decision-making activities, where contingency and adaptability
need to be woven into the fabric of the organisation. This chapter explores four
interrelated key themes:

1. Managing complexity and the organisation, where in today’s unpredictable mar-

ketplace, the need for constant innovation and consumer insight is critical in
delivering meaningful value to ever demanding customer audiences. In order to
achieve this aim, organisations have to create and implement the most effective
frameworks and governance systems to manage effectively their day-to-day
operations.
2. Following this, it focuses attention on managing uncertainty in order to be proac-
tive and agile in responding to unforeseen challenges that may lie ahead. Recent
events regarding global pandemics and environmental crises have delivered a
wake-up call to organisations and governments alike to prepare for, and accept
instability and market disruptions as a permanent fixture of strategic planning
activities.
3. One such route to achieving this involves organisational change management
and the ability to instigate and effect cultural change. Change is critical in ensur-
ing that the organisation remains competitive in turbulent business environ-
ments. Three widely used change management frameworks are critically debated
as to their relevance and applicability in today’s hyper-connected business
environment.
4. Finally, it offers an alternative approach to fostering organisational change,
introducing design thinking and the plethora of creative tools and techniques that
it beholds to the commissioners of change. Richard Buchannan’s 4 orders of
design is introduced as an alternative lens of view to that of the traditional man-
agement approaches commonly applied to change management. The chapter
concludes by offering a series of review questions and exercises that draw upon
many of the themes raised within this section.

4.2 Managing Complexity and the Organisation

As we move into an era of uncertainty, organisations of complexity are operating

under extremely turbulent and dynamic market forces—many of which are beyond
the control of the organisation. We are witnessing an ever-increasing pace of tech-
nological and market developments, coupled with increased customer demands and
expectations. In today’s increasingly crowded marketplaces, organisations (regard-
less of size) cannot be complacent in the delivery of their products and
4.2 Managing Complexity and the Organisation 55

services—competitiveness and agility is now a commercial imperative and a pre-

requisite for long-­term survival. It is widely acknowledged that the best route to
commercial success is offering consumers both products and services that exceed
their expectations, and at the heart of this—is the creation and delivery of added
value products driven by innovation. These products and services that are offered to
the consumer, are the end result of a set of complex and interrelated processes intel-
ligently managed by the organisation.
In turbulent environments, in which organisations are currently functioning, and
undoubtedly will be functioning for the foreseeable future, design remains the last
valuable opportunity for the inspiration of creativity and the ability to formulate
quick responses to latent market challenges. Central to the issue of organisational
agility to respond to unforeseen market dynamics is that of size. At one end of the
spectrum, SMEs can usually function with a single manager at the top, directing
resource and vision in response to shifting market demands. At the polar opposite of
the spectrum are large multinational organisations whereby the divisions of func-
tions and human resource sit beneath many layers of hierarchy and decision mak-
ing. Consequently, senior managers and decision makers in large organisations are
often far removed from the point of delivery—be it a product or a service; or fre-
quently, both. Furthermore, they are likely to have limited understanding of day-to-
day operational issues, customer needs and quality difficulties, unless they make a
specific point of gaining first-hand experience of customer interactions. Another
limitation of hierarchy and division, is the frequently cited issue of fragmentation
and miscommunication within the decision making process. The centralisation of
these primary activities is often the barrier for organisational change.
Morgan (1988) describes these large bureaucratic organisations as ‘machines’
that are slow moving, cumbersome entities that are resistant to change and are slow
to embrace and enact change. Research undertaken by Aronowitz et al. (2015) offers
a bleak outlook for machine organisations when trying to accommodate change:
When machine organisations have tried to engage with the new environment, it has not
worked out well for many. A very small number of companies have thrived over time; fewer
than 10% of non-financial S&P 500 companies in 1983 remained in the S&P 500 in 2013.
[…] 82% of them went through a re-design in the last three years. However, most of these
re-design efforts fail—only 23% were implemented successfully.

Another area of consideration is that large organisations are not homogenous

entities per se, but complex systems comprised of many sub-parts, each with their
own individual culture and identities. When an organisation expands its business
operations, the variation amongst these smaller sub-groups; these sub-groups may
include—production, marketing, sales, HR and so forth. Furthermore, clear lines of
communication are important between these interrelated functions, especially
within the development of products and services; sadly, often, as these functions
increase in size, they move apart as opposed to becoming more closely aligned and
integrated. Consequently, as information flows from outside the organisation into
the relevant departments, it becomes more opaque and ambiguous, leading to the
occurrence of unsound data and information having a detrimental impact on the
56 4 Organisational Complexity and Change by Design

design development process. Ghobadian and Gallear (1997) identify a series of

insights as to the inherent limitations of large organisations when compared against
SMEs. A select range of examples includes:

Structure

• Hierarchical with several layers of management—which in turn, leads to ineffi-

ciencies within the decision making process, as agreement and authority moves
up through managerial levels of responsibility.
• Multi-sited and possibly multinational—poses significant challenges, in particu-
lar if new product/service introductions are desired in unfamiliar market territo-
ries. Furthermore, senior managers may be unfamiliar with market requirements
when penetrating new market segments.
• Normally slow response to environmental changes—reminds us of the old anal-
ogy, ‘Speedboats versus Supertankers’ where more agile and responsive leaner
organisations can adapt quickly to unforeseen external events and challenges;
one such example are global pandemics, which as we are witnessing, causes
huge problems and challenges to established business models.

Procedures

• System dominated—which often hinders innovative activities if the system can-

not accommodate the desire for organisational creativity and creative individu-
als. One only needs to look towards Google, Facebook and Squarespace for
leading examples of truly innovative companies.
• Rigid and unadaptable processes—where bureaucracy and superfluous proce-
dures frequently hinder the effective flow of information within and throughout
the organisation. This is particularly acute when there are significant geographi-
cal distances between each site and area of operation.
• Fragmented decision makers—who are often far removed from points of sales or
contact with their customers. This is particularly prevalent in highly vertical/
siloed organisations.

Behaviour

• Mostly bureaucratic—where the free flow of information between functions is

reduced through paperwork and chains of decision-making. This could be exac-
erbated by a combination of points as above.
• Strongly departmental/functional mindset—is a mindset present when certain
departments or sectors do not wish to share information with others in the same
company. This type of mentality will reduce efficiency in the overall operation,
reduce morale, and may contribute to the demise of a productive company culture.
• Cultural inertia—established organisations have developed their own cultural
identity and practices, which over time could lead them to becoming more hos-
tile to change and reticent to embrace new ideas and market opportunities. There
4.2 Managing Complexity and the Organisation 57

is strong evidence that some organisations have cultures that are maladapted to
their environment, and that this is reflected in their performance. Carrillo and
Gromb (2007) point out, “Since homogeneity locks organizations in their current
culture, there is an interesting trade-off between flexibility and gambling. On the
one hand, organizations may decide to remain flexible enough to adapt to any
environment change. This is achieved by allocating agents to both cultures. On
the other hand, organizations may bet on whether the new environment will build
on one of the existing cultures and screen all agents to fit in that culture”

However, it is worthwhile to point out here that not every type of large organisa-
tion is bureaucratic in nature. Alongside the continually changing social landscape,
organisations are also changing in their structural configurations, morphing and
adapting to the macro economic environment in order to become more profitable.
Furthermore, with highly competitive markets and greater uncertainty, gives rise to
the post-bureaucratic organisation, in particular, organisations operating in typical
new industries such as IT, services and pharmaceuticals as opposed to traditional
manufacturing. However, what connects the two organisational types, are the com-
mon themes of—division of labour, authority, and control. Bolin and Härenstam
(2008) argue, “All workplaces have an organizational structure, as work tasks are
carried out in a production process somewhere, and by someone, and have to be
coordinated and controlled. Organizational structure provides a regularity that
makes organizations independent of specific individuals and means that they are
more than the sum of their individuals.”
Division of Labour: In essence could be distilled as the specification of particular
roles within the organisation and where they are assigned (i.e. located within spe-
cialised functions) in order to take place. Specialisation within this context refers to
the production process that is then sub-divided into discrete areas of activity, regard-
less of how employees are assigned or associated to job specific tasks. However, it
is worthwhile to point out here the distinct differences between the two types of
organisations; in predominantly bureaucratic organisations, division of labour is
more specialised in nature. Within post-bureaucratic organisations, it is more con-
cerned with horizontal integration across business functions.
Authority: refers to the decision making structure within the organisation, be it
centralised with the responsibility assigned to top management; at the opposite end
of the spectrum, decentralised decision making is often delegated to specific func-
tional teams, individuals or projects. Each approach has their own merits and weak-
nesses depending on the organisational type. When we turn our attention to creative
organisations, it is so often the case where individual control of the decision making
process encourages creativity, which in turn could lead to the development of inno-
vative new ideas and concepts. Carrier (1996) adds, “ Such a [decentralised] man-
agement structure would promote the entrepreneurial process, as employees would
be able to vouch for their ideas without being hindered by unnecessary hierarchical
levels. In addition, this structure would consequently mean a more informal relation
between the top management and employees and enable a faster recognition of fea-
sible ideas”.
58 4 Organisational Complexity and Change by Design

Control: In other words, it is the degree to which jobs and procedures within the
organisation are controlled by standardisation of behaviour and how a task is carried
out (Robbins & Barnwell, 2002). While adhering to rules is crucial in strongly
bureaucratic organisations, personal discretion and the ability to make decisions
independently are defining aspects of post-bureaucratic organisations. In sum,
bureaucracy is characterised by specialisation, centralisation, and formalisation,
while integration, decentralisation, qualitative and quantitative measurement of
results and goal fulfilment characterise post-bureaucracy. (Bolin and Härenstam, ibid.)

Organisational Structures: A Brief Overview

Having outlined key characteristics of large organisations, it is now time to identify

and discuss other common forms of business structures. The main objective of
developing a business structure is so that employees know where they sit within an
organisation and who to report to in terms of line management. Different organisa-
tional structures are shaped by the industry in which they operate, although they will
vary considerably because every business is unique in terms of their own particular
culture and values.
Flat Organisation—In essence, in a predominantly flat organisation, everyone is
equal, where viewpoints and values are shared democratically amongst the employ-
ees. Often these types of organisations are referred to as ‘self-managed’ organisa-
tions where there are no hierarchy, seniority or job titles. However, in terms of
scalability, this structure is often best suited to smaller companies, then over time,
introducing more levels of management as the company grows in size—regarding
practicalities of governance and operation, large organisations are not best suited to
this type of structure. One such benefit of this structure is that the decision making
process can be accelerated due to the lack of management hierarchy and chains of
command.
Functional Organisation—which takes us back to the bureaucratic organisa-
tion, based on functional specialities and domains of knowledge. Common func-
tional elements frequently include HR, Production, R&D, Marketing and so
forth, where each department and function has a clear identity and reporting
structure. Regarding the development of new products (especially where speed to
the market is critical) often the decision-making process is hindered through
achieving agreement between key individuals within each of the functions. In
terms of ownership of ideas, as an example, if a new product concept is based on
market pull factors (where a gap in the marketplace has been identified) usually
the marketing function would lead on a project of this nature. At the other end of
the spectrum, if the R&D function has identified new technologies that feature
strongly within a product, this would be classified as a ‘technology push’ type of
project, where they would be instrumental in leading it. A frequent source of ten-
sion that occurs is miscommunication between each of the functions when
4.2 Managing Complexity and the Organisation 59

developing new products—at worst, leading to poor performance and sales when
introduced to the market. Stringer (2000) argues, “most large firms are poorly
equipped to implement a growth strategy based on radical innovation because
most large firms are ‘genetically’ programmed to preserve the status-quo”. In
other words, these large firms do not have the right organisation, culture, leader-
ship practices or personnel, to implement radical innovation. Over time, compa-
nies revise their organisational structures to accommodate growth and changes in
the external environment.
Divisional Organisation—often refers to multinational organisations operating
across international boundaries; however, divisions could also refer to specific mar-
ket segments or particular consumer groups. This type of structure allows the large
organisation to compartmentalise significant areas of business operation into tightly
bounded groups. Furthermore, these groups would have distinct autonomy from the
parent company, being able to manage their own operations based around products
and or services that they offer. However, there are some inherent challenges associ-
ated with divisional structures; firstly, with a diverse range of organisational divi-
sions, each one could (and often does) compete for resources from the parent
company that may impede overall strategic objectives. In addition, to be successful,
divisions must be well managed. Executive leadership is the single most important
determinant of success for a company using a divisional structure. Secondly, the
duplication of resources, where each division requires the same organisational func-
tions—as in marketing, HR and so on, increases the cost of operations across all the
divisions. It is not uncommon, for example, for a firm to adopt a functional structure
in its early years. Then, as it becomes bigger and more complex, it might move to a
divisional structure, perhaps to accommodate new products or to become more
responsive to certain customers or geographical areas.
Matrix Organisation—is primarily a complex organisational configuration
where employees report to a number of line managers. Often, this type of organisa-
tion is best suited to the management and delivery of large projects, where different
specialisms are working closely together on a daily basis. In relation to the design
and development of new products, the primary functions of marketing, R&D,
Design and production, would form teams combining and drawing upon expertise
from the varying departments at different stages of the project. Within this structure,
employees would be usually report to the team leader and their line manager from
their respective function. However, the drawback within this arrangement is that
matrix teams are difficult to manage and diversity has been known to contribute to
poor performance. In a research study undertaken by Oertig and Buergi (2006), they
point out, “In the matrix setting, there was a tendency for project team representa-
tives to listen more to their line function management than to the project team
leader. It was important that the project leadership managed the influence of line
functions by networking with higher-level line managers and lobbying as necessary.
As an example, a project leader reported going to the line function head to ask for
someone to be allowed to attend a face-to-face meeting abroad”
60 4 Organisational Complexity and Change by Design

Organisational Attributes

In essence, an organisation is a dynamic system that a company (regardless of size)

can use to create an authority and communication structure for their employees that
supports the fulfilment of corporate goals. Having introduced the basic types of
organisational structures, other key considerations need to be taken into account
when selecting the most appropriate framework for the company. These include:

• Levels of Management—The majority of organisations consist of layers of man-

agement and or reporting structures. The top managers or CEO’s occupy the
most senior area of responsibility for the organisation, mainly creating overall
strategic vision and goals. Sitting beneath these are Middle managers who report
to top managers and allocate resources across the company. Furthermore, they
are often responsible for actioning corporate strategies and directing their effec-
tive implementation throughout organisational strata. Then we come to first line
managers who focus on day-to-day operational activities such as supervising
employees and coordinating projects. The job titles vary considerably but include
such designations as manager, group leader, office manager, supervisor, etc.
• Macro Business Environment—organisations need to configure themselves so
that they are best prepared and most suitable to the conditions of the external
environment in which they are operating. Businesses operating in highly dynamic
market sectors need to be able to respond to highly fluid changes in the market-
place—high street retailing is one such notable example. Francesca Cassidy
(2019) argues, “many high streets across the country are working towards this
reinvention, making themselves “places to be”. Others continue to struggle with
2018 seeing a slew of large retailers going into administration. The public wants
more than a retail destination; they want a location to meet, eat and drink, a place
for services and experiences, as well as shop. Retailers that can successfully
reinvent themselves will reap the rewards through more customers and
higher sales”.
• Growth Stage of the Organisation—is a key driver in determining the structure
of the organisation. Smaller start-ups often adopt a leaner more agile approach to
the management and governance of their operations. Growth potential compa-
nies, who are more established, would need to move to a more stable structure
that allows expansion and stability in order to move to the next stage of their life
cycle successfully. Churchill and Lewis (1983) writing for the Harvard Business
Review argue, “a company’s development stage determines the managerial fac-
tors that must be dealt with. Its plans help determine which factors will eventu-
ally have to be faced. Knowing its development stage and future plans enables
managers, consultants, and investors to make more informed choices and to pre-
pare themselves and their companies for later challenges. While each enterprise
is unique in many ways, all face similar problems and all are subject to great
changes”.
4.3 Managing Uncertainty in Unpredictable Times 61

4.3 Managing Uncertainty in Unpredictable Times

Change is inevitable and as such, the organisation needs to be proactive and agile in
order to respond to unforeseen challenges that may lie ahead. In stable, predictable
market environments, change is incremental and can be accommodated for; how-
ever, 2020 witnessed seismic change that fundamentally transformed the business
landscape—the global pandemic Corona Virus Disease (Covid-19). Widespread
shutdown of commercial enterprises, restrictions in the movement of people both
within and beyond national borders has affected virtually every sector of organisa-
tional and industrial life. Established business models and organisational practices
have undergone dramatic re-appraisal in how we work, consume and lead our daily
lives. Emerging from the ongoing chaos of Covid-19, it has necessitated innovations
in the development, delivery and consumption of products and services. Anderson
et al. (2021) based in the influential Pew Research Center, USA, undertook a
research study to anticipate life following Covid-19, to consider what life will be
like in 2025 in the wake of the outbreak of the global pandemic and other crises in
2020. Some 915 innovators, developers, business and policy leaders, researchers
and activists responded. Their broad and nearly universal view is that people’s rela-
tionship with technology will deepen as larger segments of the population come to
rely more on digital connections for work, education, health care, daily commercial
transactions and essential social interactions. A number of respondents described
this as a ‘tele-everything’ world. Seetharaman (2020) points out, “the hospitality
industry, world over, has faced a significant negative impact because of the lock-
down measures many countries adopted, as it forced consumers to stay away from
restaurants and cafes. While hotels and homestays are primarily meant for leisure
and therefore, not considered essential, food is by itself an essential resource.
Through the lockdown, restaurant regulars have shifted their preferences towards
off-premise dining, drive-through food pickup, ready-to-eat meals, etc.” The scale
and extent of the uncertainty that business organisations are currently facing in this
crisis is considerable; especially given the limited information about Covid-19 and
its long-term impact. As such, this uncertainty is demanding that established operat-
ing models must contain a high degree of resilience and flexibility as situations
evolve. Due to the severity of the global pandemic, the economic damage to busi-
nesses throughout the globe has exceeded early predictions by many leading busi-
ness analysts. Now, the ‘new normal’ is continuous uncertainty and fluidity. Due to
the severity of this crisis, many organisations are in a continuous struggle for their
very existence. The severity and speed of the crisis are reflected in the International
Monetary Fund’s (IMF) projections for US GDP growth. After an estimated GDP
expansion of 2.2% in 2019 (year-on-year), the US economy, in the IMF’s view, was
expected to grow at a rate of 2.1% in 2020 (forecast of October 2019). With the
onset of the pandemic, the IMF quickly shifted its estimate into contraction, of
−5.9% in April 2020, revised to −8.0% in June. The latest estimate (October 2020)
is less severe at −4.3%, but this would still be the worst result in many decades. The
forecasting institution foresees the world economy shrinking at a rate of −4.4% in
2020, after having grown 2.8% in 2019 (estimate). (imf.org, 2020).
62 4 Organisational Complexity and Change by Design

In addition to global pandemics, there are more subtle and discrete changes
that are continually arising (for some these are opportunities, others—distinct
threats), namely that of the rise of IoT product systems that are transforming
established marketplaces. Many leading companies have developed and strength-
ened their business models over many decades, but the shift to IoT is often more
challenging for them. From tennis rackets to coffee machines, IoT has the poten-
tial to create endless disruptive innovations, often in a plethora of unforeseen
business segments. Tony Shakib, Global IoT Business Acceleration Leader, at
Microsoft Azure believes that we’re at an inflection point where some companies
are taking investment in IoT infrastructure seriously, allowing them to capture
meaningful data, and integrate it into their workflow management systems. He
points out, “Gradually we’re crossing from the experimental phase to mass adop-
tion”, he explains. “Once we get there, we’ll see real change. Once you start
connecting devices and using data intelligently, the amount of innovation you
can do becomes exponential.” (IoT Business News, 2020). History can provide
us with many examples of organisations and commercial enterprises that had
failed to keep pace with market developments, the same could happen again to
organisations that fail to embrace the digital revolution. IoT does not discrimi-
nate to any organisation, regardless of their expertise, prestige and heritage; it
enables companies to provide the tools to shift away from traditional manufac-
turing to the fertile landscape of interconnect devices, services and holistic
systems.
Alongside IoT offering many unique opportunities and threats to the organisa-
tion, the emergence of the circular economy should not be overlooked. Since the
birth of the Industrial Revolution, circa eighteenth century, companies and their
customers followed a linear path of consumption. Starting with extraction and
manufacturing, then through to commercialisation and use, followed by disposal
by the user. This model has been in operation for over 250 years, informing and
shaping businesses and manufacturing operations in unison. In essence, the cir-
cular economy is an economic system aimed at reducing waste and the continual
use of finite resources, often referred to as ‘take-make-dispose’. On 4 March
2019, the European Commission adopted a comprehensive report on the imple-
mentation of their Circular Economy Action Plan (EU, 2019). It was an ambi-
tious programme of Europe wide activities that covered the whole lifecycle of
products, from manufacture through to consumption and subsequent disposal. In
2012, the average European used 16 tons of materials—and only 40% of that was
recycled or reused. In terms of value, material recycling and waste-based energy
recovery captured only 5% of the original raw-material value. Even recycling
success stories such as steel, polyethylene terephthalate (PET), and paper involve
the loss of 30 to 75% of the value of the materials during the first use cycle. On
average, European businesses and households use materials only once
(McKinsey, 2016).
Due to the harmful environmental impact caused by excess waste and the over-
use of harmful non-biodegradable materials (in particular plastic waste), there is
4.4 Organisational Change Management 63

a fast growing cohort of consumers who are becoming more ethically minded
regarding climate change and environmental care. Extensive market research
identifies millennials as a growing body of customers who are demanding envi-
ronmentally friendly products that are sustainable which heavily informs their
purchasing decisions. In 2018, as part of its New Plastics Economy initiative, the
Ellen MacArthur Foundation announced at the World Economic Forum in Davos,
that the list of leading brands, retailers and packaging companies working towards
using 100% reusable, recyclable or compostable packaging by 2025 or earlier has
grown to 11. These included Amcor, Ecover, Evian, L’Oréal, Mars, M&S,
PepsiCo, The Coca-­Cola Company, Unilever, Walmart and Werner & Mertz—
together representing more than six million tonnes of plastic packaging per year
(Ellen MacArthur Foundation, 2018). As such, organisations need to radically
re-think their business offerings, moving away from the traditional linear model
of business practices, including risks associated with the use of scarce and non-
renewable resources; prioritisation and sales of products produced with virgin
resources; the failure to collaborate; and failing to innovate or adapt. These are all
factors that will negatively affect the ability of organisations to continue business
as usual; in an era of uncertainty, the need for change is an organisational
imperative.

4.4 Organisational Change Management

Having acknowledged the need for change, there are many strategies that the
organisation could adopt in order to effect meaningful change within the com-
pany. Change is critical in ensuring that the organisation remains competitive in
fast moving environments. However, this process is not as straightforward as
first anticipated. Balogun and Hope Hailey (2004) report a failure rate of around
70% of all change programmes initiated. It may be argued that this poor success
rate indicates a fundamental lack of a valid framework of how to implement and
manage organisational change as what is currently available to academics and
practitioners is a wide range of contradictory and confusing theories and
approaches (Burnes, 2004). In essence, change management is the effective
implementation of a clearly delineated plan of activities and associated tools to
lead the people side of change in pursuit of corporate objectives. In traditional
management literatures, the organisation can draw upon numerous established
change management models for adoption. The next few sections outline a num-
ber of common frameworks that are widely used in industry; each one with their
own particular strengths and weaknesses. The following commonly known
models for review include:

• Kurt Lewin’s Change Management Model

• Kotter’s 8 Step Change Model
• The McKinsey 7-S Model
64 4 Organisational Complexity and Change by Design

Kurt Lewin’s Change Management Model

Kurt Lewin was a German-American psychologist who first introduced his ‘Three
Steps Change’ model in 1947, that featured three distinct areas of activity—(1)
unfreezing, (2) changing, (3) refreezing (Lewin, 1947). Although simplistic in
nature, it is still equally as relevant today as when it was first offered in 1947. The
three simple stages can be developed in greater detail of application based upon the
particular organisational context in which it is being used.

• Unfreezing: the first and arguably most important stage. Here, preparation for
change is introduced to the department/organisation, and most importantly, to the
employees who will feature heavily within this process. Lewis acknowledges
that resistance to change is inevitable, so for change to be effective there is a need
to replace organisational behaviours and attitudes to reinforce it (this is what
Lewis called ‘force field analysis’). In short, force field analysis is accepting and
understanding the many different factors for and against making any planned
changes. Although not actually a formal part of the model, the particular set of
actions within the unfreezing stage may include—identifying what needs to be
changed; ensuring buy-in from senior management/board of directors; and then,
creating the need for change. Throughout this early critical stage, it is important
to communicate the drivers for change and the benefits that change has to offer.
Having now ‘unfrozen’ the established status quo, the model then moves on to
stage 2 ‘Changing.’
• Changing: this is where the transition occurs, and the delicate implementation of
change commences. Due to transitioning, employees could become resistant to
change at this critical stage, therefore clear communication and leadership are
important elements to alleviate their concerns. Furthermore, referring back to
leadership, the encouragement of employees to participate within change imple-
mentation is vital.
• Re-freezing: the third and final stage ‘Re-freezing’ is to establish and embed the
new sense of order achieved through the change process. What is important here
is to create a new culture that fosters and supports new processes and systems
that are in place. In addition, mechanisms should be in place to support change
in the long-term; very easily old practices and mindsets could revert back to the
pre-change culture, rendering the whole exercise redundant.

Although since its first introduction, the world has moved on considerably, but
many aspects of the model provides an intuitive and fundamental understanding of
how changes occur, in context of the social behaviours observed at an individual and
collective level within a group or larger organisation (Fig. 4.1).
4.4 Organisational Change Management 65

Fig. 4.1 Kurt Lewin’s change management model (adapted by authors)

Kotter’s 8 Step Change (1995) Model

Kotter is the Konosuke Matsushita Professor of Leadership, Emeritus, at the

Harvard Business School, USA. Drawing upon his academic expertise in the com-
plementary domains of business administration and the management sciences,
Kotter pioneered his 8-step change model to full effect. What characterises his
model to other change models is that the emphasis here is on senior management
directing change as opposed to more of an employee perspective. Furthermore, it
places heavy emphasis on the speed of implementation. The 8 component ele-
ments of the model include:

• Step One: Create Urgency: all effective change is a response to a problem and the
first step is to identify a strong sense of urgency and the need for the implementa-
tion of organisational change. This ‘messaging’ is vital in ensuring that employ-
ees being a part of the change process understand the reasons that underpin this
course of action. Common themes that drive the need for change may include
one (or more) of the following forces—(1) shifting market demands; (2) increased
competition from their nearest competitors or new market entrants; (3) changes
in technology that may present either new opportunities or threats.
• Step Two: Form a Powerful Coalition: whereby senior business managers/leaders
combine to drive the momentum for change. This in a way, signals a sense of
urgency and agency to move change into a positive direction. Furthermore, man-
agers could be coalesced from business units or functions such as marketing,
HR, production and so on that reinforces the messaging from senior management.
• Step Three: Create a Vision for Change: Through the coalition of leaders driving
the change management project, a strong and compelling vision for the post-­
change organisation needs to be clearly articulated to all stakeholders. In addi-
tion, the new core values arising from change need to be clearly understood and
effectively implemented throughout the organisation; ambiguity and or mixed
messages need to be avoided at all costs, which could have a detrimental impact
to the overall process.
66 4 Organisational Complexity and Change by Design

• Step Four: Communicate the Vision: The new vision needs to be integrated into
activities of all individuals across the organisation, so if any one individual does
not accept it, then it can lead to issues with synchronisation and cooperation.
Kotter (1996) adds, “some key elements to effectively communicating the vision
include repetition, explanation, the use of multiple forums, and leading by
example”.
• Step Five: Remove Obstacles: by removing the many obstacles that may hinder
the process, these centres around the employees who are the ones primarily
instrumental in the success of the project. This would involve identifying those
most resistant to change and working with them to alleviate their fears or
concerns.
• Step Six: Create Short-Term Wins: the introduction of a series of short-term
achievable goals ensures momentum whilst supporting motivation amongst
employees. Incentivising quick wins builds morale and shared vision throughout
the organisation. Without short-term wins to celebrate, leaders and employees
can easily get tired of the change process, become complacent and lose that all-­
important urgency.
• Step Seven: Build on the Change: based on Kotter’s consultancy experience, he
was a keen advocate to encourage the organisation to move beyond early
­successes and consolidate change. This could be achieved through establishing
more ambitious targets and milestones thus ensuring continued momentum of
change implementation.
• Step Eight: Anchor the Changes in Corporate Culture: The final and arguably the
most difficult stage of the entire process is institutionalising the new organisa-
tional culture—in essence, embedding new behaviours, processes and habits that
reflect and embrace the change[d] process. Following ‘completion’ of the change
management process, it is imperative that the newly introduced management sys-
tem aligns with the future direction and strategic growth of the organisation
(Fig. 4.2).

Fig. 4.2 Kotter’s 8 step change model (adapted by authors)

4.4 Organisational Change Management 67

The McKinsey 7-S Model

It was devised in the 1970s by Tom Peters and Robert H Waterman who are former
consultants at McKinsey and Company. In essence, this framework provides a holis-
tic understanding of how organisations function and enables the different elements
to align to foster strategic transformation, in short—‘Change.’ Even though it has
been over 30 years since the development of the model, it is equally as relevant
today as it was then in the late 1970s. All the seven elements of the model have to
be equally addressed, as the elegance of the model is that it needs to be understood
and applied across all seven [‘hard’ or ‘soft’] interrelated areas of consideration.
These include:

• Style: in a way refers to leadership ‘style’ or as to how things are done in the
organisation. Leadership informs and effects behaviours and attitudes, which in
turns shapes the business towards a particular set of values.
• Skills: indicates the skills and skills deficits within the organisation; does the
business have in place the right skills, knowledge and competencies to achieve
corporate strategy.
• Systems: are the operational elements of the organisation; mainly focused upon
and around procedures and processes. These would form an important part of
any change management project.
• Structure: directly relates to the management structure, as discussed earlier, is
the existing structure hierarchical or flat and so forth. Furthermore, is line report-
ing and the levels of authority clear to the employees as to who they report to.
• Staff: this is quite straightforward, it relates to employees and their general capa-
bilities; plus, the number of staff and the diversity needed in each area to opti-
mise organisational capability and capacity.
• Strategy: corresponds with the dynamic external forces, which may affect the
organisation; does it have the right strategy in place to withstand external market
changes and threats via competition.
• Shared Values: are the central focus of the model as these affect the other six ele-
ments of the change management process. Shared values centre on what the
company believes in; what is its core mission and so forth (Fig. 4.3).

These three diverse change management models have their own unique strengths
and weaknesses according to where and how they are used. There are many more
comparable changes management models in existence, but these are arguably the
most commonly used and understood. Turning our attention away from established
models drawn primarily from the management sciences, we now focus on design
and on how it can provide an alternative perspective when fostering organisa-
tional change.
68 4 Organisational Complexity and Change by Design

Fig. 4.3 The McKinsey 7-S model (adapted by authors)

4.5 A Designerly Approach to Organisational Change

As previously discussed, classic change management models offer a high-level

framework for transformational change. However, design thinking could be an
invaluable approach to fostering organisational and behaviour change. Other bene-
fits of a design thinking approach may also include—developing a stronger and
more robust customer orientation, better decision making and competitive advan-
tage. Over the last ten years, design thinking has attracted the attention of senior
management professionals, as indicated by the burgeoning amount of journal arti-
cles in management circles. Olson et al. (1998) argue that design can be translated
into competitive advantage through the creation of customer value. Dunne (2011)
lends further support to this sentiment by adding, “Designers seek to empathise with
users and understand how the experience of use appears from their perspective”.
Kumar and Whitney (2007) concur by suggesting “in doing so, they hope to create
innovations that appeal to unarticulated needs, and can become a source of competi-
tive advantage”. Design as a problem solving process could be introduced within
the organisation, being deployed as an alternative means of competitive advantage
where traditional methodologies and tools are insufficient in turbulent fast past mar-
kets. Furthermore, where existing data is either non-existent or insufficient, a design
4.5 A Designerly Approach to Organisational Change 69

thinking approach to new market opportunities could yield significant results to the
company. Management activities and routines in less turbulent markets are often,
detailed, analytical and stable, characterised with predictable outcomes; outcomes
that frequently cannot satisfy ever demanding market audiences. With strong
emphasis on gleaning detailed user insights, design thinking for new business con-
texts could provide richer criteria for user-centred innovation. Firstly, the vast array
of design’s ethnographic tools could be applied to the ideation process, supported
with input from other business functions, thus fostering a strong multi-disciplinary
approach to innovation.
If unfamiliar with the use of an ethnographic approach to data collection, in
essence it features observing end-users using products or services to gain a deeper
understanding of their experiences, frustrations or modes of delight in their every-
day practices. This approach can be focused solely on the individual or scaled wider
to groups and communities. The use of tools to collect this information could be
based on the complexity of the design project, as in, observing an individual using
a particular product within the home right through to a community using public
transportation. Due to the onset of Covid-19, the use of online digital tools has
grown exponentially over the last 12 months, which has led to a series of innova-
tions in the development of ethnographic studies. Subsequently, proactive, and
entrepreneurial organisations have embraced these new approaches and methodolo-
gies, embedding them within their own design strategies and developmental sys-
tems. As such, these design orientated additions add an extra dimension of design
‘capability’ and ‘Intensity’ to organisational agility and resilience. By adopting a
diverse range of data collection approaches (be it in person or online) organisations
can redefine and/or augment their own existing resource base in the pursuit of
innovation.
Often, such ethnographic data collection activities could lead to a ‘shift’ in per-
spectives from those taking part, moving from a place of ‘judgement’ to a place of
endless ‘possibilities.’ This move towards ‘reframing’ the problem based on and
around detailed user-insights limits the immediate need for ‘quick’ solutions.
Design theorist Kees Dorst (2015) argues, “problem framing is one of the key
design practices that make the method [problem re-framing] more likely to yield
better solutions than conventional approaches to problem solving”. To move the
organisation to a more user-centred orientation, this philosophical shift could be
strengthened by aligning departmental perspectives, thus allowing the prioritisation
of information that decision-makers are working with. Heterogeneous teams (com-
prised of professionals drawn from the major functional disciplines) are commonly
acknowledged to produce more creative and innovative solutions that afford real
value to their customers. Liedtka (2018, p. 16) points out the merits of heteroge-
neous teams, arguing, “diversity brings new data and perspectives, whether from
customers, internal colleagues or external networks, into the process that are capa-
ble of producing novel insights and solutions, often by inducing reformulation of
the initial problem”.
70 4 Organisational Complexity and Change by Design

It is worthwhile to note, that with any change management process, fostering

cultural change is a challenging task—even change driven by design. By embarking
on a series of short design projects, confidence in the role of design as a driver for
success will percolate throughout the organisation. This process is not without its
risks, the often quoted mantra “fail faster, succeed sooner” by IDEO founder David
Kelley holds true, that to be truly innovative, at some point there will inevitably be
failures. In order to overcome this pitfall, a coherent and consistent communications
strategy is vital to bolster the chances for successful change. To further support this
sentiment, Thomas Jefferson, third US President, presciently adds, “if you want
something you have never had, you must be willing to do something you have never
done” which underpins the notion of design thinking as an organisational cultural
mindset as opposed to a predefined process. The Design Management Institute iden-
tified that ‘design-led’ companies outperform other companies by 228% on the
Standard and Poor’s 500 index. (DMI, 2014) Through open collaboration between
organisational functions, teams and individuals, behavioural attitudes will shift
away from that of competition to one of collaboration. This in turn would foster the
cultural conditions for the creation of meaningful value for the customer as opposed
to extracting value from traditional management processes. One of the most author-
itative voices advocating design for organisational change, Richard Buchanan
(2015), succinctly articulates that:

The principle of design that stands behind the organizational culture reform movement in
which design thinking is central is grounded in the quality of experience for all of those
served by the organization. This includes the individuals who directly use the products and
services of the organization, but it also includes those who are affected by the internal and
external operations of the organization and by those in society at large who are ultimately
affected by the vision and strategies of the organization.

Buchanan (2001) proposed his ‘4 Orders of Design’ model that positions product
type and their area of influence and complexity. Traditional design disciplines are
‘loosely’ situated within each of the four orders, which demonstrates the increasing
development of design as an emergent field of activity. The four orders include: (1)
Communications, signs and symbols; (2) Objects and artefacts; (3) Interactions and
experiences; (4) Environments and systems.

• Communications, signs and symbols: The first order is primarily information

design, outlining the work of visual communication designers, mainly graphic
and visual design (2D design). Specific themes of activity that sit within this
include, typography, illustration, photography and print, which focus upon the
nature, shape and meaning of symbols.
• Objects and artefacts: The second order embraces tangible, physical objects and
artefacts, such as products, engineering and architecture (3D design). This type
of design creates useful, usable and desirable products for people to use.
• Interactions and experiences: The third order includes the theme of design to
create meaningful design interactions via services and experiences (4D design
that is time and motion orientated).
4.5 A Designerly Approach to Organisational Change 71

• Environments and systems: The fourth order arguably is the most complex area
of design activity within which the other three orders sit, covering architecture,
urban planning, organisational design, systems architecture and so forth
(Fig. 4.4).

Turning our attention towards the fourth order of design, this includes the dis-
course of design to effect change in cultures, systems and capabilities—with organ-
isation/business design central to this process. We are now witnessing many leading
multinational organisations (IBM being one notable example) radically implement-
ing cultural change with design at the heart of this process. Strong leadership and
support at the top of the organisation, is shifting organisational mindsets away from
traditional command and control management approaches now introducing design
capabilities into the wider organisational environment. This top-down approach (4th
order design) would then permeate across business divisions, which would influ-
ence the other three orders that sit beneath it. Jenkins (2008) argues, “in effect, the
design leader must be willing to take on the organization itself as the object of
design, not just a particular product or process. This means both actively working to
reshape the underlying cultural values on which the organization is based and being
willing to challenge and rebuild some of the major organizational systems and cor-
porate processes”.
Jenkins (ibid.) based on his extensive industry consultancy experience, proposes
a seven-point plan in implementing a designerly approach to fostering cultural
change within the organisation. These can be summarised as:

• Be selective in choosing which organisations to work with: setting realistic

expectations as to how design can accommodate and sit within the overall organ-
isational culture. Identify with the senior management team where obstacles

Fig. 4.4 Richard Buchanan 4 orders of design (adapted by authors)

72 4 Organisational Complexity and Change by Design

could occur within their existing processes and systems, and identify on how
design could change these parts of the wider eco-system. In essence, the chal-
lenge here is ‘cultural alignment’.
• Work with senior leaders to build strong intent and an embedded culture of
design: cultural transformation requires the firm commitment from the very top
of the organisation in order to be truly effective. Jenkins adds, “for example, they
should be able to demonstrate a strong awareness of where and how to use
design, use a shared language about design processes, and ask good questions
that reflect their familiarity with design thinking”.
• Be a systems thinker: breaking down the organisation into a series of sub-­
systems, then being to identify the most effective ways in changing those inter-
related component parts. Each element could pose their own particular challenges,
and as such, different strategies and methodologies may need to be drawn upon
from the repertoire of design thinking tools.
• Focus on human interactions and social processes: to create a working environ-
ment that fosters and encourages meaningful human-to-human interactions in
both formal and informal settings. Furthermore, with the removal of bureaucratic
barriers, more time could be allocated to creative activities that could lead to
innovative ideas for exploitation.
• Exercise well-directed discipline when implementing new processes: ensuring
the commitment to change is maintained and that old processes and behaviours
are discouraged. One such approach would be to implement an engagement
strategy that extols the benefits of the change management process and where
design is a fundamental part of its overall success.
• Kill some sacred cows: undertaking a fundamental review of key aspects of the
company, be it established processes, systems and orthodoxies and question their
relevance in the new organisational culture. This demonstrates commitment to
change and would need authoritative support in order to demonstrate strate-
gic intent.
• Help the organisation to learn more about itself from experience: finally, to
encourage reflection and self-learning that reviews what worked and where
pockets of resistance were encountered. This process of reflection should be con-
sidered as an ongoing process of continual learning and refinement that under-
pins the new organisational culture.

cc Chapter Summary With the rise of uncertainty and constant new

challenges, organisations are beginning to realise that the old solutions
put forward by management consultants are no longer enough sufficient
in order to remain competitive. In the new market economy where
consumers hold considerable purchasing power, the creation of
meaningful value is at the forefront of business activities, and businesses
are turning towards the design profession for their design thinking skills
to foster transformative change. At the beginning of this chapter, it
introduced the many differing forces that are impacting upon the
4.5 A Designerly Approach to Organisational Change 73

organisation, in particular Covid-19 and the financial devastation that

lies in its aftermath; not only to the organisation, but to the individual
and society as a whole. Turbulent times and uncertainty are placing new
challenging demands on how we act, think and organise our daily
lives—this is no different from the organisation, regardless of size and
areas of operation.
It then offered a series of insights into the diverse types of
organisational structures that we see today. Each type of structure is
informed by the industry in which the company operates, some are very
unique to their particular industry, some very common, in a way,
illustrating the rich and varied ways the business shapes itself in order
to remain competitive. However, these structures have their own
inherent and unique strengths and weaknesses that shape, form and
influence their respective cultures and values.
In the quest for profitability and long-term survival, often it is
necessary to embark upon transformational change. However, as this
chapter discusses change and the complex issue of change
management, it presents many challenges to the organisation in order
to be successfully implemented. Three commonly known and widely
used change management models were critically analysed as to their
effectiveness and applicability; although the three discussed were
one of the many models and frameworks currently being used by
industry at present. Finally, we conclude this chapter by introducing
design as a powerful tool to effect transformational change, or as
Buchanan argues, the fourth order of design as a new and alternative
means of fostering meaningful cultural change within the organisation.
The following chapter will focus in more detail on how individual
companies managed to achieve significant competitive advantage
offered by design, and the many benefits that they secured to ensure
continued survival and profitability.

Review Questions

1. Global disasters and environmental crises present many challenges to the organ-
isation. Can you identify one notable example and describe how it affects the
organisation?
2. Identify and critically debate an emergent theme that poses significant chal-
lenges to the long-term survival of large and complex organisations.
3. Select an organisational structure that you consider the most appropriate to its
area of industrial operation; what are the elements that makes it unique to that
particular industry setting.
4. What other change management models can you identify that would be specifi-
cally suitable for non-profit organisations as opposed to commercially driven
businesses.
74 4 Organisational Complexity and Change by Design

5. Julian Jenkins (2008) outlines a seven-point plan to drive change by design

within the organisation; what other points would you consider to add to these
that could further strengthen cultural change.

Project Questions

1. Global challenges encompass a vast array of themes, identify and critically anal-
yse one such challenge where design could contribute a significant role.
2. List five leading organisations which failed to keep up with the changing con-
sumer landscape. What are the factors that contributed to their inevitable demise?
3. With the rise of working from home, identify two significant challenges to the
organisation in relation to team-based activities where creativity is
fundamental.
4. Many organisations are hesitant to invest in design (in its broadest sense); create
a hypothetical ten-point general plan outlining the benefits of design that would
convince the CEO.
5. Identify one widely acclaimed example of a large organisation adopting a design
thinking approach to foster transformational change; outline the key aspects of
this approach that were fundamental to its success.

Chapter Tasks

1. The Aviation industry has been particularly affected by the global Covid-19 pan-
demic, identify 3 areas of operation that have been significantly disrupted; what
recommendations would you provide that would minimise these risks in
the future.
2. Within 60 minutes, list as many advantages that a digital start-up enterprise that
could potentially challenge the dominance of a leading organisation within its
established market sector.
3. You have the opportunity to pitch to your company CEO the benefits of design;
provide a 5-minute speech articulating where design could specifically add value
to the customer.
4. Identify a leading organisation and then create a simple SWOT analysis as to
why they should undertake a change management project.
5. In a group setting, you have ten minutes to rank the most commonly used design
thinking techniques in business; rank them in importance on an A4 piece of
paper to be discussed amongst your group.

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Business Thinking Through Design
5

Learning Objectives

• To introduce the four main economic systems and debate their inherent
strengths and weaknesses.
• To provide an understanding of the social economy and how design can
support its continued growth as a means of widening social prosperity.
• To examine and debate three types of businesses and the basic forms of
business organisation.
• To introduce the common types of business structures and liability impli-
cations for owners and shareholders:
• To provide a general overview of business formations and how design
thinking can support the continual pursuit of innovation.

5.1 Introduction

The world is experiencing exceptional uncertainty, as humanity faces multiple cri-

ses ranging from health, economy and social to the natural environment. Nations
confront specific tensions that demand individual (or regional) policy actions, finan-
cial conditions, socio-political responses and environmental changes. Even though
these crises are systematic and global, they are also reflected in a diverse range of

Contribution by Dr Beatriz Itzel Cruz Megchun, Assistant Professor of Design & Innovation at
Pamplin School of Business, University of Portland, USA.
Supplementary Information The online version contains supplementary material available at
[https://doi.org/10.1007/978-­3-­030-­94206-­9_5].

© The Author(s), under exclusive license to Springer Nature 77

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9_5
78 5 Business Thinking Through Design

business environments. Organisations face hypercompetitive environments, global

economic failures, collapse of traditional business organisations, fast-pace manage-
ment processes and crisis of trust and credibility in their branding activities. Their
survival goes beyond planning new products, services, brand extensions or techno-
logical innovations. They need a refreshed, revitalised and rejuvenated approach to
address complex, ambiguous, uncertain, volatile circumstances in their business
operations while responding to continual global crises. Thus, governments must
enable environments that facilitate systemic change. The education system should
provide instruments that better prepare people for the economic, technological,
environmental, social and political changes ahead.
Over the past three decades, prominent practitioners have called governments
(and business managers) to adopt a ‘design’ perspective to consider these chal-
lenges from a system level. The business community have welcomed design think-
ing across all sectors of the economy (Beckman & Barry, 2007; Brown, 2009;
Dunne, 2018; Kolko, 2015; Liedtka et al., 2017; Liedtka, 2018, 2020; Martin, 2009;
Maeda, 2020). It is an approach to inquiry, cognitive processes and expression that
complements and enhances existing skills, methods, techniques and attitudes. Its
mode of analysis focuses on forms, relationships, behaviours and real human inter-
actions and emotions, as its scholarly approach deals with social complex practice.
Its impact is seen in organisational learning (Beckman & Barry, 2007; Smulders,
2004), decision making (Liedtka, 2015), customer orientation (Kumar & Whitney,
2007), innovation outcomes (Brown, 2009; Verganti, 2009), and competitive advan-
tage (Martin, 2009; Verganti, 2016). Nonetheless, business people and the business
press reduce it to an overly simplistic activity, process or toolkit that anyone can
easily use, typically characterised as a step-by-step process with a human-centric
approach that identifies problems followed by rapid prototyping that tests ideas to
solve problems. It is assumed that it is an effective way to enable business people to
think like designers, solve problems and drive profit.
Throughout the following subsections, the discussion will examine the appli-
cation of design thinking within a business context. First, it will explore the dif-
ferent economic systems that might hinder or facilitate nations and/or businesses
to thrive in the face of the twenty-first century challenges that lie ahead. It then
discusses how mainstream economic systems and the new economic systems
adopt design thinking to offer a more adaptive and resilient approach, in some
cases approaches that support human and environmental well-being. Then, it
focuses on the types of organisations and how they implement design thinking
within their daily business activities. Finally, it will conclude with a discussion
on the tensions and challenges experienced in implementing and adopting design
thinking practices.

5.2 Economic Systems that Shape Business Environments

An economic system is a means by which governments or societies set a system of

production to organise and distribute available resources, services and goods across
a geographic area or country. These systems regulate the factors of production,
5.2 Economic Systems that Shape Business Environments 79

including land,1 capital,2 labour3 and physical resources. Most governments can
shape their economic system using different mechanisms (institutions, agencies,
entities, decision-making processes, and patterns of consumption) to allocate
resources that ensure that producers and consumers obtain the goods and services
they need. Therefore, governments need to study how various agencies and institu-
tions connect, how information flows between them, and the social relations within
the system (including intellectual property rights and structures of management). In
addition, the government relies on economic theory to define the types of markets
their economic system encourages and how much influence they exert over markets.
This exercise helps answer questions about what to produce, how to produce it,
from whom to produce it, and when to produce. Governments tend to select among
four primary mainstream economic systems: traditional, command, market and
mixed (Grossman, 1963; Mamedov et al., 2016; Reisman, 1995). Ergo, there are
many types of economies around the world, and each has its own distinguishing
characteristics. Moreover, each economy functions based on a unique set of condi-
tions, static and dynamic components,4 put in situ. In the following paragraphs, we
will discuss the four mainstream economic systems.

1. The traditional economic system: is the oldest type of economy and still func-
tions in rural nations closely tied to the land, based around agriculture, fishing,
hunting or gathering. Their societies tend to be more close-knit and socially
satisfied because their members play specific and distinct roles guided by cus-
toms, history and honour beliefs. It centres on family or tribe (traditions guide
everyday life and economic decisions). It exists in a hunter-gathering and
nomadic society that relies on barter to trade and produces only what they need.
It might evolve to form some type of currency to trade. Examples of this type of
economic system still exist in countries where nearly 70% of the population lives
in rural areas and relies on subsistence farming, such as Yemen or Haiti. Similarly,
it exists in countries with pockets of indigenous people who live in remote vil-
lages, such as those who live in the Amazon rainforest or the Arctic regions.

1
Land, in economics, refers to the resource that encompasses the natural resources used in produc-
tion. In modern economics, it includes all that nature provides, including minerals, forest products
and water and land resources. Those organisations that use land have to pay a rent.
2
Capital, in economics, describes anything that confers value or benefit, factory and its machinery,
intellectual property, or financial assets, to its owner. It is a critical component of running a busi-
ness day to day and financing its future growth. It may derive from the operations of the business
or be raised from debt or equity financing.
3
Labour, in economics, refers to the general body of wage earners. It includes any valuable service
rendered by a human agent in the production of wealth. Labourers might have different amount and
character of training, degree of skills, knowledge and capacity to direct their own work or the work
of others.
4
Static and dynamic components such as institutions, infrastructure, microeconomic environment,
health and primary education, higher education and training, goods market efficiency, labour mar-
ket efficiency, financial market development, technological readiness, market size, business
sophistication and innovation.
80 5 Business Thinking Through Design

2. The command economic system: has a centralised power (government) that plays
a dominant role in the economy. The government focuses on the good for society
to maximise social welfare rather than the individual or market. It creates a cen-
tral economic plan that allocates all resources, sets priorities for producing goods
and services, owns critical industries and creates laws, regulations and directives
to enforce the plan. However, it discourages free market competition and innova-
tion as it offers a healthy supply of resources, employment and affordable prices
in goods and services for customers. Goods are not always based on consumer
demands, the system does not allow taking risks required to create new solu-
tions, and the inputs about consumers’ needs lack measure and control. A com-
mand economy is a key feature of any communist society, such as the ones
experienced in Cuba, North Korea and the former Soviet Union. China had a
command economy for decades before transitioning to a mixed economy.
3. The market economic system: is where firms and households act in self-interest
to determine how resources get allocated, what goods are produced and who
purchases the goods. It has six characteristics that define them, private property,
freedom of choice, motive of self-interest, competition, system of markets and
prices, and limited government. The separation between the government and the
market prevents the former from becoming too powerful. Its interest aligns with
that of the markets. Governments may intervene by regulating or attempting to
control fair trade, programmes, monopolies and so on. Consequently, people
find many incentives for entrepreneurship, and businesses have reasons to inno-
vate and be competitive. However, fierce competition may lead governments to
provide support to vulnerable members of society, such as cover social welfare
benefits and accessible healthcare. Currently, there are no purely free-market
economies in the world, but some economies tend to be freer than others. The
five countries with the most economic freedom are Hong Kong, Singapore, New
Zealand, Switzerland and the United States (Fraser Institute, 2017).
4. The mixed economy system: is a combination of the free market economy and the
command economy. Generally, the market is more or less free of government
ownership except for few key sensitive industries. It incorporates policies that
are social5 and capitalist6 in nature. As a result, private businesses can run more
efficiently and reduce costs. At the same time, the government can correct mar-
ket failures and use taxation policies to redistribute income in order to reduce
inequality. Most developed nations in the world have elements of all three
­economies, making them mixed economies. For example, the United States

5
Social (socialism) is a populist economic and political system based on public ownership of the
means of production, machinery, tools and factories to produce goods. All legal production and
distribution decisions are made by the government, and individuals rely on the state for everything
from healthcare to energy, the government determines the output and pricing levels of these goods
and services.
6
Capitalist (capitalism) is an economic system in which private individuals or businesses own capi-
tal goods. The production of and services is based on supply and demand in the general market
(market economy) rather than central planning (command economy).
5.3 New Economic Systems Reshaping the Business Environment 81

leaves ownership of the means of production in most private hands. Still, it

incorporates partial or total public ownership in some industries like defence and
postal service.

These mainstream economic systems portray the whole economy with just one
minimal image that reinforces a neoliberal7 narrative of the state and the domesticity
of the household. In recent years, public and private agencies have stimulated the
market, and governments have promoted a range of design-led innovation process
initiatives. They have established ambitious programmes towards the potential of
design to stimulate innovation and accelerate economic growth across many indus-
try sectors. Nations have seen a rise of open innovation labs to support design activi-
ties across sectors. Furthermore, they have established social impact investments to
drive innovation for public good and to test public policy methods. For example, its
application improves processes, develops new concepts and governance models and
envisages new business strategies and services in the public sector. Designers have
been drawing upon cultural learning theory, complex theory, institutional and
behavioural theory to understand systematic conditions of the main problems or
challenges, their value chain, the institutional or societal contexts in which they
operate.

5.3  ew Economic Systems Reshaping

N
the Business Environment

The current mainstream economic systems work differently around the globe.
Nations have distinct realities and societies that make it enormously complex to
delimit their impact. However, there seems to be a growing consensus that these
systems might not align with the scale of the challenges faced by humanity. There
are clear symptoms of generalise failures, such as increasing social inequalities
between rich and poor or raising numbers of people displaced due to global warm-
ing or conflicts. Therefore, societies need to collectively reimagine a world where
they build the foundations of something new. Academics, researchers, advisors and
non-governmental organisations, among others, are creating new narratives about
the power of the market, the partnership with the state and the creativity of society.
They have designed plausible ways to redistribute wealth, focusing on controlling
land, enterprise, technology, knowledge, and the power to create value. These new
economic systems tend to have a multilevel approach that addresses different levels
of networks and complex interconnections. Their application can be seen from the
individual, community, business and city levels to the regional level. They can co-
exist inside the mainstream economic systems. Still, their origin is to become an

7
Neoliberalism is a term used to describe the twentieth century ideas associated with economic
liberalism and free-market capitalism. It is generally associated with policies of economic liberali-
sation, including privatisation, deregulation, globalisation, free trade, austerity, and reductions in
government spending to increase the role of the private sector in the economy and society.
82 5 Business Thinking Through Design

alternative to these existing economic systems. The most prominent emergent sys-
tems feature the sharing economy, circular economy, doughnut economy and social
economy.

• The sharing economy: is a socio-economic system built around sharing (the

excess capacity of) resources. The sharing economy is often used as a general
umbrella term for new merging concepts such as collaborative consumption, col-
laborative economy, peer-to-peer economy or the gig economy (WEF, 2017).
However, many of these terms simply refer to relatively new methods of interac-
tion facilitated by centralised online platforms. This peer-to-peer (P2P) based
activity uses information technology and platforms to enable individuals, corpo-
rations, non-­profits and/or government in distributing, sharing and/or reusing
goods and services. For example, its application at the community level focuses
on initiatives that increase the sense of belonging, create social bonding, promote
values or achieve a social mission through a collective project. Whereas, when
we regard it as a business model, we regard it as an organised interaction.
Individuals make money from underused or idle assets that can be rented or
shared as a service when not in use. It differs from traditional businesses where
employers hire employees to produce products to sell to consumers, as it has
three distinguishing features. First, they use digital technologies to match buyers
and sellers. Second, they capitalise on idle capacity and third, they rely on people
building trust (trust verification). Recently, it has evolved to include business-to-
business (B2B) interactions and co-working, peer-to-peer lending, fashion, and
freelancing platforms. For instance, in China, companies like MoBike (bike-
sharing) and Molisan (umbrella-sharing) supplement the supply of services in
demand periods of peak demands. Criticisms often involve regulatory uncer-
tainty, lack of government oversight, abuses of buyers and sellers, and fear of
increased information that is widely shared.

• The circular economy: aims to redefine growth by building a sustainable society

regarding economic, natural and social capital. It proposes a closed-loop system
based on re-using, sharing, repairing, refurbishing, re-manufacturing and recycling
that minimises resource inputs, the excess creation of waste, pollution, and carbon
emissions. The objective is to gradually decouple economic activity from consum-
ing finite resources and designing waste out of the system. This model enables a
new form of society and an economy more autonomous, sustainable and mindful of
environmental resources. Organisations rely on fundamental principles of sustain-
able procurement, eco-design, industrial and territorial ecology, economy of func-
tionality, responsible consumption, waste prevention, management and recycling to
conceive new processes and solutions for optimising resources and using and re-­
using waste. The Dutch government aims to implement the circular economy by
2050. They have implemented government-wide programme across several minis-
tries to create a safe and healthy human environment. For example, some of these
programmes handle raw materials more efficiently, such as the From Waste to
Resource (VANG), Green Growth and Biobased economy.
5.3 New Economic Systems Reshaping the Business Environment 83

• The doughnut economy: aims to meet the needs of all within the means of the
planet (Raworth, 2017). It ensures that everyone has access to life’s essentials
such as water, food, housing, healthcare, education, income and work, peace and
justice, political voice, social equity, gender equality, networks and energy. It
also guarantees that collectively we do not exceed our pressure on Earth’s life-
supporting systems on which we fundamentally depend (stable climate, fertile
soils, protective ozone layer, ocean care and biodiversity life). This system acts
as a compass for human progress. It draws inspiration from complexity theory,
ecological, feminist, institutional and behavioural economics. Amsterdam is the
first city in the world to adopt the doughnut economy officially. The Amsterdam
Donut Coalition involved different players in collecting data, analysing scenarios
and drawing up proposals. They aim to achieve a zero-impact city by 2050.

• The social economy: encompasses various organisations, cooperatives, mutuals,

associations, foundations and social enterprises that occupy the space between the
state and the market. These organisations place priority on individuals and social
objectives, voluntary and open membership, democratic governance, general inter-
est, defence of solidarity, cross-collaboration, autonomous management, and rein-
vestment of most profits. The central premise is on satisfying needs or solving
complex problems that have been ignored or inadequately fulfilled by the public or
private sector. They pursue economic practices that are sustainable and inclusive:
(1) by addressing societal needs; (2) by organising economic activities built on
local roots; and (3) by working in close cooperation with other economic actors
and relevant stakeholders (OECD, 2020). They support alternative ways of organ-
ising economic activities that might be adopted by the rest of the economy, such as
fair trade, organic food movements or ethical and social investment.

The adoption of design thinking in mainstream and new economic systems has
experienced a significant rise over the last decade. Organisations capitalise on it via
equipping people with instruments to face contemporary challenges such as inter-­
connected and diffused economic, social patterns, blurred governance boundaries
and reduced trust in public actions (UNDP Global Centre for Public Service
Excellence, 2014). It has two broad applications, either as policy formulation or as
public service delivery. In the former, it facilitates an iterative process where mul-
tiple stakeholders engage progressively to refine feasible solutions. Team leaders
use ethnography, behavioural science, communication, design and architecture,
among other fields and skills to frame problems. They explore and consider multiple
perspectives to give voice to everyone that will be affected by policy decisions.
They experiment with potential ideas to reduce the risk of inconsistencies or dupli-
cation of actions and minimise unintended consequences. In the latter, design think-
ing helps develop, adopt, and implement policies while bolstering their legitimisation.
It encourages small-scale and local initiatives that prove effectiveness, create
momentum and possibly facilitate potential scaling of policies. It also simplifies the
logistical arrangements required for the implementation of policies. Bason (2010,
p. 139) argues, “design thinking represents a structured and systematic attitude or a
way of reasoning that allows bridging and managing two opposing (yet
84 5 Business Thinking Through Design

complementary) cognitive styles, analysis and synthesis”. The analytical attitude

mindset encourages rational, logical and deductive processes that lead to thinking
through solutions. Teams are cross-disciplinary, facilitating single disciplines pro-
posals and effective outcomes. Conversely, the synthesis attitude fosters emotional,
intuitive and inductive processes that promote thinking through doing and challenge
existing paradigms. T-shape people work in multidisciplinary teams that co-create
to deliver meaningful outcomes.

5.4 Types of Organisations

A nation’s prosperity is created through the capacity of their industries to innovate.

They rely on the composition of different types and forms of businesses to compete.
Some nations succeed in particular industries because their contextual environment,
national values, cultures, histories and institutions contribute to their success. As
well as, they rely on economic systems that may support their competitive advan-
tage. Each entity uses financial resources to provide goods and/or services to cus-
tomers (consumers or businesses) in exchange for money or other goods and
services. To be a viable business, they need to generate a financial return in exchange
for work undertaken, time spent, and risk taken (satisfy the market and make a
profit) to become a viable business. They adopt different forms of ownership that
entail distinct cultures, beliefs, and assumptions about how they measure success
and what their core values are. This section will introduce three main types of busi-
ness and the basic forms of business organisation.

• Service businesses: focus on the exchange between providers and users. They are
a people-centric entity that is related, social, temporal, and the interactions are
unpredictable and uncertain. Service providers perform a particular activity that
results in some benefits that include a specific output and/or involve a specific
experience. In comparison, service users need to see value in the output, the
experience or both as they are willing to pay for it or exchange for something else
of equivalent value. They are organised under three broad categories: (1) typical
service categories include transportation, restaurants, banks, phone and internet
services, entertainment, healthcare and education institution. (2) Utility service
categories concentrate on water, plumbing services and gas electricity. Finally,
(3) digital service categories focus on social media platforms, communication
and data sharing platforms facilitating exchanges. This industry represents 70%
of the Gross Domestic Product (GDP) in a number of countries, such as the
United States of America, the United Kingdom; Hong Kong, Luxembourg,
Lebanon, France, Portugal, Denmark, among others (The World Bank, 2021).

• Merchandising businesses: buys products at wholesale price and sells the same
products at retail price. They do not change the form of the merchandise, only
stock inventory. The origin of their profits is by increasing the price of the selling
products. Some categories include departmental stores, grocery, hardware,
clothes and accessories shop, consumer electronics, home furniture, appliance
store, drug stores and so on.
5.4 Types of Organisations 85

• Manufacturing businesses: buy raw materials to transform them into new prod-
ucts. They combine raw materials, labour, and overhead costs within their pro-
duction processes. The nature of their offering is interchangeable, as the key
attributes are natural, and the factors of demands depend on their characteristics.
The buyer is the market and therefore the supply method is stored in bulk.
Categories include food processing, textile production, metalwork, oil refineries,
shipbuilders, and so forth.

The demand for design and its use can change across industries, types and size
of organisations. Industries have organisational and structural differences, but they
share a growing interest in customer experience and a progressive liberalisation
with the entry of new players. The widespread application and use of radical new
technologies have facilitated new types of businesses and organisational structures.
Augmented reality, automation, artificial intelligence, blockchain, cryptocurrency,
machine learning and the internet of things (IoT) have become the dominant mode
where we experience everyday interactions. As a result, organisations, especially
digitally based services are investing in a human centred design approaches to cre-
ate products and services that humans can adapt and accept. According to Design
Thinking for Business (2020, p. 4), design thinking is booming in industries where
digital transformation requires new competencies and capabilities for developing
meaningful customer experiences. This approach looks at value and exchange from
user’s perspective and what is meaningful for them. It combines three factors:

• Technology (feasibility) concentrate on how things are made and how their pro-
cess performance improves;
• People (desirability) focuses on how things are valuable for customers (brand);
• Business (viability) emphasises how organisations can profit from offering them.

Design thinking adopts different forms and interpretations according to the com-
panies’ nature, the specific challenges and project objectives. For example, some
organisations can use new technologies as enablers of more fluid and less bounded
entrepreneurial processes and outcomes. Similarly, they can have a continuous evo-
lution of the offering’s scope, features and value. Design Thinking for Business
(2020) suggests four generic implementations of design thinking.

1. Creative problem solving: concentrates on solving wicked problems adopting

both analytical and intuitive thinking. This design thinking approach is one of
the most widely known and used among organisations. Teams undergo an itera-
tive process to understand user needs and latent desires to unveil and create ideas
to solve wicked problems. The process starts outside, as researchers need to
observe users interacting with products and services to understand user behav-
iours’ complexity and dynamism (desirability). They employ a cross-­disciplinary
team that interprets these observations, shares insights, makes sense of the vast
amount of data and identifies opportunities for new solutions. Here, designers
facilitate combining the conscious and unconscious mind, rational thought and
86 5 Business Thinking Through Design

imagination, to inspire original solutions. They transform innovative ideas into

tangible prototypes to interact and test with users, obtain feedback, and learn
from failures. They learn to frame and reframe the problem throughout the pro-
cess while experimentation becomes fundamental to validate or confirm previ-
ous reflections and hypotheses at different stages of development. The solutions
may provide incremental or even radical improvements to the products or ser-
vices offered by the organisation.
The National Australia Bank (NAB) is one of the four largest financial institu-
tions in Australia. It ranked the 21st largest bank in the world measuring market
capitalisation and 52nd largest bank in the world measuring total assets in 2019.
It serves around 12.7 million customers across Australia, New Zealand and Asia.
It partnered with Oliver Wyman, an American management consulting firm spe-
cialising in financial institutions, to improve its financial results and financial
products. They developed a new solution, called the NAB Quickbiz Loan, for
their small and medium-sized enterprises (SMEs) clients. They applied design
thinking through five distinct steps (empathise, define, ideate, prototype and
test), where they worked backwards from the client’s needs to create a truly
compelling product. They identified four main issues: (1) the loan process was
too complex, SMEs predominantly prefer unsecured product options, online/
mobile services, which make the largest difference in the credit experience, and
the process was time-consuming (Oliver Wyman & IESE, 2017). In the ideation
stage, the team agreed that the product should be radically simple (access any-
time, anywhere), out of friction (data available) and rapid decision making (auto-
mated data). The final output consisted of a three-step online application linked
to a dynamic cash-flow credit model that provides unsecured business loans up
to $50,000 to SMEs.

2. Sprint execution: aims at accelerating the development process between the gen-
eration and execution of ideas while reducing risk and uncertainty in launching
new solutions to the market. It emerges from the hybridization of creative prob-
lem solving and the lean-agile8 movement. Businesses that rely on digital tech-
nologies have increased their possibility of accessing many ideas and
opportunities and speeding up the development process. Furthermore, they chal-
lenge setting time constraints and iterations on the effectiveness of the process
and of executing subsequent ideas. The process starts with teams conceiving new
ideas brought into a product or service and tested with users to obtain feedback
(inside-out approach). Teams are composed of experts (usually internal stake-
holders) who can deal with different categories of constraints and opportunities
from other business units within the firm. Their objective is to design a product

8
Lean and Agile movement is a new management approach and an enhanced company culture that
enables business agility. Their methodologies took root in IT organisations. These methodologies
help businesses to move faster and produce higher-quality offerings. Their principles promote
focusing on work and the processes through which workflows, rather than the people responsible
for the work.
5.4 Types of Organisations 87

concept or an innovative idea and make products ready to be launched on the

market in line with users’ needs. The product is the principal vehicle to capture
the value and learn from the reactions of the marketplace. The experimentation
in the sprint execution significantly leverages the contributions of minimum
viable products9 (MVP) to obtain feedback for future developments. MVPs
allow the team to gain insights from early adopters of a product and to explore
market viability. They are not the final product but the means to learn the reac-
tion of potential users earlier within the development process. Teams learn by
doing, as they accrue knowledge through the development and interaction with
products and services.
Spotify is a Swedish audio streaming and media services provider. It is one of
the world’s largest music streaming providers, with over 356 million active users
and 158 million paying subscribers. It uses a people-driven model, an autono-
mous approach for scaling agile and increasing innovation and productivity. This
model champions team autonomy, communication, accountability and quality so
that each team (or squad) selects their framework (e.g., Scrum, Kanban, etc.).
Squads (cross-functional autonomous teams) are organised into tribes (feature
area) and guilds (passion about a topic) to help keep people aligned and cross-­
pollinates knowledge. Designers join these teams to facilitate the improvements
of features, the creation of experiences or the design of new services and systems
innovations (Spotify, 2019). Each new project aims to keep humans-in-the-loop
to create frictionless process and enhanced human experiences. The design team
developed a website, Spotify Design, where they share tools and stories that they
use in their design process.

3. Creative confidence: focuses on promoting an innovation mindset to engage

employees with a new set of approaches, practices and methodologies to foster
innovation and change. Design thinking is a medium to reshape the organisa-
tional culture and enable transformations through people. This approach uses
human-centeredness and deep empathy-based methods to co-design a shared
sense of purpose that inspires employees. This approach enables employees to
feel confident in facing organisational changes and innovation challenges, allow-
ing them to propose (design) and realise (develop) the change according to their
beliefs and attitudes. Engaging key stakeholders to feel confident with new per-
spectives and horizons stimulates proactive behaviours and creates the appropri-
ate premises to deal with innovation challenges. It also engages and keeps its
employees motivated. Furthermore, these improvements can be incremental or
even radical organisational innovations.
Ericsson is a Swedish multinational leading provider of telecommunications,
networking, and Information and Communication Technology (ICT) to service

9
A minimum viable product (MVP) is a version of a product with just enough features to be usable
by early customers who can then provide feedback for future product development. Developers
typically deploy the product to a subset of feasible customers, as they are more likely to provide
feedback and able to grasp a product vision from an early prototype or marketing information.
88 5 Business Thinking Through Design

providers. It aims to create technology and services that are easy to use, adopt,
and scale, making customers communicate successful in a globally connected
world. Ericsson’s CEO Hans Vestberg introduced in 2010 a companywide trans-
formational initiative called Innova (design thinking approach). It was an inter-
nal programme that functions as a systematic approach to innovation. It
intensifies already existing ideas so that employees can convert them into mar-
ketable concepts. The Innova system consists of several elements, which included
VC funding model; the Innova squad (a team of internal innovation consultan-
cies); an incubation process to advance ideas into products; an innovation eco-
system to collaborate with partners and universities; and Innova method (based
on design thinking). Since its three years of operation, the platform holds 6000
users, and more than 4000 ideas were submitted, with more than 450 ideas
receiving first-round funding. Innova’s incubation process aims to take further
and realise what employees have formulated thus far.

4. Innovation of meaning: concentrates on creating an innovative vision that sup-

ports new strategic directions. It allows identifying a novel purpose (a new ‘how’
and ‘why’), redefining the problems worth addressing and providing a new inter-
pretation of what is meaningful to customers/users. Teams use a human-centred
design approach to observe users and become inspired for new solutions, as they
need to interpret what is good or bad and define new meanings. They utilise curi-
ous criticism to unveil what lies beneath the surface to develop richer and more
robust interpretations. Selecting few interpretations and going deeper with fewer
perspectives, contrasting them, and fusing them can help create a powerful,
robust and meaningful vision. It is vital to debate and criticise to stimulate prog-
ress, which requires comparing different perspectives and leveraging curiosity.
Subsequently, the organisation selects experts who address the same strategic
context but from different perspectives to reflect deeper on the implications of
the emerging vision. Continuous debates with interpreters allow companies to
exchange information and then test the robustness of their assumptions.
Organisations use metaphors to represent concepts and emotions that are new
and abstract, such as new meanings.
IKEA is a Swedish founded, multinational conglomerate that designs and
sells ready-to-assemble furniture, kitchen appliances and home accessories, ser-
vices and home appliances. It integrates democratic design into its business
policy and designs the principles that everyone has the right to purchase high
quality, sustainable and well-designed products at an affordable price. This
vision aligns with Ikea’s sustainability strategy to make everyone’s home envi-
ronmentally friendly by saving energy, reducing excess waste, and depend on
recycled and renewable materials. Design thinking helped identify novel pur-
poses that align with their higher values, such as supporting UN sustainable
development goals. In addition, they facilitated re-thinking the inner workings to
ensure that shareholders inside and outside of the company implemented the
new vision. They worked directly with suppliers to ensure the IKEA code of
5.5 Business Structures 89

conduct, IWAY (IKEA for suppliers, 2021), the quality of production and work-
ing conditions. They also selected sustainable raw material as part of their design
process, thus ensuring that their products are renewable, recyclable and recycled.

5.5 Business Structures

Business managers leading any organisation need to understand the challenges and
opportunities inherent to their industries competition. They need to be aware of
standard business and management processes, practices and the dependent ways in
which different enterprises relate and operate. Businesses have an organising frame-
work legally recognised in a particular jurisdiction for conducting commercial
activities, such as sole-proprietorship, partnership, limited liability company, corpo-
ration (certified B and corporation S (S Corp), close, non-profit) and cooperative.
This framework facilitates an organisational system that supports distinct cultures,
beliefs and values. This culture can lead to a meaningful and powerful advantage
when investing time and resources in promoting the value inside and outside of their
organisations about their mission and new products or services design (process).

• A sole proprietorship, also known as a sole trader, is owned by one person solely
liable for it and any profits made or debts incurred. The business assets and lia-
bilities are not separate from the owners’ personal assets and liabilities. They
may work alone or hire employees or enlist the services of independent consul-
tants. These low-risk businesses and owners who want to test their business idea
before formalising a more formal business entity tend to choose sole proprietor-
ship. One disadvantage is that it can be difficult to raise money because they
cannot sell stocks, and banks are hesitant to lend money.
• Partnerships are businesses owned by two or more people. They can be either
limited partnership (LP) or limited liability partnership (LLP). The former has
only one general partner with unlimited liability, and the rest of the partners have
limited liability defined by a partnership agreement. Profits are passed through to
personal tax returns and the general partner, the partner without limited liability
must also pay employment taxes. The latter protects each partner from debts
against the partnership. Partners will not be responsible for the actions of other
partners. Its advantage is that partners contribute with money, property, labour or
skills to become a viable business.
• Limited liability Company (private or public) is a business structure allowed by
state statute. It takes advantage of the benefits of both corporation and partner-
ships business structures. It protects members from personal liability in most
instances. Their personal assets (cars, house and saving accounts) will not be at
risk if their LCC faces bankruptcy or a lawsuit. LCCs can be an ideal choice for
medium or higher-risk businesses, owners with significant personal assets they
want protected.
90 5 Business Thinking Through Design

• A Corporation is a legally separate business from its owners. It is overseen by a

board of directors, who hires managerial staff to run the corporation. Assets and
liabilities belong to the corporation, not the owners. In configuring a corporation,
prospective shareholders exchange money, property, or both for capital stock. A
corporation generally takes the same deductions as a sole proprietorship to define
its taxable income, and it can also take special deductions. It conducts business,
realises net income or loss, pays taxes and distributes subsequent profits to share-
holders. In contrast, the Non-Profit Organisation (NOP) is a business that has
been granted tax-exempt status because it furthers a social cause and provides
public benefit. They are called NOPs, and the donations received are typically
tax-deductible to individuals and businesses. These are earned through fundrais-
ing activities. It is important to emphasise that this term is not interchangeable
with a Non-Governmental Organisation (NGOs). Its generic definition is a vol-
untary group or institution with a social mission, which operates independently
from the government. NGOs can vary from country to country in their legal defi-
nitions, permitted activities, monitoring and oversight.
• Certified B corporations are new forms of organisations that blur the boundaries
between the for-profit and non-profit sector by adopting social and environmen-
tally driven missions while generating profit to sustainably accomplish those
missions (Haigh & Hoffman, 2012). They are legally required to consider the
impact of their decisions on their workers, customers, suppliers, community and
the wider environment. These type of organisations demonstrates viable new
business models that generate mutually enriching correlations among econom-
ics, social and environmental value creation. Shareholders hold the company
accountable to produce a certain degree of public benefit in addition to financial
profits. The overarching goal is to create a positive triple impact towards the
economy, society and environment by using the forces of a for-profit business.
• A cooperative is an organisation owned and operated for the benefits of those using
its service. Its members share decision making authority, profits and earnings gener-
ated by the cooperative. Members can become part of the cooperative by purchasing
a share, although their shares do not affect the weight of their vote. The cooperative
model is increasingly becoming very popular across many industry sectors.

Design thinking implementation is versatile across industries like agriculture;

arts entertainment and recreation; automotive; consulting; education; energy; engi-
neering; finance and insurance; food and beverage forestry and fishing; healthcare;
hospitality; information and communication; manufacturing; mining; public admin-
istration; real estate; retail; transportation and logistics. Its application and impact
on the organisation can differ upon whom or which business unit is sponsoring its
implementation, the board, business development, design, human resources, infor-
mation technology, marketing, operations, research and development, and sales. Its
outcomes can have different internal and external impacts such as market innova-
tion, organisational innovation, process innovation, technological innovation, prod-
uct/service innovation and business-mission innovation. It also supports businesses
established in different organisational frameworks.
5.6 Business Composition 91

5.6 Business Composition

The different historical conditions, economic developments and industrial struc-

tures shape each nations’ business and industry. Organisations face pressures
regarding the changes in the dynamic of the business environments and customer
preferences. They make internal and external decisions to survive. Some organisa-
tions prioritize introducing a market orientation strategy to acquire, disseminate and
respond to feedback obtained from customers, associates and competitors. Those
firms concentrating on market orientation (Narver & Slater, 1990) and learning ori-
entation (Sinkula, 1994) influence the firm’s overall innovativeness and competi-
tiveness. However, these circumstances do not apply to all sizes and types of
businesses established in emerging, developing, and developed nations.
Defining the size of businesses may vary by industry and country. Table 5.1
exhibits diverse definitions from Australia, the People’s Republic of China, the
European Union, the United Kingdom and the United States. It uses generic infor-
mation addressing different business dimensions through formulated variables as
the number of employees, an annual turnover (the amount of money taken in a
particular period) or a balance sheet (a statement of a company’s assets and liabili-
ties). As seen from the statistics within the table, there is a disparity in the head-
count, turnover and/or balance sheet between China and the other nations. Chinese
businesses that are small, medium and large-sized businesses almost double the
headcount of employees. The rest of the definitions show similar parameters on the
headcount of people. The European Union and the UK are the only nations with
standardised financial turnover and balance sheets.

• Microbusinesses: have fewer than ten employees and an annual turnover or a bal-
ance sheet below €2 million. These businesses are of paramount importance in
Latin America, and African nations as they drive economic development (and
innovation), employment, and poverty alleviation. Many people inhabiting these
regions live in rural or poor urban areas, where they produce and/or distribute
goods and services in unregulated but competitive markets. These businesses are
generally independent, largely family-oriented, and/or employ low levels of
skills. They tend to account for more than 60% of all regional enterprises and up
to 50% of paid employment. They face a lack of access to adequate financing, a
high failure rate and a low level of internationalisation. According to Snodgrass
and Biggs (1996), most of these corporations in low-income countries are small-
sized. Indeed, there is a scarcity of research exploring the impact of design under
the conditions of micro-enterprises.

• Small-sized businesses: have fewer than 50 employees and annual turnover or bal-
ance sheet below €10 million. In the U.S., this generic size standard varies on an
industry-by-industry basis. Still, its limitations generally specify having fewer than
250 employees for manufacturing businesses and less than $7.5 million in annual
receipts for most non-manufacturing businesses. They are eligible if, after counting
its receipts or employees plus the receipts or employees of all its domestic and
92 5 Business Thinking Through Design

Table 5.1 Size of businesses definition

Size OZ US EU UK China
Micro 1–4 people 1–6 people <10 people (a) <10 people (a) <10 people (a)
(a) (a) ≤ €2 million £ 1.7 million < 1 million ¥
(b) (b) (c)
≤ €2 million £ 1.7 million
(c) (c)
Small <19 (a) <250 (a) <50 (a) <50 (a) <100 (a)
≤€10 million £8.2 million (b) <5 million ¥ (c)
(b) £8.2 million (c)
≤€10 million
(c)
Medium <199 (a) <500 (a) <250 (a) <250 (a) 100–400 (a)
≤€50 million £41 million (b) <10 million ¥
(b) £35.2 million (c)
≤€43 million (c)
(c)
Large >200 (a) <1000 (a) >250 (a) >250 (a) >400 (a)
≥€50 million >£41 million >10 million (c)
(b) (b)
>€45 million >35.2 million
(c) (c)
(a) head count; (b) turnover; (c) balance sheet Source: UCL, 2021; Australian Securities and
Investments commissions Act, 2001.; Australian Bureau of Statistics; U.S. Small Business
Administration; Company Act 2006, Section 382 and 465, UK; Ministry of Industry and
Information Technology, the Ministry of Finance, the National Development and Reform
Commission, and the National Bureau of Statistics (NBS)

foreign affiliates, regardless of whether the affiliates are organised for profit, meets
the limits. In the UK, sections 382 and 465 of the Companies Act (2006) define
SME for accounting requirements. While, the U.S. Small Business Administration
(SBA) size regulations determine whether an entity qualifies as a small business for
all SBA and Federal business development programmes, such as small business
innovation research (SBIR) programme; small business technology transfer
(STTR) programme; historically underutilised business zone (HUBZone) pro-
gramme; women-owned Small Business (WOSB) and Economically Disadvantaged
Women-Owned Small Business (EDWOSB) programmes; and Service-Disabled
Veteran-Owned Small Business (SDVOSB) programme.

• Medium-sized businesses are required to meet two out of three characteristics,

either less than £41 million turnover, less than 250 employees, or less than £35.2
million gross assets. The majority of production and employment belongs to this
size of business in medium-income countries.

The application of design thinking has been studied primarily in developed west-
ern countries, where national bodies, programmes and academic institutions sup-
port these interventions (Design Council; Design Thinking for Businesses; Danish
Design Centre). It is mainly embedded in enterprises from or associated with
5.6 Business Composition 93

creative industries (Larsen & Lewis, 2007) and manufacturing industries

(Christensen & Nielsen, 2019). Its role is to support businesses in engraining design
and innovation capabilities under five headings: vision and strategy; brand and iden-
tity; product and service; user experience, and innovative culture (Ward et al., 2009).
Some studies have concentrated specifically on building innovation and entrepre-
neurship capabilities in SMEs (Lawlor et al., 2015; Christensen & Nielsen, 2019).
Design thinking supports them in developing an innovation capacity that results in
new desirable, feasible and viable business opportunities. It also offers a more adap-
tive, explorative and inclusive approach to business strategy and management
(Golsby-­Smith, 2007; Holloway, 2009). It functions as an integrator of diverse
knowledge, as it offers a holistic view, inclusive, adaptive and multi-functional
approach (Owen, 2007), and opportunity creation process. Nonetheless, the con-
straints on its implementation are on the behest of the individual managers during
the main level of analysis of their development process. SME managers’ embed
their cognitive structure and biases on their decision making, thinking and actions
across the organisation. Another constraint is the contextual setting of the SMEs,
where employees read the signals of context and act at times with immediacy.
Cognitive structure influences the way managers and employees react, perceive
opportunities, and threats. The implementation of design thinking is key to develop-
ing the ability to reduce the cognitive tensions while building capabilities that mini-
mise bias and cognitive structures that fosters the creation of new opportunities.

• Large sized businesses: employ more than 250 employees, have an annual turn-
over greater than €50 million and a balance sheet total of more than €45 million.
Generally, countries with high income per-capita have a larger number of busi-
nesses. They are more innovative in capital-intensive low-technology industries
such as chemistry and food industry (Biggs, 2002). There are also corporations,
which are a large company or group of companies authorised to act as single
entity and recognised as such in law.

The application of design thinking in large leading western organisations is com-

monplace. Proponents argue that it is a key capability for innovators and a source of
sustainable competitive advantage for organisations. Liedtka (2014), points out,
“businesses using design thinking not only produce organic growth in business
organization, but also facilitate dealing with internal organizational, management
and cultural challenges, building individual skills and regarding management devel-
opment. Organizations can embed it as a problem-solving process and an innovation
process”. Design thinking can be applied in different areas such as marketing, new
product development, business planning, research and development, externally fac-
ing functions and internally facing function. According to the Design Council
(2017), business in the UK identifies that design contributes to either greater market
share, increased turnover, development of new markets, increased profit, competi-
tiveness, new product/service, and increased employment.
94 5 Business Thinking Through Design

5.7 Design Thinking: Tensions and Challenges

Management has evolved through time as external and internal factors change. It
has affected the way managers lead people, the way they solve problems and inno-
vate. Management science emerged in the early twentieth century. The publication
of Taylor’s 1911 treatise, The principles of scientific management set directions to
focus on increasing productivity and efficiency through standardisation, division of
labour, centralisation and hierarchy. The development of business models like the
Ford assembly line spurred the discipline of speeding up productivity, controlling
quality, and minimising costs. The next development was the functional organisa-
tion during the 1950s and 1960s, where it saw the emergence of the human resources
movement. Managers began to understand the human factors in production and pro-
ductivity and tools such as goal setting, performance reviews and job descriptions.
The third change concentrated on understanding and measuring functions to
resource allocation and tools, models and diagrams to formalise the strategic plan-
ning process as in strategic planning, growth-share matrix and SWOT analysis. In
the 1980s, the business environment grew increasingly competitive and connected
with a blooming management consultancy sector. Competitive advantage became a
priority, and with it, the tools to measure processes and improve productivity such
as Total Quality Management (TQM), Six Sigma and Lean. Managers still took
decisions while employees collected data, and goals served to manage people and
maintain control. The next series of developments concentrated more on process
optimisation. In the 1990s, benchmarking and business processes re-engineering
drove an organisation-wide approach and strategy implementation of multiple
Fortune 500 companies. Tools such as strategy maps and balance scorecards gained
prominence in the C-suite.10
The last management development turned its attention to big data, where they
concentrated on using technology for growth and value creation. The over-­saturation
of competition led to concepts such as Blue Ocean Strategy11 and Value Innovation.12
However, many managers still see organisations like machines, valuing profit,
maintaining authority and relying on six sigma to improve quality. They focus on
defining potential problems or markets opportunities through continual market

10
C-Suite, also known as C-level, refers commonly to a cluster of the corporation’s most important
senior executives. It gets the name from the titles of top senior executives that start with the letter
C, like Chief Executive Officer (CEO), Chief Financial Officer (CFO), Chief Operating Officer
and Chief Information Officer (CIO).
11
The blue ocean strategy concerns with creating and capturing uncontested market spaces, thereby
making the competition irrelevant. In this proposition, market boundaries and industry structure
are not given and can be restructured by the actions and beliefs of industry players. The concept is
developed by Professor Chan Kim and Professor Renée Mauborgne from INSEAD.
12
Value Innovation strategy focus on creating a leap in value for both buyers and the company. The
value to buyers comes from the offering’s utility minus its price because the value to the company
is generated from the offering’s price minus its costs. It is achieved only when the whole system of
utility, price and cost aligned. The concept is developed by Professor Chan Kim and Professor
Renée Mauborgne from INSEAD.
5.7 Design Thinking: Tensions and Challenges 95

analysis. They use primary and secondary market research and testing in order to
move on to more concrete phases of developing business plans based on estimates
of market penetrations, pricing and distribution strategies. The problem with mod-
ern management is its quest to ensure consistency and predictability, attempting to
eliminate variation. However, they keep confronting common issues such as the best
ways to deal with complexity and uncertainty, how to lead people or how to inno-
vate. Two constant aspects of management are the management approach and the
approach of innovation. The former focus on whether the style of top management
controls, sets goals or inspires employees. The latter concentrates on how leaders
solve strategic problems and develop new products and services, whether it is from
the top-down, or top-down with bottom-up data, or participatory actions.
Design thinking in management is not without its vocal critics. Modern manage-
ment aims to ensure consistency and predictability. Organisations function like
machines, value profits and authority model, as they are built for efficiency and
quality. They are confronted with new challenges that have no previous history or
points of reference. Currently, strategic initiatives depend on big data, the volume of
information, the variety of information and the velocity of information and business
capacity to draw meaningful analysis. The excess of data and the lack of analysis
can lead organisations to suffer data paralysis. The advent of new technologies has
also brought relevance to the engineering approach, which is more technical, rooted
in analysing the problem and deconstructing its component elements. They develop
a systematic process to identify and assess potential solutions for each component
and then create a systematic response to solve them. The consideration of design
thinking focuses on its holistic and iterative process with a distinct mindset and set
of attitudes that offers unlimited possibilities. It enables people to collaborate, com-
municate, empathise, anticipate, understand and exchange ideas facilitating inti-
mate relationships inside and outside of the organisation. It allows organisations to
create economic value for all shareholders instead of value capture. Designerly and
multidisciplinary approaches can complement and enhance traditional business
management towards solving business problems, filling critical gaps and deficien-
cies, and establishing more comprehensive bodies of knowledge. As a relatively
new concept to the business world, design thinking needs to be mindfully adopted
and integrated into current (and traditional) management practices. Managers and
designers need to be analytical and critical towards adopting and applying design
thinking whilst avoiding using it as a PR exercise or a panacea for organisational
deficiencies.

cc Chapter Summary This chapter introduced the main economic systems

that feature across the globe; each one featuring their relative strengths
and weaknesses and how they either support or hinder the organisation
to develop innovative products and services. Design has had to adapt
and is continually adapting to the fluid nature of these systems; as such,
design profession needs to become more cognizant of these changes
and proactively plan ahead in order to remain relevant. With different
business emerging on a daily basis, new organisational forms arise,
96 5 Business Thinking Through Design

each one presenting their own challenges as to where and how design
sits within and operates across traditional organisational boundaries.
The business sector is widely recognising the value of design and in
particular design thinking as a strategic tool to maintain commercial
competitiveness. If understood and implemented effectively, design can
be a powerful transformative force of both commercial and societal
good; however, design thinking is fundamentally more than just a set of
basic ‘thinking’ tools. Adopting a designerly approach needs to respect
and be fully mindful of the context in which it is being used; otherwise,
the potential gains that it has to offer will never be fully utilised and
recognised—More so today than ever before, in global and hyper
competitive marketplaces.

Review Questions

1. How can government ensure and legislate for fairness in a mixed economy sys-
tem whilst also driving wider prosperity to its citizens?
2. Peer-to-Peer (P2P) platforms are gaining prominence as a popular means of
sharing excess or idle assets; what other benefits do they offer to the user?
3. With the rise of IoT businesses, new business models are created based around
satisfying user needs, how and where could design contribute to this challenge?
4. SME’s are notoriously difficult to define, often leading to inconsistencies across
the globe, which SME definition do you consider the most comprehensive?
5. Big Data has many potential advantages to the organisation, however, it also has
many pitfalls that could hinder commercial success if not properly addressed;
how could an organisation overcome data ‘paralysis’ which is one common
problem?

Project Questions
1. A traditional economic system may seem irrelevant in developed countries, how-
ever many elements of it could contribute to sustainable development. Identify
and formulate a ten-point framework where these key elements could support
sustainable design and community development.
2. P2P is incredibly popular in relation to re-purposing unwanted clothing (‘Rent
the Runway’ is a successful e-commerce platform as an example); develop a
short business proposition where other household items could be shared
amongst peers.
3. IoT is an exponential growth industry; however, developing IoT products/ser-
vices is fundamentally different to that of developing traditional products.
Identify and critique IoT design development process models to identify what
these differences are.
References 97

4. Developing innovative products and services within SMEs is often considered

high risk; list 5 main risks that are common to many SMEs and strategies to miti-
gate these risks.
5. Businesses are interested in three types of big data: (1) customer, (2) financial,
and (3) operational. Create a marketing plan as to where and how big data could
lead to the development of innovative new products or services (or both).

Chapter Tasks

1. Form a small group of no more than 4 people; then you have >60 minutes to
identify the relative strengths and weaknesses of the four main economic
systems.
2. Using flip-chart sheets and marker pens, provide a user-journey map of a con-
ceptual e-commerce platform that is based around clothes sharing aimed at
Generation Z female users.
3. Identify two leading IoT product/service systems and identify 5 key points of
where meaningful value is offered to the end-users.
4. Embedding design thinking practices and principles within SMEs is a challeng-
ing task, outline 3 main routes to design enhancement an SME could adopt and
implement.
5. Develop a propositional design process map identifying where and how big data
could feed into and inform subsequent design activities.

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Design Thinking for Sustainable Futures
6

Learning Objectives

• To introduce and critically examine the value of the Mission Statement as

a vision document that drives strategic ambition.
• To explore the wide range of themes associated with sustainable develop-
ment and introduce the Triple Bottom Line (TBL) framework that focuses
on profit, people and planet.
• To examine the rise of Corporate Social Responsibility (CSR) and articu-
late its critical role to foster ethical business practices in industry.
• To development an understanding of new business models that character-
ise Social Enterprises when addressing distinct social problems for the
common good.
• To gain a deeper understanding of business development growth strategies
within the creative industries.

6.1 Introduction

Chapter 6 takes an exploratory approach to a wide variety of interrelated themes that

encompass the communication of organisational values and how these can be used
as an effective means of competitive differentiation. Firstly, the primary starting
point of business vision is encapsulated in the Mission Statement, which is a fluid
document that elegantly captures and communicates the main purpose of the

Supplementary Information The online version contains supplementary material available at

[https://doi.org/10.1007/978-­3-­030-­94206-­9_6].

© The Author(s), under exclusive license to Springer Nature 101

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9_6
102 6 Design Thinking for Sustainable Futures

business to its relative stakeholders. Here, values, purpose and ambition are defined
and used as a guiding force to direct overall strategic vision; be it to deliver the best
IT business solutions; the most affordable and durable products within its market
sector and so forth. In addition, to many companies, it is a statement of intent
towards their commitment to the ongoing climate debate and towards the sustain-
able development agenda. Sustainability is taking prominence in policy develop-
ment activities, company strategy formulation and consumers purchasing decisions;
as such, organisations of varying size, regardless of business activity, are now mean-
ingfully engaging with this ongoing and timely critical agenda.
Alongside sustainability, its natural companion Corporate Social Responsibility
is becoming more widespread and readily adopted, demonstrating the organisations
commitment to ethical practice and transparency in how they achieve these goals.
There are many actors and beneficiaries involved in CSR practice, and this chapter
touches upon where and how they play a vital role in its effective operation. Through
this multi-agency approach to responsible practice, opportunities for product/ser-
vice innovation present themselves, which could lead to the development of new
product and market opportunities. At the heart of this is design, where design links
creativity and innovation, especially during the initial stages of the new product
development process. In terms of innovation, new business models can be estab-
lished based on addressing broader societal problems, such as access to affordable
healthcare, assistance into meaningful employment by marginalised communities
and poverty reduction.
The rise of social enterprises demonstrates the strong egalitarian values by entre-
preneurs, and how they take these socially orientated principles into the commercial
marketplace with common good as its primary purpose. The chapter concludes that
by focusing upon an ongoing research project conducted by the University of
Dundee, UK, investigating how small high growth potential businesses involved in
the gaming industry can achieve long-term commercial survival and success.

6.2 Mission Impossible?

‘Values made visible’ is a perquisite for success, and design plays a fundamental
role in that process. Design gives meaning and presence to the strategic ambitions
of the company; for instance, BMW automotive are committed to the manufacture
of high precision-engineered motor vehicles, where quality is embedded within
every aspect of their vehicles development; design ensures this integrity is main-
tained and carefully communicated to their customers. In terms of service provi-
sion, The AirlineRatings.com Airline Excellence Awards (2020) rated Air New
Zealand, the Kiwi flag carrier the top spot due to inflight innovations, environmental
leadership and staff motivation. Air New Zealand Acting Chief Executive Officer
Jeff McDowall points out “winning the award for a record sixth time was a testa-
ment to the efforts of the airline’s 12,500 staff who were focused on delivering an
excellent uniquely Kiwi experience to its customers every day”. (ibid.) This
6.2 Mission Impossible? 103

commitment to outstanding service delivery and celebrating New Zealand as a lead-

ing destination is at the heart of the company’s mission statement—“Enrich our
country by connecting New Zealanders to each other and New Zealand to the
world”. (Air New Zealand, 2021) This introduces us to the value and role of the
company mission statement as a powerful tool to communicate strategic intent to all
its stakeholders.
A concise mission statement can foster employee satisfaction and productivity in
equal measure, as provides a strong sense of purpose, where they can focus of daily
activities that will enable them to realise company related goals. During the 1990s,
more than half of US businesses had some kind of mission or vision statement; this
number doubled from ten years earlier. (Levering, 2000). Table 6.1 outlines a brief
series of mission statements from some of the world’s leading brands.
Falsey (1989) argues “a mission statement tells two things about a company:
who it is and what it does”. Furthermore, it extols the primary purpose of the busi-
ness, the reason as to why the business exists. It should articulate its priorities, val-
ues and core beliefs. Williams (2008) raises an interesting point regarding the
benefits of a mission statement, suggesting, “In addition to specific benefits that are
said to accrue from having such a statement, successfully completing the mission
statement process demonstrates that a firm can think reflectively, plan carefully,
work collaboratively and make informed decisions”.
It is worthwhile to note, that mission statements are different to vision state-
ments, which are often used interchangeably—but are two different entities. Even
though strategic management distinguishes between vision and mission statement,
many organizations confuse them and put them together in the same statement (Sufi
& Lyons, 2003). A vision statement is where the company or organisation wishes to
go to in the future; it sets the scene for long-term ambitions and goals. Unlike a
Mission statement, the Vision statement is solely for internal purposes, outlining
long-term aspirations for the future, serving as a touchstone for strategic planning
purposes within the organisation (or divisions within a larger organisation).

Table 6.1 Mission statements from leading brands

Company Mission statement
LinkedIn “To connect the world’s professionals to make them more productive and
successful.”
Alibaba “To make it easy to do business anywhere.”
BBC “To enrich people’s lives with programmes and services that inform, educate and
entertain.”
Asana “To help humanity thrive by enabling all teams to work together effortlessly.”
Google “To organize the world’s information and make it universally accessible and
useful.”
3M “To Improve Every Life through Innovative Giving in Education, Community and
the Environment.”
Patagonia “Build the best product, cause no unnecessary harm, use business to inspire and
implement solutions to the environmental crisis.”
104 6 Design Thinking for Sustainable Futures

A mission statement is a short term (usually between three and five years)
describing the organisations ‘current’ state and their core values. This should be
continually up-dated to remain relevant and timely. One survey of 220 small busi-
nesses found that: 64% did not have a written mission statement; 7% had mission
statements that were only accessible to senior managers; 29% had a written mission
statement accessible to all employees. (Toftoy & Chatterjee, 2004) There is consid-
erable debate as to what to include in an overarching mission statement, but it is
commonly agreed that a focus should be on the employees, a clear understanding as
to who your customers are, and then an element looking to future growth and profit-
ability. As such, a carefully crafted statement should link the employees, the busi-
ness and the customer. Uniting these elements should be defining the company and
importantly, what does the company stand for in terms of purpose.
David (2007) argues, “effective mission statement must be broad in scope, gen-
erate strategic alternatives, not overly specific, reconcile diverse interest of different
stakeholders, arouse positive feelings and emotions among stakeholders, motivate
readers to action and must generate favourable impression of the organization”.
Interestingly, David includes the term ‘favourable impression’ regarding how its
many stakeholders perceives company image; this can be achieved in a variety of
ways, one notable way could be how the company demonstrates its commitment to
ethical practices, towards the environment or places sustainability centre to its oper-
ations; or all three combined. This raises the issue of corporate ‘reputation’ as a
huge asset to the organisation, contributing to its overall performance and financial
value, especially to leading international brands. Kim Harrison (2020) Founder and
Principal of Cutting Edge PR, argues, “Sometimes reputation is the biggest single
organizational asset, especially with big brands. For instance, the reputation capital
of some top companies is more than half of their market value, including Apple,
Disney, Alphabet (parent company of Google), ExxonMobil, Unilever and Shell”
We are now witnessing a growing number of businesses integrating sustainability
and ethical practices into their company strategies, demonstrating that they can do
well by doing good. As such, they can enhance reputation, whilst exceeding cus-
tomer expectations in the development of new growth opportunities. These new
values could then be incorporated into the development of the company’s overall
mission statement (see Patagonia in Table 6.1).

6.3 Sustainable Futures

Over the last few decades, we have been witnessing the rise of sustainability and a
conscious move towards adopting eco-friendly principles and practices into every
aspect of our lives; none more so than organisations, embracing the sustainable
development agenda. This shift has come from the heightened environmentally ori-
entated approach to our culture, economic, and communications infrastructure.
There is a reason the term ‘eco-friendly’ edged its way into the modern spotlight and
has been dominating the conversation ever since the late 1970’s. One defining
6.3 Sustainable Futures 105

moment in its development was the Brundtland Report (Sustainable Development,

1987) named after the chairperson of the World Commission on Environment and
Development (WCED), Gro Harlem Brundtland. In essence, this comprehensive
report highlighted that global environmental challenges were centred on the massive
poverty and inequalities of the global south and the unsustainable levels of consump-
tion and production in the North. Recommendations arising from the report, called
for a cohesive strategy that unified both development and the environment—now
commonly described as ‘Sustainable Development.’ The report defined the term as
the “development that meets the needs of the present generations without compro-
mising the ability of the future generations to meet their own needs”. A useful way
of examining the vast terrain of literature surrounding sustainability is to see it
through the lens of the ‘Triple Bottom Line’ (TBL) framework as an interrelated set
of overarching themes that are inextricably intertwined. In the framework developed
by Elkington (1997), the equally weighted economic, social and environmental lines
could also be referred to as ‘profit, people, and planet’ respectively (Fig. 6.1).

• Economic (Profit): Focuses heavily on how businesses can be economically sus-

tainable in the long term. Essentially, it depicts a revolution in values within the
organisation. Elkington (1997) argues that the traditional belief in business, that is,
‘the business of business is about the creation of economic value.’ Broadly speak-
ing, the main goal of economic sustainability is to develop an inclusive, innovative
economy for the benefit of wider society; to shape the future of a community by
creating the right kinds of jobs; and to improve the skills of people (Edwards,
2005). This emerged from traditional environmentalism. It is a recognition of the
importance of secure, long-term employment in ensuring the health of the ecosys-
tem, as poverty has been a critical contributor to environmental degradation.

Fig. 6.1 The Triple Bottom Line (TBL) (adapted by authors)

106 6 Design Thinking for Sustainable Futures

• Social (People): The social bottom line is predominantly a business term in the
field of ‘sustainable business’ which defines the way in which an organisation
should operate in a society while considering the social, ethical and political
context of that community (Jeurissen, 2000). However, in a broader context,
social issues of sustainability are about the ways in which we interact with the
economy, environment and each other. One main obstacle to achieving social
sustainability is the growth of poverty and rising inequality, which is at the heart
of the 17 sustainable development goals featured within ‘The 2030 Agenda for
Sustainable Development’, (sdgs, 2015) set out by the United Nations in 2015.
• Environmental (Planet): Arguably, this bottom line could be considered the most
worthy for particular attention when discussing sustainability. Elkington (1997)
attempts to raise organisational awareness of environmental issues as their opera-
tions impact the environment through consumption of renewable and
­non-­renewable resources. Moreover, their impacts also degrade the ecosystem as
the result of water, land and air pollution. Bhamra and Lofthouse (2007) regard
this principle of sustainability as ‘environmental justice.’ This gives equal access
to a clean environment and equal protection from possible environmental harm.
(Cutter, 1995) This in essence, argues that human activities should use natural
resources at levels at which they can be replenished naturally. The principle of
environmental sustainability can alter current forms of human interactions with
the environment in ways that keep the environment as pristine as possible; other-
wise, the resulting degradation could lead to the inability of the planet to sus-
tain life.

The TBL contains three equal areas of consideration, and when combined, pro-
vide a clear focus for action in terms of meaningful engagement when addressing
sustainability issues. However, these do present further and quite significant chal-
lenges to the organisation—measuring impact and defining the metrics for success.
For instance, turnover and profit can be measured in Pounds, Dollars, Euros and so
forth; however, how does the organisation measure environmental health and
enhanced social capital? There has been considerable debate regarding establishing
common units of measurement that could be applied to the three pillars of the
TBL. Referring back to the earlier discussion on company mission, Jackson et al.
(2011) make an interesting observation regarding the inclusion of sustainable busi-
ness practices, arguing, “to create a company whose mission is true sustainability,
all engaged individuals need to have a better understanding of what sustainability
entails. The spotlight needs to move from the financial bottom line to a more encom-
passing viewpoint of the company’s impact on the world. Once this information is
shared, it is then necessary to begin looking at the community to realize what envi-
ronmental concerns are being voiced by the public”. In terms of TBL reporting,
there are some distinct concerns surrounding that company activities and actions do
not support their strategic intentions. For instance, in a drive to become more envi-
ronmentally responsible, they may only produce limited evidence of limited finan-
cial achievements regarding this commitment. As such, adhering to sustainability
6.3 Sustainable Futures 107

principles aligned to TBL can be both difficult to maintain and importantly, com-
municate to a wide set of stakeholder audiences. Consequently, organisations could
be reticent to embracing a sustainability ethos during the shift to TBL reporting.
With a desire to adopt sustainable principles, there are also a number of other
benefits that can be enjoyed by the organisation—one involves becoming truly more
innovative. In a few different studies by the Harvard Business Review (2009) and by
Deloitte (2012), researchers found that organisations that were leaders in sustain-
ability were also leaders in innovation (and specifically with sustainability leading
the way for innovation). Significantly, what we are currently witnessing are organ-
isations and businesses worldwide, reappraising their core product/service offerings
set against the backdrop of the Covid-19 pandemic. This can be said of the ongoing
climate crisis, whereby companies being seen as a good steward and averting disas-
ter of their own making, enables them to reflect and look for alternative environ-
mentally solutions. Kerrigan and Kulasooriya (2020) point out, “Yet crises can also
be profound catalysts for change, creating opportunities to gain new perspectives.
Businesses that see climate change—and sustainability—not only as a threat but
also as an opportunity might be best placed to unlock new innovations and ignite
unexpected collaborations. Businesses may need to transform themselves to thrive
in an era where tackling sustainability is becoming an imperative”. In the market-
place, we are reaching a tipping point whereby ethically minded consumers are fast
becoming the norm for their desire to purchase and consume sustainable products
and services, especially older Millennials and Generation Zs (defined as those being
aged 9–24 in 2021). One of the defining features of this demographic group is that
“To win the hearts of Gen Z, companies and employers will need to highlight their
efforts to be good global citizens. While focusing on the quality of the goods/ser-
vices you provide is still important, a company’s ethics are more important than
ever. Moreover, actions speak more loudly than words: ‘Companies must demon-
strate their commitment to a broader set of societal challenges, such as sustainabil-
ity, climate change and hunger”. (Gomez et al., 2021). With this increasing demand
for sustainable alternatives, new market demands are opening up that offer strong
potential for long-term growth.
To exploit these emergent growing opportunities, three potential design/business
strategies could be adopted: (1) Future Forecasting (2) Internal Design-Driven
Innovation (3) Design Alliances.

1. Future Forecasting: Benjamin Franklin’s often quoted maxim “If You Fail to
Plan, You Are Planning to Fail” is more pertinent now in these times of uncer-
tainty. By developing a long-term future facing strategy, it will prepare the
organisation for resilience and potential growth through the creation of lasting
value in mid to long-term planning activities. One invaluable design approach
that could aid these activities or inspire radical new ideas for latent market
opportunities is design ‘fiction’. It is commonly acknowledged that design is
used to solve current actual problems, making things better or modifying an
existing product currently in use. However, design fiction is fundamentally more
different, is it part of a group of design practice, which we would refer to as
108 6 Design Thinking for Sustainable Futures

‘speculative design.’ Leading design theorists Dunne and Raby (2009) argue,
“rather than solving existing problems, these approaches use design to ask ques-
tions”. They do this by creating prototypes, but instead of being actually created,
these prototypes are used to encourage people to think critically about issues
where design can make a meaningful contribution. A speculative design
approach, asks how things might be in the future, why things might be that par-
ticular way, with a view to identifying potential problems and their subsequent
solutions.
2. Internal Design-Driven Innovation: In terms of adopting a future focused phi-
losophy, organisations can plan for the long-term by critically reappraising the
skills-sets, knowledge and competencies that they currently have and leverage
them within new business strategies. Referring back to Chap. 2, we tentatively
introduced a series of design process frameworks and models that could be
drawn upon to drive innovation. In addition to these, digitally orientated and
novel ethnographic design approaches (as discussed in Chap 4) could be
enhanced and tailored to a wide range of user centred contexts to drive new
design inspired opportunities for business development. However, these new
approaches are not solely for identifying new business avenues, they can be
equally as invaluable for identifying new sustainable interventions into product
development. At the time of writing this textbook, both authors have been
inspired by discussion and debates being shared at the 2021 COP26 Climate
Change Summit in Glasgow, UK. Throughout the week, numerous discussions
were focused on ways of protecting and restoring forests and critical ecosys-
tems, and on how individuals, organisations and governments can transition
towards sustainable, resilient and natural positive futures. Design can be placed
central to this ambition in the way it could be innovatively used to change cur-
rent attitudes towards the creation and development of energy, environmental
and sustainable products and services. Here, design can be viewed as an organ-
isation resource to change established orthodoxies and dated practices.
In essence, raising the sustainability agenda within the organisation, can spur
the creation of new business models supported by innovative new products that
satisfy consumer trends for ethically orientated goods and services. An integral
part of this approach would be to formalise the visibility and role of design as a
driver for innovation. Central to successfully managing design is an understand-
ing within the organisation of how it can use design as a key part of any new
business strategy; raising its value as a strategic ‘visionary’ asset is one way to
ensure this. Von Stamm (2004) argues, “it is essential to understand that the key
to success is to make design and innovation the core of the company’s strategy.
It is not about bringing in a designer for a new product once every few years; it
is about making design and innovation a way of life—about questioning and
challenging what and how things are done, and asking where there might be an
opportunity to add value”.
3. Design Alliances: Demand driven innovation is a highly responsive and flexible
type of innovation that not only satisfies customer’s wants and needs, but also
more often exceeds them. In order to achieve this, the organisation needs to
6.4 Corporate Social Responsibility 109

anticipate shifting consumer trends and build them into any forward thinking
strategy. There are many different and often complex variables that need to be
considered and accommodated in order to remain flexible in the face of shifting
market demands. The first variable is the relationship between the marketing and
design functions, market-led information can be translated into design require-
ments. Critically, the second factor is forging closer, more collaborative relation-
ships between all the differing partners within the company’s eco-system, where
they can consult and seek specialist knowledge when developing initial concep-
tual ideas for either new or modified product families and services that lean
towards sustainable values and principles. This in turn, shifts the power from the
organisation to the consumer; organisations that fail to do this will be the ones
that see falling sales and diminished reputation in ethically orientated markets
calling for greater sustainability.

6.4 Corporate Social Responsibility

A companion theme in addition to sustainable development is that of Corporate

Social Responsibility (CSR) which places ethical accountability and responsible
organisational practice. In essence, CSR is a philosophy adopted by the organisation
that illustrates its commitment to fostering social change for the benefit of all of its
stakeholders and the wider community. CSR can take many different forms that
range from corporate philanthropy and employee volunteering through to ethical
labour practices, environmental efforts and community development. The main
stakeholders who benefit from CSR activities include:

• Increased employee satisfaction: which leads to the retention of a highly satisfied

workforce, which takes pride in their work through the opportunity to develop
their skills and career aspirations.
• Consumers: through transparent and honest business practices, customers are
becoming more aware of ethical considerations and expect the same from the
brands that they are loyal to. Forbes (2017) has identified that Millennials prefer
to do business with corporations and brands with pro-social messages, sustain-
able manufacturing methods and ethical business standards. An earlier research
study undertaken by Nielsen (2015) indicated that, globally, 66% of consumers
are willing to spend more on a product if it comes from a sustainable brand.
Millennials gave an even more impressive showing, with 73% of surveyed mil-
lennials indicating a similar preference.
• Suppliers: organisations often select suppliers who equally demonstrate their
commitment to CSR practices, as this can also reflect on their own reputation. An
increasing amount of customers is demanding transparency in both supply chain
and production systems that responsible practices are being respected.
Furthermore, with growing demand for the protection of human rights, employee
welfare further back in the supply chain is also under increased scrutiny.
110 6 Design Thinking for Sustainable Futures

Questions such as—is child labour used? Are fair wages being paid? What are
the working conditions like and so forth?

• Communities: community engagement is one of the core principles of

CSR. Working with the local community can reap a wide range of benefits for
both parties. For example, many businesses, local customers are an important
revenue for sales; as such, demonstrating a strong community focus builds repu-
tational value, which in turn could make it easier to recruit and retain local
employees. Community based activities could include supporting local charity
initiatives, working with schools and colleges on a long-term basis and support-
ing local good causes via financial or voluntary support offered by their
employees.

In addition to the above beneficiaries, CSR practices could also lead to increased
creativity within the company. CSR initiatives encourage employees to continually
identify new ways and means of ethical behaviour and practices. As such, existing
products and services offered by the company could be viewed from an alternative
position, where they are scrutinised and reappraised in order to reduce environmen-
tal impact, for instance, developing new products. This often involves working with
several internal business functions within the company, and with external suppliers
and ideally, customers. Therefore, new product development (NPD) is an effective
means from which to analyse product characteristics and features that could gener-
ate innovative solutions for future product specifications. This in turn could lead to
the opportunity to differentiate products from competing rivals whilst also commu-
nicating CSR and environmentally friendly credentials. Over time, these egalitarian
values would influence the mindset of the stakeholders, employees and end-users
towards adopting CSR principles that would not only benefit the company, but also
the wider community as well. Yang et al. (2016) point out “input of CSR require-
ments during the initial stage of product design can minimize the need for frequent
design changes. Consideration of CSR in product design thus not only reduces
waste but also enhances company image”. Furthermore, when discussing environ-
mental impact, CSR can contribute via a wide number of ways. Firstly, reducing
energy consumption, as it often affects the customer’s lives immediately and
directly, which is the same for organisations, which could translate into lower or
higher energy bills. Energy efficiency management is a growing industry that pro-
vides companies of all sizes, strategies and frameworks to reduce their use of energy,
which often results in increased performance and lower manufacturing costs.
Effective CSR practices adopted by the company can offer a significant advan-
tage in terms of raising company profile and corporate reputation in highly competi-
tive markets. Therefore, CSR reporting and communication activities are important
to any forward thinking branding and business strategy. Effective PR can provide a
basis for a CSR orientated company to differentiate itself from their rivals. According
to the 2015, Global CSR study (Cone Communications, 2015) key findings identi-
fied that:
6.5 Social Enterprises—A Hybrid Business Model 111

• 91% of global consumers expect companies to do more than make a profit, but
also operate responsibly to address social and environmental issues;
• 84% say they seek out responsible products whenever possible;
• 90% would boycott a company if they learned of irresponsible or deceptive busi-
ness practices.

Identifying that 84% of customers would seek out CSR led companies in terms
of product purchasing intentions, an integrated CSR communications strategy
would enable the company to stand out in highly competitive markets. Therefore, a
strong and authentic communications strategy is crucial in publicising CSR prac-
tices; however, the key term here is ‘authenticity’ as consumers are increasingly
becoming aware of companies using CSR as a superficial marketing strategy with-
out meaningfully practising it. Otherwise, the discrepancy between what they say
and what they actually do, can lead to serious reputational damage that could sig-
nificantly harm the company. Therefore, companies need to clearly demonstrate and
articulate as to how they support CSR activities through their daily activities.
Marketing agency, Lewis Marketing (2020) points out that “At the end of the day,
organizations should prioritize CSR activity because they genuinely care about
those causes. That doesn’t have to mean, however, that they can’t also benefit from
the initiatives. From the lens of a public relations professional, CSR campaigns can
provide a valuable boost to a company’s reputation, especially when those efforts
attract attention from news and media for their impact”.

6.5 Social Enterprises—A Hybrid Business Model

Referring back to our earlier discussion regarding company mission (as in “what is
the purpose of our business?”), we turn our attention to social enterprises that place
greater emphasis on ‘purpose’ as opposed to pure profit. In essence, they provide
business solutions to social problems, whereby all profit is re-invested for the pur-
suit of greater social impact. A succinct definition of a social enterprise defines its
purpose, as “a cause-driven business whose primary reason for being is to improve
social objectives and serve the common good” (Thegoodtrade, 2021). What makes
a social enterprise different to an ethical business is that it uses its mission as a
vehicle to provide a business solution to a social problem. An ethical business pri-
marily is for shareholder profit, but adopts an ethically orientated approach to busi-
ness activities. Depending on its core mission, a social enterprise will adapt its
business model according to the problem that it is aiming to address; hence, the
wide variety of business models that feature in social enterprises. Here are six com-
mon examples of social enterprise business models:

1. The Business Support model: offers business support solutions to the social
entrepreneur who wishes to start a business. Business support could be offered
in the form of marketing, financial and training support activities in order to
grow the nascent business.
112 6 Design Thinking for Sustainable Futures

2. The Sales Intermediary model: this type of SE business acts on behalf of their
client(s); often this could take the form of selling produce and goods grown by a
farmer (i.e., cocoa beans, bananas etc.,) to the wider general public. In a way,
they would be providing access to market in order to generate sales and income.
3. The Employment model: whereby the SE would provide employment / training
opportunities for disadvantaged people/communities who would otherwise
struggle to find meaningful employment with a fair wage.
4. The Service / Fee model: the SE would directly charge the customer for socially
beneficial services offered. Commercial settings for this model would be varied
across many customer facing service industries.
5. The Cooperative model: is a fee-based membership organisation, that would pro-
vide member services to a group or community that shares a common social
need. Common examples of this cooperative structure would include employee
owned businesses and credit unions. A credit union is a financial co-operative,
which provides savings, loans and a range of services to its members.
6. The Subsidised Service model: would fund social programmes by selling prod-
ucts or offering services in the commercial marketplace. For example, a dentistry
practice could provide dental services to those most in need who otherwise
would find it difficult to access affordable health treatment.

A major survey of social enterprises undertaken by Social Enterprise UK in 2019

identified a series of key findings regarding the contribution of social enterprises to
the UK economy (Table 6.2)
The report goes on to say, “we believe social enterprises are leading the way for
business in many areas, and this report makes that clear. The start-up wave of social
enterprises continues to surge, with 42% under 5 years old. This movement is being
driven by women and BAME-led start-ups, demonstrating the vibrancy and diver-
sity of the sector. Social enterprises create vital opportunities in uncertain times,
employing those who are disadvantaged, and reinvesting over 75% of their profits
into delivering their mission”. (ibid., p. 4.)

Table 6.2 Key findings from the Social Enterprise UK, 2019 survey
Themes Key findings
1: Growing in 52% of social enterprises grew their turnover in the last 12 months. This is
Size higher than in 2017 and much higher than the 34% of SMEs who have seen
an increase.
2: Independent Social enterprises are businesses that earn their income through trading,
Businesses competing in the marketplace—77% of social enterprises earn more than
75% of their income from trading, up on our previous survey.
3: More The proportion of social enterprises introducing a new product or service
Innovative was 56% in 2019, higher again than previous years and far outstripping
SMEs, at 36%.
4: Commercially 48% of social enterprises made a profit in the past year, with 27% breaking
Successful even and a lower percentage losing money than in previous research. The
longer a social enterprise has been around, the more likely it is to make a
profit.
6.5 Social Enterprises—A Hybrid Business Model 113

Finding three, regarding innovation is worthy of further discussion as to where

design can make a meaningful contribution to and by the social enterprise. Firstly,
adopting a design thinking approach can allow the social entrepreneur to identify
latent customer needs (often through design thinking tools and techniques). This
could yield new opportunities where gaps in the marketplace, and importantly, ave-
nues for social good, could be embraced. Rather than creating and offering products
for high volume sales, new product introductions could be centred upon individual
needs where profit is not the sole purpose. Secondly, with financial resources being
a significant limitation to the social enterprise, design thinking through making
could be an efficient and viable alternative to the purchasing of expensive manufac-
turing equipment. Low fidelity prototyping, can allow the company to explore and
test initial ideas relatively quickly and inexpensively. This could then lead onto the
subsequent benefit of design and production via additive manufacturing (otherwise
commonly known as 3D printing). Based on the principle of reducing excess wast-
age, this approach could benefit individuals and communities around the world that
have limited access to materials and financial assistance. For instance, the New
Story and ICON partnership in Mexico 2020 aims to ‘provide 3D printed homes
that are intended to offer low-cost housing for low-income communities in Latin
America that adapt to their day-to-day lives. The new homes that have been success-
fully 3D printed will be granted to local families in Mexico currently living in
extreme poverty and makeshift, unsafe shelter. This project is to tackle the global
housing crisis, which has identified 3D printing as a viable solution. 3D printing
allows New Story to reach more families faster, while simultaneously improving
quality and design flexibility.’ (3d printing industry, 2020)
In an ‘opinion’, piece for the Design Council (2015) Mat Hunter, Chief Design
Officer, eloquently points out, “What fascinated me most about this act of reflection
was to see that while we still believe design is of great benefit to the world of social
enterprises, it is also true to say that the world of social enterprise is good for
design”.

CASE STUDY: Creating Design Tools to Enable Games Studios to Address Long-
term Business Sustainability Challenges

The following case study offered by Dr Xinya You, R&D fellow in sustainable
creative business, InGAME: Innovation for Games and Media Enterprise at the
University of Dundee, UK, provides a set of tools to enable young start-up com-
panies within the Gaming industry, to develop and grow their fledgling busi-
nesses. It provides a systematic account of how these tools can be easily used
within business planning activities.

Introduction
Dundee is a small Scotland city in Scotland with a population of about
150,000. In 2014, it was recognised by the United Nations as the first UNESCO
City of Design in the UK for its outstanding contributions in the fields of video
games, comics and medical research. Since the Game Boy era, Dundee has been
114 6 Design Thinking for Sustainable Futures

an important contributor to the video game industry. The famous video games IP
Lemmings and Grant Theft Auto were created in the city. A game studio in
Dundee also produced the console version of Minecraft. In addition, Abertay
University in Dundee is the first university in the world launched a video games
degree and the prestigious Princeton Review has ranked the quality of its video
games education number one in Europe for seven years. More importantly, in the
past 20 years, a video game cluster has gradually formed in Dundee and its sur-
rounding areas. Today, there are more than 80 video game companies operating
in the cluster, many of which are small and medium enterprises formed by gradu-
ates of Abertay University.
In 2018, a new multimillion-pound Innovation for Games and Media
Enterprise (InGAME) project established a dedicated research and development
(R&D) centre in Dundee to increase the value and scale of the cluster (The proj-
ect is part of the AHRC Creative Industries Clusters Programme: https://cre-
ativeindustriesclusters.com/clusters/ingame/. Grant Reference: AH/S002871/1).
Led by Abertay University, in partnership with the University of Dundee and the
University of St Andrews, InGAME establishes a collaborative network of aca-
demic researchers, students, industry experts and business leaders–it enables the
project to benefit from the expertise and experience held in the Dundee games
cluster and the HEI partnership. Moreover, InGAME engages the wider creative
district and sector support agencies such as TIGA, Ukie and UK Games Fund, to
promote economic growth, sector diversification and cultural engagement
in the UK.
Sustainability challenges facing Dundee games cluster:
In order to increase the value and scale of the Dundee video games cluster,
InGAME prioritises three high-level challenges that the cluster needs to solve.
1. Creativity Risk: The financial risk that comes with developing speculative
original IP for the games market is often fatal for start-up and micro-SMEs.
2. Technology Innovation Risk: Technology innovations within the cluster,
though often iterative, inventive and ingenious, are not systematically
captured or tested for generalisation or re-use value. This leads to missed
commercial opportunities.
3. Commercialisation Risk: Although the cluster is comprised primarily of mid-
sized SMEs and an even larger number of start-ups and micro-SMEs, these
smaller organisations often lack the commercial expertise to innovate new
business models and recognise new market opportunities.
Understanding Sustainability Challenges from a Game Studios’
Perspective
To better understand the sustainability challenge from the perspective of a
game studio, InGAME interviewed the founders of three Dundee game compa-
nies. All three game companies are committed to creative experimentation and
are keen to explore innovation opportunities. InGAME wanted to gain some
insights from the interviewees on how their company maintains business sustain-
6.5 Social Enterprises—A Hybrid Business Model 115

ability in a challenging market environment. Some interesting findings from the

interview data are shown below.
Finding 1: There are several popular business models in the gaming industry.
In the video game industry, there are three popular types of business models:
third party publishing, self-publishing and work-for-hire business models.
Finding 2: The sustainability risk of self-published business models is rela-
tively high. For many game studios, the self-publishing model is relatively risky
because they lack the ability to successfully connect their games to the target
market, and they do not have sufficient capital reserves to support the develop-
ment of original IPs in the long term. However, for game studios, self-publishing
is also the most desirable type of business model because it provides the highest
degree of creative freedom. In the best-case scenario, a successful original game
IP will make a game studio successful both commercially and creatively.
Finding 3: The sustainability risk of third-party publishing models is medium.
Compared with self-publishing, the third-party publishing model is relatively
less risky. When applying this type of models, the game studio is usually paid by
a publisher to make an original IP within a period of time and the publisher is
responsible for the formulation and implementation of product marketing strate-
gies. The commercial success of the game in the market largely depends on the
capability of the publisher and the collaboration does not guarantee good sales.
For game studios, third-party publishing models usually provide a certain degree
of creative freedom and moderate game development revenue.
Finding 4: The sustainability risk of work-for-hire models is relatively low.
The work-for-hire model is an ideal choice for game studios to develop industry
networks, enhance game development capabilities and create predictable income.
When applying this type of model, game studios generate revenue by developing
games for clients, and usually do not participate in the formulation and imple-
mentation of product-market strategies, nor are they responsible for sales perfor-
mance. The work-for-hire model usually means limited creative freedom and
relatively low service revenue.
Finding 5: Hybrid business model designs can help game studios achieve
sustainable growth. Game studios sometimes apply more than one business
model at the same period of time. For example, two interviewees stated that their
companies use both a work-for-hire and third-party publishing models. As they
said, the former is used to maintain and strengthen their business, while the latter
is a model that is expected to create a stable higher income in the near future.
Finding 6: Game studios may change their business model in response to the
needs of business growth and their long-term goals. For instance, the two inter-
viewees mentioned above regarded their work-for-hire models as transitional
models to ensure business sustainability in a short period. Both companies plan
to switch to third-party publishing and self-publishing models in the next few
years, so that they can create their own games and obtain higher market returns.
Finding 7: The co-evolution of organisation design, business model and
product-­market strategy is important for business sustainability. A few years
116 6 Design Thinking for Sustainable Futures

ago, one of interviewees wanted to add a new console game development service
to his company’s work-for-hire model. What he did was to use the company’s
own funds to develop a multi-platform console game. The whole process involves
the evolution of product-market strategy (i.e., entering a new market), business
model (i.e., using a new third-party publishing model) and organisational design
(e.g., scaling up the team and learning new skills). The successful release of the
new game proved its ability to provide a new console game development service
and made its work-for-hire business model more competitive, thereby enhancing
its business sustainability.
InGAME’s Business Sustainability Triangle Model
Based on the above findings, InGAME proposed a business sustainability tri-
angle model consisting of product-market strategy, business model and organisa-
tional design (see Fig. 6.2).
As Zott and Amit (2013, p. 409) pointed out, “Examining the dynamics of
business model evolution (how they emerge and how they are shaped and adapted
by entrepreneurial actors over time)—as well as how business models co-evolve
with product market strategy and organization design—reflects an important
cross-disciplinary research program that will substantially solidify the business
model as a pivotal level and unit of analysis in our understanding of value cre-
ation and capture.” InGAME’s business sustainability triangle model provides a
research direction for helping video game studios achieve sustainable success.
Creating Design Tools That Can Help Game Studios Achieve
Sustainable Success

Fig. 6.2 InGAME’s business sustainability triangle model (developed by author)

6.5 Social Enterprises—A Hybrid Business Model 117

Guided by the business sustainability triangle model, InGAME conducted an

in-depth case study of another Dundee game studio. Founded in 2000, the com-
pany has developed over 150 casual video games, covering a range of platforms
such as Game Boy Advance, HTML5 Browser, Xbox, iOS & Android devices
and Microsoft Windows. It not only has extensive experience in using work-for-­
hire, self-publishing and third party publishing business models, but also has
undergone six business model transitions. It provides a suitable case to illustrate
how a game studio’s product-market strategy, business model and organisational
design can co-evolve to support its long-term sustainable development. Two
design tools were created and validated as the outputs of the case study.
Design Tool 1: Business Modelling Blueprint
The Business Modelling Blueprint (BMB) is an integrated tool that can help
companies understand the relationship among business models, product-market
strategies and organisational design (see Fig. 6.3). The purpose of creating this
tool is to facilitate the data collection and analysis of the case study. The BMB
tool will be provided to Dundee game studios to help them analyse, develop
established businesses and create new businesses.
The creation of the tool is inspired by Osterwalder and Pigneur’s (2010)
“Business Model Canvas” (BMC), highlighting the construction of value chains
(i.e., value co-creators, value propositions, value co-creation, value delivery and
value capture) and value co-creation process. The BMC has nine building blocks:
Key Partners, Key Activities, Key Resources, Value Propositions, Customer
Relationships, Channels, Customer segments, Cost structure and Revenue
Streams. All of these building blocks are embedded in the InGAME BMB tool in
the form of retained building blocks, new building blocks and questions.
The BMB tool has two dimensions:
Horizontal dimension: It describes the value co-creation process. For exam-
ple, users need to identify customer segments, create value propositions, develop
products and services, design customer journeys and ultimately provide cus-
tomer experience.
Vertical dimension: The vertical dimension indicates how value co-creators
need to be considered and can be engaged in the value creation process. For
example, when creating a value proposition, users should consider customer
needs, organisational capabilities and resources, and which key capabilities and
resources should be outsourced to key partners.
How to use the BMB tool it shown below:
Step 1: Answer all the questions in each component of the blueprint.
Step 2: If you find some questions are difficult to answer, you need to do some
research to obtain the necessary data to help you answer the questions.
Step 3: If you are unsure of some answers, treat the answers as assumptions.
Go collect data, test your assumptions and use your findings to modify your
original answers.
Some of InGAME’s findings from using the BMB tool to analyse the case
study data are as follows:
 118
6

Fig. 6.3 Business-Modelling Blueprint (developed by author)

Design Thinking for Sustainable Futures
6.5 Social Enterprises—A Hybrid Business Model 119

Analytical framework. The BMB tool offers a useful analytical framework for
business modelling. It can help companies explore their strengths and weak-
nesses of using different business models from a comprehensive perspective and
provide information for key strategic decisions related to organisational design,
business models and product-market strategy. For example, the case study found
that the company’s organisational structure and business process allow its
employees work efficiently and effective for clients when using the work-for-­
hire model. However, when there are few constraints, they cannot support
employees to strike a balance between creativity and productivity, which in turn
leads to higher product development costs and lower commercial viability. This
problem surfaced when the company applied the self-publishing and third-­
publishing business models to develop its own product. In order to improve the
business sustainability of these two models, the company needs to redesign its
organisational structure and business processes for them.
Units of analysis. Each block of the BMB can represent a unit of analysis.
InGAME have found many related examples from the case study. Taking the
“organisational capability and resources” as an example, the case study shows
that when using a work-for-hire model, the company often competes with many
other game studios on price and there is a limited scope for what the company
can upsell in terms of its creative team’s skill. In order to enhance the sustain-
ability of the business, the company needs to further develop its organisational
capabilities.
Building block stability. Some building blocks related to organisational design
are relatively stable, directing the direction of co-evolution of business models,
organisational design and product-market strategy. For example, the company’s
ambition to succeed both creatively and commercially (i.e., the “organisation”
block) is such a stable building block. In terms of commercialisation, the com-
pany wants to achieve significant success in the market. In terms of creativity, the
company is not only committed to making creative games, but also constantly
trying to create games in better ways. These thoughts have profoundly affected
the company’s organisational design and development and have not changed
when the business model changed.
Design Tool 2: Business Model Evolution Journey Canvas
The Business Model Evolution Journey Canvas (BMEJC) is a reflective tool
that can help game studios evolve their business models and successfully transi-
tion from one business model to another (Fig. 6.4). The reason for creating it is
to facilitate data collection and analysis of the case study as well. This tool will
be provided to game studios to help them understand when, why and how to suc-
cessful transform and evolve their business models.
The BMEJC tool is created on the basis of the BMB tool: the building blocks
of the BMB can be used to identify decision-making factors for business model
transformation in the BMEJC. These blocks can be labelled as organisation fac-
tors, key partner factors and market factors. How to use the tool is shown below.
120 6 Design Thinking for Sustainable Futures

Fig. 6.4 Business Model Evolution Journey Canvas (developed by author)

Step 1: Business models. Fill in all the business models that your company has
used and are going to use in the blocks in round shape in the middle of the canvas
in chronological order (the canvas is extendable).
Step 2: Business model evolution timeline. Fill in the years of use of each
business model in the black boxes at the top of the canvas.
Step 3: Business goal. Fill in your business goal next to the arrow on the right
side of the canvas. Your business model(s) should help you to achieve the goal.
Step 4: Organisational and market environments. Use sticky notes to describe
the organisational and market environments before and after the transition period
of using new or different business models.
Step 5: Key decision-making factors. Use the building blocks of the BMB tool
to identify key decision-making factors (organisation, key partner and market
factors) related to the applying new or different business models. Place the labels
in the corresponding organisational and market environment zones on the can-
vas: put organisation factors in organisational environment zones, put market
factors in market environment zones, put key partners on the line between organ-
isational and market environment zones.
Step 6: Key decision points of business model evolution: Put the key decision
points of business model evolution icons on the canvas and number them in
chronological order. The numbered key decision points show how the organisa-
tion, key partner and market factors affect the evolution of a company’s business
model over time.
6.5 Social Enterprises—A Hybrid Business Model 121

Step 7: Problems and resolutions. If your company encountered a problem

when using a certain business model or has difficulty applying a new business
model, mark the problem area with the problem icon—this can help you find the
relevance of the problem to your organisation, market, or key partners. Then, use
the resolution icon to mark the resolution area(s)—how did and/or will you
resolve the problem? A solution may involve new product-market strategy,
organisational design and business model transformation.
Figure 6.5 is an example of how InGAME used the tool to analyse case study
data. Some findings from using the BMEJC tool to analyse the case study data
are as follows:
Analytical framework. The BMEJC tool provides users with a useful analyti-
cal framework that can help them understand how to evolve business models and
how to transition from one business model to another. As shown in Fig. 6.5, it
enables users to map out the evolution history of their company’s business model,
reflect on the organisational and market environments of the business model
transition period, and identify the market, organisation and key partner factors
involved in key decision-making.
Business model evolution and business sustainability. The BMEJC tool can
help users better understand when, why and how to successful transform and
evolve their business models, thereby enhancing the business sustainability of
their companies. For example, Fig. 6.5 shows that the company encountered a
problem when it applied a third-party publishing model between 2000 and 2002:
the publisher failed to connect the company’s games with the market–despite the
good feedback from players on the game experience. To solve this problem, in
2002, the company decided to enter a new market by adopting a work-for-hire
model and make innovative games for a client who owned the sales channel of
that market. This decision was made based on the company’s game development
capability. In order to meet the client’s needs, the company revised its business
processes, relocated its resource and reduced the cost of game development. As
a result, the new business model significantly increased the company’s revenue
and enhanced its business sustainability.
Conclusions
The case of InGAME shows that it is feasible to create design tools to help
game studios solve long-term business sustainability challenges. Applying a
challenge-driven approach and collaborating with industry experts and business
leaders are critical to solving such challenges. For InGAME, the collaboration
with four Dundee game studios helped it understand the existence of three popu-
lar industry business models, the different sustainability risk levels of these busi-
ness models, and some organisational design and product-market strategy
challenges that game companies may encounter when using these models. The
two design tools created base on their experience will be used to create an
InGAME Business Model Design Booklet. InGAME will share the booklet with
 122
6

Fig. 6.5 Business Model Evolution Journey Canvas–application example (developed by author)
Design Thinking for Sustainable Futures
6.5 Social Enterprises—A Hybrid Business Model 123

Dundee’s video game studios to help them enhance the sustainability of their
business, thereby increasing the value and scale of the Dundee games cluster. ◄

cc Chapter Summary It is commonly agreed that the world’s leading

brands enjoy strong customer loyalty, which in turn reflects their
longevity and commercial success. One factor that contributes to this is
their clear commitment to providing meaningful experiences to their
customers, be it through online / offline activities or a combination of
both. These experiences could be considered ‘values made visible’
reflecting the values of the brand and the purpose of these values to their
stakeholders. A powerful mission statement encapsulates these values
and the reason why the company is in business. Defining corporate
values is linked to the new perspective of sustainability and Corporate
Social Responsibility in which ethical values shape and direct
organisational decision-making and strategic vision. The Climate
Change agenda is gaining prominence, affecting our lives in the here
and now, and future generations to come, as such, sustainable business
practices are now becoming imperative to organisations, regardless of
size and location. Not only is there a need to radically re-think common
business models and established orthodoxies, but also mission in terms
of social impact and societal ‘good.’ Across the commercial landscape,
we are witnessing the rise of dynamic social enterprises that are actively
engaging with complex social problems that affect individuals and
communities and across the globe. They may sound like charitable
enterprises, of which they are not; they are businesses with a purpose to
make meaningful change to their customers. Innovative in nature, they
are value generators across diverse sectors that genuinely place people
before profit. In terms of contribution and impact to the local economy,
Dr Xinya You provided a succinct account of her current research
activities, based around the gaming industry in Dundee, Scotland.
SMEs often encounter significant challenges to their growth and long-­
term commercial development; here, she outlined key approaches and
strategies to enable their sustainable growth. Through the development
and support of the flourishing gaming industry, its contribution to the
local and regional economy is significant in the creation of employment
opportunities and wider social prosperity. Chapter 7 now turns its
attention towards design thinking for branding activities by Dr Sotiris
Lalaounis, based in the Department of Management, University of
Exeter Business School, UK.

Review Questions
124 6 Design Thinking for Sustainable Futures

1. What is the primary aim of a Mission Statement and who would be

responsible for its development and wider dissemination?
2. What are the three interrelated elements of the Triple Bottom Line frame-
work and how would these inform any sustainable development strategy?
3. Corporate Social Responsibility is a holistic organisational philosophy,
as such, who would be the main stakeholders in its effective operation?
4. What makes Social Enterprise business models uniquely distinct from
established commercial rivals?
5. Fledgling gaming companies encounter significant challenges to busi-
ness survival, what are the main challenges that they face on a day-to-
day basis?

Project Questions

1. Devise a succinct Mission Statement for a business proposition that

could be adopted by a Social Enterprise.
2. What other metrics of success could be used to quantify impact within
the Triple Bottom Line framework?
3. CSR has many benefits to the organisation and its stakeholders; however,
what are the disadvantages of CSR to company reputation if not fully
practiced?
4. Within your regional setting, identify one Social Enterprise and explore
how its business model addressed a particular social need.
5. Referring to the Business Modelling Blueprint, develop a new product
introduction strategy for an environmentally friendly consumer durable
product.

Chapter Tasks

1. Take a Mission Statement from a leading international brand and provide

your own interpretation as to how it could embrace their core organisa-
tional values.
2. Identify one Sustainable Development Goal defined by the UN, (2015)
and list key 5 points as to how design can make a meaningful contribu-
tion to its achievement.
3. Within 60 minutes, list as many challenges as you can, outlining the
introduction of CSR to an international courier company.
4. Form a small group of no more than 4 people and then devise a new busi-
ness model for a social enterprise that seeks to provide accessible finan-
cial support/loans to marginalised communities.
5. Identify how a small gaming company could diversify its existing prod-
ucts to a completely new market audience.
References 125

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Design Thinking for Branding
7

Learning Objectives

• Explain the two components of the brand audit: brand inventory and brand
exploratory and discuss how brand exploratory contributes to brand equity
development.
• Explore how design thinking (inspiration stage) can facilitate a thorough
brand exploratory by pursuing consumer ethnography to achieve the
required levels of empathy.
• Discuss how the findings of the brand audit can help brand marketers iden-
tify branding problems and/or opportunities.
• Discuss how design thinking (ideation and implementation stages) can
provide solutions to branding problems and/or strategies to harness brand-
ing opportunities.
• Explore how design thinking can help brand managers and designers
develop branding strategies which balance the need for brand consistency
and brand relevance (through the concept of brand ambidexterity).

7.1 Introduction

Bringing together concepts and frameworks from extant academic literature in mar-
keting, brand management, consumer culture theory and design management, the
overall purpose of this chapter is to provide an understanding of how design

Contribution by Dr Sotiris T. Lalaounis, Senior Lecturer in Marketing and Design Management,

University of Exeter Business School, UK.
Supplementary Information The online version contains supplementary material available at
[https://doi.org/10.1007/978-­3-­030-­94206-­9_7].

© The Author(s), under exclusive license to Springer Nature 127

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9_7
128 7 Design Thinking for Branding

thinking can contribute to brand management. Nowadays, organisations recognise

that brands are (their most) valuable intangible assets and there is “a shift in empha-
sis from a notion of brands as logos to a more integrated view as the matching of a
firm’s functional and emotional values with the performance and psychosocial val-
ues sought by consumers” (de Chernatony & Dall’Olmo Riley, 1998, p. 418).
Brands reside in consumers’ minds and require significant and continuous organisa-
tional investment because they provide firms the ability to develop and maintain
unique propositions in consumers’ hearts and minds. Organisations need to develop
and maintain a holistic perspective in order to bring together brand identity and
brand image to define their brands and their meaning (Dall’Olmo Riley, 2016).
Inspired by the service-dominant logic in marketing (Vargo & Lusch, 2004, 2008)
which advocates that consumers co-create value with organisations by taking part in
value-creation networks (Baron & Harris, 2008; Tynan & McKechnie, 2009), brand
managers and designers recognise that meaning itself is dialogic and socially con-
structed (Morris, 2003) and that, similarly, brand meaning is co-created by consum-
ers (as the main external stakeholder) with organisations. Organisations create the
brand identity, that is, the brand expressions and messages (input) (Aaker, 2010;
Schmitt & Simonson, 1997) communicated to consumers in the market. The con-
sumers’ unique interpretations of these brand expressions and messages (output)
(Margulies, 1977) lead to brand image which is all about consumer impressions
(Schmitt & Simonson, 1997). Hence, organisations communicate their brand mes-
sages (output) which are perceived and are uniquely interpreted by the target audi-
ence who then add their own experiences to generate an ever-evolving brand
narrative. This notion of a co-created brand meaning is reflected in the following
definition of brand.

A brand is a customer experience represented by a collection of images and ideas; often it

refers to a symbol such as a name, logo, slogan, and design scheme. Brand recognition and
other reactions are created by the accumulation of experiences with the specific product or
service, both directly relating to its use, and through the influence of advertising, design,
and media commentary. (American Marketing Association, 2015, cited in Dall’Olmo Riley,
2016, p. 4)

The main objectives of branding, as an essential part of business strategy, are

creating identification, differentiation and value for consumers, organisations and
society. From a consumers’ perspective, a brand is important because it provides
consumers the ability to identify the organisation producing the product or deliver-
ing the service, and in consequence, assign responsibility to this organisation. If
consumers are happy with product performance or the quality of the service, they
can purchase the brand again, if not, it is very likely they will avoid the brand in the
future (Keller & Swaminathan, 2020). Over time, consumers who purchase a brand
develop their own brand knowledge, that is, their own brand meaning stored in their
memory (Keller & Lehmann, 2003), leading to trust towards the brand. This trust
reduces any risks associated with purchasing and consuming a product; buying from
a brand which consumers know and trust, means that consumers feel safe that the
product will perform or the service will deliver what was expected
7.1 Introduction 129

(Delgado-­Ballester & Munuera-Alemán, 2001). This also means that brands can
reduce the cost for searching for new products or services because consumers return
to the brands they trust. Finally, and most importantly, brands are symbolic devices,
they help consumers satisfy their emotional needs because they empower consum-
ers to construct and communicate their own self-identities. As consumers, we buy
brands whose personality and values correspond to our own; brands speak to us and
speak for us. “Brands create the construct that empowers people to be, experience,
and become whatever they desire” (Jacobs & Wintrob, 2016, p. 55). Consumers
gather together a constellation of brands and possessions (Chaplin & Lowrey, 2009;
Solomon, 1988) which over time become part of their extended self as explained by
Belk (1988) with the following:

we learn, define, and remind ourselves of who we are by our possessions…we seek to
express ourselves through possessions, and use material possessions to seek happiness,
remind ourselves of experiences, accomplishments, and other people in our lives, and even
create a sense of immortality after death. Our accumulation of possessions provides a sense
of past and tells us who we are, where we have come from, and perhaps where we are going.
(Belk, 1988, p. 160)

From a societal perspective, brands are important because they generate and own
a significant part of global wealth and provide employment (with associated social
benefits) (Hales, 2011). Society demands from brands to operate with social and
environmental responsibility. In fact, brands can reflect many societal values, domi-
nant ideologies, the aspects that people like about their society and its representa-
tions (Holt, 2004, 2006; McCracken, 1986; Shepherd et al., 2015). Over time, many
brands have become expressions of political ideologies, especially nowadays where
political and societal discourse has become explosive and rather divisive.
Nevertheless, many brands could also “pre-empt cultural spheres of religion, poli-
tics, and myth, as they generally promote an ideology linked to political and theo-
logical models that equate consumption with happiness” (Schroeder, 2009, p. 124).
Finally, brands are important to organisations because they create identification
and differentiation, act as guarantee of quality to consumers leading to brand trust and
generate added value. This “added value with which a given brand endows a product
[or service]” (Farquhar, 1989, p. 24) is what we call brand equity. The implication of
brand equity is that consumers are willing to accept a higher price for a comparable
product because of the brand, while suppliers (to the organisation) are willing to
charge the organisation lower costs due to the popularity of the brand. Putting these
two together means that the organisation’s profit margins improve (lower costs to the
organisation and higher price to the consumers). As Keller (1993) explains:
Customer-based brand equity involves consumers’ reactions to an element of the marketing
mix [product, price, place, and promotion] for the brand in comparison with their reactions
to the same marketing mix element attributed to [an]…unnamed version of the product or
service. (Keller, 1993, p. 2)

Brand managers ought to maintain a good understanding of brand performance

to determine brand value and how this manifests in financial contributions to the
organisation. To assess brand performance, brand managers need to regularly
130 7 Design Thinking for Branding

conduct a brand audit, a consumer-focused task which evaluates the health of the
brand and identifies ways to improve brand equity (Keller & Swaminathan, 2020).
Indeed, once brand equity is developed, the onus is on brand managers to maintain,
defend and enhance the brand’s equity in a dynamic market environment (Van
Rekom et al., 2006). Design thinking, and in particular, engaging in the inspiration
stage (of the design thinking process), can help brand managers successfully con-
duct the brand audit. Consumer ethnography allows brand mangers understand con-
sumers’ thoughts, feelings and behaviour towards the brand (purchase and
consumption) to achieve the required level of empathy. This can lead to identifying
branding problems and/or opportunities for the brand which organisations must
address. The ideation and implementation stages of the design thinking process can
then enable brand managers brainstorm ideas and determine the most optimum
strategies to solve these branding problems and/or to harness these branding oppor-
tunities. Ultimately, this allows organisations sustain and enhance brand equity fur-
ther. Figure 7.1 diagrammatically presents the connections between the stages of the
design thinking process, brand audit and brand equity management, and provides
the structure based on which we frame how design thinking can contribute to brand
management. We will be referring to this conceptual model at every stage of our
discussion in this chapter.

ASSESSING MANAGING
BRAND PERFORMANCE BRAND EQUITY

BRAND AUDIT BRAND EQUITY

(2) IDENTIFYING BRANDING

CONSUMER ETHNOGRAPHY
PROBLEMS / OPPORTUNITIES

(1) DESIGN THINKING (3)

PROCESS
(4)
INSPIRATION IDEATION

(3)
IMPLEMENTATION

(4)

BRANDING STRATEGIES

Fig. 7.1 Design thinking and brand management (adapted by author)

7.2 Brand Audit, Consumer Ethnography, and Design Thinking 131

7.2  rand Audit, Consumer Ethnography,

B
and Design Thinking

The brand audit allows brand managers to assess the performance of the brand from
both organisation and consumer perspectives. Keller and Swaminathan define brand
audit as a “consumer-focused exercise…to assess the health of the brand, uncover
its sources of brand equity and suggest ways to improve and leverage its equity”
(2020, p. 329). The brand audit has two constituent components: the brand inven-
tory and the brand exploratory which examine the brand from organisation and
consumer perspectives, respectively.
Brand inventory involves “carrying out a detailed profiling of the organisation’s
products and/or services to determine how these are marketed and branded. This
requires a thorough examination of brand elements and supporting marketing cam-
paign materials” (Lalaounis, 2020, p. 257). Brand elements include brand names,
logos, and symbols used by the organisation while marketing campaign elements
include the organisation’s marketing strategies (in relation product, pricing, promo-
tion, and distribution decisions) (Keller & Swaminathan, 2020). The second compo-
nent of the brand audit, the brand exploratory examines the performance of the
brand from the consumer perspective. It is defined as “research directed to under-
standing what consumers think and feel about the brand and act toward it in order to
better understand sources of brand equity, as well as any possible barriers” (Keller
& Swaminathan, 2020, p. 332). This will help brand managers understand the true
meaning of the brand to its target group of consumers.
Brand exploratory can be conducted by pursuing quantitative and qualitative
techniques. Quantitative techniques can include methods to measure levels of
awareness, the strength, favourability, and uniqueness of brand associations (brand
meaning), consumers’ purchase intentions, their brand loyalty, and brand substitut-
ability, that is, the consumers’ willingness to substitute the brand with another
(when the brand is not available). Qualitative techniques involve open-ended inter-
pretivist methods to uncover consumers’ deeply held perceptions and feelings, such
as free associations exercises, completion and interpretation tasks, and comparison
tasks (for more on quantitative and qualitative methodologies for brand exploratory,
see Chap. 8 in Lalaounis, 2020).
In addition to these qualitative techniques, organisations have also harnessed the
power of ethnography in order to mitigate the say/do gap bias (Liedtka, 2015)
whereby consumers do not always behave in the way they say or think they do
(Fellman, 1999), as well as to overcome situations where consumers cannot convey
the reasons behind their brand choices or are merely disinclined to do so. Users can
have needs and desires they are not aware of, or cannot articulate (Chen & Venkatesh,
2013). They often lack the ability to identify problems with existing products and
services, and are unable to envisage future product and service use and what they
will want or will consume in the future (Cooper & Evans, 2006). Ethnography, a
research method traditionally used in anthropology, “produces a detailed, in depth
observation of people’s behaviour, beliefs, and preferences by observing and inter-
acting with them in a natural environment” (Ireland, 2003, p. 26). Traditionally,
132 7 Design Thinking for Branding

ethnography requires substantial time so that the researcher ‘goes native’ and is
accepted as a member of the social group under study, minimising any influence on
individual or group behaviour, while uncovering patterns of behaviour which origi-
nal members of the social group have not been able to identify or explain them-
selves (Malinowski, 1922; Plowman, 2003).
Unlike in anthropology where an ethnographic study takes place over a long
period of time, consumer or design ethnography is much more applied to suit the
demands of organisations and suit the work of brand managers and designers. “[In]
common with other kinds of applied anthropology, [design ethnography] is usually
done more quickly and given less theoretical contextualisation…In addition….the
data collection methods and ways ethnographic materials are analysed are shaped
by the particular needs of industrial designers” (Wasson, 2000, p. 382). Ireland
(2003) explains that there are six types of ethnography for design research:

1. Field ethnography, the most traditional approach where the researcher observes
individuals’ behaviour in a natural setting (e.g. at their home or in stores) (par-
ticipant observation),
2. Digital ethnography where researchers use digital cameras to record people’s
behaviour and observe and analyse it later,
3. Photo ethnography where members of the social group under study are asked to
take photos or videos of their daily lives and reflect on these with diary notes,
4. ‘Real world’ ethnographic enactments, pioneered by the MTV in its Real World
Series, where a certain environment was custom-built in order to monitor peo-
ple’s behaviour,
5. Personas which are visual or textual scenarios or profiles generated to inspire
and direct design based on studies of real people,
6. Ethno-futurism, which “combines digital tools capturing day-to-day activities
and small details of cultural significance with future perspectives, which…explore
major trends that can influence and change culture as a whole. Such approach is
ideal for technology products that require understanding an individual’s perspec-
tive and the broader picture, as well as for products whose success relies on
trends, at least to a certain extent”. (Lalaounis, 2017, p. 45)

With consumer ethnography, the researcher can gather consumer market insight
by participating in consumers’ daily life in particular settings (people’s homes or in
retail environments), collecting data using primarily participant observation, and
personal, in-context interviews, and then reporting on the findings of this process
(Moisander & Valtonen, 2012). Indeed, in a seminal ethnographic study, Peñaloza
(1998) combined field and digital ethnography, that is, participant observation and
photography, with interviews to explore the consumption of spectacle (a mix of a
museum-like experience with commercial characteristics) at the Nike Town store in
Chicago, USA.
Due to the ubiquity of the Internet and social media in daily life, purchasing, and
consumption, consumers’ online behaviour is as important as their physical behav-
iour. Humans have evolved to homo connectus (Llamas & Belk, 2013), who are
7.2 Brand Audit, Consumer Ethnography, and Design Thinking 133

wired or wirelessly connected so that they can be constantly logged on due to their
fear of missing out (FOMO). On that basis, Belk (2013) argues that in the digital
world, “there are many new possessions and technologies through which we present
and extend our self, and they operate quite differently than in predigital days. They
also create different ways through which we can meet, interact with, and extend our
aggregate selves through other people while experiencing a transcendent sense that
we are part of something bigger than us alone” (Belk, 2013, p. 494).
In response to these changes in consumer culture, Kozinets (2002) developed a
special type of ethnography which seeks to observe and understand people’s online
behaviour. Netnography “adapts ethnographic research techniques to study the cul-
tures and communities that are emerging through computer-mediated communica-
tions. [It] uses the information that is publicly available in online forums to identify
and understand the needs and decision influences of relevant online consumer
groups” (Kozinets, 2002, p. 62). In comparison with the aforementioned types of
ethnography, netnography can be unobtrusive if the researcher decides to monitor
and observe behaviour without participating (non-participant observation) which
can be beneficial as there is minimum influence on online consumers’ behaviour by
the researcher. Netnography can also be less time-consuming than other types of
ethnography yet it allows continuous access to the (online) social group under study
which provides advantages to researchers (Kozinets, 2002). However, it is impor-
tant to point out that netnography, similar to other qualitative methodologies,
requires strong interpreting skills by the researcher, careful evaluations of emerging
behavioural patterns, and the engagement of several methods for triangulation.
These enable researchers to make shrewd data interpretations necessary to generate
knowledge and insights so that brand managers and designers develop and manage
successful brands (Moisander & Valtonen, 2012).
Ethnography is strongly connected with the process of design thinking. Liedtka
contends that the design thinking process involves “iterative cycles of exploration
using deep user research to develop insights and design criteria, followed by the
generation of multiple ideas and concepts and the prototyping and experimentation
to select the best ones—usually performed by functionally diverse groups working
closely with users” (2015, p. 927). Hence, there are three stages: (1) inspiration
which involves data gathering to achieve empathy, (2) ideation which is all about
brainstorming and ideas development, and (3) implementation, which involves pro-
totyping and testing to determine the most optimum solution and refine it further.
This process is iterative rather than linear which is why Brown (2009) describes
these stages as spheres of innovation (rather than stages). The inspiration stage of
the design thinking process involves the use of applied ethnography to achieve the
required level of empathy. Hence design thinking contributes to brand audit (and in
particular, brand exploratory) through their common use of applied consumer eth-
nography (Fig. 7.1—arrow 1). In the inspiration stage of the design thinking pro-
cess, brand managers and designers must go out in the real world to observe target
users’ behaviour and understand the socio-cultural context within which this behav-
iour takes place. Brown (2008) argues that design thinking follows a human-centred
approach to understand people’s behaviour and their explicit and latent needs and
134 7 Design Thinking for Branding

deliver solutions which satisfy these needs. Actually, “design thinking is not only
human-centred; it is deeply human in and of itself” (Brown, 2009, p. 4).
Observing, living through and understanding users’ behaviour allows brand
managers and designers to achieve three levels of empathy:

1. Physical empathy, which requires physically living through, first hand, the user
experience,
2. Cognitive empathy, which involves translating these physical experiences into
opportunities to improve these experiences by asking questions which uncover
users’ latent needs,
3. Emotional empathy, which requires emotional understanding to work with ideas
and concepts that matter to the target users at an emotional level.

This transforms target users from adversaries to advocates of these ideas and
concepts (Brown, 2009). Ultimately achieving empathy enables brand managers
and designers to understand users and their behaviour well; empathy enables them
to see the world through the users’ eyes, feel the world through the users’ emotions,
understand the world though the users’ experiences and using the users’ meanings
of these experiences and the world in general (Brown, 2009; Elliott & Jankel-Elliott,
2003). From a branding perspective, the brand exploratory, based on inspiration
through ethnography and empathy, allows brand managers and designers to under-
stand the brand ecology (Percy et al., 2001) which involves “studying the lived
experience of the consumer as a social being, and which considers not just the atti-
tudinal, emotional, and behavioural aspects of brand consumption, but explores
how this brand-related behaviour integrates with wider social and cultural experi-
ence in the life-world of the active consumer”. (Elliott & Jankel-Elliott, 2003,
p. 215).

7.3 Identifying Branding Problems and/or Opportunities

Assessing the performance of the brand based on the brand audit, and in particular,
the brand exploratory, enables organisations to maintain and enhance the equity of
the brand. As mentioned earlier, brand equity is all about the extra value the brand
gives to a product or service beyond the objective quality of this product or service
(Farquhar, 1989). Carrying out the brand audit, and in particular the brand explor-
atory based on consumer ethnography, enables brand managers and designers to
identify any potential branding problems and/or opportunities for the brand, in rela-
tion to the four layers of the Customer-Based Brand Equity (CBBE) pyramid model
(see Figs. 7.2 and 7.3) which is a seminal framework in brand management and
development. For example the results of the brand exploratory could determine
whether the levels of consumer awareness need to improve, identify any negative
consumer associations which must be eliminated, understand what consumers think
(is it a credible part of the consumers’ consideration set?) and feel towards the brand
(emotions towards the brand, and those generated by the brand) to address any
7.3 Identifying Branding Problems and/or Opportunities 135

STAGE 1 STAGE 2 STAGE 3 STAGE 4

Create brand meaning

Make consumers
in consumers’ minds Generate rational and
aware of the brand and
by linking certain brand emotional consumer Transform consumer
associate the brand
properties with a range responses to brand responses to long-term
with a specific
of tangible and identity and brand loyalty relationships.
category or consumer
intangible brand meaning.
need.
associations.

BRAND BRAND BRANDE BRAND

IDENTITY MEANING RESPONSES RELATIONSHIPS

Fig. 7.2 Stages of brand development (based on Keller 2001, adapted by author)

BRAND
RESONANCE

CONSUMER CONSUMER
JUDGMENTS FEELINGS

BRAND BRAND
PERFORMANCE IMAGERY
ASSOCIATIONS ASSOCIATIONS

BRAND
SALIENCE

Fig. 7.3 Customer-based brand equity pyramid model (Keller, 2001, adapted by author)

negative cognitive and emotional elements, or assess the levels and the extent of the
consumers’ loyalty towards the brand.
According to the CBBE pyramid model, in order for organisations to develop
high levels of brand equity, the first stage is to ensure that consumers are aware of
the brand and that the brand is related to a specific product or service category or to
a particular consumer need (first layer of the CBBE pyramid model). This therefore
involves developing a brand identity to achieve brand awareness (brand salience).
As previously explained the brand identity includes the brand’s expressions and
messages communicated to its target audiences (Aaker, 2010; Schmitt & Simonson,
1997). The brand identity integrates different design elements and combines prod-
uct, graphic, and environmental design. Design management enables brand manag-
ers and designers to communicate consistent and coherent messages to target
consumers (Johansson & Svengren Holm, 2006). Brand identity includes four
136 7 Design Thinking for Branding

elements: properties (buildings, offices, retail places, and company vehicles), prod-
ucts (the products’ or services’ sensory characteristics), presentations, that is, the
elements surrounding the product (its packaging, labelling, and tags), or the ele-
ments surrounding the service (shopping bags, retail place settings, and employee
uniforms), and publications (promotional materials, advertising, and stationery)
(Schmitt & Simonson, 1997; Schmitt et al., 1995).
These brand identity elements can generate brand awareness which is all about
consumers’ ability to recall and recognise the brand. Brand recall “relates to con-
sumers’ ability to retrieve the brand when given the product category, the needs
fulfilled by the category, or some other type of probe as a cue… [it] requires that
consumers correctly generate the brand from memory” (Keller, 1993, p. 3). With
brand recognition, consumers confirm they recognise the brand when exposed to a
visual stimulus (a brand element e.g. brand logo or symbol), and are able to cor-
rectly determine that they have seen or heard of the brand before (Keller, 1993).
Brand managers and designers must also work to achieve depth and breadth of
brand awareness. A salient brand enjoys depth of brand awareness which is all about
the ease of brand recall and recognition as well as how likely the brand will come in
consumers’ minds, and breadth of brand awareness which is all about the range of
consumption situations in which the brand will come to consumers’ minds. The
greater the range of circumstances the brand will come to consumers’ minds, the
broader the consumers’ awareness of the brand (Keller, 1993; Keller &
Swaminathan, 2020).
The second stage involves linking the brand with a range of strong, favourable
and unique associations in consumers’ minds to develop brand meaning (second
layer of the CBBE pyramid model). These associations can be performance asso-
ciations related to the intrinsic properties of the brand, its inherent characteristics,
that is, how the brand satisfies the consumers’ functional needs, for example the
product’s characteristics, reliability, service effectiveness, and price, and imagery
associations related to the extrinsic properties of the brand, that is, how the brand
satisfies the consumers’ emotional or symbolic needs, for example, associations
related to who the user of the brand is, in which situations the brand can be used,
or associations about the personality of the brand (Keller, 2001). Brand managers
and designers can continuously assess and understand the consumers’ brand asso-
ciations by asking a sample of the target audience the following simple question:
‘what comes to your mind when you think of [Brand X]? (free associations exer-
cise) (Keller, 1993). Consumers’ responses to this question include their thoughts,
feelings and perceptions of the brand (their own image of brand); any negative
associations uncover problems with the brand image which brand managers and
designers must address with a branding strategy (discussed further below).
Understanding consumers associations which constitute the brand meaning is
essential because as mentioned before brand meaning is dialogic and socially
constructed.
Instead of constructing brands for consumers, [brand managers and designers] must
coevolve brands with people and further embed the ability for meaning-making into [the]
brand building process…[They] must acknowledge that the act of meaning-making occurs
7.3 Identifying Branding Problems and/or Opportunities 137

within the individual and is not something [they] can control. At best [they] can use design
to create the opportunity, context, and tools for meaning-making and put them into the
hands of people. (Jacobs & Wintrob, 2016, pp. 54–55)

In the third stage, the organisation must generate positive rational and emotional
consumer reactions (consumer judgments and feelings) (third layer of the CBBE
pyramid model) to the brand identity and brand meaning (stages 1 and 2). Consumer
judgements rely on consumers’ cognitive responses and involve (1) consumers’ per-
ceptions of brand quality which (similar to beauty) is a subjective construct, (2)
brand credibility which is about the brand’s expertise (competence and innovative-
ness), trustworthiness, and likeability, (3) brand consideration (its relevance and
meaningfulness to target consumers), and (4) brand superiority, that is, whether or
not it is unique and better than the competitors’ brands in the product or service
category. Consumer feelings are concerned with consumers’ emotional responses to
the brand identity and brand meaning. “Brand feelings relate to the social currency
evoked by the brand” (Keller, 2001, p. 14). Richins (1997) determined the con-
sumption emotions set, a list of positive and negative emotions occurring during the
act of purchasing and during consumption (using the product or service) including
emotions such as love, contentment, excitement, and joy (positive), and sadness,
fear, shame, and anger (negative). Of course, brand managers and designers must
ensure that brand purchase and consumption generates positive emotions with the
target audience. They should try to render the brand with positive emotions which
can be an effective branding strategy because consumers are not only rational but
also emotional decision-makers and “we all respond emotionally to our life experi-
ences and we naturally project emotional values onto the objects around us” (Gobé,
2009, p. xxix).
Finally, these responses must be transformed to long-lasting loyalty relationships
between consumers and the brand (brand relationships to achieve brand resonance)
(fourth layer of the CBBE pyramid model). “Brand resonance refers to the nature of
the relationship that customers have with the brand and the extent to which they feel
that they are ‘in sync’ with the brand. Brand resonance is characterised in terms of
intensity or the depth of the psychological bond that customers have with the brand
as well as the level of activity engendered by this loyalty”. (Keller, 2001, p. 15)
High levels of brand equity are manifested by high levels of consumer loyalty
towards the brand (Keller, 2001). There are four categories of brand resonance:

1. Behavioural loyalty which is about the number of consumers who buy the brand,
how much they buy from it, and how often,
2. Attitudinal attachment which signifies that consumers have a strong emotional
connection with the brand, they are in sync with the brand,
3. A sense of community where the brand becomes the centre of a social group
(brand community) formed on the basis of social relationships among brand
admirers (Muñiz Jr. & O’Guinn, 2001), and
4. Active engagement which involves loyal consumers evangelising about the
brand, praising it to fellow consumers and urging them to try it. Active engage-
138 7 Design Thinking for Branding

ment is “the strongest affirmation of brand loyalty [where] customers are willing
to invest time, energy, money, or other resources into the brand beyond those
expended during purchase or consumption of the brand” (Keller, 2001, p. 15)
(for a further analysis of CBBE pyramid model, see Chap. 2 in Lalaounis, 2020).

7.4 Design Thinking and the Development

of Branding Strategies

Once brand managers and designers have identified branding problems and/or
opportunities, they can pursue the second and the third stages of the design thinking
process, that is, the ideation and implementation stages (Fig. 7.1—arrows 3), in
order to develop branding strategies which solve the branding problems and/or har-
ness the branding opportunities identified (in the brand audit) (Fig. 7.1—arrows 4).
This provides the organisation the capability to manage and harness its brand’s
equity further. The ideation stage requires from brand managers and designers inter-
preting the data gathered through consumer ethnography, to determine patterns of
behaviour. At this stage, the team also needs to engage in brainstorming in order to
come up with ideas which could potentially solve the problem at hand or help the
organisation capitalise on the identified opportunity. Once different choices have
been developed, brand managers and designers prototype and test these ideas to
determine the best concept. The most optimum design concept will have to satisfy
three overlapping criteria: feasibility, visibility and desirability. “Feasibility relates
to what is functionally possible within the foreseeable future, viability is about what
is likely to become part of a sustainable business model, and desirability is what
makes sense to people and for people” (Lalaounis, 2017, p. 55). Brand managers
and designers need to achieve a harmonious balance of these three criteria
(Brown, 2009).

Brand Consistency Versus Brand Relevance

Beverland et al. (2015) argue that in order to preserve and enhance brand equity,
brand managers “must maintain [brand] consistency (in both image and marketing
support), take a long-term view, and carefully leverage existing brand equity. Yet at
the same time, managers must also maintain brand relevance, which require change
and importantly, innovation” (Beverland et al., 2015, p. 589). In a study of innova-
tion cases in organisations across a range of sectors, they explored how design
thinking enables brand managers to develop successful branding strategies by rec-
onciling this tension between brand consistency and brand relevance. Extant litera-
ture has highlighted the importance of achieving both, in order to maintain or revive
brand equity (Brown et al., 2003; Giesler, 2012; Thompson et al., 2006).
Brand consistency is concerned with the standardisation and maintenance of a
well-defined brand image and meaning through consistent brand identity elements:
properties, products (or services), presentations, and publications (Schmitt &
7.4 Design Thinking and the Development of Branding Strategies 139

Simonson, 1997). This is essential for the preservation of strength and favourability
of consumers’ brand associations (Keller, 1999). “A commitment to consistency
and stability is…revealed in the brand audit process, whereby managers are encour-
aged to focus on customer touch-points and journeys in order to close identity-­
image gaps” (Beverland et al., 2015, p. 590). However focusing too much on brand
consistency can prove problematic because the brand needs to be adapted to market
and consumer changes if it is to stay relevant. Hence, brand relevance is also
required. A brand needs to be relevant, meaningful and appropriate to the target
consumers so that it is part of their consideration set (Aaker, 2012; Rosenbaum-­
Elliott et al., 2011).
Drawing from management and organisation studies literature, Beverland et al.
(2015) connect brand consistency with the concept of exploitation whose “essence
is the refinement and extension of existing competencies, technologies, and para-
digms” (March, 1991, p.85), and brand relevance with the concept of exploration
which is all about pursuing new opportunities, developing new knowledge and
capabilities, and achieving radical innovation with products and services (Tushman
& O’Reilly, 1996). Design thinking can empower brand managers to achieve both
exploitation and exploration, brand consistency and brand relevance, through the
concept of brand ambidexterity which Beverland et al. “define as a marketing capa-
bility whereby a brand is strategically managed to create value through the pursuit
of both consistency and relevance” (2015, p. 592).
Etymologically, the word ambidexterity includes the Latin ‘ambi’ which means
both, and ‘dexter’ which means right or favourable (Maier, 2015). Tushman and
O’Reilly define ambidextrous organisations as those which have the “ability to
simultaneously pursue both incremental and discontinuous (radical) innovation and
change results from hosting multiple contradictory structures, processes, and cul-
tures within the same firm” (1996, p. 23). Such organisations are able to both exploit
their existing resources, products and knowledge, and explore the new, the radical,
the unconventional, which could be products, technologies or markets. Building and
maintaining ambidexterity can be extremely difficult because it requires a combina-
tion of the contradictory demands of exploiting and exploring (Smith & Tushman,
2005). Ambidexterity requires a balance between exploitation and exploration and
can lead to tensions because of their different knowledge management processes
(March, 1991).

Design-Driven Brand Ambidexterity

Beverland et al. (2015) argue that the dominant logic in contemporary brand man-
agement has privileged brand consistency over relevance. A study by Högström
et al. (2015) identified that certain mental schemas can define a brand manager’s
time horizon and his/her enacted environment width which includes the elements
seen as important for brand performance. The authors found two mental schemes:
calculative and heuristic, which both emphasise consistency at the expense of rele-
vance, undermining the power and potential to (radically) innovate (Beverland
140 7 Design Thinking for Branding

et al., 2015; Högström et al., 2015). Design thinking can challenge this dominant
logic in contemporary brand management through design-driven brand ambidexter-
ity, avoiding stagnating practices caused by an over-emphasis on exploitation and
brand consistency. Design thinking is based on abductive reasoning and can encour-
age brand managers and designers to consider the possibility of what ‘might be’
(Martin, 2009) and ask the question of ‘what if’ (Liedtka, 2015) leading to the
generation of new insights and the creation of new knowledge. As Liedtka (2015)
contends, design thinking “relies on abduction and experimentation involving mul-
tiple alternative solutions that actively mediate a variety of tensions between possi-
bilities and constraints, and is best suited to decision contexts in which uncertainty
and ambiguity are high. Iteration, based on learning through experimentation, is
seen as a central task”. (Liedtka, 2015, p. 927).
The human-centeredness of design thinking goes beyond customer orientation
advocated in marketing and brand management literature because it enables brand
managers and designers to identify unarticulated human needs and desires and
reframe or develop new markets, products, services, and experiences (Beverland
et al., 2015; Michlewski, 2008). In other words, design thinking cannot only help
brand managers and designers solve branding problems, but also create new possi-
bilities and harness these opportunities (Beverland et al., 2015; Liedtka, 2004).
Design thinking can help them manage the tensions inherent in the dualism of brand
consistency versus brand relevance, propelling brand growth in mature [product or
service] categories, enhancing present associations in consumers’ minds or generat-
ing new ones, and revitalising brands facing a decline (Beverland et al., 2015).
These underlying tensions include brand position versus market, brand position ver-
sus effectiveness, and brand position versus emerging future (Beverland et al.,
2015). In marketing, a product’s position is the “the place the product occupies rela-
tive to competitors in consumers’ minds” (Kotler et al., 2008, p. 157); it is the men-
tal place the product occupies in consumers’ minds on the basis of perceptions
about the product’s quality, price, and status. Brand positioning is all about building
or adjusting consumers’ brand perceptions (Fuchs & Diamantopoulos, 2010) and
“involves establishing key brand associations in the minds of customers and other
important constituents [internal and external stakeholders] to differentiate the brand
and establish (to the extent possible) competitive superiority” (Keller & Lehmann,
2006, p. 740).

 rocess for Triggering Brand Ambidexterity Through

P
Design Thinking

On the basis of their empirical study, Beverland et al. (2015) contend that design
thinking’s contribution to managing the tension of brand consistency versus brand
relevance can be understood as a three-stage process: (1) destabilisation, (2) define
and develop, and (3) transformation (see Fig. 7.4), with each stage involving a num-
ber of sub-practices which designers follow.
7.4 Design Thinking and the Development of Branding Strategies 141

DESTABILISATION DEFINE & DEVELOP TRANSFORMATION

Naïve questioning Capabilities matching Mapping innovation

Problem interrogation Problem scoping to brand
Contextual immersion Solution development Re-stabilising

Fig. 7.4 Achieving brand ambidexterity through design thinking (based on Beverland et al. 2015,
adapted by author)

• The first stage, destabilisation, involves designers challenging, or “destabilising

the categories used by brand managers to frame their options for innovation”
(Beverland et al., 2015, p. 599). This can be achieved by carrying out three sub-­
practices: naïve questioning, problem interrogation, and contextual immersion.
Naïve questioning is all about asking ‘what if’ questions which on face of it
might seem simplistic. Yet these questions are extremely useful because they can
challenge the status quo and current norms to achieve problem interrogation
which allows brand managers and designers to consider the wider socio-cultural
and historical contexts where the brand consistency versus brand relevance ten-
sion develops (Beverland et al., 2015). Contextual immersion is about brand
managers and designers immersing in the target consumers’ world (this directly
connects with consumer ethnography previously discussed) to foster a discus-
sion about current assumptions in regards with consumers’ thoughts, feelings,
and behaviour towards the brand.
• The second stage, define and develop, involves designers interacting with brand
managers to “leverage specific brand-related inputs such as customer research
[e.g. results from ethnographic studies as explained above], and to ensure that the
resulting innovation could be integrated within an expanded brand narrative”
(Beverland et al., 2015, p. 602). In this stage designers and brand managers need
to work together to define and develop possible solutions; this can be achieved
by three inter-related sub-practices: capability matching, problem scoping and
solution development. Capability matching allows brand managers and design-
ers to work together to identify tangible and intangible inputs to a planned design,
that is, functional and symbolic assets, respectively, making sure that any innova-
tive offerings which are developed do not only go in line with the brand’s posi-
tion but also expand the brand identity “by adding associations that do not clash
with existing ones, reinterpreting existing categories, or highlighting aspects of
the firm’s operation that had previously been downplayed or ignored” (Beverland
et al., 2015, p. 602). Problem scoping seeks to understand the nature of the prob-
lem which needs solving by analysing the wider context any brand innovation
has to address. These two sub-­practices lead to the final sub-practice of this
stage, solution development, allowing brand managers and designers to develop
a solution which provides brand relevance without sacrificing brand consistency
(Beverland et al., 2015).
142 7 Design Thinking for Branding

• The third and final stage, transformation, involves transforming the brand, and it
can be achieved by two sub-practices: mapping the innovation to the brand, and
restabilising. It is important that the developed solution is mapped to the brand,
that is, it is “formally located within the brand’s narrative…tweaking the brand
story by emphasising or revealing associations that the brand has [so far] ignored,
but could credibly claim, as well as rebuilding the complete brand system (i.e.,
reworking all brand-supportive marketing materials)” (Beverland et al., 2015,
p. 604). This means that the developed solution extends the brand narrative and
the brand identity is refreshed. With the final sub-practice, restabilising, brand
managers and designers use the outcomes and insights of the previous stages and
sub-­practices as the basis for determining brand consistency in the future.

The process explained above supports our main argument that design thinking
can successfully contribute to the branding strategies through its main premise of
human-centeredness and empathy (based on consumer ethnography), and the prac-
tices of brainstorming, and concept experimentation and testing. Unboundedly,
Beverland et al.’s (2015) process embraces the essence of the inspiration, ideation
and implementation stages of the design thinking process (Brown, 2009; Liedtka,
2015). Their recommended process enables brand managers and designers to
closely and continuously collaborate in order to develop branding innovations and
solutions which integrate brand consistency and brand relevance, “maintaining mar-
ket relevance through innovation without unintentionally corrupting or distorting
carefully cultivated brand equity” (Beverland et al., 2015, p. 606). Such innovations
and solutions can take the form of, for example, new or improved products or ser-
vices, brand communications campaigns, new or updated brand aesthetics, practices
for fostering a brand community, emotional branding campaigns, as well as corpo-
rate and social responsibility activities, using product, service, graphic, and com-
munications design practices.
In relation to new product development (NPD) in particular, Nagaraj, Berente,
Lyytinen, and Gaskin argue that “design thinking can be framed as a dynamic capa-
bility that addresses routine and cognition-based inertia by expanding the organiza-
tion’s knowledge resource base, particularly in familiar contexts [contexts where
there NPD team is familiar with the problem]” (2020, p. 297). In addition, an exper-
imental comparison study conducted by Meinel et al. (2020) involving 53 NPD
teams, sought to compare the application of design thinking (as a user experience-­
driven approach) with the user preference-driven approach, a more traditional inno-
vation approach which focuses on translating user needs, desires, and aspirations
into solutions which match the pre-determined problem. This translation process is
conducted by “aggregating data and making trade-off decisions between user pref-
erences traceable” (Meinel et al., 2020, p. 662). The purpose of this comparison was
to investigate whether design thinking leads to the generation of “more superior new
product (or service) concepts in terms of creativity” (Meinel et al., 2020, p. 662).
Their research findings confirmed that pursuing design thinking enables brand man-
agers and designers to develop more creative product or service concepts than the
more traditional innovation approach, echoing Wattanasupachoke (2012) whose
7.4 Design Thinking and the Development of Branding Strategies 143

empirical study argued that applying design thinking in business management can
enhance creativity leading to innovations for consumers. In particular, Meinel et al.
(2020) determined that

design thinking positively affects the feasibility, relevance, and specificity of the generated
concepts. [The exception was] concept novelty [for which their] findings did not reveal a
statistically significant effect of design thinking when compared to [the traditional] method.
This could be due to the fact that whereas [the traditional method] is rather intuitive and
leads to concepts of passable levels of novelty, applying design thinking has the potential to
lead to concepts of greater novelty, but is more unusual and challenging and thus requires
stronger guidance and support [which were beyond the scope of the time frame of their
experimental study]. (Meinel et al., 2020, p. 668)

cc Chapter Summary The main purpose of this chapter was to discuss the
contributions of design thinking to brand management. The chapter
presented a conceptual framework which explains the connections of
the design thinking process with brand equity and its management,
through the power and scope of consumer ethnography and empathy. In
a contemporary post-modern world, brand managers and designers
must continuously assess the brand performance by conducting the
brand audit. Organisations must maintain, protect and harness further
the brand equity in a continuously evolving market environment. Design
thinking, and in particular, the inspiration stage (of the design thinking
process), can help brand managers successfully conduct the brand audit.
The inspiration stage involves consumer ethnography which enables
brand managers and designers to uncover consumers’ thoughts, feelings
and behaviour towards the brand (purchase and consumption) to achieve
consumer empathy. Based on the findings of consumer ethnographic
studies, they can identify branding problems and/or opportunities which
require attention. The ideation and implementation stages of the design
thinking process give brand managers and designers the necessary tools
to brainstorm ideas and develop the most optimum strategies to solve
these problems and/or to capitalise on these opportunities. Ultimately,
design thinking provides the organisation immense power to balance
brand consistency and brand relevance, and continuously manage and
enhance brand equity. Most importantly, this is done with a human-­
centred approach, putting the target consumers at the heart of the
process to deliver products, services, experiences which they embrace
and develop a loving loyalty relationship with.

Review Questions

1. Explain the two parts of the brand audit and their contribution to the assess-
ment of brand performance.
2. Discuss how brand managers and designers can apply consumer ethnogra-
phy in order to successfully pursue the brand audit?
144 7 Design Thinking for Branding

3. Which are the three levels of empathy brand managers and designers should
seek to achieve?
4. Discuss the four layers of the Customer-Based Brand Equity (CBBE) pyra-
mid model.
5. What are the potential problems and/or opportunities (in relation to the
CBBE pyramid model) that brand managers and designers might identify by
pursuing consumer ethnography?
6. How can the ideation and implementation stages of the design thinking pro-
cess help brand managers and designers to develop branding strategies?
7. Why are brand consistency and brand relevance, both important for brand-
ing strategies?
8. How can design thinking help brand managers and designers balance brand
consistency and brand relevance through brand ambidexterity?

Main Project Task

Choose a brand and critically evaluate its current branding strategies. Applying
appropriate brand concepts and theories, discuss its future development.
Project steps:
To carry out the main project task, you should achieve the following steps:

1. Briefly introduce the brand and its market context (product or service category,
target audience(s), and competitors).
2. Critically evaluate the brand and its current branding strategies by conducting
both parts of brand audit: brand inventory and a brand exploratory. With regards
to brand inventory, you should—textually and visually—profile the product(s)
and/or service(s) of your chosen organisation explaining how they are marketed
and branded. With regards to the brand exploratory, your evaluation should be
based on secondary research data gathered from publicly available sources and
primary research data gathered by pursuing an ethnographic study (participant
observations of the target users and interviews with a small sample). This stage
connects with the inspiration stage of the design thinking process (to achieve the
necessary level of empathy).
3. Clearly determine what is the problem that the brand faces, and/or the opportu-
nity that the brand should capitalise on (based on the brand exploratory carried
out in step 2). It is important to ‘place’ this problem and/or opportunity on the
CBBE pyramid model in order to provide solid foundation for the next step.
4. Develop a strategy to solve the identified problem and/or harness the identified
opportunity (using the ideation and implementation stages). The strategy can
include a new product or service, a new communications campaign, the design
of an updated brand identity and so on.
5. Identify metrics that should be used to evaluate the effectiveness of your pro-
posed brand development strategy in the future, that is, determine how you plan
to evaluate, in the future, whether or not your strategy has achieved your brand
development objectives.
References 145

Chapter Tasks

Carry out the following tasks to assess a brand’s equity and its performance in its
product or service category:

1. Name five brands from a specific product or service category (e.g. five cos-
metics brands or five airline brands) (make a list of these brands).
2. Select one of the brands that you have included in the above list.
3. What comes to your mind when you think of this brand? (Make a list of your
own brand associations).
4. What do you like or dislike about this brand?
5. In your opinion, how credible is this brand (in relation to its expertise, trust-
worthiness and likeability)?
6. Is the brand one you would consider buying in the future? Why/why not?
7. How is this brand similar and how is it different to other brands in the same
category?
8. How does this brand make you feel? Does it generate any feelings about
yourself or about your relationships with others?
9. Have you bought the brand before? If yes, how often? If no, (move to Q11).
10. If the brand is not available the next time you attempt to purchase it, what
would you do?
a. Wait until it becomes available.
b. Visit another store or website to find and purchase it.
c. Replace the brand with another brand.
11. Would you recommend the brand to others? Why/why not?

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139–168.
Beverland, M. B., Wilner, S. J., & Micheli, P. (2015). Reconciling the Tension Between Consistency
and Relevance: Design Thinking as a Mechanism for Brand Ambidexterity. Journal of the
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Brands (pp. 3–27). Marketing Science Institute.
Moisander, J., & Valtonen, A. (2012). Interpretive Marketing Research: Using Ethnography
in Strategic Market Development. In L. Peñaloza, N. Toulouse, & L. M. Visconti (Eds.),
Marketing Management: A Cultural Perspective (pp. 246–260). Routledge.
Wasson, C. (2000). Ethnography in the Field of Design. Human Organization, 59(4), 377–388.
Design Thinking: Practice
and Applications 8

Learning Objectives

• To develop an understanding of design thinking methodologies utilised

within a broad range of diverse contexts.
• To introduce the key elements of service design and how these both inform
and enhance end-user experiences.
• To illustrate how design can contribute to and drive organisational innova-
tion at a strategic level of application.
• To gain a deeper understanding of industry specific tools and how these
can foster wider innovation networks.
• To provide insights as to how design thinking practices traverse organisa-
tional structures and stakeholder groups.

8.1 Introduction

This chapter focuses upon design thinking in practice; it departs away from its theo-
retical underpinnings touched upon and critiqued in earlier sections of this book.
Three leading academics share their experiences of drawing upon and deploying a
diverse range of tools and techniques that span the disciplines and design and ser-
vice design. The first two cases are discussed by leading design academics, Ir Ehsan

Three leading academics equally contributed to this chapter (in the following alphabetical order):
(1) Dr Bijan Aryana, Senior Lecturer in Design at Chalmers University of Technology, Sweden; (2)
Ir Ehsan Baha, Assistant Professor in Designer Identity Development at University of Montréal,
Canada; (3) Dr Radka Newton, Senior Teaching Fellow at Lancaster University, UK.
Supplementary Information The online version contains supplementary material available at
[https://doi.org/10.1007/978-­3-­030-­94206-­9_8].

© The Author(s), under exclusive license to Springer Nature 149

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9_8
150 8 Design Thinking: Practice and Applications

Baha and Dr Bijan Aryana, which explores design thinking processes, methods,
tools in two large organisations. Following this, Dr Radka Newton, based in
Lancaster University, UK, offers the third case study, working with a broad range of
stakeholders in a higher education institution. The primary aim of the project was to
identify as to where improvements could be made to enhance the student learning
experience as part of their degree studies. Findings from the three sets of cases offer
a rich illustration as to the transformative nature of design to afford enhanced end-
user experiences.

8.2 Design Processes, Methods and Tools

The authors of this section, Ir Ehsan Baha and Dr Bijan Aryana share similar profes-
sional journeys in which they explored both academia and industry for gaining a
better understanding of holistic patterns of design in various applications and socio-
technical contexts. Ir Ehsan Baha is an Assistant Professor at the School of Industrial
Design of University of Montréal and also the founder of the design consultancy
Meaningwise. Dr Bijan Aryana is a Senior Lecturer in Design at Chalmers University
of Technology, Division of Design and Human Factors. The aim of this discussion
is to cast light on design thinking for practice, two real world cases are used for
clarifying the contents. These cases are intentionally selected from sectors that are
less represented in current design thinking literature despite their impact on the
society and economy.

Introduction

In his book, The Sciences of the Artificial, Herbert Simon defines design as: devis-
ing courses of action with the aim of changing existing situations into preferred
ones (Simon, 1996). As one of the pioneers of Design Science, he highlights the fact
that design is the core attribute of any professional activity (Simon, 1988). There
have been many changes in the discipline of design ever since, and not everyone
shares Simon’s definition of design. Nevertheless, designers of the twenty-first cen-
tury benefit a lot from scientific methods, for example, in areas like user studies and
design evaluation. Despite benefiting from scientific methods, design still has a
strong relationship with practice and it cannot be learned without engaging in real
world practice. Research done on prominent designers shows that they benefit from
their personal qualities, tacit knowledge and soft skills for the success they achieve
in design projects (Cross, 2011). Hence, understanding the principles of design on
an abstract level using only explicit knowledge is just the starting point of under-
standing design. In this section, we explore intangible aspects of the relationship
between design thinking and practice, including the design process and the under-
standing of stakeholders’ varied languages and requirements. Moreover, we explore
the importance of having a reflective approach, generating collaborations, with tools
and methods that emerge through design (Aryana, 2020).
8.3 Case Example 1: Hitachi ABB Power Grids 151

The first case elaborates the unique characteristics of design in business-to-­

business (B2B) settings, as well as designing experiences for complex human
machine systems. In this case, we will look at Hitachi ABB Power Grids, a global
provider of power and digital technologies, advanced automation systems, and open
digital platforms for power grids. In addition to producing physical equipment,
Hitachi ABB Power Grids aims for effective digitalisation of all elements of the
energy value chain. To address this, a variety of design solutions including services,
digital user interfaces, and physical peripherals are required. Due to the sensitivity
and complexity of power grid systems, a thorough understanding of safety and
human factors is necessary. Designers must consider the requirements of individual
end-­users, in addition to companies and organisations as customers. Resultant
designs in this industry might be in use for decades.
The second case shows the challenging task of designing and introducing a new
type of service at MaaS Global. MaaS Global represents itself as the world’s first
true Mobility as a Service (MaaS) operator. MaaS is a service, which orchestrates
various means of transport and provides its users with a single point of interaction
via an integrated mobility platform. The core product of MaaS Global is a mobile
application called Whim. Whim users have access to many transport options, free
from timetables, fixed routes, parking worries and the costs of owning a car. This
case is an example of complex services, which could be challenging for designers.
The MaaS provider cannot control every touch point of the service, especially phys-
ical touch points, while it is responsible for the overall user experience throughout
each journey.

8.3 Case Example 1: Hitachi ABB Power Grids

Design Process

At Hitachi ABB Power Grids, design is being viewed as combination of various

activities including defining and solving problems, deciding what part of the prob-
lem to solve, and what order to follow in solving the problem, finding stakeholders,
identifying methods and technologies that can address the problem, exploring the
solution space, and calculating the costs and resources required for the solution. As
these activities suggest, a real-world design project does not follow predefined
steps. The scope of the problem and the order of design related activities are to be
defined as the project proceeds. Design follows an evolutionary process in Hitachi
ABB Power Grids. Clients usually plan to use these expensive systems for a rela-
tively long period of time, which means that designers often cannot completely see
what would happen at the end of the inheritance phase, when for example a second
version of the system is going to be designed.
In addition, the common iterative Human Centred Design (HCD) process may
not be applicable for many of the projects in high-risk industry, as it is not always
affordable to prototype and test a complex and expensive system. In such cases, an
in-depth cognitive task analysis increases the success chance. Cognitive task
152 8 Design Thinking: Practice and Applications

analysis aims at understanding tasks that require high level of cognitive activity
including judgement, problem solving, remembering, recalling, attention and deci-
sion making (Crandall et al., 2006). By predicting the tasks and analysing them
from a cognitive point of view, it would be possible to make design decisions prior
to developing and testing expensive systems. Documentation of cognitive task anal-
yses helped the design team to create their own tools that give them shortcuts for
identifying design specifications such as colour perception and service design map-
ping templates that are adopted to this specific industry. Of course, when tests on
low fidelity level are possible, for example in the case of user interface design, such
tests can facilitate the decision-making process and ease the communication
between the design team and management.
The complexity of systems requires small and focused teams with unique knowl-
edge and skills for development of each part. These small teams also work in a large
organisation landscape. Because of this contradiction, networks are necessary for
effective information flow among these small teams and ensuring collaboration.
Design can produce visible and tangible outcomes such as scenarios of use or user
interfaces. These outcomes are understandable for most people regardless of their
professional background. For example, a new human machine interface that
improves usability and safety in a specific product that is developed by a team can
trigger questions about usability and safety in other products developed by other
teams, even if those products are different in terms of their core technology or area
of utilisation. The design team can open a discussion and facilitate collaboration
between the teams. In this case, design can act as a tool for collaborative network
initiation (Baha et al., 2013).
In summary, design at Hitachi ABB Power Grids follows an emerging and evo-
lutionary process with the following characteristics:

• Every design project is unique, and it is hard to set predefined and sequential
steps for the project. Activities and decisions evolve as a project proceeds.
However, certain phases and set of methods and tools are identifiable.
• The impact of design is not limited to product or service level. Inside the organ-
isation, design can shape decision making and resource allocation. It impacts the
future of the organisation, as the relationship between the client and the organisa-
tion starts and lasts for years after purchasing the system. Power grids are vital
parts of the infrastructure and design of systems can have a long-term impact on
areas beyond the organisation including built environment, natural environment,
and the society.
• Documentation of design gradually creates industry-specific tools, for example
for identifying colour perception or service design mapping. Design facilitates
the collaboration and communication among small and specialised teams by rep-
resenting artefacts or scenarios of use in tangible ways, beyond technical com-
plexity. Thus, design at Hitachi ABB Power Grids does not only produce systems,
but also networks, tools and ways of collaboration.
8.3 Case Example 1: Hitachi ABB Power Grids 153

Methods and Tools

The long lifespan of systems in the power grids industry means that designers often
are not able to observe the inheritance of their designs. However, it is likely that
designers inherit solutions from earlier generations. Many systems from the past
decades have been defined as products, while the current strategy of Hitachi ABB
Power Grids is to define new systems as a part of a service. One of the common
methods for initiating projects is problem reframing in which product design prob-
lems of the past are reframed as service design problems of the present. This method
is often accompanied by qualitative research. For qualitative research, contextual
inquiry is a common method which casts light on how system operators work with
existing products. Contextual inquiry is a mix of observation and semi-structured
interview in the context of use (Sleeswijk Visser et al., 2005). It starts with a set of
standard questions and then participants are questioned and observed while per-
forming their ordinary tasks. This method can produce relevant data for cognitive
task analysis explained in earlier, as it gives information about the tasks, their
sequences, and related decisions and perceptions of users. Designers also look at
quantitative data from secondary sources, and this gives them an idea about most
common incidents in similar systems in the past. Such data is available from author-
ities responsible for safety and standards. Qualitative and quantitative data help
designers to use another tool called service map that facilitates transition from
inheritance phase to variety generation. Service map is a visual representation of
how design requirements of a service match the service attributes (Tomczak
et al., 2012).
Visualisation is a powerful ideation tool that enables designers to show alterna-
tive processes through which a future system will work. Visualisation can empower
and be empowered by with problem reframing. For example, when designers were
ideating visualisation displays for electric transmission and power distribution net-
work systems, they realised that the standard diagrams for transmission networks
locate connections based on a technical logic. The line thickness in these diagrams
represents the nominal voltage. In case of problems in the network, these visualisa-
tions can help the clients to understand in which connection the problem occurred
and proceed with maintenance. The data from qualitative research helped designers
to reframe this problem as what if the system makes the client aware of how the situ-
ation develops and maintenance in which geographic location can prevent prob-
lems? This reframed problem translated into the idea of visualising state estimator
in which the user can see the power network in connection with the real geographic
locations. The solution also utilises icons and colour coding to give users a dynamic
understanding of how voltage and capacity are distributed in the network, which
accordingly can show potential problematic connections.
In addition to generating new ideas using visualisation and problem reframing,
literature review also can provide the design team with existing solutions like tech-
nologies and user interfaces, which may have potential for the current project.
Although prototyping the whole system may not be possible, human machine inter-
faces and visual displays can be prototyped with lower fidelities at this point, so the
154 8 Design Thinking: Practice and Applications

management and the design team can make a decision about the promising ideas
that can be implemented.
An effective concept pitch presentation plays a key role in justifying a design
solution and attracting resources for implementation. In a large organisation where
people are coming from various disciplinary backgrounds, there is a need for clear
and simple presentation of concepts with minimum technical jargon. An effective
pitch presentation can help management and business teams to evaluate concepts
and make the right decision for further investment on implementing the concepts.

8.4 Case Example 2: Maas Global

Design Process

The core product of MaaS Global is the application called ‘Whim’ which is a mul-
timodal travel platform that enables people to use different means of transport such
as bikes, e-scooters, public transports, taxis, and rental cars. Everything from plan-
ning a journey to booking a trip and receiving a receipt can be done through this
app. Whim can be a good example of the concept of mobility as a service (MaaS).
Service design for MaaS can be defined as advocating user perspective within
the business. In other words, design translates human behaviours into design
solutions. As an activity, design at MaaS Global is structured around users and
aims to understand what services and artefacts are being used currently and to
translate user needs into an improvement of their lifestyle. As a young digital
business, business context and investors’ expectations dictate a structured
approach towards the design process, where certain milestones should be visible
for everyone. In addition, as software technology is at the heart of the service,
software development strategies impact the way the design process is organised.
This means that although designers are aware of the iterative nature of human
centred design, the sharp deadlines for achieving business and software develop-
ment objectives sometimes direct them to a linear process. In addition, many
activities that are theoretically supposed to be in sequential order can be done
simultaneously to ensure such deadlines. There are many iterations between ide-
ation and implementation phases, as immediate feedback from the market may
lead to using alternative solutions that are already developed but are not used in
the final product. Examples of such solutions include alternative scenarios of
use, visual contents, interactions or technical features.
Designers do not often have enough freedom to explore a variety of ideas and
insights due to the limited time available for completion of each project. However,
they document ideas and keep them in ‘parking lots’ for future projects where ideas
may find opportunities to grow. Such ideas are usually being collected at the end of
each design sprint, or from competitor benchmarking. For example, when MaaS
Global decided to enter a new market in Northern Europe, service design ideas from
earlier projects were used as probes in user studies. Users’ feedback to these ideas
8.4 Case Example 2: Maas Global 155

helped the consumer insight team to reframe the brief and consider an adapted way
of delivering the service. In the literature, design processes often start with identify-
ing the problem, but in MaaS Global projects, problems can be inherited. Designers
may even start with something that exists now such as existing mobility services
and scenarios of use. In fact, one could say that design starts in solution space with
some existing prototypes. When there are already solutions, designers need to start
the design process by looking at opportunities beyond the organisation’s conven-
tional solutions.
Although there is a dedicated design team within the organisation, design is
strongly connected to every division within MaaS Global. Multiple groups may
work on a project from research to implementation, so it is important to know if they
are solving the right problem. The higher management is actively involved in prob-
lem reframing for design. A wide range of qualitative and quantitative methods are
being used through a design project, which makes it impossible for the designers to
deal with all data without getting help from data analytics and consumer insight
teams. The consumer insight team works closely with the data analytics team to
deliver a realistic idea of the existing situation, as well as projections of the future.
One of the unique characteristics of design for MaaS is that the service provider
does not have a full control on all service touch points. Mobility providers such as
public transport, taxi companies and shared mobility providers are the ones who
shape a significant part of the users’ experience. Therefore, service design for MaaS
requires adaptation of conventional service design tools and methods. Along with
addressing the design briefs, the design team is also involved in adapting and rein-
venting methods and tools. Not all such adaptations are formally documented due to
limited time and resources. However, few became permanent parts of the design
practice at MaaS Global including a card-sorting toolkit for MaaS, and visual
mobility probes for co-creation workshops.
Overall, similar to Hitachi ABB Power Grids, design at MaaS Global has an
emerging and evolutionary nature that can be elaborated by following highlights:

• Design at MaaS Global has been adapted to sharp business deadlines and soft-
ware development realities. Some design activities may be done in parallel, and
such activities are distributed among divisions in MaaS Global. Therefore, it is
hardly a predefined and sequential process.
• Design at MaaS global impacts multiple levels, ranging from the final product
service to business strategy. As mentioned, design activities are distributed within
the organisation. For example, higher management is actively involved in prob-
lem reframing. The business itself is structured around a digital product, which
is highly influenced by design, and somehow represents the identity of MaaS
global. In some cases, design ideas that are not implemented may be used for a
better understanding of the use context and setting strategic goals.
• Some design projects may initiate in a solution space and not necessarily a prob-
lem space. The service cannot identify its touchpoints, but it should look at exist-
ing means of transport and mobility services.
156 8 Design Thinking: Practice and Applications

Methods and Tools

It is interesting that like Hitachi ABB Power Grids, many projects at MaaS Global
start with inheritance. Mobility as a service is a new concept, but mobility itself is
not. To deliver a MaaS solution, an understanding of the solution space is necessary.
The solution space includes existing experiences, technologies, and business mod-
els originated from other mobility related areas. Examples include but are not lim-
ited to available means of transport, shared mobility solutions like carpooling and
ride hailing, and services around mobility like navigation services. Quantitative data
which can be accessed through data analytics shape the big picture of how these
solutions work together. For example, one can understand how often people in an
area combine different mobility solutions in a single journey, or how they manage
transitions. This data can be used in a method called behavioural mapping.
In this method, participants’ behaviours are being recorded in a specific setting
during a certain period. The data can be collected by looking at specific individuals
or geographic areas, which can give insights to temporal or locational patterns of
behaviours (Ng, 2016).
As seen in Hitachi ABB Power Grids, problem reframing can be a method for
variety generation. Reframing problems provides opportunity for creative ideation
and innovation. Qualitative user studies help the designers to reframe problems
based on real world user scenarios. For user studies, field probing is used which is a
mix of observation and semi-structured interviews in the context (Mattelmäki,
2006). Travellers are observed in locations like train stations or public transport
hubs, with a focus on transitions between different means of transport and their
interactions with the environment, for example when they try to get travel informa-
tion from displays or similar. When they consent, they were interviewed for more
details about their daily travel habits and decisions in choosing mobility options. To
implement the design, only one or two high fidelity prototypes are tested. Data from
the tests are more likely to convenience the management and investors to accept a
new design (Baha, Ghei et al., 2021). For the test, a group of randomly selected
users are offered with the new design, while others evaluate an existing design. In
case there are two high fidelity prototypes, a randomly selected group will work
with one of the prototypes and the rest will work with the other one. This method is
called AB testing (Marsh, 2018). Metrics like number of errors, time spent on each
prototype, and percentage of users who complete certain tasks can be used for com-
paring alternatives offered to participants.

Summary

Design thinking projects are initiated, embedded, and developed with(in) one or
more organisations depending on an objective and context. In practice, the project
objectives and context have an entangled relationship. A design thinking project can
gain its objectives from the context. However, project objectives can also alter a
project context, or in some cases initiate a new project context. In design
8.4 Case Example 2: Maas Global 157

consultancy projects for example, external designers usually perform an intake

meeting with their client(s) to clarify the objectives of the project. The intake meet-
ing functions as a dialogic inquiry where designers meet clients in order or both
parties to get acquainted and negotiate one or more projects. Such a meeting is usu-
ally followed up by constructing a proposal for the project.
The intake meetings and project proposals are effective means for defining the
objectives of a design thinking project. However, in practice, project objectives
maybe challenged and may require several rounds of revision. These challenges are
not only caused by the unfolding of the project, depending on its nature and the situ-
ation at hand, they are also inherent to the nature of design and its understanding
within organisations. While design often gets pushed by business for predictability,
embracing uncertainty is its strength (Stolterman, 2021; Verganti, 2017). This ten-
sion also plays a role in how professionals with a different disciplinary background
understand design and design expertise within an organisation. In practice, the latter
is quite a challenge. Many organisations and professionals do not understand the
nature and the expertise of designers (Baha, Gokhle et al., 2021), and designers have
difficulty to clearly communicate their expertise and roles in organisations.
Consequently, a better understanding of design, the design thinking project and the
expertise of the designers is formed through the practice of design thinking. That is,
project objectives become clearer and find a better alignment with the design think-
ing project context in time. Furthermore, although design traditionally has an orien-
tation around graphics and products of a single organisation, expanding in depth and
reach, today design has evolved to an order of systems designed by collaborative
networks consisting of multiple organizations. With the advancements of informa-
tion technology, everyday products and services are increasingly becoming digi-
tized. This digitalisation has changed the nature of products and services in multiple
ways amongst which their evolving form, produced by fluctuating collaborative
networks (Sturkenboom et al., 2019). Thus, rapid changes in systems and their
related stakeholders also accounts for dynamic project objectives in design thinking
projects.
Defining, maintaining and revising project objectives is a complex task in the
practice of design thinking. Alignment is required between a number of project
context aspects. The type of organisation and their offering(s) are two main project
context aspects that influence the objective of a design thinking project. SMEs often
need design thinking to improve the quality of their existing solutions, while enter-
prises often use design thinking for entering or creating new markets (Norman &
Verganti, 2014). Start-ups for example, are often in a fuzzy front end of innovation
where they are still searching for an appropriate identity that can bring them stabil-
ity. Design thinking projects here can serve this identity search, helping starts-ups
to better position itself and scale up. SMEs often need design thinking to improve
the quality of their offerings while enterprises often also require design thinking for
entering a market or creating new one (Norman & Verganti, 2014). In this way,
design thinking is not only in service of an organisational regime, but it can also
alter the regime of an organisation (Dong et al., 2021). In other words, through
158 8 Design Thinking: Practice and Applications

establishing, expanding, and creating new offerings, design thinking projects sup-
port organisations with stabilisation, growth, and maintenance. Another aspect that
defines the objective of a design thinking project is timing. Design thinking projects
can engage with different parts and stages of an organisation. Organisations are in
the process of starting up, scaling up, existing as a small to medium enterprise or
existing as an enterprise that is currently operational with a roadmap.
There are different levels where design thinking projects can have impact within
an organisation. The total experience model designed by Van Erp (2011) (see
Fig. 8.1), distinguishes four roles for designers: (1) Entrepreneur, (2) Strategist, (3)
Conceptualist and (4) designer. Although this role taxonomy is not exhaustive, the
four roles, in combination with the right column that we have added to Van Erp’s
model, can explain how in-house and external designers can be positioned, position
themselves, navigate and influence a design thinking project. Noticeable here is that
the higher designers get in the model, the fewer number of people and more deci-
sion-making power. Although the different levels indicate a hierarchy of autonomy
and power in a design thinking project, all four levels are co-dependent and require
a fundamental alignment.
While in the past, design within organisations was mainly on a realisation level,
applied to graphics and products, today design is also applied to services, and prod-
uct service systems. With the developments of design and its establishment in busi-
ness, however, the realisation level was extended to conceptualisation, where the

What is being devel- What is being experi- What is being offered

oped enced to the firm

Dreams: vision, am- Meaning Ways of working

bition, economic within and with
Entrepreneur
value other organiza-
tions

Direction: the brand, Meaning, emotional Positioning / com-

product strategy, experience peting within ex-
Strategist
communication strat- isting and creation
egy of new markets

Interaction: cross Aesthetics, meaning, Optimal use of re-

medial concepts, emotional experi- sources, infrastruc-
Conceptualist
product service sys- ence ture
tems

Design: products, Aesthetics, meaning, Portfolio of the offer-

services, communi- emotional experi- ings
Designer
cation ence

Design discipline

Fig. 8.1 Van Erp’s total experience model with designer roles and the range of developments and
experiences they can offer (Van Erp, 2011; adapted and elaborated by authors)
8.5 Understanding the Student Learning Experience Through… 159

making and thinking activity in design became separate, resulting in what we know
as design thinking today. Today design has expanded further to a strategic level
where design thinking projects are used to explore possible futures for an organisa-
tion. In some organisations, start-ups often, the influence of design thinking is fur-
ther raised to the entrepreneurial level. On this level, design thinking is used for
organisational design, branding, and leading of an organisation.

8.5  nderstanding the Student Learning Experience

U
Through a Design Methods Approach

The following case study offered by Dr Radka Newton, Senior Teaching Fellow,
based at Lancaster University, UK, provides a rich illustration of the application of
a design-led approach to an annual degree programme review and the curriculum
learning experience. The design thinking methodology incorporated systematic
mapping, personas, and user journey mapping, to help educators to better under-
stand the students’ university ‘experience’. In addition, special thanks go to PhD
student Yueyi (Joy) Wang who provided all the figures and illustrations to accom-
pany this case study.

Introduction

Design thinking methodology is the foundation to many branches of design activi-

ties. Service design, which is dedicated to creating meaningful human-centred
interactions, is one excellent approach to achieving this activity. Over the past
decade, the educational sector has started describing the student experience as a
process using a variety of concepts from service operations management, and
most recently service design. Service design research and its application within
public services, health and social innovation (Sangiorgi & Prendiville, 2017;
Kimbell, 2009) have identified the benefits of a user-centred approach to curricu-
lum development and teaching practices. Students can easily be denominated as
co-producers of their educational experience (Carey, 2013) and as such, they have
active engagement in co-creating the value of that experience (Osborne et al.,
2016). Universities can be perceived as networks facilitating the values and creat-
ing an environment in which the student can actively create their personalised
version of the experience (Prahalad & Ramaswamy, 2004). It is a two-way pro-
cess where the facilitator (university) and the student are constantly entering a
dialogue through multiple interactions and touch points. Service design that
encompasses the complexity described above and achieves excellent user interac-
tion is crucial for strategic aims of any service-­orientated practices, including
education. Holmlid & Evenson (2008) provide a comprehensive summary of the
meaning of service design putting emphasis on mapping the user journey and
exploring the expectations and the reality that the customer is experiencing whilst
trying to achieve the desired qualities within the resources of the organisation
providing the service.
160 8 Design Thinking: Practice and Applications

in service design, collaborators visualise, express and choreograph what other people can’t
see, envisage solutions that do not yet exist, observe and interpret needs and behaviours and
transform them into possible service futures, and express and evaluate, in the language of
experience, the quality of design. (Holmlid & Evenson, 2008, p. 341)

Service design in education has so far been predominantly explored in the areas
of student support services such as student registration and induction (Baranova
et al., 2010; Kuzmina et al., 2012; Madden & Walters, 2016). It is making slow
inroads to the design of the curriculum and more widely to the design of the student
experience (Altay, 2014; Lilley et al., 2012; Pazell & Hamilton, 2020). There are
many aspects of the education that cannot be seen, which does not mean they do not
exist. Educators thrive to receive feedback from students dominated by high levels
of satisfaction and fulfilment. However, often we hear frustrations, disappointment
and confusion due to poorly designed programmes and courses that are centred
around classroom availability, system function or administration processes that are
outdated and nobody has energy to review or challenge. Most educators want to
help their students reach their highest potential, similarly to service designers who
simply try to create good experience for users. In business schools, we aim to edu-
cate students to be better managers and to understand continuous improvement
techniques, to understand how to make strategic decisions, how to listen to their
teams and how to be more engaged within their own development. Designing a
good learning experience means understanding the student needs, combined with
their expectations and assumptions, as well as their family pressures of their learn-
ing outputs. To be able to truly design a meaningful learning experience, the student
who has embarked on this journey needs to stay at the heart of this design. Design
offers the educators emotional and practical mindset to really think about the value
that we are delivering to students. Design helps educators focus on the learning
journey and not solely on the output.
This case study will provide an example of applying service design and user-­
centred design methods to understand students and their educational experience on
MSc Management programme at Lancaster University, UK. The case aims to dem-
onstrate educators an application of designerly mindset in order to achieve the goal
of placing the learner into the centre of the learning process.

 he Context of MSc Management Programme

T
at Lancaster University

MSc Management Programme:

• Globally ranked and accredited postgraduate programme with an average cohort

size of 50 students.
• 60% non-EU overseas students (China, India, Thailand, Taiwan)
• 20% UK students (10% already studies in Lancaster)
• 20% EU students
• 50/50 male female
8.5 Understanding the Student Learning Experience Through… 161

Entry criteria:

• Equivalent of upper second-class honours in the first degree achieved in any aca-
demic discipline—prior knowledge of business sand management not required
• English language score IELTS 7.0
• Work experience after the first degree is limited to 2 years to enter this programme

Issue:
The programme curriculum was remodelled to align the programme with a
European counterpart delivered globally. The course structure changed to one-
week module delivery with an increased breadth of subjects all delivered in one-
week block. Students did like the block nature of the delivery and reported that it
was easier to focus on one subject at a time. However, students expressed anxiety
and stress, higher level of complaints about the learning experience related to
assessment. Students stopped engaging with the customised career development
provision.
Based on the identified issue, service design approach was selected to address
the particular issue of increased stress, complaints and lack of engagement with
career provision. Data has been collected from 2018 onwards from 114 students
who have participated in a design-led programme review process. The iteration of
zoom in and zoom out (see Fig. 8.2) generated an understanding of wider educa-
tional ecosystems which allow educators to understand the issues within a complex
network, acknowledging the barriers and bureaucracies and also identifying cre-
ative solutions and potential opportunities for change.

Mapping the Organisational Ecosystem

Placing the design of the educational experience into a wider environmental context
is paramount and often forgotten. The learning occurs in a certain cultural and regu-
latory context with quality assurance and accreditation parameters driven by

Zoom in to
improvements made
Zoom out to and feedback to
collborative ideation students
and prototyping of acknowledging
Zoom in to posisble solutions ecosystem limitations
collaborative analysis and their feasibility in
of key pain points of the wider ecosystem
Zoom in to the the leareners'
learners and their experience
learning experience
Zoom out to wider in the wider
ecosystem and place ecosystem and on the
the learning programme
experience in the
wider education and
institutional context

Fig. 8.2 Design-led annual programme review process (adapted by author)

162 8 Design Thinking: Practice and Applications

multiple stakeholders, internal and external. The full educational ecosystem

includes not only the human actors but also interfaces such as student record sys-
tems, accommodation, student union, places of learning and places of social inter-
action. Such ecosystems could be very complex, and it is useful to start with a
broader visualisation that prepares a sense-making ground for understanding.
Ecosystem mapping heightens the awareness of the organisational context, the
limitations within that context, and unavoidable influence on educational experi-
ence designing and planning. It also allows people to pause and appreciate the
culture of the organisation and encourages dialogues between the organisation and
its stakeholders. University is as a complex ecosystem full of mysterious processes
and dark corridors which are not always easy to get through. With the presented
case, the one-year postgraduate programme MSc Management (MiM) inhabits the
Management School and Lancaster University ecosystems. MiM is a small compo-
nent of this vast ecosystem and yet contains many components that are reliant on
the appreciation and understanding of the wider picture. Ecosystem mapping
ensures pattern recognition and relationship between the MiM programme design
and other components within the organisation. The university ecosystem (Fig. 8.3)
provides a higher-level mapping that gives us an opportunity to see the position of
MiM in the organisational network.
Questions to ask:

• How is the University governance impacting on the programme design process?

• What is the accepted process of programme design and what is the timescale?
• Who makes the final decisions about programme design?
• Who should be involved in the design process at the University level?
• What are the regulations and legal obligations that we need to incorporate into
our design?
• What are the key University systems and actors that MiM students will interact
with during their programme?

Key findings from the University ecosystem mapping:

• MiM students are an integral part of this large ecosystem and their experience
will be impacted by their interaction with components such as the visa applica-
tion process, the infrastructure in the city and its connection to the University.
Within Central University systems that they will interact with registration team,
accommodation, and the social activities offered through the Campus wider ser-
vices. Some components at outside of the university service and yet affect the
students’ overall experience.
• All staff involved in the MiM programme are an integral part of this large eco-
system and they cannot always be able to carry out decisions without consulting
the University counterparts. MiM design will feature in different order of priori-
tisation for different University level actors.
8.5 Understanding the Student Learning Experience Through… 163

Fig. 8.3 University ecosystem (developed by author)

The ecosystem mapping can be taken to another level by zooming in to the more
imminent MiM context of the Management school (Fig. 8.4), which provides fur-
ther layer of information important for our sense-making stage of the design. The
questions to ask will be the same as those we asked at the University level with
additional curiosity about the MiM programme place within the Management school.
Key findings from the Management School ecosystem mapping:

• MiM does not belong to an academic department and is administered from a

central school postgraduate office.
• MiM has multiple specific and unique resources such as its own programme
team and careers support, as well as dependency on all academic departments
who provide the teaching staff.
• MiM students do not interact with any other students within the curriculum that
is solely delivered for them.
164 8 Design Thinking: Practice and Applications

Fig. 8.4 Management school ecosystem (developed by author)

• MiM is subject to multiple accreditations and rankings and its reputation reflects
the broader school, not just the programme.

The ecosystem mapping facilitates visual understanding of the context of the

learners and the context of the organisational structures that programme design is
based on. It helps clarify assumptions of the learners’ touch points and empathise
with matching of the system’s benefits and limitations. Location and campus facili-
ties of a university will determine whether students will enjoy their university life
during their learning as well as enjoyment and friendships. MiM students are a part
of a big university community not just the Management School. They will make
new friends, new connections through accommodation colleges, sports teams and
student societies. For many of them, it will be their first time away from home. All
salient elements outside of teaching contents should be considered while designing
the learning experience of both the programme and curriculum.
8.5 Understanding the Student Learning Experience Through… 165

Student Personas

In education, we usually start at the point of the programme development and deliv-
ery whilst the discovery stage is quickly rushed through and neglected. The discov-
ery stage is crucial for designing successful and meaningful learning experience and
also helps avoid expensive developments that often fail and do not meet the needs
of our students, bringing about more frustration to educators. There are different
ways of engaging students in the discovery stage. Here we demonstrate how to
involve students’ participation to create personas and map their emotional learning
journey. Design methods like personas, empathy mapping or journey mapping pro-
vide a complementary mechanism to gain deeper understanding of our students’
needs and acknowledging the holistic nature of student learning journeys as well as
the importance of emotions and empathy. The first design tool that MiM students
engaged with was persona visualising and focusing on the story behind each stu-
dent. Students worked in self-selected groups of five, and as a stimulus, they were
encouraged to think about a typical student on their programme, using the broad
parameters outlined in Fig. 8.5. It is very important that not to provide students with
any pre-set templates and provide them enough freedom, yet some framework to
guide their thinking and subsequent discussions.
Student groups were given an A3 card, coloured pens, a selection of stickers and
various craft materials. During the process, staffs were checking around the room
whilst using questions to stimulate the discussion. It started with a series of informal
and light-hearted questions such as:

• What is your name?

• Where are you from?
• Do you have any pets?
• What colour of jacket do you like to wear?
• Do you visit family in back home often?

The process of creating personas was insightful to observe. The artefacts that
students created underpinned by the stories developed a profound portfolio of
boundary objects (Star and Griesemer, 1989) facilitating the intersection between
the programme ecosystem and the students’ world that they carry, from their own
backgrounds as well as how it is adapted within the wider university ecosystem. The
visual representation provided insights into how the students saw themselves and
what they considered important to share. It provided a near to cathartic experience
of portraying their expectations, needs, fears and emotions as well as some facts that
afforded us better understanding of our student cohort. It also helped them create a
distance from making any comments, which may be personal to them as individu-
als, which they found very helpful and non-threatening. For example, the story of an
ambitious German student called Alex Wolf (see Fig. 8.6), who despite his active
lifestyle, engagement with social media, high career motivations, and also suffers
166 8 Design Thinking: Practice and Applications

Fig. 8.5 Student persona (developed by author)

8.5 Understanding the Student Learning Experience Through… 167

insecurities around language barrier and struggles with mental health. This particu-
lar persona helped staff and other students break down the assumptions we have
about the European students who are usually high achievers and often pass through
the programme without any major difficulties.
Another example was Joy from China (see Fig. 8.7), whose ambition is to become
rich, have a better future and most importantly get a distinction for her studies. She
doesn’t have a clear career aim but comes from a business family and as the only
child is prepared to go back to family business after a bit of a corporate work experi-
ence. Joy struggles with exams on the programme. She is an active person with
many hobbies and enjoys being a member of student societies. Joy’s persona
revealed some new information about students from family business backgrounds
who find it difficult to think about their career path. It also brought the focus on
academic achievement in Asian students to light and their stress levels around
their exams.
The students’ personas were developed in a workshop by the students themselves
who had directly experienced the learning process. From their stories, educators
could identify key influents to improve and redesign the learning experience through
both emotional and practice perspectives. The typical data review does not offer an
opportunity to capture the depth of student’s characteristics as design workshops do.
This designerly method is complementary to the data-driven feedback informing
the annual programme review bringing the involvement of students in a way

Fig. 8.6 Visual persona example—Alex Wolf (visualisation by Joy Wang)

168 8 Design Thinking: Practice and Applications

Fig. 8.7 Visual persona example Joy Zhang (visualisation by Joy Wang)

different from the usual module surveys. In addition, the design workshops on MiM
programme have had the following benefits for the participants, which exceeded the
planned objectives of the programme team to glean in-depth information about
the cohort:

• Students learnt about the importance of understanding the customer voice in

business

The nature of the workshop was ideal. Learning by doing, from my point, is always the best.
I learnt a lot about the development of a persona and then using this persona to develop a
“customer” lifecycle where the persona is the customer of the university and students have
needs which the uni and the programme need to address.

• Students developed greater self-awareness and deepened friendships

even if I am an introvert, we got to know each other well. It was not like… I was among
friends rather than strangers
It is kind of comforting, in a way, to know that everyone is going through it together and
that you’re not the only person that feels sometimes, how am I going to get through this
and stuff.

• Students felt included in the programme design and empowered as human beings
8.5 Understanding the Student Learning Experience Through… 169

I feel it positively included everyone, we were able to all of us get involved and contribute
for the improvement.​
Like at the end of the day we’re human beings, we’re not just robots so you need to think
about the student well-being first, which this is the most thing I liked about this university.

Emotional Journey Mapping

Journey maps visualise the user experience over a certain period and capture a
sequence of steps the user goes through during their engagement with certain ser-
vice (Stickdorn et al. 2011). Journey mapping or experience mapping serves as an
ethnographic research method giving attention to actions and emotions that the user
may find difficult to articulate otherwise. It is also telling what events or touchpoints
the user chose to project onto the journey map and what emotions they associate
with it. In addition, it gives more context to the information voiced in the persona.
For instance, students in MiM programme pointed out anxiety around exams. The
journey created a visual story of the programme experience and helped the pro-
gramme team gained insights into the highs and lows of the cohort. To start the
mapping activity, long rolls of white paper were placed on a wall. Coloured pens,
sticky notes and emoji stickers were also provided. Students started with their per-
sona’s journey at the start of the programme and took us through to the current point
of the workshop. By elaborating their feelings instead of discussing individual
tasks, students were empowered to admit first exam failures, homesickness, job
application rejections as these events were not personally associated with them.
The usual temptation is either to blame the students, assume that they do not
access the information that is provided, or react to the lack of student engagement
by either introducing more provision or making it compulsory. By adopting design
approach, we have taken more empathic approach, which consequently shows the
true pain points and provides an effective and efficient insight into possible areas of
improvement. The involvement of the students in the reflection as well as ideation
provides an opportunity of improvement by co-design. The design approach served
as a non-judgemental method to focus on the areas we set out to improve and having
the initial awareness of how the programme first into the university ecosystem
together with understanding of potential barriers and enablers in the programme
ecosystem helped he programme team take the inspiration from the students and
turn it into tangible and valuable changes to the programme. In addition, it enables
the programme team to listen to the voices from students and turn it into tangible
and valuable changes to the programme.
The initial question to start the mapping activity was, “Why aren’t the students
engaging with our careers provision”? Having reviewed the journey maps, the pro-
gramme team realised that the main challenge is to deliver learning events at the
right time and in the right format. November stood out as the cold month with first
assignments fails and job application rejections occurring at the same time.
Employer campus visits and practice job interviews with our careers team became
too overwhelming for students. The key points that we understood from the reflec-
tions were:
170 8 Design Thinking: Practice and Applications

• The career sessions were scheduled in the times when the students felt lowest
due to the first assessment failures, weather and homesickness
• The information overload meant the students disengaged with activities beyond
their programme modules
• The focus on careers seemed too scary and distant
• Some of the students didn’t want a traditional graduate career as we imagined it
• Students felt confused about what to do next
• The programme was too busy, students felt over-assessed, they found it difficult
to cope with their hectic schedule with scarce downtime

The visualisation of emotional journey mapping shows patterns of the common

responds and associated emotions in the cohort. The reoccurring patterns reveal
more systematic issues in the programme design and provide an opportunity to
address those as a priority. For instance, one of the high spike of positive emotions
related to a cohort visited Manchester Career Fair that depicted in the extract of
journey map below (see Fig. 8.8). In subsequent years the University decided to
discontinue this particular career fair activity and funding was withdrawn.
Confirmation of the value brought by this event through journey mapping has sup-
ported our appeal to keep this as a funded activity for future cohorts.
Another example is the negative emotions associated with exams. This negative
pattern appeared in all journey maps, which has provided us with an opportunity to
understand the context of the exam fears with a rapid prototyping of preventative
actions such as providing past exam papers, scheduling exams in mid-week to give
space at each side of the week to prepare and relax before the next learning event
which has been followed through assessment strategy and supported by university-­
wide stakeholders. The last example of a pattern that need to be mentioned was
related to the lack of downtime leading to lack of student engagement in societies
and sport activities, which may lead to more serious mental health issues. Students
prototyped a week in the programme structure and simply kept Wednesday after-
noon off, which is a university designated time for sports and societies. The assump-
tion the programme team made was that this only related to undergraduate student
and postgraduate timetable never allowed for this time to be incorporated as down-
time. This was a real light bulb moment for the programme team and this very
simple adjustment provided the MiM programme with a unique characteristic that
started attracting more University students who wanted to progress to the master’s
degree within our university. This feature also provides acknowledgment that ‘We
Care’ about the students’ overall university experience, not only the learning on the
programme.
The value of taking time to engage with our learners though a service design
methodology has facilitated a focused programme improvement strategy with
understanding of what learning experience features add value and how they fit into
the wider life of a student and the University ecosystem. The constant zooming in
and zoom out with no judgement on single activity has been essential to this practice
(see Fig. 8.2). In addition, the service design approach informed a quick and easy
 8.5 Understanding the Student Learning Experience Through…

Fig. 8.8 Emotional journey map extract (visualisation by Joy Wang)

171
172 8 Design Thinking: Practice and Applications

modification that systematically improved the programme design at the same time
centrally placing students at the heart of this process.

Summary

The typical way of improving a university programme through student feedback

usually results in collecting complaints, which is not that helpful. The average
uptake of students to complete standard evaluations on the MiM programme oscil-
lates between 10% and 30%, which does not provide a representative view of the
student experience. Many students worry that providing feedback may have nega-
tive impact on their relationship with staff and impact on their grades. Design meth-
ods introduce a new way to capture many aspects of students’ needs and concerns
and create a non-judgemental space between staff and students where students
could voice their reflections through a persona and their emotional journey map.
The value of the design approach is ultimately in addressing the right problems in
the right way instead of rushing into conclusions based on assumptions.
There is multiple theoretical impact of service design applying in educational
context that needs to be researched further. The key concepts that ought to be
explored are related to adaptability of service design to a higher education context
and its impact on student engagement through partnership. The approach in this
initiative was driven by improving students and staff experience and was liberated
from the burden of the debate related to the concept of student as a customer. The
engagement between the student and the educational institution has not been per-
ceived as a pure supplier-customer relationship but has been superseded by a col-
laborative concept where the student is a co-producer of their own university
experience. A testimony from one of the student participants confirms the twofold
value that design methods have brought to the students on the Lancaster MiM
programme:
I really liked both activities as they allowed us to step back and have a good think about our
development since starting the programme and also the people we are surrounded by,
whether they be students or administrative staff. I liked how fun it was as it made it easier
for us to take part and share ideas, and to be more relaxed with each other. I think being in
groups was also good as we could all add our own ideas and reflect upon them based on
what others thought and said.

cc Chapter Summary To demonstrate the breadth of the practical

application of design thinking, this chapter has carefully chosen three
diverse case examples drawn from industry practice. In a way, the
rationale for their selection was to illustrate the different approaches
and methods that were applied and the unique challenges that each case
encountered. Using service design principles underpinned by design
thinking methodologies in the higher education sector is rarely explored
in design literature; even less so in the realm of business and management.
The cases offered by Aryana and Baha further lend credence to the
8.5 Understanding the Student Learning Experience Through… 173

elasticity and applicability of designerly approaches when seeking

competitive advantage. In the near future and beyond, the field of design
thinking will feature and critically debate the distinct advantages of
utilising design approaches to often insoluble problems. It is heartening
to see cases of this nature, testament to the increasing confidence of
organisations to adopt alternative approaches to solving the wicked and
complex challenges that lie ahead.

Review Questions

1. The first case study focused on placing students as central to the research
process. What other tools and techniques would you additionally draw
upon to identify their current educational experiences and how could
these be enhanced?
2. Hitachi ABB Power Grids use the full range of design to develop com-
plex interactive systems. What other ways do they use design?
3. MaaS Global often uses insights and ideas in identified from earlier proj-
ects that are ‘parked’. What mechanisms would you put in place where
these ideas could be widely shared amongst the extended design team?

Project Questions

1. Learning persona is an incredibly powerful tool to gain deeper insights

into student’s values and interests. Based on Fig. 8.5, create your own
learning persona in connection with your previous or current educational
experience.
2. Create an evaluation strategy that can be used to test complex systems
where design is a key element of your approach.
3. Identify a multimodal travel platform (ranging from bikes to public
transport) and then document the critical areas where the user interfaces
with its main touchpoints.

Chapter Tasks

1. Form a small group of no more than six people, and then give each
person a box of paper clip; in this activity try and find as many uses for
them as possible, apart from holding papers. After 60 minutes, share
ideas with the rest of the group to see if there are any unifying principles
or designs.
2. Storyboarding can be a particularly useful creative exercise for develop-
ing new procedures or improving existing processes. Rather than writing
out the steps of the procedure, draw each step in a series of small, rectan-
gular boxes, like. You might discover a useful new step in the process that
you had not considered.
174 8 Design Thinking: Practice and Applications

3. Based on your own shopping habits, create a visual journey map of a

regular trip to your local supermarket, identify key points that you find
important and pain points that you would improve upon to enhance your
shopping experience.

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Design Directions and Future
Trajectories 9

Learning Objectives

• To introduce and examine the role and application of design within a broad
range of dynamic future-orientated contexts.
• To examine the diverse range of international [DESIS / Living Lab] net-
works and understand their primary remit in the desire to fostering social
innovation.
• To provide an understanding of design democracy and its commitment to
the co-creation of user centred values.
• To critically examine the emergence of data driven innovation offered
through the Internet of Things (IoT).
• To identify emergent macro trends and developments within the broad
themes of technology, demographics and the environment.

9.1 Introduction

Design is in a continual state of perpetual change: this is a given; but what is con-
tested is understanding the factors that are driving this perpetual and transforma-
tional change. In an attempt to understand and reflect upon these (and often) invisible
forces driving change, it is timely to pause for a moment and take stock of the cur-
rent situation and then focus our energies to the near future as to where design wants
to go and what it wants to be. To begin answering these challenging set of

Supplementary Information The online version contains supplementary material available at

[https://doi.org/10.1007/978-­3-­030-­94206-­9_9].

© The Author(s), under exclusive license to Springer Nature 177

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9_9
178 9 Design Directions and Future Trajectories

interrelated questions, Chap. 9 begins with a brief reflection as to the current state
of design, especially its role beyond the traditional design studio and the limited
confines of aesthetic application and promotional activities. One could argue that
“design has come of age” being widely acknowledged and respected by its more
mature partners and their respective disciplines active in the world of commerce and
industry. Furthermore, design is transcending the boundaries of industry practice
and application, being invited into the higher echelons of local and national policy
making; exploring and informing policy that is shaping the infrastructure of urban
environments, national healthcare delivery and transportation amongst many other
aspects of government responsibility.
Alongside policy making, design is increasingly playing a greater role in society,
and one such initiative is the DESIS Lab network, founded by Ezio Manzini in
2009, an international network of design schools and related organisations working
on initiatives in the design for social innovation and sustainability fields. In the
complexity of contemporary society, social innovation is gaining wider attention
and especially the design profession is increasingly recognising its potential, as a
driver of sustainable change. Change cannot be imposed, meaningful change is
facilitated through inclusivity, mutual respect and understanding, in a way democ-
ratising the process of transformational change via design. One such approach is
participatory design where all stakeholders contribute to this process on an equita-
ble footing, where no one holds the definitive view—empowering participants
through meaningful ‘involvement’ and ‘empathetic’ understanding. The concept of
Living labs is introduced, which in a way, takes action research to a higher level,
where ideas, abstract concepts are prototyped and tested in complex real world set-
tings. What makes these labs successful is the commitment to the non-judgemental
sharing of ideas and values in socially orientated ‘experimental’ spaces brokered by
shared value stakeholders and participants. In terms of exponential innovative
growth potential, one has to look no further than the internet of things (IoT) and its
capacity to disrupt not only mature markets, but every aspect and nuance of our
everyday lives. Some say ‘data is the new oil’ but one could argue that IoT is by far
greater an industry movement than oil. The total installed base of Internet of Things
(IoT) connected devices worldwide is projected to amount to 30.9 billion units by
2025, a sharp jump from the 13.8 billion units that are expected in 2021
(Statista, 2021).
The role of design as a conduit between the realms of data and innovation is an
important one, and this contested territory is ripe for negotiation and respectful
cooperation. This chapter concludes by focusing attention towards the future, iden-
tifying three significant and mutually interconnected areas of activity that embrace
technological advancements, people and society and the environment, in particular
climate change. These vast and critically important ‘terrains’ of activity coupled
with the onset of globalisation are indeed the new ‘Steppe’ plains that can be mean-
ingfully navigated through the footsteps of design.
9.2 Design Influences and Contested Territories 179

9.2 Design Influences and Contested Territories

This section sets out the pervasive and influential role that design can offer to peren-
nial wicked problems; problems well beyond the established boundaries of design
activities. Challenges in contemporary society, such as population growth, political,
economic and environmental factors and social divisions, are creating drivers for
innovation (Kimbell, 2011). As such, language and terminology (such as innovation
and design thinking) that have historically been attributed to design, are finding
their way into other domains and becoming socialised as a means of practice
(Carlgren, 2013). Consequently, designers and the profession of design is finding a
meaningful role beyond the conventional ‘design studio’, and working in increas-
ingly diverse settings such as local, regional and national policymaking, healthcare
provision and delivery and education, in order to address a varied range of complex
problems.
In today’s globalised society, the world is fast becoming complex and interde-
pendent; as such, we are witnessing transformational changes in every aspect of our
lives, leading to the formation of new wicked challenges for the design profession.
These complex and emergent challenges are not isolated to one particular sector, but
across a whole range of interrelated domains where simple design solutions are
unfeasible. Typically, these challenges and associated problems can often be char-
acterised as emergent phenomena with non-linear uncertainties. Collectively, these
are having a detrimental impact on a wide variety of key aspects of our planet, our
society, our health and at a deeply personal level, our spirit as to how we perceive
and understand the world around us. Human beings are depleting the planet’s natu-
ral resources and standards of living will begin to decline by 2030 unless immediate
action is taken. The World Wide Fund for Nature (WWF, 2018) warns that the cur-
rent overexploitation of natural resources is generating an enormous deficit, as 20%
more than can be regenerated is consumed each year and this percentage is growing
steadily.
The current ecological crisis, wherein we continue to deplete our natural capital
on a massive scale will inevitably lead to food supply shortages and subsequent
price increases by 2030, leading to increasing sections of society encountering food
poverty. The World Health Organisation has identified that
The largest number of undernourished people (more than 500 million) live in Asia, mostly
in southern Asian countries. Together, Africa and Asia bear the greatest share of all forms
of malnutrition, accounting for more than nine out of ten of all stunted children and over
nine out of ten of all wasted children worldwide. In southern Asia and sub-Saharan Africa,
one child in three is stunted. (WHO, 2019)

Furthermore, our social crisis sees nearly 2.5 billion people on our planet living in
abject poverty. With the rise of Covid-19 continuing unabated, in the ‘Poverty and
Shared Prosperity Report’ by the World Bank (2020), “the pandemic is estimated to
push an additional 88 million to 115 million people into extreme poverty this year,
180 9 Design Directions and Future Trajectories

with the total rising to as many as 150 million by 2021, depending on the severity of
the economic contraction. Extreme poverty, defined as living on less than $1.90 a
day, is likely to affect between 9.1% and 9.4% of the world’s population in 2020”.
Given these appalling statistics, these arguably constitute the most significant fail-
ure of our time. These crises, however, present significant challenges and opportuni-
ties for design. It is now timely for design (in its broadest sense of application) to
face these challenges and envision and realise alternative directions for the planet.
Given its complexity, design is continually reflecting upon its historical develop-
ment as a driver for change; on the present, as a discipline seeking dynamic cross-­
disciplinary horizons far beyond its current boundaries; and the future, becoming an
alternative means of engaging with emergent global challenges. Design is a balance
between the technological and humanistic aspects of society and culture. Its pri-
mary aim is to make the industrialised world both human, habitable and impor-
tantly, equitable, a means to evenly share prosperity to everyone. In fact, it has been
widely acknowledged that design is now the best tool we have available to us in
making sense of the increasingly complex and challenging situation that we cur-
rently find ourselves in. The growing trend to use design as a transformational tool
has also brought more focus on the disciple of design, requiring design practitioners
to be more open and co-operative in how they work. In particular, demonstrate tal-
ent and expertise with both quantitative and qualitative research methods; have the
ability to analyse and synthesise often complex data sets, and subsequently com-
municate findings and solutions in objective and compelling ways. If design is the
best available tool at our disposal in order to shape desired futures, how might the
designer best critically reflect, collaborate, create and articulate new visions for
local, regional, national and international contexts? How can designers effectively
develop news of wider participation to create these truly desirable futures?
Designers are equipped with a set of inherent skills and attributes that they offer
to any given problem (regardless of context) is that they possess non-tangible skills;
those that cannot be seen or do not have a physical manifestation. Some of these
non-tangible skills relate to the confidence, approaches and mindset of the designer;
their ability to ask ‘what if’ questions and to take risks, their comfort in ambiguity
and confidence in their own creative abilities (Cross, 2006; Campbell, 2009). These
types of skills are often tacit, come naturally through experience (Cross, 2011;
Wood et al., 2009).
Hargraves (2018, p. 78) argues, “For most of the nineteenth and twentieth centu-
ries, designers thought of themselves as having subject matter expertise. Furniture
designers were experts in the construction of chairs, tables, cupboards, and other
furniture. Graphic designers understood themselves as masters of two-dimensional
communicative form. This conception has shifted significantly during the past
40 years. Design, in large measure, no longer understands itself through the classes
of artefacts it produces. Instead, design commonly conceives of itself and promotes
itself as a general approach for innovative change as having no subject matter that is
properly its own. This conception leads to an anxiety that manifests in questions
commonly asked of designers: ‘What exactly do you design?’”
9.2 Design Influences and Contested Territories 181

Design is becoming further diverse in its meaningful application, forming a new

approach to policymaking, healthcare delivery and crime reduction activities. We
are also witnessing the emergence of sub-fields within the discipline of design, see-
ing the growing prominence of service design, social innovation, radical co-design
and so forth. Primarily, these developments have been largely brought about by the
changing roles and contexts of design and of how it is used within highly contextu-
alised settings. By building purposeful relationships, the designer (working with
other disciplines, professionals and citizens) will enhance their own and others
abilities to challenge existing economic, social, environmental, and political mod-
els. This will help to foster a deeper understanding and strengthen the inter-­
relationship between the design profession and other specialist domains of practice.
As such, this could for instance, lead to more sustainable products, services and
processes, whilst rethinking how policy could work better. Collaboration alone,
however, will not be enough. It requires shifts in the culture and practices of co-­
designing, co-innovation and co-production to collectively decide and socially orga-
nise a future world that affords a wider means of prosperity to everyone.
In 2020, the UK Design Council (2021) launched an initiative as to how a sys-
tematic design approach can contribute to achieving net zero within sustainable
development; in particular, working across business, public and the third sector, in
alignment with the UK government’s target outcome of net zero emissions by 2050.
What was particularly interesting with this ambitious initiative is that their approach
and central role within the project was twofold:

• To provide greater awareness and credibility to the growing practice of systemic

design and create a framework that allows designers from different disciplines to
come together with non-design professions and communities to undertake
this work.
• To use our position to influence policy, regulation, standards and the design com-
missioning system to make it easier for designers to work in this way.

Turning our attention away from the UK, a noteworthy international initiative
that positions design as a central agent for change is the DESIS Network. DESIS is
the acronym for ‘Design for Social Innovation and Sustainability’ which features an
international network of design schools or departments of design (DESIS Labs)
within larger higher educational institutions. The primary remit of the DESIS asso-
ciation is to use design to trigger, enable and scale-up social innovation through
design thinking and design knowledge (DESIS, 2021). Academics within the Labs
(be it lecturers, researchers or a combination of both) are committed to advancing
the role of design to foster societal change through design theory and practice.
“Design schools (DESIS Labs) aim to participate and empower these processes,
being one of these centres or by being connected with other existing centres. In this,
DESIS Labs, being based in universities have the flexibility to explore and consoli-
date new frontiers, but at the same time stimulates universities to be open to society”
(Cipolla et al., 2015, p. 6). A notable example would include the DSU-DESIS Lab,
(Dongseo University) located in Busan, South Korea, which devotes particular
182 9 Design Directions and Future Trajectories

emphasis working with local communities in cooperation with industry, small busi-
ness owners, and regional governments. In Curitiba, Brazil, the Design &
Sustainability Research Center at Federal University of Paraná (UFPR) hosts a
DESIS Lab that focuses on the development of protocols for projects in Design for
Sustainability through open innovation platforms (Crowd-Design, Crowd-Funding,
Crowd Voting, Crowd Sourcing).

9.3 Democratic Design

The development and marketization of commercial products and services intended

for mass-market consumers, offers many unique challenges to both the organisation
and design/marketing functions. One primary challenge is the adoption of collab-
orative approaches to truly understand ‘who’ exactly they are designing for, in par-
ticular, the specific end-users of their product offerings. When designing products
that have mass appeal, finding representative participants is of primary importance.
In order to achieve this, designers need to work beyond the confines of the organisa-
tion, reaching out into the wider marketplace where specific representation of the
ideal user can be sought. However, one major obstacle that is frequently encoun-
tered is that external parties have little incentive to actively participate, especially
within tight schedules set out by the company. One further benefit of identifying and
understanding ‘lead’ users is that they could provide vital user insights that could
then initiate the development of subsequent innovative products. Effectively under-
taken, this in a way could change a company product-centric approach to one that
engages with the co-creation of value between the company and their users.
While the view of the individual innovator prevails, it is becoming increasingly
challenged by the collaborative business environment as a basis for innovation
(Prahalad & Krishnan, 2008). One notable advocate for user driven innovation is
Eric von Hippel, American economist and Professor at the MIT Sloan School of
Management, who was the inventor of the ‘Lead User Method’ that places primary
emphasis on the end-user to drive product innovation(s). In essence, “the method is
based on the empirical knowledge that innovations are often not initiated by manu-
facturers, but users stand often as the propelling strength behind developments”
(Hengsberger, 2019; von Hippel, 2005). This advocacy for external input(s) into the
design development process, leads us to the theme of ‘participatory’ design, where
this approach is an inclusive method to co-design, co-create and co-operate with
numerous stakeholders (as opposed to just end-users). Designers use an extensive
range of tools and techniques to understand users; as such, the designer moves into
the bounded realm of the user. However, participatory design turns this approach
around, where end users move into the realm of design and design research.
Worthwhile to point out here, that although the end-users are an invaluable part
of this approach, ultimately, the commissioner of design decides the final decision
regarding product attributes and its position within the marketplace. In a way, the
user is the main passenger in the vehicle, but the designer is the one who is driving
9.3 Democratic Design 183

the vehicle to its ultimate destination. This then begs the question, “so what is the
main role of the end-user in this particular research approach?” Firstly, users would
take part in extensive activities whereby they would form a central part in develop-
ing low fidelity mock-ups of the products (be it soft or physical) that would be tested
in a variety of hypothetical scenarios. This then, would allow users to share invalu-
able insights as to why the product was developed in a particular way to suit their
specific needs. Through this sharing of ideas and rich personal insights, the (design)
researcher can then gain a deeper understanding of what they need. In essence, it is
an effective means of validation, to see a product in use as opposed to gaining writ-
ten or spoken feedback; in short, research through design. There is a point of caution
here that needs to be highlighted; that this intensive and time-consuming process is
more expensive than non-participatory design methods. However, in particular con-
texts of product use, the benefits of this approach far outweigh the disadvantages.
As touched upon, participatory design should be used when companies want a par-
ticular set of users to act as opposed to speak. As the old adage rings true, ‘actions
speak louder than words.’
Due to the rich and broad nature of participatory design as an inclusive approach
to yielding detailed user insights, context is highly important; in both the way, the
designer would create a democratic framework for the research study and the tools
in which to collect data. There is a vast array of tools and techniques available to the
designer, so it is important to understand and define as to what are the ultimate aims
of the project. Sanders et al. (2010) offer an interesting approach to the selection of
tools available and their particular merits when collecting specific user require-
ments. Their framework has three distinct elements that include: (1) form; (2) pur-
pose; (3) context, which should be equally considered when planning a PD project.
Firstly, form articulates what particular type of activity is going to take place;
this may entail making prototypes, talking where participants would recount experi-
ences or be involved in detailed discussions about how they use a particular product
or service. Purpose, outline why tools and techniques are going to be drawn upon
and used; in particular—tools to glean detailed information through probing; for
priming, as in preparing participants for the research study; understanding, as in
developing a deeper understanding of their experiences; and fiction exploration, to
develop conceptual propositions for preferred fictional futures. Finally, context
focuses on the overarching PD study in terms of cohort size of participants, and
whether online or in-person (which is particularly pertinent given the ongoing
Covid-19 restrictions). It is worthwhile to point out here that there is a distinct dif-
ference between ‘Participatory’ design and ‘User-centred’ design, where they are
commonly misunderstood as being the same. Robertson and Simonsen (2012) artic-
ulate the key differences, arguing, “Participatory Design is not the same as ‘user-­
centered design;’ though the two can have much in common and some design tools
and techniques are used in both. While many areas of design now pay at least lip
service to people’s participation, the question of how participation is being negoti-
ated and defined (and by whom) is fundamental to distinguishing Participatory
Design from the more common user-centered approaches.”
184 9 Design Directions and Future Trajectories

Living Labs: Co-Creative Potentialities?

Following on from participatory design, the emergence of the living lab movement,
places participatory design central to its role within the co-creation of innovative
solutions. In essence, the concept of living labs is widely attributed to the late
William (Bill) Mitchell, Dean of the School of Architecture and Planning at the
Massachusetts Institute of Technology, was considered one of the world’s leading
urban theorists. Through the work of his Smart Cities research group at the MIT
Media Lab, he pioneered new approaches to integrating design and technology to
make cities more responsive to their citizens and more efficient in their use of
resources. Before we discuss the movement in further detail, the Living Labs phe-
nomenon is very limited to the point that there is a lack of a widely recognised defi-
nition (Kviselius & Andersson, 2009; Tang et al., 2012). However, two primary
characteristics form the essence of a living lab; firstly, they are bounded environ-
ments that facilitate real-life testing and experimentation; and secondly, participants
and users are knowingly involved within the process of innovation. Here, the term
‘knowingly’ is an important point, where users actively engage with the sharing of
ideas and experiences. Claudia Dell’ Era and Paolo Landoni (2014) undertook a
lengthy examination of living labs, and from their research study, they defined a
living lab as “a design research methodology aimed at co-creating innovation
through the involvement of aware users in a real-life setting”. Their definition
accords with the findings of Eriksson et al. (2005) and Schuurman et al. (2012), who
describe Living Labs as a user-centric research methodology to sense, prototype,
validate and refine complex solutions in multiple and evolving real-life contexts.
Due to both the popularity and relevance of living labs as engines for stimulating
innovation, we are witnessing the global emergence of living labs. One main
umbrella organisation driving the growth of living labs is the ‘European Network of
Living Labs’ (ENoLL) in Europe and now expanding its remit worldwide. Since its
early formation in 2006, ENoLL has labelled over 460 living labs to date. ENoLL is
active in many different areas of work and funded projects to strengthen the impact
that living labs can generate, focusing on capacity building and scaling-up of solu-
tions and services.
Primary areas of activity include:

• Smart Cities
• Future Internet
• Education
• Design
• Big Data
• Climate
• Creative Industries

Not only do the living labs focus upon specific themes, they also base themselves
around particular areas of investigation. ‘Research’ labs conduct research on a host
of activities based around the innovation process. ‘Corporate’ labs extensively
9.4 Data and Design 185

involve users and other stakeholders to co-create innovations within a physical envi-
ronment. ‘Organisational’ labs are where members of the organisation co-creatively
develop innovations. ‘Intermediary’ labs accommodate a diverse range of partners
to innovate in a central (but neutral) environment. Often you will find that living
labs comprise of four main partners—(1) researchers; (2) public organisations; (3)
companies; (4) end-users. Benefits to each partners are diverse; companies can gain
access to and generate novel ideas for commercialisation. Public sector organisa-
tions can identify opportunities for an increased return on investment on innovation
research and users can initiate innovations that they seek which are not currently
available. A pre-requisite for living labs is that they should have access to multi-­
contextual environments alongside cutting-edge technologies and infrastructure to
facilitate and support user involvement and testing. Furthermore, to underpin these
activities, the labs need the involvement of experts drawn from the different partners
in order to succeed. The following examples illustrate the different areas of focus of
the labs in Table 9.1. Provide a snapshot of the range of activities currently being
undertaken across the ENoLL network of living labs.

9.4 Data and Design

Data driven innovation is becoming widely recognised as a means of securing com-

petitive advantage, however, due to its ambiguous nature, data driven innovation
(DDI) can feature in a wide variety of forms and applications. Due to its emergent
nature and commercial sensitivity, it is often difficult for organisations and individu-
als to understand its application in commercial practice. In essence, DDI is an inno-
vative idea that has its origins arising from correlations in data, which could then go
on to filling a measurable need or marketplace opportunity. A succinct definition of
DDI refers to the innovation process that relies on digital technologies to provide
new processes, services and products (e.g., Martínez-López & Casillas, 2013;
Nambisan et al., 2017). However, DDI is a far more complex area of practice, where
many thousands of innovative products draw upon big data to function; further-
more, many processes and sub-systems are optimised through data. The smartphone
is a simple example of a ubiquitous product that relies heavily upon real-time data
to provide the user with added value features through its interactive functionality.
This process creates instantaneous data at each step, which forges a continuous data
chain production system.
The role of big data in innovation is a huge area of discussion, as such, this sec-
tion will focus on one particular aspect, that of the ‘Internet of Things’ (IoT) which
deserves particular attention. IoT coined by British entrepreneur Kevin Ashton in
1999, primarily refers to the billions of physical devices that are connected to the
internet, sharing and collecting data; due to the availability of cheap computing
devices and global wireless networks, it is now possible to transform everyday
objects into a part of the internet of things. Through connecting all these devices and
adding sensors to them, you can now add many layers of digital intelligence, thus
enabling them to communicate real-time data without the need of human
186 9 Design Directions and Future Trajectories

Table 9.1 ENoLL living labs—examples of living labs by area of focus

Name Country Area of focus
LivingLab China An educational platform based on the open approach and
SHANGHAI’ environment of Sino-Finnish Centre, located in Tongji University.
It promotes open innovation for generating social construction of
knowledge, bridging top-down and bottom-up social innovation
process in real world contexts by involving relevant stakeholders.
Basaksehir Turkey The Living Lab has aimed to increase the life standards of the
Living Lab local society, the quality of Basaksehir city and consciousness of
urbanisation by means of taking into consideration desires of the
local citizen and society by a set of high and standardised
innovative services for the local public as well as private
organisations. Basaksehir Municipality, in accordance to these
purposes regarding applying the quality, provide unconditioned
customer satisfaction, education and control to all of its citizen
and employees, by continuously improving and applying
development facilities.
TIE-LL Italy TIE Living Lab aims at operating as a smart platform to stimulate
Technology technology innovation and innovative entrepreneurship for local
Innovation development in the global scenarios, by leveraging on talents,
Ecosystem technology, collaboration, collective intelligence, and networking,
in the strategic perspective to exploit and valorise research
outcomes, technological assets and scientific results. Thus, TIE
Living Lab acts as a bridge that connects civil society, academy,
businesses, markets, government and institutions, aiming at
helping entrepreneurs overcome the valley of death, and at
fostering innovation and entrepreneurship.
Lahti Living Finland The special focus of the Lahti Living Lab is to develop and study
Lab innovativeness and productivity in the public sector. The main
activity is to integrate the users into the innovation processes of
public sector service development. For this purpose, the methods
and tools are developed and studied. The methods of involving
and activating the users vary, there are methods based on ICT but
also on face-to-face communication. The Lahti Living Lab
concept consists of different research and development projects,
which all have a common nominator, that is, the users as
innovators.
Source: enoll.org (2021)

intervention. As such, it allows the super fluid connection between both physical
and digital universes. Not only devices can feature within this dynamic system, but
also smart cities, where entire urban environments are embedded with sensors to
enable city planners and urbanists to understand and manage complex living envi-
ronments. The Internet of Things comprises four key elements:

• People: using hardware devices in a network to share information and usage data.
Common examples include fitness sensors and social networks.
• Things: physical sensors, devices, actuators, and other items generating data or
receiving information from other sources.
9.4 Data and Design 187

• Data: raw data analysed and processed into meaningful information to support
intelligent decisions and control mechanisms.
• Processes: leveraging connectivity among data, things and people to add value to
the user.

IoT has come some way from its original application within the realm of manu-
facturing, where its nascent means of usage was ‘machine-to-machine’ via radio
frequency identification (RFID). Moving away from an industrial setting, IoT is
turning its attention towards our everyday living and working environment, filling
homes and offices with interconnected smart devices. Tech analyst company IDC
predicts that in total there will be 41.6 billion connected IoT devices by 2025, or
“things”. It also suggests industrial and automotive equipment represent the largest
opportunity of connected “things”, but it also sees strong adoption of smart home
and wearable devices in the near term. (Ranger, 2020). The benefits of IoT to busi-
ness are extensive; however, it does depend on specific application—usually based
around the themes of efficiency and agility. For instance, organisations would have
greater access to detailed data about their own products in use and their internal
operating systems and therefore, develop a stronger ability to make swift changes as
a result.
Alongside the IoT, new terms are being coined given its wider application; these
include the ‘Internet of Everything’ “is bringing together people, process, data, and
things to make networked connections more relevant and valuable than ever before-­
turning information into actions that create new capabilities, richer experiences, and
unprecedented economic opportunity for businesses, individuals, and countries”
(Cisco, 2013). Then we have the ‘Industrial Internet of Things’ (IIoT) which goes
beyond the normal consumer devices and internetworking of physical devices usu-
ally associated with the IoT. What makes it distinct is the intersection of information
technology (IT) and operational technology (OT). Finally, ‘Enterprise IoT’ is the
next advancement in technology that enables physical ‘things’ with embedded com-
puting devices (tiny computers) to participate in business processes for reducing
manual work and increasing overall business efficiencies. IoT allows devices and
people to work more seamlessly together, offering the following distinct benefits to
the company:

• Enhanced productivity: it is a given that machines are far superior to humans

when it comes to producing and managing complex data. With the exponential
growth of IoT within the factory, products and systems can smoothly operate on
a regular and consistent basis. This enhanced means of operation can lead to the
creation of better products whilst also delivering enhanced customer service
experiences. The collection of real time data can enable service refinements
based on user-generated information.
• Increased automation: following on from enhanced productivity, the IoT can
allow organisations and manufacturers to automate repetitive tasks that would
otherwise be conducted by people. IoT systems connected to the cloud and AI
algorithms will enable machines to do much more work than they could ever
188 9 Design Directions and Future Trajectories

have done before. This frees human beings to focus on more creative value-­
added work, rather than just crunching numbers.
• Improved efficiency: regardless of business operation, the more data that can be
collected can be used to improve efficiencies. For instance, IoT is an important
component of predictive maintenance, which is a technique that uses condition-­
monitoring tools and techniques to monitor the performance of a structure or a
piece of equipment during operation. The recorded information enables an engi-
neer to predict the future failure point of the asset being monitored, allowing the
asset to be fixed or replaced just before it fails.
• Augmented customer experiences: IoT is beginning to feature heavily in the
development and delivery of enhanced customer experiences. The mantra ‘the
customer is king’ is placing greater emphasis on the organisation to continually
refine and develop how they interact with their customers, and indeed a wider
range of their stakeholders. The internet of things in conjunction with artificial
intelligence can provide greater insights into customer requirements and
behaviours.

With IoT offering the huge potential to disrupt established markets, companies
need to re-think their business models and operating procedures to exploit fully this
new technology. This places greater emphasis on the way companies conceive, cre-
ate and commercialise IoT offerings to often-unfamiliar customer audiences wary
of new technologies. In essence, companies need to be strategic in the way they
promote and market IoT products in order to survive. To be successful, companies
need to be careful in the way they convince potential new customers to the benefits
that their products offer, thus justifying either premium prices or taking the time and
trouble to familiarise themselves with how they use this new technology. As such,
this takes us back to the critical business functions of design and marketing when
devising a heavily reliant IoT marketing strategy. Firstly, beginning with the cus-
tomer (or end user or both) who initially are reticent to purchase an unfamiliar pre-
mium product, the benefits need to be articulated in a manner where value in use to
them is clearly explicit. For instance, customers could save on their monthly domes-
tic energy bills by being more energy efficient, or improving home security, offering
peace of mind whilst away on vacation. Connected IoT devices provide a wider
range of benefits (both monetary and non-monetary) which could result in a series
of unique value propositions. However, these need to be carefully crafted in all
marketing and promotional materials in order to win over sceptical consumers. The
Internet Society (2019) conducted extensive research into customer perceptions and
attitudes towards IoT devices, with main findings that included:

• 63% of people surveyed find connected devices ‘creepy’ in the way they collect
data about people and their behaviours.
• This sentiment is echoed throughout the survey, with half of people across mar-
kets distrusting their connected devices to protect their privacy and handle their
information in a respectful manner (53%).
9.4 Data and Design 189

• On top of not trusting the device itself to keep data secure, 75% of people agree
there is reason for concern about their data being used by other organisations
without their permission.
• The security concerns are serious enough to deter almost a third (28%) of people
who do not own smart devices from buying one; security concerns are as strong
a deterrent as the price of a device.
• People have concerns about security and privacy but do not know how to adapt
and adjust device settings in a way that might allay these fears. 80% of people
surveyed are aware of how to set and reset passwords, but only 50% are aware of
how to disable the collection of data about users and their behaviours.

The above set of findings is widely held across many consumer groups regarding
IoT, and as such, these perceptions can be overcome through intelligently planned
and executed marketing strategies. Consultancy firm L.E.K. (2015) offers an inter-
esting set of marketing strategies based around the introduction of IoT to both new
and existing customers (Table 9.2). As can be seen, the different approaches between
traditional and IoT marketing strategies is markedly different in both planning and
implementation.
Alongside marketing IoT products to companies and individuals, the internet of
things can also make a huge contribution to marketing activities in its own right. It
is particularly relevant to bridging the physical and digital worlds within high street
retailing where enhanced customer experiences are crucial in ensuring customer
engagement and retention. IoT allows marketers to offer highly personalised and
context specific tailored messages to the consumer, for example, digital signage and
wayfinding in physical retail environments via mobile applications or other devices
in digital interactions. With more retailers adopting IoT technologies, advanced per-
sonalised digital interactions will become the norm on the high street; retailers who
do not keep up with this growing trend will soon obsolete. Research undertaken by
the forecasting consultancy Juniper (2015) found that leading retailers using the IoT
to generate an ‘ecosystem’ are poised to gain market advantage and capitalise on the

Table 9.2 Marketing traditional products versus Marketing IoT devices

Stand-alone box Connected device
Target profile Open to purchase Open to change
Sales B2C: Established channels B2C: Established and new channels
touchpoints B2B: Limited touchpoints, B2B: Multiple touchpoints; cross-­
typically technical/functional functional and C-suite stakeholders
experts
Sales Identifying and meeting existing Sharing insights and bringing awareness
approach needs of new needs
Product expertise Customer expertise
Price versus quality trade-off Transformation
Focus on meeting specs and ‘Nonobvious’ benefits; focus on value
known needs (monetary and nonmonetary) of benefits.
Source: L.E.K. Consulting
190 9 Design Directions and Future Trajectories

opportunity. Linking the hardware elements of RFID tags, beacons and connected
consumer electronics, such as wearables, with software analytics promises in-depth
business insight and an enhanced customer experience. “Retailers such as Zara and
Target are already taking advantage of the benefits offered by RFID asset tracking”
noted author Steffen Sorrell. “Meanwhile the beacon industry is expanding rapidly;
used as a method to provide consumers with contextually relevant information in
conjunction with their smartphone or wearable will enormously enhance the in-­
store experience”.
As IoT innovation advances and permeates our daily lives, it will disrupt entire
industries and has a profound impact on business. Despite a number of companies
considering incorporating IoT components to their products and service portfolios,
there is still a lack of understanding on the developmental processes of IoT products
and services as well. Traditional design processes are fast becoming redundant
when used to create IoT products, as such; organisations now need to take into
account real-time data flows during the design process throughout product develop-
ment, which in turn, could shape commercial outcomes. Lee et al. (2019, 2020)
have conducted extensive research into IoT NPD processes that require radical re-­
thinking as to how organisations embark upon digitally orientated business
strategies.

9.5 Design Directions in an Era of Uncertainty

Design as we know is a discipline that exists between two worlds—‘the here and
now’ and the ‘where we could be’ offering endless possibilities for curious minds.
It is worth pointing out that this section does not attempt to predict the future, more
so to reflect upon where design is now and its potential evolutionary ‘next step’ as a
means to enhancing our daily lives set against the backdrop of social and technical
change. In essence, design thinking is a driver for meaningful change within a glo-
balised world. Design is and will always be considered an invisible resource? Often
the term ‘design’ is commonly, and sadly, used to articulate how either a product or
object looks, mainly at a very superficial level of understanding. With this rather
limited definition of usage, it is regarded as a frivolous activity offering no real
worth to the organisation. However, enlightened organisations regardless of size,
really understand its ‘value’ not just at a tactical level of engagement, but as a vital
ingredient and source of both inspiration and opportunity. When carefully managed
and orchestrated, design has the innate ability to offer a distinct range of value-­
propositions that are desirable in the eyes of the consumer and end-users alike. With
the advent of globalisation in full force, competition between companies is becom-
ing increasingly fierce, and as such, design is now becoming the commercial
‘imperative’ in the continual struggle towards long-term survival and continued sus-
tainable success. Here, we are going to turn our attention to three increasingly criti-
cal developments that organisations of all sizes, needs to plan for and respond to in
order to survive. Aspects of these developments have been touched upon within
9.5 Design Directions in an Era of Uncertainty 191

preceding chapters of this book, however, due to their growing importance, they do
warrant closer investigation. The following will shape the contours of the world we
will live in during the coming decades:

• Technology
• Demographics
• Environment

Building on the progress of human development, numerous countries and nation

states will encounter many structural challenges to build on and augment earlier
successes, especially set against the backdrop of climate change and economic
uncertainty. Furthermore, the damaging consequences of extreme weather events
and rising sea levels will disproportionately affect poorer countries and developing
economies even further. Alongside environmental challenges, the exponential rise
of technological developments will accelerate and improve human experiences,
however, there is an increasing possibility that these developments could open up
new fissures and tensions between industries, and society as a whole, leading to
socio-economic inequalities. To further exacerbate economic and social disparities,
demographic changes could lead to global migration, a potential pressure that will
increase friction between states. The rise of Asian economies is challenging estab-
lished rules and institutions as, combined with their large population size and densi-
ties, they create new and unforeseen challenges to western economies.

Technology

A confluence of diverse trends is providing fertile conditions for a perfect storm

over the next few decades and beyond. However, it is widely accepted that these
new technologies will not come to fruition evenly or predictably, they will more
than likely to share a set of common drivers and associated dynamics. Digital expe-
rience continues to be a critical driver of enterprise transformation in fact, 64% of
participants in Deloitte’s global CIO survey say digital technologies will affect their
businesses in the next three years. (Deloitte, 2020). With the wider dissemination of
technological expertise, the drive to the setting of common standards to promote
one solution over another and faster product development processes will inform
long-term strategies to ensure continued commercial success. With timelines shrink-
ing, the ability to develop, commercialise and withdraw technologies from the mar-
ketplace is now measured in years as opposed to decades. Multiple partners and
international joint ventures (IJV) are driving technological developments that can
be offered to the marketplace before rival companies. With this growing imbalance
of technological knowledge, developing countries are becoming dependent on
adopting technologies without understanding the implications of these choices
being fully considered.
A good example of this comes from a recently published study (Poliquin, 2020)
from the University of California, Los Angeles, which explores how technology (in
192 9 Design Directions and Future Trajectories

the broadest sense) has affected wages over the years. The research examined the
introduction of something as relatively mundane as broadband into Brazil between
2000 and 2009. It revealed that the technology coincided with an increase in wages
across the labour market, but whereas the average employee saw wages rise by just
2.3%, those in managerial positions saw a 9% rise, and those in the boardroom saw
an even more impressive 19% boost to the income. The hypothesis proposed by the
researchers is that the new technology allowed the more productive workers to be
even more productive, thus widening the income gap between them. Martin Ford
issues an equally strong warning. In his book, The Lights in the Tunnel (2009), he
argues, “as technology accelerates, machine automation may ultimately penetrate
the economy to the extent that wages no longer provide the bulk of consumers with
adequate discretionary income and confidence in the future. If this issue is not
addressed, the result will be a downward economic spiral”.

Demographics

According to a report published by the National Intelligence Council (NIC, 2021) it

estimates that during the next 20 years, the world’s population will continue to
increase every year, adding approximately 1.4 billion people to reach an estimated
9.2 billion by 2040, but the rate of population growth will slow in all regions.
However, this growth will quickly decline from 2040. Population growth in China
will plateau, being overtaken by India as the most populous country around 2027.
As widely acknowledged, the global population will age, rising from a median of
around 31 years in 2020 to 35 in 2040. This ageing population will bring associated
challenges, in particular affecting Eastern Europe and China. One such develop-
ment will include the reduction in productivity as older workers show reduced pro-
ductivity gains and a greater reliance on healthcare provision and access to affordable
pension schemes. A report produced by UNECE (2007) points out, “the number and
proportion of older persons in society increases, so the total resources required to
meet their needs are growing. Literally all spheres of society need to adapt to this
change”.
The World Health Organisation (2018) predicts that:

• Between 2015 and 2050, the proportion of the world’s population over 60 years
will nearly double from 12% to 22%.
• By 2020, the number of people aged 60 years and older will outnumber children
younger than 5 years.
• In 2050, 80% of older people will be living in low- and middle-income countries.
• The pace of population ageing is much faster than in the past.
• All countries face major challenges to ensure that their health and social systems
are ready to make the most of this demographic shift.
9.5 Design Directions in an Era of Uncertainty 193

Environment

Since the start of the industrial revolution in the eighteenth century, there has been
a significant change to the earth’s atmosphere due to increased emissions of green-
house gases, primarily caused by humans. Consequently, this has led to global
warming which has effected noticeable change in the climate. Through the burning
of fossil fuels (coal, natural gas and oil) combined with large-scale land use and
urbanisation, these contributing factors have further intensified greenhouse emis-
sions. According to the scientific reports of the Intergovernmental Panel on Climate
Change (IPCC, 2018), “the average global surface temperature has increased by
1.04 °C in the last 130 years, the sharp increase in global warming since 1950 can
no longer be explained by natural climate fluctuations. Greenhouse gases such as
carbon dioxide (CO2) are almost certainly responsible for this”. Alongside the phys-
ical effects of climate change, nation states and geographic regions will encounter
challenges and tensions regarding reducing emissions of greenhouse gases and the
implementation of adaptive measures. The burden of these measures will not be
shared equally across the globe, thus making it challenging when applying these
stringent commitments. There is also a growing movement towards reducing global
warming, with youth activists like Greta Thunberg, giving voice to the concerns of
young people across the world.
In a report released by UNICEF (2021), Thunberg argues, “We are not just
victims, we are also leading the fight. But [the world] is still not treating the cli-
mate crisis like an emergency. We are still just talking and greenwashing things
instead of taking real action. But, on the other hand, there have been many mil-
lions of people mobilised, especially young people, and that is a very important
step in the right direction”. Policymakers continually have to devise policies that
are deeply unpopular amongst the general public, drawing protests against their
implementation, such as all new conventional petrol and diesel cars and vans are
set to be banned from sale in the UK from 2030. New hybrids will be given a stay
of execution until 2035, on the condition they are capable of covering a “signifi-
cant distance” in zero-­emission mode, announced the UK government (gov.uk,
2020). Luke Murphy, head of the influential Institute for Public Policy Research’s
Environmental Justice Commission, points out, that “The phase-out of new petrol
and diesel vehicles by 2030 is an important step, but it won’t be enough just to
switch to electric vehicles. If we attempt to replace vehicles one-for-one, it will be
a huge draw on other environmental resources. We need to reduce car use overall,
which means greater investment in sustainable public transport options, including
rail and bus services, as well as more support for cycling and walking”.
(Forbes, 2020).

cc Chapter Summary Design could be considered a rebellious child

constantly questioning things and long-held, widely accepted
assumptions. The following oft-quoted remark reflects the contrarian
nature of design that “the important thing is not to stop questioning.
Curiosity has its own reason for existing” (Einstein, 1955). Following
194 9 Design Directions and Future Trajectories

on from this maxim, this broad ranging chapter has introduced a plethora
of emergent themes and topics that both capture and reflect the continual
progression of design as an agent of change. However, the forces that
influence and shape the contours of design are complex and often
invisible, thus making any predictions as to its next evolutionary steps
almost impossible to predict. Regarding the present day, design has
travelled a considerable journey since its primary role as a stylistic and
perfunctory element of industry and commerce from the seeds of the
eighteenth century industrial revolution. Fast forward to the twenty-first
century where disruption and creative renewal are a given, design has
finally found a safe harbour to reflect and reappraise its next evolutionary
journey over unchartered horizons and turbulent seas of meaningful
engagement. The themes of digital, technological advancement and IoT
present many significant challenges to both the individual and
organisations alike. The bifurcation between these two respective
domains is becoming increasingly blurred, even more so with the
emergence of democratic design and the rising empowerment of the
end-user within the design development process. Taking these inclusive
principles further, we are witnessing the rise of collaborative research
centres and departments such as the DESIS network and Living Labs
reaching out into new and unchartered territories of socially orientated
modes of engagement.
In today’s hyper-connected world, one country’s societal
problems can become ours. Nations are facing stagnating economic
growth, financial instability, political turmoil, hunger, poverty and
the consequences of the Covid-19 pandemic. These are all social
issues that have to be addressed, one way or the other, and as such,
these wicked problems generate many opportunities for ambitious
entrepreneurial minds. In fact, more than 80% of economic growth
comes from innovation and application of this new knowledge.
However, it should be acknowledged that social innovation is
actually adding an extra dimension to the field and practice of
innovation, sustaining economic and social growth and indeed wider
prosperity to a whole range of individuals and communities.
Uncertainty and unpredictability are recurrent themes frequently
discussed by industry and policymakers alike, and the positioning of
design to plan for, accommodate and respond to global challenges
that include, technology, demographics and climate change are
becoming the new imperatives that demand urgent critical attention.
To conclude Chap. 9, future challenges potentially have their
inherent solutions inspired from the past, and in respect of these
emergent global challenges, the prescient Chinese proverb poetically
suggests, “when the winds of change blow, some people build walls
and others build windmills”.
9.5 Design Directions in an Era of Uncertainty 195

Review Questions

1. What are classed as ‘wicked’ problems and how is the design profession address-
ing these perennial problems?
2. DESIS Labs is an international network of design research centres; what types
of research themes are they critically engaging with?
3. Participatory design is an inclusive approach to yielding information rich user
centred data, what are the three main elements of participatory design?
4. Living Labs focus upon a diverse range of specific research themes; who are the
four main partners that feature within Living Labs projects?
5. What are the numerous benefits to the company when embarking on IoT devel-
opmental strategies?

Project Questions

1. Identify two diverse ‘wicked’ problems and discuss where and how design could
contribute to addressing them.
2. Identify and list a series of tools and techniques widely used within participatory
design and list out factors that make them particularly unique to gleaning user-
centred insights.
3. Select one commonly used domestic appliance within the home and consider
ways in which it could be transformed into a digitally enable IoT product system.
4. Devise a marketing strategy for an IoT related device to new customers who are
unfamiliar with IoT outlining its two primary benefits.
5. It is widely forecast that population growth will significantly increase over the
next 60 years; identify a series of implications where design can minimise the
impact of this development.

Chapter Tasks

1. Develop a simple 500 word proposal outlining your research interests and how
they could be turned into a DESIS Lab.
2. Based on this proposal, which partner organisations would be instrumental in
turning your idea into a viable proposition and what benefits would they offer to
your Lab?
3. Identify five IoT products currently on the marketplace and list the key similari-
ties and differences between them.
4. List three main advantages and disadvantages of establishing an International
Joint Venture. What other aspects of an IJV do you think need to be taken into
account?
5. Form a small group of no more than four people; then identify a current partner-
ship between two leading international brands, examining the pros and cons for
each brand within that partnership.
196 9 Design Directions and Future Trajectories

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Summary
10

10.1 The Design Nexus: Reflections and Reorganisation

Over the last decade, design thinking has moved considerably into many facets of
organisational life. It has also been widely drawn upon and utilised to address deep-­
rooted social and global challenges. Its evolutionary development continues to
inform its character and value as a highly creative problem-solving approach to
often complex problems. Many regard it as a panacea to solve all known ills and
wicked problems with one prescribed dose of application; then magically, solutions
and desired endpoints are successfully achieved. Sadly, however, this is not the case.
We strike a strong cautionary note here to argue that design thinking does have a
leading role in effecting meaningful change, but, (here is the caveat) it does have
limitations as to what and how it can contribute to leading this ‘change.’ Complex
problems, by their very definition, are complex, and as such, demand the input and
voice of many different stakeholders, many of whom are drawn from a diverse range
of disciplinary backgrounds. In addition to these, a further layer of complexity is
that of context—the very specific conditions and surrounding phenomena—in
which it is applied. When these two factors are not taken fully into account, design
thinking often over-promises and under-delivers to expectant and subsequently, dis-
appointed audiences.
Going back to the issue of complex problems, these are widely recognised as
multi-dimensional and non-linear, which cannot be properly addressed by a ‘tradi-
tional’ design thinking approach. In a way, design thinking needs to become more
‘messy’ and fluid without its demarcated boundaries of application in use. In
essence, it needs to become more ‘design’ as opposed to a philosophy based on key
design principles, more akin to a design ‘related’ approach. This aspect could be
connected to its inherent ambiguous nature, where design thinking needs to

© The Author(s), under exclusive license to Springer Nature 199

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9_10
200 10 Summary

demonstrate its true value as an agent for change. Like it or not, design thinking is
here to stay, but it needs to move onto its next evolutionary stage of development.
Both authors are from traditional design backgrounds, and have carefully scruti-
nised the development of design thinking as a nascent approach to engaging with
complex problems. In order to move it forward, the authors here, aim to carefully
nudge, cajole and coax design thinking back to its original roots—the discipline of
design. As such, we have identified five distinct characteristics of its nature
(Fig. 10.1) that are shrouded within its veil of ambiguity (although some character-
istics are less ambiguous than others); however, let’s draw our attention to the fol-
lowing five key elements that could strengthen the value of design thinking to its
most ardent critics (many of whom reside in the discipline of design). Firstly, the
five dimensions have differing levels of influence and impact; these align with
Richard Buchanan’s ‘4 orders of design’ that in Chap. 4. Design thinking cuts across
the four orders to foster transformational change, ranging from behavioural ‘inter-
actions’ at an individual level, right through to systemic change when applied at a
macro level of strategic engagement.

Fig. 10.1 The five interrelated dimensions of design thinking (developed by authors)
10.3 Design Commonwealth 201

10.2 Design Values

Design values investigating the value of design is not a new endeavour; this has
been ongoing since the late 1960s (in particular with the emergence of the Design
Research Society in 1966 to advance design as a recognised discipline in its own
right). Design Councils around the globe have been strong advocates for design,
promoting it to many industry sectors, over the last two decades. Furthermore, with
the emergence of sub-disciplines that sits within design (for instance, UX design;
participatory design and so forth), its reach and value have entered into new domains
of application. Chapters within this book have demonstrated the immense value that
design can create, when utilised as both a problem and decision making framework
that is embedded into the DNA of the organisation. Chapter 2 discussed how design
thinking could inform business strategy, whilst cementing stronger customer rela-
tionships. It introduced Fraser’s ‘Three Gears of Design’ methodology where end-­
user insights can identify new business opportunities via the development of
innovative new products and services that are truly user centred.
Furthermore, the chapter explored how SMEs could adopt design thinking prac-
tices to scale-up ambitious growth plans, taking them from stage 1 to stage 4 on the
Danish Design Ladder. To assist the strategic growth ambitions of SMEs, govern-
ments around the world are creating local and national design support programmes
to drive long-term economic growth and industry competitiveness. Chapter 6 fea-
tured an interesting and an in-depth account of young Gaming start-up companies
based in Dundee in the UK, that are contributing to the development of the high
growth video game industry. However, as the author (Dr Xinya You) points out,
these small companies faced many critical challenges in the formative stages of
company development. Three high level risks that the fledgling companies faced
(and continue to face) include the huge financial risks associated with the develop-
ment of IP in the long term. Secondly, technological innovation risks often leads to
missed commercial opportunities that are vital to SME growth. To overcome the
many inherent risks across the gaming sector, the author was instrumental in creat-
ing two design tools that led to the development of an InGAME Business model
design booklet to support and increase the value of the Dundee games cluster to the
region. Chapter 8 explored the intangible aspects of the relationship between design
thinking and practice, in particular, the creation of user value through design think-
ing tools and methods. The two case examples offered both a powerful and perva-
sive argument as to the role of design thinking and how it could be used to explore
both possible and potential futures for strategic direction and growth.

10.3 Design Commonwealth

Design commonwealth is a traditional English term for a political community

founded for the common ‘good’. In this sense, we view common good as demo-
cratic design process, where design thinking is embraced as a powerful vehicle to
create meaningful participation and inclusivity amongst individuals and wider
202 10 Summary

communities. Chapter 9 places great emphasis on the democratisation of the design

decision-making process. It touches upon and traverses the vast expanse of end-user
participation and the many diverse tools and techniques to capture the ‘voices’ of
the user. Eric von Hippel is a leading advocate who has devoted his career to devel-
oping methods and frameworks to drive user inspired innovation via his ‘Lead User
Method’ that places primary emphasis on the end-user to foster product innovation.
The chapter then turns its attention to the ‘Living Labs’ movement, that places par-
ticipatory design central to its role within the co-creation of innovative solutions.
What makes the Living Labs particularly unique is that they are bounded environ-
ments that facilitate real-life testing and experimentation.
In addition to this, participants and users are explicitly involved within this activ-
ity, generating and offering highly personalised insights and observations, rather
than mere passive participants. Chapter 4 explores the complex issue of organisa-
tional change management, offering a series of well recognised and commonly used
change management frameworks to foster transformational change. However, given
the strengths and merits of each adopted route to change, Chap. 4 introduces an
alternative design orientated approach based on Richard Buchannan’s four orders of
design. Moving through the four orders, the fourth and final order is primarily
focused upon systems and organisational design. It focuses more upon the psycho-
logical and cultural contexts that give meaning to design and the wider system that
supports it. IBM is a noteworthy example of how a leading international organisa-
tion is radically implementing cultural change across its organisational divisions,
with design thinking at the heart of this ongoing process. Chapter 5 critically inter-
rogates the theme of design commonwealth through the perspective of creative con-
fidence, where it focuses on promoting an innovation mindset to engage employees
with a new set of approaches, practices and methodologies to foster innovation and
change. The author of Chap. 5 (Dr Beatriz Itzel Cruz Megchun) offers a wide vari-
ety of contexts and applications of design thinking that demonstrates its applicabil-
ity to a range of diverse contexts. Highlighted throughout the discussion were the
different types of economic systems and business structures that warrant very spe-
cific approaches to the usage of design thinking practices. What may be appropriate
and suitable for one business type may not be suitable to another business with a
completely different organisational structure. This takes us back to the earlier dis-
cussion where context is critical when embarking on a set of design thinking
interventions.

10.4 Design Perspectives

Design perspectives is a particularly prescient and recurrent theme given the ongo-
ing impact and uncertainty of Covid-19 to national and local economies. Chapter 4
takes a closer look at the rise of business uncertainty and the need to plan ahead in
order to remain commercially viable in the shifting landscape of enterprise. CEO’s
and business leaders rely upon established structures and processes to navigate cor-
porate turbulence, which in a way mitigate risk and financial impact to profit
10.5 Design Transformations 203

margins. What we are witnessing throughout the globe, is how well prepared and
agile businesses are, given the ongoing seismic events since spring 2020. This leads
us to explore the skill sets and competencies of tomorrow’s business leaders and the
leadership qualities required in order to provide vision and agency to companies
operating in complex international markets. Chapter 3 examines business curricula
within the higher education sector, and how does it equip business leaders with the
abilities to lead and deliver projects through instilling a sense of common purpose
to their employees. Uncertainty can be commonly measured by both magnitude and
duration, challenging even the most resilient entrepreneurial minds. Readers can
draw upon local examples of companies struggling or flourishing within these chal-
lenging times, where firm leadership saved many companies as others fell by the
wayside and declined.
New and alternative perspectives have risen to the fore, none more so in business
and management education. Traditional curricula and methods of teaching are con-
tinually being re-appraised, undergoing continual scrutiny for industry relevance,
both for today and tomorrows dynamic commercial landscapes. Chapter 3 com-
pared and contrasted the key pedagogical approaches between design and business
education, identifying how shared approaches could go some way to equip students
with T-shaped skills that offer them deep knowledge of their subject area alongside
a broad base of general supporting skills. With the advent of design thinking mod-
ules and short courses growing in prominence in business schools, design is slowly
becoming recognised as a key element and driver of organisational creativity and
innovation. New technologies and educational systems are being developed to sup-
port continuous professional development to business executives. We are seeing the
emergence of leading universities and industry partners offering a wide range of
design thinking short courses to prepare participants for the future challenges that
lie ahead when striving for organisational competitiveness and success.

10.5 Design Transformations

Design transformations primarily involves the development of robust and highly

flexible business strategies that embrace ongoing technological developments and
shifting consumer demographics. Chapter 9 carefully examines the exponential
growth of IoT and its disruptive potential to established business models. To re-­
affirm this, the often quoted adage “data is the new oil” perfectly captures the huge
growth potential of the internet of things and its vast untapped potential to revolu-
tionise business and our everyday lives. For example, Airbiquity is a software and
engineering company that provides real-time data to users of connected motor vehi-
cles, in addition to lifecycle management support services. The impact of this ser-
vice offering is contributing to profound changes in the way we use and maintain
motor vehicles on a daily basis. JOSH.AI provides voice controlled home automa-
tion using a wide variety of connected devices. This technology allows users with
physical or cognitive impairments to lead independent lives that would have been
unthinkable only a few years ago. At an urban scale of application, the rise of smart
204 10 Summary

cities allows planners, urbanists and architects to design integrated and networked
environments that can radically re-shape the way we conceive and develop transport
infrastructure, water supply and waste disposal facilities. Combined, it allows for a
more interactive and responsive approach to uniform city administration and
governance.
Chapter 8 featured a comprehensive discussion by Dr Radka Newton whereupon
a small team of academics utilised a vast array of design thinking tools to elicit a
deeper understanding of the student learning experience at Lancaster University.
Service design is a closely related discipline to design thinking that shares many
similarities in the way it utilises creative processes to capture the intangible experi-
ences by the user, in this particular case, the users were students who freely shared
their experiences with the academic team in order to improve upon the existing
education provision within the department. Chapter 2 introduced and debated the
value of design support programmes to SMEs by the UK Design Council. It is
widely acknowledged that SMEs are the engine of growth for regional and national
economies, however in order to flourish, SMEs require tailored ‘support’ pro-
grammes to remain competitive. Support could take the form of knowledge transfer,
capacity building and employee skills development. In this case, it touched upon the
‘Design Leadership Programme’ where SMEs could add meaningful value to their
customers and clients via the development of fluid design strategies to create new
business opportunities.

10.6 Design Futures

Design futures explores the proactive nature of design thinking where attention is
devoted towards imaginary and preferred futures for the organisation. Within the
advent of rapid globalisation, intelligent technologies, and new demographic trends,
changes in overall business activity are leading to cross-industry and cross-sectoral
cooperation. In order to develop more flexible business models, design thinking has
become the new focus towards new business model development within contempo-
rary organisational practice. In a traditional organisational structure, two important
elements in business activities, design and management are often undertaken in
isolation; however, it is commonly agreed that this binary model is no longer suffi-
cient to both create and foster meaningful values in the development of strategic
planning business activities. Key design decision makers need to understand and
embrace the basic logic of business practices. Similarly, CEOs and business manag-
ers need to be aware of the impact of design on the enterprise against the backdrop
of emergent future trends in order to secure long-term sustainable success.
Chapter 7 provides a detailed account of implementing a three-stage process to
achieve brand ambidexterity in order to ensure brand relevance in a contemporary
post-modern world. The first stage of the change process centres upon re-framing
organisational routes to innovation (destabilisation) via problem interrogation and
contextual immersion. Then, stage two (define and develop) involves the designers
working closely with brand managers to scope potential problems that could be
10.7 Final Reflections 205

encountered in the solution implementation phases. Finally stage three (transforma-

tion) culminates in the refreshed brand identity that aligns with corporate objectives
moving into the future. Chapter 6 introduces and explores sustainable futures, set
against the backdrop of climate change and global environmental challenges that
are forcing organisations to change their current business practices. Policymakers
and businesses have to reappraise their existing understanding and approaches to
sustainability issues that include the ‘Triple Bottom Line’ (TBL) when measuring
impact and metrics for success. Central to this ongoing and crucial debate is design,
where the design profession can draw upon its vast repertoire of skills and method-
ologies to embrace and overcome these critical challenges.

10.7 Final Reflections

The themes introduced within this book highlight a plethora of critical roles and
applications of design throughout a variety of complex and demanding contexts.
These challenges span and traverse established boundaries that are continually
being redefined in a contemporary era of great uncertainty and ambiguity. Design
continues its relentless journey of development, entering into new domains of influ-
ence, ranging from healthcare delivery, policymaking and reducing social inequal-
ity. Climate change, sustainable development goals and globalisation amongst many
more emergent causes are forcing individuals, organisations and national govern-
ments to seek new ways to address these urgent challenges. Design is one such tool
that could be deployed to re-think and engage with these interconnected context-­
sensitive challenges. The five dimensions of design thinking offered by the authors
provide agency to the role and understanding of design thinking as one such power-
ful means to facilitate meaningful change for people and the planet, both now and
in the future.
Spend eighty percent of your time focusing on the opportunities of tomorrow rather than the
problems of yesterday.
—Brian Tracy, motivational speaker and writer
Index

A Change and crisis, 1

Aaker, David, 128, 135, 139 Change management, 53, 54, 63, 65–68,
Archer, Bruce, 11, 12 70, 72–74
Authority, 56, 57, 60, 67 Characteristics of design, 151, 155
Automation, 187, 192 Circular economy, 82
Climate change, 178, 191, 193, 194
Co-design, 169
B Command economic system, 80
Behaviour, 56–58, 64, 66, 68, 72 Communities, 102, 105, 106, 109, 110, 112,
Big data, 184, 185 113, 123, 124
Boundaries, 1–3, 6 Competitive advantage, 27
Brand ambidexterity, 127, 139–143 Complexity, 53–74
Brand audit, 127, 130–134, 138, 139, 143, 144 Conceptual framework, 143
Brand consistency, 127, 138–143 Consumer behaviour, 35
Brand credibility, 137 Consumers, 102, 107–111
Brand equity, 127, 129–131, 134, 135, 137, Control, 54, 57, 58, 71
138, 142, 143 Cooperative, 83, 89, 90
Brand exploratory, 127, 131, 133, 134, 144 Cooperative model, 112
Branding activities, 78 COP26 Climate Change Summit, 108
Brand inventory, 127, 131, 144 Corporate Social Responsibility (CSR), 101,
Brown, Tim, 10, 12, 14, 15, 18, 19 102, 109–111, 123, 124
Buchanan, Richard, 9 Corporation, 82, 89–91, 93
Bureaucracy, 56, 58 Covid-19, 53, 61, 69, 73, 74
Business composition, 91–93 Covid-19 Pandemic, 6
Business environments, 78–84 Creative confidence, 87
Business leader, 28, 38, 48 Creative industries, 101, 184
Business operations, 78 Creative problem solving, 85, 86
Business school, 27, 28, 30, 31, 33–39, Creativity, 28, 29, 31, 35, 36, 43, 45, 48
43, 46, 48 Curriculum, 39
Business strategy, 2 Customer-based brand equity pyramid model
Business structure, 77, 89–90 (CBBE), 134–138, 144
Business support model, 111 Customer relationship management
Business-to-business (B2B), 151 (CRM), 35

C D
Case studies, 150, 159, 160, 173 Danish Design Centre (DDC), 29
Certified B corporation, 90 Danish design ladder, 21, 23–25

© The Author(s), under exclusive license to Springer Nature 207

Switzerland AG 2022
Y. Huang, D. Hands, Design Thinking for New Business Contexts,
https://doi.org/10.1007/978-3-030-94206-9
208 Index

Data Driven Innovation (DDI), 177, 185 Educator, 159–161, 165, 167
Decision-making process, 202 Efficiency, 187, 188
Democratic design, 182–185, 194 Emotions, 134, 137
Design, 9–25 Empathy, 127, 130, 133, 134, 142–144
Design alliances, 107, 108 Employee satisfaction, 103, 109
Design commonwealth, 201–202 Employment model, 112
Design Council, 10, 16, 21, 22 End-users, 201, 202
Design directions, 177–195 Entrepreneurial minds, 203
Designerly, 4–6 Entrepreneurship, 35, 41, 43
Designerly approaches, 68–72 Ethical innovative leaders, 44
Design for Europe, 22 Ethnography, 127, 130–134, 138, 141–143
Design for Social Innovation and European economy, 10, 19, 20
Sustainability network (DESIS), Evaluations, 133, 144
177, 178, 181, 182, 194, 195 Executive online learning, 36
Design for sustainability, 33 Experimentation, 202
Design futures, 204–205 External forces, 53, 67
Design Issues, 11
Design management, 30, 33, 35, 36, 43
Design methodology, 11 F
Design methods, 159–172 Feasibility, 85, 138, 143
Design perspectives, 202–203 Flat organisation, 58
Design process, 9, 10, 12, 13, 16, 20, 22, 23, Four orders of design, 70
150–151, 162 Functional organisation, 58
Design research, 2 Future forecasting, 107
Design Research Society, 201 Future orientated, 177
Design school, 31–33, 48
Design studio, 178, 179
Design teaching, 2 G
Design thinking, 9–25 Game, 113–121
Design thinking curriculum design, 39–48 Generation Z, 107
Design thinking for business, 1 Global pandemics, 56, 61, 62
Design thinking in healthcare, 43 Government responsibility, 178
Design tools, 22, 113–121, 155, 165, 183, 201
Design values, 201
Desirability, 85 H
Destabilisation, 140, 141 Harvard Business Review, 18
Digital innovation, 35 Healthcare, 178, 179, 181, 192
Dimensions, 39, 44 Hierarchy, 55, 58
Discipline, 28, 31–35, 39 Hitachi ABB Power Girds, 151–156, 173
Divergent and convergent thinking, 10, 14 Human Centred Design (HCD), 151, 154
Division of labour, 57 Human interactions, 72
Divisional organisation, 59 Human-centred innovation, 15
DNA of an organisation, 201 Hybrid business model, 111–113, 115
Double-Diamond Model, 13, 16 Hyper-connected business environment, 54
Doughnut economy, 82, 83
Dynamic system, 60
I
IBM, 29, 36, 37, 49
E IDEO, 14, 15
Eco-friendly, 104 Ideology, 129
Ecological crisis, 179 Inclusive, 5, 46, 83, 93, 105, 182, 183, 194
Economic systems, 77–84, 95, 97 Industrial Internet of Things (IIoT), 187
Education, 27, 28, 31, 34, 36, 38, 41, Industry practice, 2
43, 48, 49 Information Technology (IT), 187
Index 209

Innovation, 10, 12, 14, 15, 17–22 O

Innovation of meaning, 88 Operational Technology (OT), 187
Internal design-driven innovation, 108 Organisational attributes, 60
International Joint Ventures (IJV), 191, 195 Organisational structures, 58–60, 73
Internet of Things (IoT), 62 Organisation types, 78, 84–90

J P
Jones, John Christopher, 11 Participatory Design (PD), 182–184, 195
Journey map, 159, 165, 169–172, 174 Partnerships, 81, 89
Personas, 159, 165–169
Policy making, 178
K Policymaker, 205
Keller, Kevin Lane, 128–131, 135–140 Popper, Karl, 11
Kelley, David, 70 Postgraduate, 32–34, 41
Korea advanced Institute of Science and Productivity, 187, 192
Technology (KAIST), 29 Product marketing strategy, 115
Kotter’s 8 step change model, 63, 66 Profit, people, and planet, 101, 105
Kurt Lewin’s change management model, 63–65 Prototype, 19, 151, 155, 156

L Q
Lawson’s design process, 13 Qualitative methodology, 131, 133
Level of management, 58, 60 Quantitative, 153, 155, 156
Liedtka, Jeanne, 131, 133, 140, 142
Lifestyle, 165
Limited liability company, 89 R
Loyalty, 131, 135, 137, 138, 143 Re-freezing, 64
Resilient, 203

M
Macro business environment, 60 S
Management school ecosystem, 163, 164 Sales intermediary model, 111
Managing uncertainty, 54, 61–63 Secondary, 153
Manufacturing business, 85, 91 Service business, 84
Market economic system, 80 Service design, 23, 149, 152–155, 159–161,
Marketing research, 35 170, 172
Matrix organisation, 59 Service/fee model, 112
The Mckinsey 7-S model, 63, 67, 68 Shared values, 67
Merchandising business, 84 Sharing economy, 82
Methods, 131–133, 143 Simon, Herbert, 10–12
Microbusinesses, 91 Small and medium-sized enterprises (SMEs),
Millennials, 109 10, 19–25, 157
Mission Statement, 101, 103, 104, 124 Smart cities, 184, 186
MIT, 36 Social economy, 77, 82, 83
Mixed economy system, 80 Social enterprises, 101, 102, 111–113,
Mobility as a Service (MaaS), 151, 154–159, 173 123, 124
Social processes, 72
Sole proprietorship, 89
N Sprint execution, 86, 87
Netnography, 133 Stakeholders, 103, 104, 106, 109, 110, 123,
Net zero, 181 149–151, 157, 162
New Product Development (NPD), 190 Start-up, 35, 157, 159
Non-linear, 179 Strategy, 10, 15–19, 22, 23, 25
210 Index

Subsidised service model, 112 U

Suppliers, 109, 110 Uncertain futures, 194
Sustainability, 102, 104–109, 113–121 Uncertainty, 72, 73, 190–193
Sustainability risk, 115 Undergraduate, 32–34, 39, 41
Sustainable business practice, 123 University ecosystem, 162, 163, 165, 169, 170
Sustainable futures, 104–109 University of Portland, 28, 39–48
Systems thinker, 72 Unpredictable, 53, 54, 61–63
User experience, 151, 169
UX design, 201
T
Target audience, 128, 135–137, 144
Technical jargon, 154 V
Tension, 77, 78, 93–95 Van Erp, 158
Textual scenarios, 132 Viability, 85, 87
3D printing, 113 Visualisation, 15, 153, 162, 167, 168, 170, 171
Three gears of business design framework, 17
Three gears of design, 201
Total Quality Management (TQM), 94 W
Traditional economic system, 79, 96 Wicked problem, 11
Transformations, 67, 72, 140, 142 World Commission on Environment and
Triple Bottom Line (TBL), 101, 105, 106 Development (WCED), 104