Give your Organization a Value Advantage with human-centered design

 It’s important to keep sight of the people who are the subject of value creation programs. ‘Human-centered’ means making a rich connection with people both within and without the organization.  No matter how well intentioned a program is, performance and value can be difficult to report because the objective and scope of many programs are poorly defined.  What follows is a blueprint in three parts for designing effective programs:

• Understand business imperatives
• Know where you can innovate
• Design it and do it

1. Understand Business Imperatives

What is your vision?  What un-met customer needs are you helping to fulfill?  What value proposition do you provide?  How will your program achieve financial viability?  What outcomes are you looking to achieve?  Much of your success will be determined by how you answer these questions and how aligned your organization is.

Imperative #1:  What is your vision?

This is often not as straightforward as it seems.  Vision comprises four parts:

• your point of view
• what you are going to do about it
• for whom and
• how it will be viable (achieve ROI)

Imperative #2: Strong Culture

It doesn’t matter what your vision is if your organization is being pulled in different directions.  Dysfunction inside an organization leads to dysfunction for the customer.  Strong organizations rally in collaboration around a compelling vision.  Your brand is a reflection of what’s going on inside your organization.

Imperative #3: Business Model

What is the best way to deliver value to your customers and keep them coming? What balance of activities and resources will you invest in to be successful?  Is your model simple or complex?  As the market evolves, you may need to revisit and redesign the configuration of your business as well as your value proposition(s) and your business model(s) to keep things simple and nimble.

Imperative #4: Operations

Efficient and productive operations support the overall objective by understanding the function they perform, their place and context in the value chain.  That can only happen if the organization is aligned and the business model is effective.

2. Know Where to Innovate

If you’ve nailed your business imperatives, innovation will now differentiate you from your competitors.  To deliver viable business outcomes, there are four primary areas within which innovation can take place in your business^_:

An organization with strong customer IQ^_, seeking to create great customer value, will pull the primary innovation lever and understand where to innovate across their entire value chain to maximize impact.  Within each of the four areas of innovation, there are multiple types of innovation that can take place.^_ Even if you’re in a competitive market, you have significant room for creating disruptive advantage.  You’ll know which innovations create value if a) you design for your customer and b) your organization collaborates.

3. Design it, Do it

Design is a process for delivering value. Critical design components in determining program scope are:

• Defining the objective of the program;
• Generation and selection of ideas – including a throttling process around brainstorming known as ‘Diverge-Converge’ – that allows for the identification and selection of a small number of promising options for further development;
• Recurring iteration, development and fine-tuning.

The design process also accounts for doing the work of prototyping, testing and validating ideas to determine the most feasible and viable outcomes. Design doesn’t replace the hard graft of business planning and delivery. It underpins it with a scalable and repeatable method.

 

Designing innovation from the outside-in means defining the jobs that customers are trying to do. What benefit would accrue to them if they could overcome particular challenges that they face? What are their internal obstacles? The more you design from their perspective, the more energy you will generate in support of your offerings inside their company. Customers will see you as sharing and innovating to enable their imperatives.

Business Innovation, Machine Learning and Design – The Human Angle

As machine learning and automation come to the fore, there will be a stronger imperative for human-centered design. Our world is still one where humans make determining decisions, supported by data. Our human and digital lives are both subjective.  Studies like Daniel Kahneman’s Thinking Fast and Slow show that the bias in our thinking changes frequently, heavily influenced by the way a situation is framed, even as it pertains to repeat situations. If human judgement isn’t always expert at interpreting human behavior, neither is your CRM or marketing database. Iterative design, ideation, modeling and testing between humans and machines will help to significantly fine-tune your outcomes.

During a recent customer project involving predictive learning I learned that design thinking and machine learning share practically the same basic five-step, iterative model. From my research, sociologists at IDEO and machine learning engineers at Google agree that you don’t need a lot of data to make fairly accurate choices. Well-rounded observation of just ten to twenty people can be enough to make generalized assumptions across a broad set of data. To quote Leon Zhou at Google, “deep data from a small sampling pool is representative of the whole. Abundant and accurate data from a few subjects can reflect a general trend for the entire population.” So, we’re not looking at massive overheads and tons of compute power – we’re looking at a good design process.

In both design-thinking and machine-learning, the ‘diverge-converge’ phase is central to the development and training of the model you are designing for. That both disciplines share a common origin in engineering is no surprise and it shapes my perspective that the best artificial intelligence is rooted in human-centered, outside-in and iterative design.

In Summary

Even in a world of rapid technological advancement, understanding these three areas will give your organization a tremendous value advantage:

1. Define your business imperative and rally your teams, business model and operations around it;
2. Know what your customer is trying to do, be agile and embrace the many types of innovation that you can bring to help them;
3. Design your business from the outside-in, as you would a stellar product or service. Follow structured design processes and accelerate your opportunities exponentially through machine learning.

 

Credits!

Read Larry Keely’s The Ten Types of Innovation or follow Jeremiah Owyang for more insight into corporate innovation. Thanks to SmartOrg’s David Matheson for his insight on Customer IQ. You can read his book The Smart Organization for more, it’s well worth the read. I learned from IDEO and Google about the relatively small amount of data required to drive quality insight for both design and machine learning. Finally, thanks to Leon Zhou for his partnership on this whole topic and for teaching me about machine learning.