Design Thinking Chapter 1

The Role of and Need for the "New" - Innovation

• Creativity is the phenomenon of forming something new or valuable, characterized by the ability to think outside the box and generate solutions.
• The 4P Model of Creativity consists of:
  • Person: the entrepreneur who uses skills, creative abilities, and motivation to create a product.
  • Process: the procedure involved in creating and developing the product, including creativity techniques, thinking, and actions.
  • Product: the outcome of the creative process.
  • Press: the environment in which we live and operate.

Myths of Creativity

• 9 common myths about creativity, including:
  • Creativity can't be taught.
  • Women are more creative than men.
  • You need a flash of inspiration.

Creativity vs. Innovation

• Creativity involves identifying and solving a problem by generating new ideas.
• Innovation involves taking the most suitable idea and implementing it.

The Creative Person and the Environment

• The key role player in the creative process is the individual, and their level and style of creativity have an impact on newness and innovation.
• The interaction between individuals and their environment influences the application of creative ability.
• Creativity declines when we enter a formal institutional environment, such as a school or workplace.

The Dynamics of Creativity

• Personality is a pattern of relatively permanent traits and unique characteristics that give both consistency and individuality to a person's behavior.
• The dynamics of creativity help explain what affects an individual's level of creativity.
• Intrinsic motivation is conducive to creativity, while extrinsic motivation is detrimental.

Barriers to Creativity

• Perceptual barriers: making quick decisions without identifying the problem, premature assumptions, and neglecting relationships between variables.
• Emotional barriers: fear of failure, over-motivation, and inability to change one's mindset.
• Cultural barriers: conformation, stereotyping, and lack of inquisitiveness.
• Environmental barriers: physical, economic, and intellectual barriers.
• Intellectual barriers: unwillingness to use new solution approaches.

The Creative Process

• The creative process consists of six stages:
  • Interest: identifying a problem or opportunity.
  • Preparation: thinking about the problem in a lateral way.
  • Incubation: generating alternatives and possibilities.
  • Illumination: having an "aha" moment or insight.
  • Verification: addressing issues related to the idea.
  • Exploitation: implementing the idea.

Creativity Techniques

• Divergent thinking: thinking in different directions or looking for multiple options.
• Critical/convergent thinking: analysis, logic, and critical assessment.
• Techniques for stimulating creativity, including:
  • Association technique.
  • Wishful thinking technique.
  • Metaphor or analogy technique.
  • Trigger technique.
  • Questioning technique.
  • Force field analysis technique.### Design Thinking
• Design thinking is a non-linear, iterative process that seeks to understand users, challenge assumptions, redefine problems, and create innovative solutions to prototype and test.
• A design thinker should have five characteristics:
  • Empathy
  • Integrative thinking
  • Optimism
  • Experimentalism
  • Ability to collaborate with other design thinkers

4P Model of Creativity

• The 4P Model of Creativity is linked to design thinking and consists of:
  • Person: a good design thinker should be curious, judicious, courageous, tolerant of ambiguity, honest, and persuasive.
  • Process: the USERS acronym can be applied (understand, shape, explore, refine, and share).
  • Press: the environment and outside elements constrain and affect designers, either helping or hindering creative thought processes.
  • Product: identifying new and useful outcomes and qualities of creative products.

Three Key Pillars of Design Thinking

• The three key pillars of design thinking are:
  • Attitude of the creator/designer and the need of the end user/recipient.
  • Approaching the identified problem from different points of view, involving a team of diverse people with different competencies, experiences, and views.
  • Testing or checking whether the solution will work in the real world by asking, probing, or conducting surveys with people.

Six Characteristics of Design Thinking

• The six characteristics of design thinking are:
  • Problem framing and problem solving.
  • Stakeholder-centredness.
  • Pursuit of diversity.
  • Experimentation.
  • Visualisation.
  • Abductive reasoning.

Four Questions

• The four questions in design thinking are:
  • What is?
  • What if?
  • What wows?
  • What works?

Ten Design Tools

• The ten design tools are:
  • Visualisation.
  • Journey mapping.
  • Value chain analysis.
  • Mind mapping.
  • Brainstorming.
  • Concept development.
  • Assumption testing.
  • Rapid prototyping.
  • Customer co-creation.
  • Learning launch.

The Design Thinking Process

• The design thinking process consists of:
  • Empathise: gaining understanding and gathering information about the wants and needs of the end user.
  • Define: refining the insight gained in stage one into a problem statement from the perspective of the stakeholders involved.
  • Ideate: coming up with as many new ideas as possible to solve the current problem.
  • Prototype: transforming the solution ideas into tangible prototypes to enable interaction with users and to learn from them.
  • Test: testing the prototype with a sample population to gain valuable feedback on the efficacy of the proposed ideas or solution.

The Opportunity Design Framework

• The opportunity design framework is a continuous process that establishes an opportunity when there is an overlap in the interplay between desirability, viability, and feasibility.

Applying Techniques to the Design Thinking Process

• Techniques can be applied to the design thinking process, including:
  • Empathise: surveys, participant observation, interviews.
  • Define: benchmarking, customer profile map, morphological analysis.
  • Ideate: divergence, convergence, brainstorming, mind mapping, random word generation.
  • Prototype: storyboard, role play, static modelling, small-scale implementations, dynamic simulation.
  • Test: survey, experiment, refining the point of view, triangulation techniques.

Link to Project Management

• Design thinking can be linked to project management because it shares related concepts such as:
  • Framing and reframing.
  • Focusing on the wants and needs of users.
  • Using visual aids.

Five Areas that Can Adapt Design Thinking to Strategy Development

• The five areas that can adapt design thinking to strategy development are:
  • Seeing an opportunity differently by focusing on the stakeholders or making a strategy human-centred.
  • Learning in action through experimentation and by prototyping new models.
  • Managing a portfolio by creating an ongoing platform for exploration and paying attention to new strategies and offerings.
  • Making change happen at scale through alignment, story-telling, and engagement.
  • Moving from tweaks to transformation by developing a design-enabled business model.

The Creative Outcome

• The creative outcome is evaluated using criteria such as:
  • Cost.
  • Time.
  • Feasibility.
  • Acceptability.
  • Usefulness.
  • Other.

Pugh Method

• The Pugh method is used to evaluate ideas and focuses on the opportunity in the market environment.

Industry Analysis

• Industry analysis involves understanding the industry structure, size, cost drivers, competitive role players, legislation, rules and regulations, government's role or influence, life cycle of core products in the industry, key success factors, barriers to entry for newcomers, impact and nature of technology in this industry, demand and supply, and profitability.

Micro, Market, and Macro Environment

• The micro environment refers to the nearby environment under which the business operates and involves the business's systems, procedures, culture, management, employees, etc.
• The market environment refers to internal and external factors and forces that affect the business.
• The macro environment includes the external and uncontrollable factors that influence the business and affect its performance and strategies.

STEP 1-4 of the Pugh Method

• STEP 1: Learn and understand your branch of industry.

• STEP 2: Develop evaluation criteria and a datum.

• STEP 3: Discuss and evaluate against the datum.

• STEP 4: Improvement process.### ENTREPRENEURIAL PROCESS

• Four critical anchors for distinguishing between an idea and an opportunity:

• Adding remarkable value to the customer

• Solving a considerable problem with customers willing to pay a premium for the solution

• Having vigorous market, margin, and money-making characteristics

• A perfect fit between the founder and the management team, as well as an appealing risk-reward equilibrium

CRITERIA FOR EVALUATING VENTURE OPPORTUNITIES

• Industry and market:
• Market structure, size, growth rate, capacity, and cost structure
• Customer, user, benefits, value addition, and degree of fit
• Management team:
• Entrepreneurial team, industry and technical experience, integrity, and intellectual honesty
• Return on investment, time to breakeven, capital requirements, profitability, and sales growth
• Economic:
• Growth rate, market size, market capacity, and cost structure
• Return on investment, time to breakeven, capital requirements, and profitability

HARVEST ISSUES

• Value-added potential
• Existing mechanisms and strategy
• Capital market structure
• Barriers to entry, control over cost, prices, and distribution

FACTORS FOR FINDING OPPORTUNITIES

• Active search
• Alertness
• Prior knowledge
• Social networks

PROTECTING CREATIVITY

• Intellectual property rights
• Design (aesthetic and functional) - 15 and 10 years of protection
• Copyright - 50 years of protection
• Patents - 20 years of protection
• Trademark - forever, with 10-year renewal

INNOVATION

• Linking invention to market
• Forms of innovation: products, services, processes, new industries, new organisations
• Degree of newness:
• New product lines
• Improvement of existing products
• Cost reductions
• Line extensions
• Product repositioning
• Completely new products

MODELS, PROCESSES, AND PATTERNS

• Component knowledge
• System knowledge
• Types of innovation:
• Incremental innovation
• Radical innovation
• Architectural innovation
• Modular innovation
• Ten types of innovation:
• Business model
• Networking
• Enabling process
• Core process
• Product performance
• Product system
• Service
• Channel
• Brand
• Customer experience
• Processes of innovation
• Models of innovation
• Rothwell’s five generations of innovation models:
• Linear model
• Coupling model
• Parallel lines model
• Systems integration and extensive networking model

BUSINESS MODEL TO BUSINESS PLAN

• The Business Model Canvas (BMC)
• Value-to-customer section:
• Value proposition
• Customer segments
• Channels
• Customer relationships
• Revenue streams
• Business efficiency section:
• Key partners
• Key activities
• Key resources
• Cost structure