IDEO Human-Centered Service Design PDF

9 -6 1 5 -0 2 2 REV: JANUARY 29, 2016...

9 -6 1 5 -0 2 2 REV: JANUARY 29, 2016 RYAN W. BUELL ANDREW OTAZO IDEO: Human-Centered Service Design Each team creates its own variation of the design process in order to solve a specific challenge, but the signature aspect of the process is that it begins and ends with the human experience. — IDEO Partner Diego Rodriguez Mildreth Maldonado, the CFO and chief marketing officer (CMO) of Cineplanet, Peru’s largest cinema chain, sat in her office in Lima. In a few minutes, she would walk into a conference room and join five of her Cineplanet colleagues for a presentation by a team of designers from IDEO, a global design firm. In response to a rapidly changing competitive landscape, Cineplanet’s management had hired IDEO several months before to assist with a redesign of the movie-going experience it offered its customers. During the meeting, the IDEO team would present their emerging vision for the future of Cineplanet—a vision they planned to prototype in one of Cineplanet’s most popular theaters. Maldonado had been an embedded member of the design team since the beginning of the project. During the first four weeks, they toured Peru and Chile, visiting cinemas, conducting interviews, and observing how customers interacted with Cineplanet. This “exploratory phase” of the process had been exhilarating, confirming much of what Maldonado had long suspected while also uncovering new insights about latent customer needs. The next four weeks, however, had been more difficult for her. Maldonado and the designers settled into a project space in IDEO’s San Francisco office to reflect on what they learned in the field and to generate ideas and concepts that would serve as the foundation for their recommendations for prototyping. Maldonado was an economist with an MBA (Tuck ’03), and the mechanics of this “concepting phase” had been unlike anything she had previously experienced. The concept ideation process progressed iteratively rather than linearly and seemed counterintuitive to her at times, making it difficult for her to update and manage the expectations of her Cineplanet colleagues. By the time she returned to Lima, Maldonado felt more at ease with the concepting process and was in agreement with the recommendations around which the team was converging. The IDEO team conducted weekly conference calls with the Cineplanet core team to refine the concepts. It also kept in daily contact with Maldonado to better understand the concerns of the other members of Cineplanet’s leadership. Maldonado and some of her colleagues participating in the project wondered if Cineplanet’s leadership team would support prototyping the concepts the IDEO team would Professor Ryan W. Buell and Associate Case Researcher Andrew Otazo (Case Research & Writing Group) prepared this case. It was reviewed and approved before publication by a company designate. Funding for the development of this case was provided by Harvard Business School and not by the company. HBS cases are developed solely as the basis for class discussion. Cases are not intended to serve as endorsements, sources of primary data, or illustrations of effective or ineffective management. Copyright © 2014, 2015, 2016 President and Fellows of Harvard College. To order copies or request permission to reproduce materials, call 1-800- 545-7685, write Harvard Business School Publishing, Boston, MA 02163, or go to www.hbsp.harvard.edu. This publication may not be digitized, photocopied, or otherwise reproduced, posted, or transmitted, without the permission of Harvard Business School. This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  615-022 IDEO: Human-Centered Service Design recommend. More importantly, would the leadership team appreciate the magnitude of the cultural and organizational shifts that would be required to successfully implement those ideas? The Evolution of IDEO IDEO was cofounded by David Kelley, Bill Moggridge, and Mike Nuttall in 1991, with an initial focus on product design and engineering. Like many of its competitors in the design industry at the time, it employed industrial designers, as well as mechanical, electrical, and manufacturing engineers, who worked in teams to design and improve products for its clients. What set IDEO apart, however, was its human-centered approach, which fused empathy for the end user with prototyping and iteration to design products that served unmet consumer needs. This distinctive, human-centered innovation process eventually garnered the attention of the national media. Most notably, in 1999, a team of IDEO designers featured on ABC’s Nightline was challenged by the show’s producers to redesign a shopping cart in four days. The widely seen segment captured the imagination of potential clients and helped fuel the expansion of the domains in which IDEO operated. Whitney Mortimer (HBS ’88), IDEO partner and global marketing director, recalled, “We got a call from a guy who was running the emergency room at DePaul University. He said, ‘If you can do that for a shopping cart, then you can do it for an emergency room. Let’s go.’” IDEO and its clients found that the company’s human-centered approach applied to a wide range of challenges. IDEO partner Diego Rodriguez (HBS ’01) explained, “The human-centered design process obviously works for products—that’s where it originated—but the beauty of it is that it’s applicable to almost anything you might come up with as a challenge.” After 1999, IDEO continued to expand its range of industries, most notably winning food and beverage, health-care services, and financial services projects. The firm was increasingly focused on designing organizational change in addition to designing new products and services for its clients. While each office initially operated somewhat independently, in 2004, the company realigned itself around the shared purpose of creating impact through design. Mortimer elaborated: We saw how far design could go to address new kinds of challenges facing business and society. The challenges were complex, they were human, and they were systems- based. We were starting to understand how design could have broader impact and that we needed to rethink how we talked about design. Design had been thought of as a thing that makes noise when you drop it. It was thought of as form, objects, and beauty. It still may be all of those things, but we weren’t focused on the noun anymore. We were focused on the verb, and we started talking about an approach and a mindset. The approach became known as design thinking: a human-centered approach to innovation that integrated the needs and desires of users with the possibilities of technology and the requirements of business. IDEO continued to expand into new domains, including government, education, and social innovation. By 2014, its methods had evolved to include product, service, brand, digital, space, organization, and venture design. IDEO was a privately held firm that, in 2014, was owned by several dozen partners, including founder and chairman David Kelley. It employed approximately 700 full-time staff, had relatively low staff turnover, and generated approximately $150 million in revenues in 2014. It had offices in Palo Alto, San Francisco, Chicago, New York City, Boston, London, Munich, Singapore, Shanghai, and Tokyo.1 Some of its most famous designs included the first Apple mouse, one of the first laptop computers, the Oral B Gripper fat-handled toothbrush, the Palm V personal digital assistant (PDA), 2 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  IDEO: Human-Centered Service Design 615-022 and Bank of America’s “Keep the Change” savings account service. IDEO was ranked 10th on Fast Company‘s Top 25 Most Innovative Companies list and 16th on Fortune’s list of 100 most-favored employers by MBA students, in addition to having won 181 Industrial Design Excellence Awards, 41 Red Dot awards, 28 iF Hannover awards, 18 Medical Design Excellence Awards, 22 Webby Awards, and the Smithsonian Cooper-Hewitt National Design Museum’s National Award for Product Design. Embracing Ambiguity as a Team: Cultivating the IDEO Culture As IDEO grew, it reorganized itself in response to its broad array of projects and the diversity of the talent it employed. Ilya Prokopoff, an IDEO partner, described the company’s progression: “We think much more intentionally now than we did when I started 17 and a half years ago about so many things—client relationships, the quality and consistency of our work, the talent development process, and how we plan for the future. We’re much more mindful today of where we’re going.” This intentionality was most apparent in the thoughtful way IDEO crafted and reinforced its culture. Practically every facet of the company—from the design of its organizational structure and physical spaces to the way it hired, trained, organized, and managed its employees—was aligned with supporting and reflecting IDEO’s values and building a vibrant, distinctive culture. Rodriguez explained, “We value the ability to embrace ambiguity. You have to be comfortable with starting with a blank sheet of paper—and even relish it. You will have moments of doubt where you’re not sure what to do. But because we believe so strongly in creativity and the design process—that there’s a way of solving complex problems—we help each other, support each other, and collaborate.” As Rodriguez elaborated, IDEO’s culture was a critical enabler of its process. “Knowing how the design process works is very different from actually being able to practice it. A lot of the things that make IDEO shine are largely tacit, such as our culture. For that reason, we’re not afraid to talk about how IDEO ticks because actually making it work is a whole other ballgame.” IDEO had a very flat organizational structure. The desks of partners and senior leaders were interspersed among those of junior designers, which promoted a spirit of openness and accessibility. The layout of IDEO spaces engendered interaction. Project spaces were arrayed around the perimeters of large central areas, and some featured a “front porch” that facilitated sharing between teams. Employees were encouraged to express themselves, which extended to the design and personalization of their work environments. Walking through an IDEO office, one might encounter a seven-foot-tall sea monster costume, an oversized origami sculpture, a Nordic fish lamp, or collections of past products and design prototypes. Posters of IDEO’s core values and sticky notes from brainstorming sessions covered the walls. (See Exhibit 1 for a list of its core values.) IDEO’s leaders were passionate about finding exceptionally talented people, in a variety of domains, who would stimulate and enrich the firm’s culture. In 2013, the company received more than 17,000 applications for 60 jobs. In particular, when seeking to hire a new designer, managers often looked for individuals who met a T-shaped profile. “A T-shaped person is someone who is world class in at least one thing—the vertical stroke of the T—and fluent in many other things—the horizontal stroke,” described Rodriguez. “That combination is what we rely on. The beauty of IDEO is that we can take almost any group of T-shaped designers, and so long as the right skill sets are in the room, we know that they’re going to come up with something remarkable.” “T-shaped people are our special ingredient,” said Mortimer. “Without them, you have really smart people who are rock stars of whatever field they come from, but they can’t collaborate.” A premium was placed on identifying collaborators among potential recruits. “I look for life experiences which involve achieving some meaningful goal by being part of a team,” explained 3 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  615-022 IDEO: Human-Centered Service Design Rodriguez. “And whether it was a championship soccer team or an awesome band—or even an awful band—the important thing is that you enjoyed the experience of creating with other people. Many people at IDEO will report significant life experiences in sports and/or music.” People were encouraged to seek help from all of their coworkers, including those at the very top of the organization. 2 Likewise, the firm’s leadership often sought assistance from all qualified individuals, regardless of seniority.3 “I believe that the more complex the problem, the more help you need,” said Tim Brown, IDEO’s CEO. “And that’s the kind of stuff we’re getting asked to tackle, so we need to figure out how to have a culture where help is much, much more embedded.”4 IDEO’s culture of helping was structured into its employees’ schedules. Staff sometimes had gaps between projects and spent that time assisting their peers with projects unconnected to their own work.5 This allowed teams to tackle assignments from many different perspectives, as IDEO’s employees came from a wide array of backgrounds, including psychology, linguistics, and business, among many others.6 They underwent both formal and informal review processes to ascertain their contribution to the firm’s culture of helping. Teams were thoughtfully assembled from available employees on a project-by-project basis. IDEO leadership considered multiple factors, including expertise, skill sets, personalities, growth aspirations, development needs, and the cross-pollination of perspectives. “It’s not an equation—this method of pulling together the perfect team. It’s an intensely human process,” explained Rodriguez. He continued: Each project is a chance for people to get feedback and talk about where they want to go with their careers. David Kelley has a teeter-totter diagram he draws. On one end is a heart, and on the other is a dollar sign. The balance between the two is not something we’re trying to resolve in the moment, but we do aspire to balance it over time. We may have had someone work on a project that wasn’t exactly their cup of tea. So on the next one we’ll try and create an extra special experience to balance out the heart side a bit more. We’re trying to help people have the most fulfilling design experience they can. When possible, project leaders and potential team members were engaged at a very early stage so that they could help shape the scope and design of a project. Rodriguez explained, “Being part of the team putting together a project means that you’re going to be even more interested in working on it. And then, basically, we’re giving you a chance to shape your work reality.” When IDEO and Cineplanet began exploring a possible collaboration to reimagine the movie-going experience for the emerging middle class in Peru, Scott Paterson, an IDEO project leader with a background in art and architecture, joined Prokopoff to participate in the early conversations. Together with the Cineplanet management team, they scoped out the project. Paterson and Prokopoff worked together to identify other designers who could join the project team. Greg Burkett, Emily Eisenhart, and Rosaria Mannino, IDEO designers with a complementary set of skills, were scheduled to be available, and expressed interest during conversations with Paterson about the project. All four eventually boarded a plane bound for Peru in early February 2014. Peru’s Rising Middle Class Peru was located on the western coast of South America, to the north of Chile, south of Ecuador and Colombia, and west of Brazil and Bolivia. (See Exhibit 2 for a map of Peru.) It had an official population of 29.8 million people in 2013.7 Lima, the country’s capital and largest city, was home to an estimated 8.7 million people.8 With a GDP of $203.8 billion, Peru was categorized as an upper-middle-income 4 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  IDEO: Human-Centered Service Design 615-022 country by the World Bank.9 Between 2002 and 2012, it had the fastest-growing economy in Latin America.10 (See Exhibit 3 for a chart of GDP growth in selected Latin American countries.) Between 2003 and 2013, average wages grew by 7%, while the percentage of the population that lived on less than $2 a day simultaneously decreased by 28%.11 Total consumer spending, which grew from 30.7 billion solesa in 2008 to 41.5 billion soles in 2014, became one of the country’s driving economic factors.12,13 Following the resolution of the pervasive social and political unrest of the 1990s and early 2000s, Peruvians felt much safer attending public venues. Middle-class families suddenly felt physically and financially secure enough to begin visiting concerts, sporting events, and movie theaters. Peru’s growing middle class (approximately 60% of the population in 2014) spent more money and demanded more services.14,15,16 Lizandro Vargas, a Universidad de Piura professor, stated that Peruvians “now have internet access, cable TV, and spend large sums of money on entertainment, going out to eat, films, and other ways of leisure, [a trend that] may be observed [in] every age span; those who have the money will invest in technology and spend it on entertainment.” 17 Increased disposable income allowed Peruvians to spend more money on entertainment, and going to the movies became one of their favorite pastimes.18 The number of Peruvian movie theater customers doubled between 2006 and 2012.19 In 2013, a record number of 35 million movie tickets were sold in Peru, an increase of 13% over the year before.20 Peruvian behavior was emblematic of a larger Latin American trend, where aggregate box-office revenues increased by 73% between 2008 and 2012, making it the fastest-growing movie-watching region in the world. (See Exhibit 4 for a breakdown of global box-office growth.)21 Movie theater companies raced to meet demand. In 2013, Peru counted 69 movie theaters that held 473 individual viewing rooms. 22 By 2015, those numbers were expected to grow to 87 and 600, respectively.23 By 2012, 76% of all movie theaters in the country were found in the capital.24 However, as demand increased in the provinces, cinema companies began to dedicate a higher percentage of their growth to cities and towns outside of Lima. 25 Cineplanet In 1998, three Peruvian friends completed their MBAs at the University of Pennsylvania Wharton School and decided that they wanted to return to their home country to found a startup. 26 After conducting research into several domestic markets, they noted the number of moviegoers had declined from 15 million in 1981 to 3 million in 1995 and concluded that their country’s entertainment sector was significantly underserved.27,28 In 1999, they founded Nexus Film Corp. and bought Cineplex, a movie theater chain that operated three cinemas in Lima.29 The company’s name was changed to Cineplanet in 2000.30 In 2004, Cineplanet expanded into Chile under its Movieland franchise by acquiring four cinemas from Cencosud, but also decided to rename its Chilean operations Cineplanet in 2012. It opened two additional Chilean cinemas (Costanera and Concepción) that same year. In October 2013, Cineplanet further expanded its presence in Chile by acquiring a cinema complex from Cine Hoyts, a Santiago-based cinema company. Cineplanet quickly became the largest cinema company in Peru in terms of number of theaters, tickets sold, and net income.31 In 2013, it accounted for 40% of all trips to the cinema in the country. In addition to its status as market-share leader, Cineplanet was a leader in technology and service innovation among Peruvian cinemas. In 2008, for example, it became the first cinema company in Peru a The nuevo sol was the official currency of Peru. It was also referred to as the “sol” (“soles” in the plural). As of August 2014, one sol traded for 0.35 U.S. dollars. 5 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  615-022 IDEO: Human-Centered Service Design to offer 3D movies to its customers. As a response to a perceived demand for higher-quality amenities and services, it introduced its Cineplanet Prime movie theaters into the Chilean market in July 2012 and into the Peruvian market in February 2013. Prime moviegoers in the San Borja movie theater could expect to pay 40 soles, as opposed to 20 soles for adult general admission or 25 soles for 3D general admission.32 In return, they were offered larger, ergonomically designed, reclining seats; a larger screen; food and beverage service; individual lamps and tables; and a full bar.33 (See Exhibit 5 for a picture of the Cineplanet Prime seats.) In 2014, Cineplanet became one of the first cinema companies in Peru to begin converting its analog projector systems to a digital format. However, despite Cineplanet’s position as a market leader, it still sought opportunities to improve. Cineplanet’s Redesign Goals Cineplanet’s management hoped to offer new services to the country’s growing middle class in order to allow it to further expand into what it considered an underserved market. Furthermore, it perceived the Peruvian middle class’s growing demand for services as an opportunity and impetus for innovation. “Consumers are becoming much more sophisticated,” said Fernando Soriano, Cineplanet’s CEO. “We are doing extremely well, and this is exactly the time when we should invest. Look at Blockbuster. They didn’t invest in their company when things were good and they went out of business. We don’t want the same thing to happen to us.” Company leaders wanted to pursue a differentiation strategy and keep Cineplanet ahead of its competition. “We are conscious of the fact that we don’t sell movies, popcorn, or soft drinks. We sell an experience,” said Soriano. “Are our services sufficiently attractive for consumers to choose us? That is why we chose to work with IDEO. How do we get the client to want to come to the cinema, and not just for those products? We have to change the thought process of the people who go to the cinema simply for the movies.” Management planned to increase Cineplanet’s growth rate over the coming years. As of 2013, the company operated 24 theater complexes in Peru that served 13 million customers and operated another 7 in Chile that served 2.6 million customers. By 2016, it planned to construct 18 additional complexes in Peru and 5 more in Chile to serve a total of 30 million clients in both countries. “Most of our prior decisions were based on assumptions that we made about the customer or about what would work best from an operational point of view,” said Maldonado. “Now that we are a mature business, we’re entering another phase of growth for the company where we’re focusing on what our customers say they really need. I think we’ll find a lot of new opportunities from this new point of view.” Cineplanet’s management also wanted the redesign to go beyond simply introducing new products and services. It planned to institute significant cultural changes within the company. “In terms of methodology, our culture is highly operational. We’re trying to learn how to approach and learn from our customers. We need to change how our staff members are talking to customers and how they serve them,” explained Maldonado. “This is not a onetime project. It’s just the beginning of something new inside the firm.” With that in mind, Rafael Dasso, the president of Cineplanet’s board, decided to join Maldonado and Soriano as a part of the core team, as well as Alvaro Sedano, chief programmer; Veronica Vallarino, chief of marketing; and Hernan Carranza, chief innovation officer at Intercorp’s Innovation Lab, Cineplanet’s strategic partner. 6 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  IDEO: Human-Centered Service Design 615-022 Implementing IDEO’s Human-Centered Design Process at Cineplanet When the IDEO designers landed in Lima, they joined Maldonado, who became an embedded member of the project team. Together, they launched into IDEO’s design process, which began in an exploratory manner before transitioning iteratively and organically into “concepting” and prototyping. Exploratory Phase: Inspiration and Research The first phase of any IDEO project was exploratory in nature. Through observation and synthesis, project teams researched a broad array of topics associated with their brief before identifying and focusing on the narrower set of relevant data they would ultimately use to create and test possible design solutions. This conscious broadening and narrowing effort was repeated in some form in all three phases of IDEO’s design process, as designers would fluidly alternate between divergent and convergent thinking. Through divergent thinking, designers sought to multiply options and create a broad set of choices. Then, through convergent thinking, they would funnel through the possibilities, eliminating options and making choices. As CEO and president Tim Brown explained, “The process of the design thinker looks like a rhythmic exchange between the divergent and convergent phases, with each subsequent iteration less broad and more detailed than the previous ones.” 34 Empathy and “human-centeredness” were central to IDEO’s design process. 35 The exploratory phase’s first step involved intensive research of and interaction with consumers, industry experts, b extreme users,c analogous examples,d and a variety of other sources in order to gain inspiration and insights into a product’s or service’s current and potential uses, benefits, and pain points. e Its designers constantly sought to place themselves and their clients in the end-users’ shoes.36 In practical terms, this often meant watching users interact with a product in real time and picking up on problems that would be impossible to gauge from a purely theoretic or analytical perspective. 37 Rodriguez described the importance of empathy: In essence, what you do in the human-centered design process is go out into the world to gain empathy for somebody else’s existence. All of us have a different story, so it’s really important to understand what’s happening in someone’s life and how your design solution might change it for the better. The IDEO team began the Cineplanet project a week and a half before traveling to South America. They conducted research on Peruvian and Chilean cultural practices, investigated how people in Peru and elsewhere spent their leisure time, and learned about movie-going experiences around the world in order to have a base to work from when they arrived in the country. Once in Peru, they also sought b IDEO considered individuals with in-depth knowledge of an economic sector to be industry experts. For example, team members on the Cineplanet project conducted extensive interviews with experts in food, movie distribution, and cinemas. Interviews with Cineplanet company experts were referred to as “looking in,” while interviews with outside experts were referred to as “looking out.” c Extreme users were individuals who either were particularly passionate about products or services or used them in manners that diverged significantly from their designed purposes, often employing workarounds. Their needs, desires, or behaviors were amplified relative to those of mainstream users. d When conducting analogous research, designers examined examples of how organizations in different sectors solved issues relevant to those faced by the product or service they were designing. For instance, the design team on the Cineplanet project sought inspiration from hotel checkout systems and e-commerce websites when hypothesizing different possible cinema payment methods. They also interviewed food vendors and event planners to broadly explore other facets of movie-going. e Pain points were aspects of a product or service that were considered inefficient, irritating, or unpleasant by consumers and that presented opportunities for design improvements. 7 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  615-022 IDEO: Human-Centered Service Design inspiration from the different ways people gathered and socialized by visiting parks, churches, and other public spaces. Their goal was to provoke unconventional modes of thinking that pushed the boundaries of possible future design solutions. The team spent their first week in Peru in Lima, where they met with Cineplanet executives, visited various theaters, and conducted interviews with industry experts (i.e., filmmakers and experts on piracy). Next, they took a bus trip to Huancayo, a city in the Andes, where they interviewed users, DVD merchants, and other participants in the movie space. A week later, they traveled to Santiago, Chile, to conduct more user interviews in a different market. The designers spent their final week in Lima, where they synthesized what they learned and began brainstormingf about what they would concept when they returned to San Francisco. Throughout the phase, the team sought to understand larger societal trends and acclimate to the region’s varied movie-going cultures and idiosyncrasies. “It’s really easy to assume that because you do something all the time that you then know everything there is to know about it,” said Burkett. “Peru is a different country and a totally different culture. So, if we applied what we think about movies in the U.S. to what’s happening here, then it won’t be helpful to the end goal.” Maldonado explained her own experience as an embedded client team member and cultural liaison in the first phase of the IDEO process: It worked out much better than I thought in the beginning because I had to learn the methodology, but we learned how to work together. That’s why I feel very much a part of the team, and not just a client. I was the link that helped the team understand how the Peruvian market and the Peruvian customer work. It’s not just about my knowledge of the industry, but also about being able to relate to our culture, our people, and to understand the customer. An indispensable part of conducting research involved sitting down with a product’s or service’s current or potential clients in a relaxed setting for extended interview sessions that lasted between one and a half and two hours. It was also a concrete expression of IDEO’s emphasis on human-centered design. Maldonado explained why: “It is very important to conduct interviews in a customer’s home because they feel much more comfortable. It takes them a while to talk, but it is totally different from a questionnaire or survey. I think you can get much richer insights than with more traditional research methods.” Eisenhart elaborated on the importance of context in interviews: You want, as much as possible, to conduct interviews in-context and surrounded by a user’s typical environment or the tools of their trade. For the Cineplanet research, we wanted to interview people in their home because that’s where many of them consume media—on smartphones, laptops, or in their in-home movie theaters. That way, people could point to their devices and DVDs and show us what their routine is. We also wanted to interview people in the cinema, because we were trying to understand behaviors and mindsets at the cinema itself. Chances are you would uncover something much more authentic asking someone while they’re waiting in line how they feel about the line rather than once they’re home or a few days later. This component of the process differed from traditional market research, because IDEO’s designers did not generally attempt to aggregate input from a representative sample of consumers. Instead, they sought inspiration by gathering as much feedback as possible from both “average consumers” as well f Brainstorming was a process by which designers thought expansively and without constraints about possible solutions. 8 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  IDEO: Human-Centered Service Design 615-022 as those on the extreme ends of the distribution. The team then condensed those stories into insights about the users’ desires and motivations. In preparing for an interview, IDEO team members usually began with an emergent line of inquiry they wished to explore. For instance, the project team wished to discover whether going to the cinema in Peru was a social or individual experience. From that starting point, they developed a set of exploratory objectives and an interview outline. That outline included several exercises that were designed to get customers and industry experts to communicate their latent needs. One such exercise involved asking customers during an interview to recall their past week and reconstruct an in-depth “daily diary.” Burkett explained, “It helps us understand how they spend their time and how the cinema fits into it. It’s usually very hard for people to abstractly remember exactly what they did. They don’t think about their lives in an explicit fashion. This helps us get it all out and understand what they were thinking when they made their decisions.” Another exercise involved asking industry experts to physically sketch out complex systems and processes on a piece of paper. “One morning, we talked to the number-one distributor in Lima,” said Mannino. “We had him write down the process of making a deal, what the bargaining pieces looked like, and where the power dynamics lie. We’re very visual people, so we like to have some piece of paper we can use to redirect the conversation and act as a unifying item to go back to.” Throughout the exploratory phase, the designers often sketched out impromptu drawings to communicate possible solutions to interviewees and other members of the project team. (See Exhibit 6 for an example.) The team referred to these sketches as “sacrificial concepts.”g “They allow us to see how people perceive our ideas from a very nascent state. In a sense, sacrificial concepts are really the earliest form of prototyping,” described Burkett. “People fill in what they’re imagining,” added Paterson. “We’re not beholden to [these concepts]. We sketch them out really quickly, and if someone doesn’t connect to them, we just throw them away because we’ve not really invested in them, we’re not emotionally attached.” Even discarded concepts would continue to inform the designers’ thinking, as they iterated toward workable solutions.h When users rejected concepts, designers were able to learn why particular approaches would be ineffective, sparking new avenues of exploration. Moreover, pieces of discarded concepts could be iteratively recombined to form new testable ideas. The nature of the Cineplanet projecti often forced the project team to separate during fieldwork. After team members gathered information through stories, testimonies, observations, or other sources, they regrouped and conducted what the team referred to as “downloading sessions.” While not a common term across IDEO, these downloading sessions served as a mechanism for individuals to communicate what they learned to the rest of the group and for the team to reflect on shared experiences. “Downloading is storytelling, and it’s the first step of synthesis. When we’re downloading, we get the rest of the team up to speed and synthesize what we heard and saw in the field,” said Eisenhart. “It’s about moving from observations and stories to abstract themes and insights that span across users. What themes are surfacing and what are the opportunities for design here?” g The project team’s occasional use of the term “sacrificial concept” differed completely from how it was sometimes used in marketing and advertising. In advertising, the term described offering clients a purposefully subpar solution before presenting a much more viable option. In the design process, “sacrificial” was instead used to connote the team’s willingness to share and explore nascent ideas, parting with those that were not deemed viable. h Iteration was a key element of IDEO’s design process. It referred to the process of successively creating new versions of an idea and improving it with each repetition by incorporating the learning from previous attempts. i For the Cineplanet project, the team wanted to cover more territory and interview a larger number of people during their month abroad. Furthermore, the team preferred to limit the number of designers present during interviews so as not to overwhelm interviewees. The necessity of a Spanish translator constrained the number of designers who could participate. 9 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  615-022 IDEO: Human-Centered Service Design The designers then created profiles of the customers to organize their needs and behaviors and figure out what archetypes they might fall into. (See Exhibit 7 for the customer profile form used by the IDEO team.) As the exploratory phase neared completion, the IDEO designers worked to understand the experiences they had had in the field. The synthesis of raw data and insights into discrete and digestible narratives was crucial to the next stage of the design process. Concepting Phase: Ideation In the “concepting” phase, designers used insights from the exploratory phase to generate hypotheses about solutions that would meet the latent needs of customers. The goal of concepting was to bring ideas to life visually so that people could respond to them. The designers also began considering which ideas would be made tangible, and how. The phase served as another period of divergence in IDEO’s design process, as the designers drew upon their field experiences to consider a broad range of possible solutions. To aid in the process of concepting, designers sought frameworks that distilled the behavioral patterns and themes they observed in the field. Once they created a framework, they stress-tested it by considering it from the perspectives of multiple customers. j This assisted their brainstorming and testing of a wide array of possible solutions. However, the process was highly iterative, as designers moved between frameworks and brainstorming. (See Exhibit 8 for IDEO’s brainstorming rules.) Team members discussed emerging concepts vigorously. During this process, designers would often reflect on user stories, frameworks, and behaviors to assess the alignment of potential solutions with the insights that surfaced in the previous phase. Simultaneously, the business implications of concepts and the technical considerations of their implementation were explored to ensure efficacy from multiple angles. “At IDEO, we value strong ideas that are loosely held,” said Rodriguez. Team members took ownership of their ideas, but they were also expected to be willing to abandon or refine them if they were on the wrong track, learning as they went. Along the way, many concepts would be reconceived multiple times, as the designers iteratively converged on a set of possible solutions that could be tested during the prototyping phase. For the Cineplanet engagement, after the exploratory phase in South America, the project team moved into a space in the San Francisco office for concepting. Courtney Song, an IDEO designer with a background in architecture and visualization, joined the team to help with the remaining phases of the project. The team brainstormed ideas to address problems and pain points that had surfaced in the field. One such example was how Cineplanet customers should pay in the movie theater. Several concepts were offered by the team members. One involved a cashless, alternative payment method that ranged from a conventional card to a customer wristband, which could operate in concert with a mobile app. (See Exhibit 9 for an example of concept boards for the Cineplanet project.) The team thoroughly debated and tested the merits of each concept. During weekly calls, the project team shared collections of concepts with Cineplanet’s core team and solicited feedback that could be incorporated into successive design iterations. Since the designers were thoughtful about how concepts would integrate with each other, the suites of concepts presented changed shape from week to week. However, they converged upon a common thread that surfaced early during the team’s exploration: movies were social experiences that were meant to be shared with others. This insight eventually evolved into the theme that “Cineplanet is for sharing.” j Designers would regularly consider how an insight that arose from one customer interviewee would be perceived by others they interviewed who exhibited different behaviors, or were in a different living situation or economic bracket. In other cases, designers would follow up with customers they had met in the previous phase to ask them additional questions. 10 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  IDEO: Human-Centered Service Design 615-022 The designers thought critically about how they might test each concept. “Throughout concept development, we constantly keep in mind how we’re going to prototype what we come up with,” said Paterson. “We’ll have three and a half, four weeks to then develop the concepts and how we are going to prototype them.” Saturday, May 3, the date when the team was scheduled to present the live prototype in an actual cinema with real customers, was rapidly approaching. Prototyping Phase: Getting Tangible Prototypes were manifestations of concepts that consumers could interact with directly, which enabled IDEO designers to accumulate feedback on design ideas that had resonated with users during the previous phases. In essence, they were means to test and refine ideas with greater fidelity. Tangible prototypes were physical objects that could be touched and manipulated, such as a greeting kiosk or seating array. However, prototypes could also be intangible. For example, an employee could be trained in a role or script for a new type of client interaction, such as offering customers information on products. Both kinds of prototypes were usually only refined to the point at which customers could fully grasp the concepts being tested without being distracted by their roughness. For instance, a seating arrangement prototype might be composed of plastic instead of more robust materials, because it only had to last long enough for the designers to get live feedback on users’ interests, behaviors, and interactions with it. During field testing, designers would observe whether users engaged with the prototypes, if the prototypes served their intended purposes, whether customers utilized them in unanticipated ways, and whether unforeseen problems arose. In addition to direct observation, designers might ask customers questions about their experiences or leave questionnaires, which customers could fill out of their own volition. Throughout the process, the use and orientation of prototypes would be constantly altered and manipulated by designers. For example, IDEO team members might rearrange the pylons, ropes, and signage at the entrance of an amusement park every half hour to discover which layout produced the fastest line. Designers would often “prototype on the fly,” rapidly mocking up and iterating impromptu solutions triggered by real-time observations. Larger service projects (such as the redesign of a cinema) necessitated that the team operate in stages around individual or groups of prototypes, which were arrayed in separate stations within the venue. Designers typically spent one to two hours (depending on the number and scope of the prototypes) observing and collecting feedback from customers interacting with prototypes in a station. Then they would pack it away before moving on to observe the next one. Throughout this process, designers and client employees outside of the project team who were assisting with the field test would constantly communicate in order to bring as many perspectives as possible to bear on the performance of the prototypes. For example, a designer with a background in business operations might have ideas on how to improve a prototype’s efficiency. Another designer with a degree in behavioral psychology might see patterns in how a prototype affected group dynamics. A client employee who was familiar with the normal behavior of a business’s customers might be well placed to predict and note how a prototype might integrate with the existing operation. Taken together, these different viewpoints would help the team pinpoint how to improve prototypes through successive iterations as they drove toward a solution that could be implemented. (See Exhibit 10 for a “prototype download form,” used to capture data on a prototype’s performance.) At the end of a day of field testing, the IDEO team members would organize a final meeting with the client employees. They would urge everyone in the room to share stories of what they had experienced during the day. Designers would encourage the participants to go beyond simply describing facts in order to understand the context and particularities of customer and employee 11 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  615-022 IDEO: Human-Centered Service Design experiences. They would elicit and record the details and emotions that arose during customer interactions with the prototypes. They would look for stories that recounted users’ frustrations, excitement, surprise, joy, or indifference. They would utilize these insights to weave a narrative, ascertain the effectiveness of the prototypes, and facilitate improvements and implementation. Upon the phase’s completion, the designers synthesized their observations into suggestions for how the client might improve its operation. The client organization then used IDEO’s concepts, insights, data, and results to further test and refine the prototypes, before moving into implementation. The Meeting Maldonado greeted her colleagues and the IDEO team as she walked into the conference room. The Cineplanet executives were excited to see which concepts the IDEO designers wanted to prototype. As Maldonado sat next to Paterson, she wondered whether the Cineplanet team would understand the magnitude of the change the company was about to undergo. Cineplanet could not simply implement a few prototypes and continue conducting business as usual. Instead, the concepts constituted a new system that would require deep organizational and cultural changes. If Cineplanet chose to adopt them, it would have to shift from a company that emphasized and excelled at operations into a business that focused much more on its customers’ needs and desires. That would entail changing not only its cinema layouts, but also its training, hiring, IT, services, and products. The room eventually fell silent, and Paterson began the presentation. 12 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  IDEO: Human-Centered Service Design 615-022 Exhibit 1 IDEO’s Core Values 1. Be Optimistic 2. Collaborate 3. Take Ownership 4. Embrace Ambiguity 5. Talk Less, Do More 6. Learn from Failure 7. Make Others Successful Source: Adapted from “Little Book of IDEO,” IDEO website, http://www.ideo.com/lboi/peopley. html#beoptimistic, accessed March 2014. Exhibit 2 Map of Peru Source: “Peru,” CIA World Factbook website, https://www.cia.gov/library/publications/the-world- factbook/geos/pe.html, accessed February 2014. 13 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  615-022 IDEO: Human-Centered Service Design Exhibit 3 Annual GDP Growth in Selected Latin American Countries 7 6 Brazil 5 Mexico 4 Annual GDP Growth % 3 Peru 2 Latin American and the Caribbean 1 0 2012 2013 2014 2015 2016 Source: Adapted from “Country and Region Specific Forecasts and Data,” World Bank website, http://www.world bank.org/en/publication/global-economic-prospects/data?region=LAC, accessed February 2014. Exhibit 4 International Box-Office Growth (billions USD) % Change 2012 % Change 2012 2008 2009 2010 2011 2012 vs. 2011 vs. 2008 Europe, Middle East, and Africa $9.7 $9.9 $10.4 $10.8 $10.7 -1% 10% Asia Pacific $6.8 $7.2 $8.5 $9.0 $10.4 15% 53% Latin America $1.6 $1.7 $2.1 $2.6 $2.8 6% 73% Total $18. $18.8 $21.0 $22.4 $23.9 6% 32% 1 Source: Adapted from Motion Picture Association of America 2012 Annual Report, p. 5, http://www.mpaa.org/Resources/3037b7a4-58a2-4109-8012-58fca3abdf1b.pdf, accessed March 2014. 14 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  IDEO: Human-Centered Service Design 615-022 Exhibit 5 Cineplanet Prime Seating Source: “Vive la Experencia de Cineplanet Prime,” Cineplanet website, http://www.cineplanet.cl/cines/prime/, accessed September 2014. Exhibit 6 “Sacrificial Concepts” from the Cineplanet Project Source: Casewriter photos. 15 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  615-022 IDEO: Human-Centered Service Design Exhibit 7 Customer Profile Form for the Cineplanet Project Name: The conversation made us realize that we should consider: Company: Role: Top need: Favorite concept: A few good quotes from the conversation: A month from now, what are the 3 things we should remember about this conversation? Unusual or interesting behaviors we noticed: Any initial thoughts/ sketches about a concept for this particular user? Source: IDEO and Cineplanet project team. 16 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  IDEO: Human-Centered Service Design 615-022 Exhibit 8 IDEO’s Brainstorming Rules 1. Defer judgment. 2. Encourage wild ideas. 3. Build on the ideas of others. 4. Stay focused on the topic. 5. One conversation at a time. 6. Be visual. 7. Go for quantity. Source: https://challenges.openideo.com/blog/seven-tips-on-better-brainstorming. Exhibit 9 IDEO Concept Boards for the Cineplanet Project Source: Casewriter photos. 17 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  615-022 IDEO: Human-Centered Service Design Exhibit 10 Prototype Download Form for the Cineplanet Project Download Form To be completed after each prototype 1. Overall, how did customers react to the prototype? 2. What worked well? 3. What didn’t work well? What would you do differently next time? 4. What was the most common question you received? 5. What was most surprising to you? 6. What other things does this prototype make you want to test? Other comments: Source: IDEO and Cineplanet project team. 18 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  IDEO: Human-Centered Service Design 615-022 Endnotes 1 “Contact,” IDEO website, http://www.ideo.com/contact/, accessed March 2014. 2 Teresa Amabile, Colin M. Fisher, and Julianna Pillemer, “IDEO’s Culture of Helping,” Harvard Business Review 92 (January- February 2014): 4. 3 Amabile et al., “IDEO’s Culture of Helping.” 4 Amabile et al., “IDEO’s Culture of Helping.” 5 Amabile et al., “IDEO’s Culture of Helping,” p. 7. 6 Alfonso Neri, “The Deep Dive,” ABC News Nightline, February 9, 1999. 7 “Peru,” CIA World Factbook website, https://www.cia.gov/library/publications/the-world-factbook/geos/pe.html, accessed February 2014. 8 “Peru,” CIA World Factbook website. 9 “Peru Data,” World Bank website, http://data.worldbank.org/country/peru, accessed February 2014. 10 “Peruvian Consumers in 2020: A Look into the Future,” Euromonitor, accessed February 2014. 11 Andres Schipani, “Peru Boom Spurs Growth of Middle Class,” Washington Post, January 9, 2013, http://www.washingtonpost.com/world/the_americas/peru-boom-spurs-growth-of-middle-class/2013/01/09/7d80faf8- 5a7f-11e2-beee-6e38f5215402_story.html, accessed February 2014. 12 “Peru Consumer Spending,” Trading Economics website, http://www.tradingeconomics.com/peru/consumer-spending, accessed February 2014. 13 Schipani, “Peru Boom Spurs Growth of Middle Class.” 14 Andres Schipani, “Peru’s Middle Class Prospers from Investment-Driven Growth,” Financial Times, November 28, 2013, http://www.ft.com/intl/cms/s/0/f2a68f2e-5767-11e3-b615-00144feabdc0.html#axzz2uMUoYhrx, accessed February 2014. 15 “Peruvian Consumers in 2020: A Look into the Future.” 16 Schipani, “Peru Boom Spurs Growth of Middle Class.” 17 “Business Environment: Peru,” Euromonitor, accessed February 2014. 18 Abraham Taipe Ballena, “¿Por qué el 2015 Podría ser el Año del Boom del Cine Comercial en el Perú?” El Comercio Portafolio, December 23, 2012, http://elcomercio.pe/economia/peru/que-2015-podria-ano-boom-cine-comercial-peru-noticia-1678401, accessed February 2014. 19 “Los Peruanos van más al Cine: el País Facturó más de 125 Millones de Dólares en 2012,” Portada, February 26, 2013, http://mercadotecnia.portada-online.com/2013/02/26/los-peruanos-van-mas-al-cine-el-pais-facturo-mas-de-125-millones- de-dolares-en-2012/, accessed February 2014. 20 Taipe Ballena, “¿Por qué el 2015 Podría ser el Año del Boom del Cine Comercial en el Perú?” 21 Motion Picture Association of America 2012 Annual Report, p. 5, http://www.mpaa.org/Resources/3037b7a4-58a2-4109- 8012-58fca3abdf1b.pdf, accessed March 2014. 22 Taipe Ballena, “¿Por qué el 2015 Podría ser el Año del Boom del Cine Comercial en el Perú?” 23 Taipe Ballena, “¿Por qué el 2015 Podría ser el Año del Boom del Cine Comercial en el Perú?” 24 “Los Peruanos van más al Cine: el País Facturó más de 125 Millones de Dólares en 2012.” 25 Taipe Ballena, “¿Por qué el 2015 Podría ser el Año del Boom del Cine Comercial en el Perú?” 26 “Nuestra Empresa,” Cineplanet website, https://www.Cineplanet.com.pe/nuestraempresa.php, accessed February 2014. 19 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.  615-022 IDEO: Human-Centered Service Design 27 “Nuestra Empresa.” 28 “Nuestra Empresa.” 29 “Nuestra Empresa.” 30 “Nuestra Empresa.” 31 “Nuestra Empresa.” 32 “Cineplanet San Borja,” Cineplanet website, http://www.Cineplanet.com.pe/nuestroscines.php?complejo=31, accessed February 2014. 33 “Cineplanet Anunció Apertura de las Primeras Salas Prime en el Perú,” Agenda Empresarial, February 5, 2013, http://www.rpp.com.pe/2013-02-05-Cineplanet-anuncio-apertura-de-las-primeras-salas-prime-en-el-peru- noticia_564385.html, accessed February 2014. 34 Tim Brown and Barry Katz, Change By Design: How Design Thinking Transforms Organizations and Inspires Innovation (New York: Harper Business, 2009). 35 Tom Kelley and David Kelley, “Why Designers Need Empathy,” Slate, November 8, 2013, http://www.slate.com/blogs/the_eye/2013/11/08/empathize_with_your_end_user_creative_confidence_by_tom_and_davi d_kelley.html, accessed March 2014. 36 Kelley and Kelley, “Why Designers Need Empathy.” 37 Kelley and Kelley, “Why Designers Need Empathy.” 20 This document is authorized for use only in BIMTECH INDIA's PGDM-RM-DT at Birla Institute of Management Technology (BIMTECH) from Jul 2024 to Jan 2025.