Designing Digital Retail (Part 7): The Value of Design Approaches in Digital Retail
This is the seventh in a series of articles that explore how traditional retailers can move through the challenges of digital transformation. You can see all the articles in this series here.
The next post concludes the series by offering 8 Recommendations for successful Digital Transformation in Retail.
Why are we talking about Design?
Design has taken an increasingly important role in the economy, especially in the technology industry. According to the British Design Council (Benton et al, 2018) between 2009 and 2016 the Design economy grew by 52%, far outgrowing the underlying growth of the economy. Design has taken a leading role in creating the end-to-end customer experience (Breschi et al. 2017). Among the most digitally mature retailers, design is represented at the highest levels of the organisation. For instance, in 2018, Valerie Casey was appointed as Chief Design Officer at Walmart (Wilson, 2018).
In their book ‘Advances in Product Family and Product Platform Design’, Simpson et al. (2014) argue that successful product family design and platform design is the result of the enterprise positioning customers at the centre of value creation. Organisations must be human-centred in their activities and outcomes. All technology in retail exists fundamentally to drive customer outcomes.
All technology in retail exists fundamentally to drive customer outcomes.
What is Design Thinking?
It has been comprehensively demonstrated that well-managed design activities and approaches add competitive advantage to companies (see for example Rae, 2013; British Design Council, 2012; Forrester, 2018; Shepperd et al., 2018). An effective design-led approach results in the creation of desirable products and service experiences, enables emotional connections to be built with customers and adds value through ensuring better functionality (efficiency, reliability, ease of use, comfort) and more meaningful experiences for customers. This explains why human–centred design approaches (Norman, 1992) such as User Experience Design and Service Design have grown in tandem with the growth of personal computing and the service economy.
Writers such as Brown (2009) and Martin (2009) have argued that design is much more than a series of disciplines to make products and services desirable and usable. They suggest it also offers powerful problem-solving approaches to corporate problems and innovation opportunities, which differ from traditional business thinking and approaches. Writers have argued that Design-based approaches can bring added value to the challenges of business strategy (Martin, 2009; Calabretta et al, 2016) and can be used to develop new business models (Osterwalder et al, 2010) and operating models (Campbell et al., 2017) as well as enhance idea creation (Shah et al., 2003) and facilitate cocreation between stakeholders (Sanders and Stappers, 2008).
At the root of this approach is the concept of ‘Design Thinking’. The contemporary notion of Design Thinking was developed and cultivated in the business world by various groups, especially the design consultancy Ideo and Stanford Business School (Di Russo, 2016). These groups were influenced by earlier design theorists who argued that designers approach problems differently from other forms of problem solving, especially from the scientific approaches of modern management. For instance, March (1984) argued that designers use abductive reasoning rather than inductive or deductive reasoning. Nigel Cross’s essay ‘Designerly Ways of Knowing’ (Cross, 1982) argued that the methods of design are ‘modelling, pattern formation and synthesis’ and the values of design are practicality, ingenuity, empathy and a concern for appropriateness. Schon’s ‘The Reflective Practitioner’ (1983) argued that a designer should always begin with the activity of reframing the problem. Often by restructuring or reinterpreting a given problem, a solution presents itself much more immediately. Rittel & Webber (1973) argued that design is particularly effective at addressing ‘wicked’ problems, which are problems that are complex, unique, ambiguous and have no definite solution (Rittel & Webber, 1973, p161). Designers are taught to be constantly aware of the interplay between the conceptual, functional and visual elements of a product, service or system. Holm (2011) argues this makes design effective at playing an integrative role in the business.
Designers are taught to be constantly aware of the interplay between the conceptual, functional and visual elements of a product, service or system. Holm (2011) argues this makes design effective at playing an integrative role in the business.
Design in Retail
It is clear from the above overview that many of the qualities and benefits of Design Thinking make it valuable in addressing the challenges faced by traditional retailers as they move through digital transformation. It is clear that design approaches are valuable for enabling the organisation to deliver compelling, valuable customer experiences. It is clear that design can bring value to the complexity of building and managing product ecosystems that deliver consistent customer value. It is also reasonable to assume that design approaches can contribute to the wicked problems faced by those at the meeting point between business and technology, such as Enterprise Architecture, as they struggle to design appropriate information systems for the organisation.
Lindberg et al (2011) explores the usefulness of Design Thinking methods for software development. The authors contrast software design, which focusses on technical problem solving and a deductive rationalist approach, with Design Thinking. Design Thinking focusses on the human and social dynamics of everyday life significance of software, and approaches problems as wicked, without seeking to reduce the problem space. The authors show user-centred design approaches can help focus the strategy on the user, so that the real business value of the software is focused on from the start. They also explore how an iterative approach to problem solving enables the basic idea to be tried and tested at low cost. They suggest that Design Thinking can help IT strategy through reframing problems before solutions are attempted.
There has been some discussion within the Enterprise Architecture community about how Design Thinking approaches can add value. These discussions focus on how Design Thinking approaches can enhance how architects solve complex problems, and improve the way in which Enterprise Architects and the business communicate. For instance, Malik (2018) suggests that Design Thinking can be useful in informing business capability models, particularly through enabling stakeholder communication in workshops and providing a common language to enable the business and technology to communicate. The Open Group (2018) suggest that Design Thinking can enable the architects to better understand the needs of the customer and therefore suggest more appropriate customer-focused solutions.
A small number of academic studies have explored how design can contribute to the problem of designing product ecosystems and technology infrastructure in complex organisations such as retailers. Fortier (2012) studied organisations carrying out User Experience Design of complex product ecosystems, including Ideo and Adaptive Path. The authors found common factors including developing a holistic ‘systems-based’ perspective, building emotional connections with users, enabling interdisciplinary collaborations, harmonizing touchpoints (similar to channel integration), and empowerment of users to enable them to achieve goals. The authors conclude that if all these factors are in place, this will increase the likelihood that the product ecosystem users have rich, satisfying experiences.
A number of approaches and methodologies have been developed within the design community that can be used by businesses to design product and service ecosystems and address the kinds of ‘wicked’ problems faced by retailers. Each method starts with activities to understand the needs of end-customers. The methods also seek to operate across multiple perspectives and dimensions. Outputs include system design (such as service blueprints), as well as the design of customer journeys and experiences. Participants are taken through the ‘design double-diamond’ (see fig 3 below) in which there is a discovery period, before the problems are defined, followed by a period of solution exploration, involving iteration of ideas and methods to test and validate concepts.
The Design Double Diamond (Design Council. 2005)
One example is ‘The Product Service System Toolkit’ (Devitt, et al, 2017). This is a series of tools that can be used to develop a product-service system. The Toolkit contains a series of canvases which represent both customer perspectives and system perspectives. The ‘Product Service system map’ gives a high-level system overview of the product ecosystem. ‘Customer journey maps’ show the journeys of a customer through the system. A touchpoint matrix shows how the customer experiences the system through the various different touchpoints. Finally, the toolkit user is encouraged to develop a series of low quick prototypes to test the customer experience with potential users.
A second Design Thinking method that has been used by forward-thinking new retail platform organisations including Farfetch is the ‘Platform Design Toolkit’ (Cicero et al, 2017). This approach is designed to be used for designing platforms through which multiple producers, customers and contributors connect, collaborate and exchange value. The key features of this toolkit are in its capacity to define the larger ecosystem of the platform, and the way that value is created and exchanged for each platform user.
A third design-based methodology for approaching complex business problems such as digital operations is ‘Enterprise Design’ (Guenther, 2013). This method aims to bridge the gap between the business, technology and people. It can be used as a complement to Enterprise Architecture. The method allows the user to develop a rich multi-dimensional picture of an enterprise, describing its anatomy (actors, touchpoints, services, products etc.) seen through four ‘frames’, or viewpoints; which are ‘business’, ‘people’, ‘function’ and ‘structure’. While the concept behind this method is promising, it has not become a well-known or mainstream approach. Perhaps the reason for this is that it will become an overwhelmingly complex task for one person or team to map all this detail min large organisations. Methods such as these must be reasonable, understandable and usable or they will not be adopted.
While these methods provide useful toolkits to help organisations who are creating product-service systems and digital strategy from scratch, they are of limited use to organisations who are already managing multiple product teams and managing the integrations of new products with legacy systems. There is therefore a need for a methodology for enabling organisations who are in the ‘flow’ of product development to enable the orchestration of digital teams to happen more effectively.
The Digital Mission Canvases fill this gap. This is a method informed by Design Thinking that enables large enterprises engaged in Lean, Agile and DevOps software practices to create alignment around larger organisational goals. You can read more about the canvases here.
References
Benton, S, Miller, S & Reid, S (2018) The Design Economy 2018: The state of design in the UK. The Design Council
Breschi, R., Freundt, T., Orebäck, M., & Vollhardt, K. (2017). The expanding role of design in creating an end-to-end customer experience. New York: McKinsey & Company.
British Design Council (2012). Design delivers for business: A summary of evidence from the Design Council’s Design Leadership Programme. September 2012
Brown, T. (2009). Change by Design. How Design Thinking Transforms Organizations and Inspires Innovation. Harper Business
Calabretta G, Gemser, G & Karpen, I (2016). Strategic Design: Eight essential practices every strategic designer must master. BIS.
Campbell, A., Gutierrez, M., & Lancelott, M. (2017). Operating model canvas. Van Haren Publishing.
Cross, Nigel (1982). Designerly ways of knowing. Design Studies, 3(4) pp. 221–227
Di Russo, S. (2016). Understanding the behaviour of design thinking in complex environments. Unpublished PhD thesis. Melbourne: Swinburne University.
Forrester (2018). The total economic impact of IBM’s design thinking practice. Forrester Research Inc.
Fortier, S. (2012). A systems approach to rich user experience design (Doctoral dissertation, Carleton University).
Guenther, M. (2013). Intersection. Morgan Kauffman.
Holm, S. L. (2011). Design management as integrative strategy. In Cooper, R., Junginger, S., & Lockwood, T. (Eds.). (2013). The handbook of design management. A&C Black.
Lindberg, T., Meinel, C., & Wagner, R. (2011). Design thinking: A fruitful concept for I.T.
development?. In Design thinking (pp. 3–18). Springer, Berlin, Heidelberg.
March, L.J. (1984) “The Logic of Design” in The Architecture of Form, Cambridge University Press, UK.
Martin, R. (2009). The Design of Business. Why Design Thinking is the Next Competitive Advantage. Harvard Business Review Press
Norman, D. A. (1992). Design principles for cognitive artifacts. Research in Engineering Design, 4(1), 43–50.
Osterwalder, Alexander; Pigneur, Yves; Clark, Tim (2010). Business Model Generation: A Handbook For Visionaries, Game Changers, and Challengers. Strategyzer series. Hoboken, NJ: John Wiley & Sons.
Rae, J. (2013). What is the real value of design? Design Management Review, 24(4), 30–37
Rittel, Horst W. J.; Webber, Melvin M. (1973). “Dilemmas in a General Theory of Planning” (PDF). Policy Sciences. 4 (2): 155–169.
Sanders, E. B. N., & Stappers, P. J. (2008). Co-creation and the new landscapes of design. Co-design, 4(1), 5–18.
Shah, J. J., Smith, S. M., Vargas-Hernandez, N., Gerkens, D. R., & Wulan, M. (2003, September). Empirical studies of design ideation: Alignment of design experiments with lab experiments. In Proc ASME Conf on Design Theory and Methodology (pp. 1–10).
Schön, D. A. The Reflective Practitioner: How Professionals Think in Action. New York: Basic, 1983.
Sheppard, B., Sarrazin, H., Kouyoumijian, G. & Dore, F. (2019). The business value of design. McKinsey & Co.
Simpson, T. W., Jiao, J., Siddique, Z., & Hölttä-Otto, K. (2014). Advances in product family and product platform design. New YorN: Springer.
Wilson, M (2018) Exclusive: Valerie Casey to lead Walmart’s aggressive design push. Fast Company, June 2018. Retrieved from https://www.fastcompany.com/90176863/exclusive-valerie-casey-to-lead-walmartsaggressive-design-push
