Strategies to harness business complexity in experience and service design
One must understand how business and industry operates (including their internal dynamics) and develop strategy how to approach design of experiences. Different businesses and industries do require different approaches.
One must understand how business and industry operates (including their internal dynamics) and develop strategy how to approach design of experiences. Different businesses and industries do require different approaches.
To everyone involved in service design, it is absolutely clear from the start that dealing with business system does require a special attention. In order to design a service and successfully implement it, one will confront different business environments that need specific approach.
To work seamlessly with business organisations, internal experience design teams are structuring design systems, external service design agencies are building business/industry knowledge and transformation (change management) skill sets. They create specific approaches that they find working in particular business environment.
But the question is: is there any comparison or smilarities among businesses that could help us structure proper strategic approach to effectively manage design of services?
Bain&Co global strategy consulting firm published a paper on managing capital investment effectiveness. That paper (although covering different topic) puts a light to our topic as it exposes how different industries have different dynamics. Here is the main chart of that report:
Here is the explanation of the analysis from the report itself (with all financial jargon included in full):
“… Bain compared concentration of investment against (capital) investment intensity in 17 industries ….. (see Figure 1). While some industries, like semiconductor manufacturing and airlines, are almost as capital intensive in terms of the amount of investment, the decisions are fewer and far more monolithic. For example, compare the capital decisions for an executive at an airline and an executive at a telecommunications provider, who are both spending $6 billion of capex (capital expenditure) over three years. The airline is replacing 60 old aircraft with 60 new aircraft from a mix of four configurations. The telecom executive needs to make many more decisions, on everything from expanding the wireline fiber-to-the-home footprint by a million new premises, to buying spectrum, upgrading 4,000 cell towers to 5G wireless, or replacing 500,000 set-top boxes….”
What I will argue that parallels can be drawn for experience design. Service design is faced with different challenges in MONOLITHIC vs FRAGMENTED environments.
In MONOLITHIC environments designers are able to “go deep” and develop understanding of the business. Company focus is streamlined around only few projects, what gives ability to designers to actively participate in design of experience. One can observe that for those industries, service design agencies have managed to acquire sufficient business knowledge and are able to provide significant business value with their designs (full service, experience and business design). There are many great case studies of service design agency bringing full business value in automotive, airline, technology etc.
On the other hand, in FRAGMENTED environments, designers are faced with two challenges: (a) many concurrent projects and constantly changing environment that impact customer experience, and (b) many decision makers within those projects that require alignment. In this kind of environment designers cannot grasp the whole complex business ecosystem and have trouble “going deep” into the business. And even if they could, they are faced with continuous change as many concurent projects are constantly altering the environment. Increase of investments gives even more challenges as they increase the volume of changes (more change projects). Not to forget the navigation through internal politics and struggle for inflence that this environment usually creates. To put it simply: whatever you learn, design and implement today, there is a great chance it will be changed in very near future. And to manage all that single handedly is a challenge for itself. In these industries, design agencies are struggling with penetreation into the business. Their work remains on the level of isolated specific projects as current design tools (and skills) are not able to cope with this fast changing business complexity for any business design of such scale. To prove this I can say that there is relatively unknown cases where service design agency was engaged as a driver in transformation of the incumbent business of telecom, retail bank or insurance (only specific projects, or set up of sub-brands with limited service scope). This work is still in scope of consulting firms as service design agencies are not equipped with sufficient knowledge to harness those challenges.
When you add INVESTMENT INTESITY on top of that (percentage of annual revenues that is invested in the business), things get more complicated. Without going into to much details, just imagine how much change is going on in one telecom where 15-20% of annual revenue is invested in technology, systems and infrastructure. To be able to implement those investments, extremely large number of projects and activities is running fully in parallel that require specific approach to manage it while maintaining consistency in provided service and customer experience.
Also worth mentioning is that, from the graph itself, one can see that industries that are generally struggling with customer experience (or that are currently most investing in CX) are those from FRAGMENTED environments.
So what all this means for service and experience design you might ask. Well, it’s the strategy how to deal with differnt type of businesses: how to design and manage service experience.
To work (design service and manage customer experience) effectively in MONOLITHIC environments, you can rely on building business capabilities of designers. Designers will be able to work closelly with business to deliver their designs and implement designed service with line management. And this is the area where service design teams (internal and external) are building their capabilities either by introducing change consultants to assist designers and business in implementation.
But for FRAGMENTED environments, an effort of extending individual capabilities will not be sufficient — here you need to develop a system to handle whole fast changing complexity. A design system to manage a business system. A design system that will allow you to coordinate all running projects and activities because (i) you are NOT able to be physically present in all projects or activities, (ii) you are NOT able to influence all those decisions that are taken by a large number of project and activity participants, (iii) you have to get everybody to work in coordinated way and finally (iv) to effectivelly manage design. Pattern language design system may be one type of solution.
This is area where service design agencies and internal service design teams need to put effort to manage business complexity. Structured approach to business, delivery of design would be ensured. Hopefully more ideas would be generated in near future.
More info on humanact team is available on http://www.humanact.design
