More than a feeling: Applying design thinking process in innovation Designed & Authored by Rafi Amjadrasyid Reinard Lucky Kemenkoan Karya Inovasi : Implementasi Karya Initiator Class Content Team August 2020 Not many companies have emphasized the importance of design thinking alike Airbnb. a startup that turned off by a lot of investors at first but turned out to be a giant, valued at $31 billion by investors. One of the most valuable insight from Joe Gebbia about how design thinking directly transformed Airbnb from failing startup to billion-dollar business. Joe talks about how a lot of company spends their time mostly on improving their products rather than talking to their customers , which happened to a Airbnb. Most ideas or company are too data-driven as data seems to be the single most accurate omnipotent substance that became the driving force or leader on which a company should be led to. “ A lot of people think Airbnb is an overnight success which can be further from the truth... So there’s been like 5 launches in the history of the company but people don’t really know all of them. The other 4 were basically failures... The reason i think looking back I can connect the dots... The reason is that, we have this sillicon valley mentality that you had to solve problems in the scalable way. Cause that’s the beauty of code. Right you can write one line of code that can solve a problem for one customer, ten thousands, or even a million... So the first year of the business was us sitting behind our computer screens trying to code our own way the problems... Cause that was like our stigma that we have in mind, the dogma on how we are supposed to solve problems in sillicon valley.” - Joe Gebbia Joe Gebbia Paul Graham C O F O U N D E R O F A I R B N B C O F O U N D E R O F Y - C O M B I N A T O R “ D e s i g n h a s a lways b e e n a d r i v i n g fo rc e i n my l i fe : i t ’s t h e l e n s t h ro u g h w h i c h I ex p e r i e n c e t h e wo r l d .” “ Lo o k i n g a t t h i n g s f ro m o t h e r p e o p l e’s p o i n t o f v i ew i s p r a c t i c a l ly t h e s e c re t o f s u c c e s s .” What became the turning point for Airbnb was the day that the founders realized the answer is not from looking behind the computer screen, instead the answer lies beneath the conversation with the people that uses their product. Paul Graham told Joe Gebbia to get out from the computer screen and meet their actual users. Joe Gebbia even ends up sleeping in one of the house that hosts in Airbnb. The core message from this is to be able to gain emphathy from the problem that you are trying to solve. By having empathy and trying Joe Gebbia tries its best to put himself in the customer shoes. Joe sucessfuly see the real problem and how it stunts Airbnb growth. These insights were could be barely identify when Airbnb team were neglecting the importance of understanding what the people need. Until then, Design thinking process help shaped Airbnb to the multi billion dollar company that started from understanding what the customer trully needs. In this handbook we will guide you step by step to understand the design thinking process. When I was young, I feel there are no need for innovation as I lived comfortably knowing everything is served to me effortlessly. I feel as if my live has everything it’s in right place and innovating to create something new sounds too hard to be achieved or barely even necesarry. Then I figured that one of the most important thing that lack in me is empathy. As much as I want to help other people I’m not sure how to start. Don’t come up with “you.” Most enterpreneurs that fails, come up with the idea for theirselves. “I have this product.” “I created this solution.” “I designed and implemented my innovation.” The essence of this issue that they did not start from “them.” If you want to make something that people would use. You should start from them, not what technology or services that you thought of. The common problem that founders do is to have too much assumption rather than dealing with their actual customer’s voice, feelings, and thoughts. “I believe many people will use my product.” “I’m sure that the world will deal with this problem for a long time.” “I know that this problem exist for some people.” Having assumptions are great but you also have to remember to validate your assumptions. You have to get out and meet the people that you want to help. It’ll make you understand the essence of what problem that you are trying to solve and how your technology or services might help them. “They have a problem that I can contribute solving” 1. Empathize 90% of startups failed because they make products that no one wants. Identifying customer better by empathy mapping Having empathy means knowing and understanding other’s people experience from their own shoes. It is proven to be beneficial in many aspects, from improving people’s social lives and relationships to transforming a failing startup into a multi-billion dollar company. Now that we know the importance of empathy, how do we utilize it to achieve our goals? There is a tool called empathy mapping that can help us visualize empathy. Empathy mapping is a way of gaining insight and shared understanding by acquiring knowledge from the user to aid decision making. The tool provides a series of guidance to identify a target group’s thoughts, feelings, motivations, desires, and needs . This forces the investigating team to focus on the target group’s requirements, rather than its own. It could help companies consider how people might respond to a new product, or simply to assess a team’s reaction to a new workflow. The Steps of Empathy Mapping 1. Decide the subject and scope Empathy map concept by Dave Gray The first step on empathy mapping is specifying the type of user you will be mapping and defining the primary purpose of your mapping. “Who are you mapping?” “What is your goal?” “What do your subject needs to do or achieve?” Ask questions to help you find the direction for the rest of the mapping process. Find the key points that you want to adress. It is essential that you identify what you need and the specific goal you want to achieve. One good rule of thumb is to create an individual empathy map for 2. Collect research data Empathy mapping works best if it’s based on actual thoughts, feelings, and perceptions of the subject . In this stage, you need to collect as much information as possible based on your user’s experience. Empathy mapping is a qualitative method, so it may come from user interviews, field studies, qualitative surveys, or even diary studies. 3. Start filling the outer section of the map Before filling the map, it is crucial that everybody involved in the empathy mapping process have already read and understood the data collected from the previous step. Start by filling in “Who are we empathizing with?” section (step 1) on the top side of the map and go clockwise. If you have an answer that could fit in more than one section, you can choose one. The sections are provided to push our knowledge about users and to make sure that we don’t miss any important dimension. You can write the answers on a sticky note and stick them on the map. The key is try not to interpret or summarize, because it may cause deviation to the actual opinion of the user. 4. Complete the center section of the map After you have completed the outer section of the map, it’s time to move “inside” your customer’s heads. This is the key part of the empathy mapping exercise, because understanding the users’ thoughts and feelings is the foundation for empathizing with them. “What data points didn’t fit in the section/cluster?” “What themes were repeated in all quadrants?” “What gaps exist in our understanding?” Eric Ries F O U N D E R O F L E A N S T A R T U P “ I f yo u d o n’ t k n ow w h o yo u r c u s to m e r i s , yo u d o n’ t k n ow w h a t q u a l i t y i s .” Clasify their thoughts and feelings into pains and gains. The goal is to identify what the users worry or fear and what the users want, need, or hope for. A good way of identifying is to cluster similiar notes that belong to the same quadrant, and try to align it with the other quadrants. The goal of the activity is to gain a shared understanding of the user and all of the team members. 5. Reflect Take a step back on what you’ve done, ask other people or higher boards (managers, developers) to help evaluate and give their suggestions. 6. Draw conclusions Now, you have a clear picture of how your stakeholders or customers feel about their situation, or what they need. The next step is to draw a conclusion, that could help you to deliver a human-centered solution as the first stage of the design thinking process. What makes a good problem statement? After emphatizing and finding out your customer’s voice, feeling, struggles, and thoughts. You have actually found the specific niche that you will help. The next step in the design learning process is to define the problem correctly. Sure a niche for example say, people above the age of 20 that has diabetes. So what are you trying to improve to make those specific niche better? Are you trying to create an easier way for them to track their glucose intake, or are you trying to create a fundraising project for the niche that you determined? What are the existing solution for the problem that you have predefined? What makes you have correctly defined the problem that they are having? In this section we will tell you how to correctly and efficiently define a problem. Defining a problem cannot be too broad nor be too specific. Also, the right problem answered with the right solution, best to be scalable, so more and more people could harvest the value that you created and it all starts from defining the problem. Defining the problem can be the most challenging part of the design thinking process. You need to synthesize the findings from the empathizing stage and use it to set your team on the right direction. A good problem statement can guide you throughout the design thinking and kickstart your ideating phase. So, what makes a good problem statement? 1. Human-centered: must be based on specific users, find out what their needs and insights from the empathizing phase. A human-centered approach must focus more on the willingness and effort to help the user, not to gain monetary returns. 2. Broad enough for creative freedom: the problem statement should not focus too narrowly on a specific method or procedures to find the solution. Also, do not list the technical requirements; being too specific and technical may kill innovation and unexplored ideas. 2. Define Steve Jobs F O U N D E R O F A P P L E “ I f yo u d e f i n e t h e p ro b l e m c o r re c t ly yo u a l m o s t h ave t h e s o l u t i o n .” 3. Narrow enough to make it managable: not being too specific also means not making the problem statement too broad. For example, the statement “improve the people’s health” is too broad and can lead to ineffective solutions. Have sufficient constraints to make the project managable. 4. Forward looking: always make room for improvement. A good problem statement contains within it seeds for possibilities. 5. Verb driven action oriented: the use of verbs can spark more innovation and ideas. For example, rather than saying “the users need a wristwatch” (noun) we could use “the users need a way to know the time quickly” (verb). The Needs Statement One of the ways to define a problem is to first find out what the user need. Based on the findings from the empathizing stage, we can start to grasp on what the user feel, think, and eventualy what the user needs. The Needs Statement is a powerful tool to define what the user need It is a qualitative success metrics in the design thinking process, that are user-driven and rooted in the potential ability of your product. The needs statement is a primary tool in the design thinking process, it can align different view points before moving forward to ideating. In its core, the needs statement provides insight on what we want to achieve with our goal, not how. It can help us advance our presumptive solutions from specific features towards deep insights about the problem that the user needs to solve. Formula and Key Points The Needs Statement can also be mentioned as Point Of View (POV) Statement , because we are looking deeper to what the users need by imagining their point of view. A simple formula can be seen on the image above, which contains: User...needs a way to....[verb]....because...[surprising insight] Point of View Statement Formula by IDEO Design School For example, let’s say our user are young working professionals, who find it hard to eat healthy because of the long hours of working. They have no time for grocery shopping, and preparing a meal may spend more time and effort. How do you create a good problem statement out of this situation? Bad example: Young working professionals needs a way to eat healthily. (Too broad, only states facts) Good example : Young working professionals need a quick, convenient solution to eating healthily. (Good POV and insights) Making a good problem statement also means knowing the root cause of the problem. Feeling stuck? You can try to reframing techniques to help you get a better understanding on the problem: step back from obvious solutions, alter your focus or point of view, try to uncover the real issue, look for ways to bypass resistance or mental blocks, or think about the opposite. There are also several tools you can use to help find the root cause of a problem, such as: the 5 Whys, fishbone diagram, scatter plot diagram, and pareto chart. After we have defined our design challenge in the problem statement, we can now start to generate ideas to solve the challenge. In this stage, we can start by asking “How Might We” or in what ways might we. The goal of the practice is to spark potential ideations and brainstorms. The How Might We (HMW) questions should be based on the data and observations we found on the empathizing stage. For example, you have observed that youths tend to not come to the post office. From this observation, you can ask some HMW questions such as: “How might we make the post office more social, so youths feel engaged?” “How might we make visiting the post office more exciting?” “How might we create a popular trend for the youths so they go to the post office?” HMW questions are used to spark innovation and explore various ideas How Might We? Russel Ackoff P I O N E E R I N O P E R A T I O N S R E A S E A R C H “ We f a i l m o re o f te n b e c a u s e we s o lve t h e w ro n g p ro b l e m t h a n b e c a u s e we g e t t h e w ro n g s o l u t i o n to t h e r i g h t p ro b l e m” Pensa system’s drone checking on inventory automatically. If the problem is defined correctly and many people/ companies struggles to find a solution for it. It’s a sign for a really valuable answer is needed as Pensa system is able to raised a total of $17.2 million from investors since it was founded in 2016. Kevin Hale’s tips on finding a good problem. Problem : Popular Growing Kevin hale is a partner at Y-Combinator. He was also a cofounder of Wufoo which was funded by YC and acquired for $35million. Now, Kevin hale is an active investor and partner at YC that accelerates and mentor startups at an exceeding rate. At one of his talks in YC he explained about how to properly evaluate ideas as he also elaborates some of the key principles on finding a good problem. For the problem that you define, you might need at least one of the category in order to be a good problem. Good problems are popular. Many people are experiencing it therefore it has a huge market size or opportunity to solve. For example before Netflix takes over Blockbuster. There were a popular problem that people that want to watch movies must leave their home, travel to blockbuster,rent a CD with a fixed rate respective to how long the person has it, and finally return the CD. This is a popular problem because many people experience it and there were basically no alternatives for that problem. So the problem defined is “People need to forgo a complicated and expensive path to watch a movie.” In the other hand try to avoid problem that are too specific or only a few number of people that has it or it’s basically not popular, you might as well wasted your time creating for something that will only be used for low numer of people. A growing problem means that there are circumstances that made the problem grow at an exceding rate unlike any other problems. For example, as retail stores are always increasing in demand due to the increasing number of population. They have a growing problem to keep track of their inventory management. Pensa systems, a startup founded in Austin in 2016, realizes this problem and created a drone based inventory-tracking system integrated. The problem defined is “retail companies are struggling to have an efficient inventory-tracking system.” Realize that this definition is not only growing but also popular. Urgent Urgent problem is a problem that need to be solved very quickly. An urgency can raise the value of answering problem. For example, Vent-i answers an urgent call in scarcity of ventilators due to the COVID-19 pandemic. The problem defined is “Scarcity of ventilators due to COVID-19.” Not only the nature of the problem is urgent but also the current existing solution is expensive. VENT-I’s ventilator being distrubuted in local hospitals. A problem always comes with an opportunity. An opportunity to help, contribute, collaborate, or even innovate. Expensive A problem that is expensive to solve means that the problem is realy expensive to solve. In the other part, you can charge a lot of money for it. Often times this type of problem is really high scale and more complicated than the other. An example is i like is Tesla automobile. The problem that they are solving is sustainable fuel for a better future and the problem to eliminate strain by driving an automobile manually. This as you figured is not a cheap problem to solve. Nevertheless, if the problem defined correctly and many people agreed to it. Solving the problem might become really fruitful. $103B is Tesla recent valuation. Worth more than General Motors and Ford Motor Comapny combined. Despite Tesla is 1000 years younger than Ford Motor Company. Mandatory A problem that is mandatory means a problem that must be solved. People are in pain if this problem is not being solved. The example that i’d like to put is a painstaking process for diabetic people to monitor their blood glucose. They would need to inject a small needle to their fingers to a traditional glucose monitor device that would inturn measure it’s blood glucose based on a chemical sensor. Plus, some institutions and research actually state that this method is not 100% accurate. Dexcom realizes this problem and defined it as “diabetic people has to gone through a painstaking process to monitor their blood glucose.” Frequent A frequent problem means that it is encountered frequently. It could be many things, even some things that you might not realize a problem. Back when online transaction isn’t common. People would need to do distant transaction by sending a check or through a mail. As some people like business man or enterpreneurs frequently need to do a huge transaction but it’s basically too complicated and takes too much time. X.com and Confinity realizes this problem and defined is as “people struggles to do online transaction despite they need to do it frequently.” Answering this problem they created a e-commerce payment system and merged into paypal. Dexcom can read blood sugar without any blood. To answer the mandatory problem that diabetic patients experience. Dexcom comes up with a device that could monitor blood sugar without extracting any blood. This answer the mandatory painful experience that diabetic patients feel. Paypal as a solution for frequent online transaction. Back in the day, the merge of X.com and Confinity as paypal is a pioneer for an online payment system. The oportunity for this innovation as the well defined problem is one of the reason for the success of the company. Paypal was acquired by eBay in a deal valued at $1.5 Billion. Ideate is the part where you comes up with potential solution after defining your problem that you want to solve. It also involves with your background and experience related to your defined problem. Because some solution might required a certain expertise in require to fit with the problem. There are many topics in how to measure and evaluate the valuation of your idea respected to the defined problem. 3. Ideate Michael Seibel C E O O F Y - C O M B I N A T O R “ M y d e f i n i t i o n o f p ro d u c t - m a r ke t f i t i s yo u a re d row n i n g i n d e m a n d - yo u r p ro d u c t i s b e i n g u s e d by s o m a ny c u s to m e r s t h a t yo u c a n n o t h a n d l e a l l t h e n ew p e o p l e k n o c k i n g a t yo u r d o o r ! ” Introducing problem-solution fit. Many people have great ideas, but people that succeed are the ones who found the solution of the customer’s problem, rather than the ones who are building a solution in search of a problem. In reality, the best way to succeed is by identifying an existing problem and to solve it with a solution that customers find useful and satisfying; And this is what we call as problem-solution fit: the evidence that a product, or a service, solves a customer problem. Over the years, entrepreneurs tend to base their startups solely on their assumptions and ideas. Two well-known examples are the startups Segway and Webvan, who spent more than 100 million dollars, developing products that no one wants to buy. Achieving problem solution-fit means entrepreneur have informations and insights on what the user actually needs. Finding a problem- solution fit requires the alignment of some major key points, which consists of: Steps on finding Problem-Solution Fit Ask this question in your head, who will your customers be? Successful startups put focus on one market at a time, and early adopters are the first step in the quest for problem-solution fit. Early adopters are the early consumer of a product and they can be very impactful in kickstarting the market expansion. By winning domination in that market, we can expand to similar product market and keep adjusting at every step: product concept, product positioning, marketing strategy, and choosing the most appropriate distribution channel and pricing. 1. Valuable Customer Segment 2. Customer’s undeserved needs After identifying the target customer segment, we can start investigating their needs . One of the best ways on getting information from the customers is through customer discovery interviews. First, we can write down all of the assumptions about the customer’s view on our product. For example: “People find it hard to communicate with mobile phones in the area.” We can also list potential obstacles that may come during the execution, such as legal requirements and cultural barrier. This can help you understand your customers better. Then, we can start to validate our assumptions through talking with prospective customers. You can ask questions such as: “What do you like/dislike about the way you are doing the task?” “How important would it be to you to get a better solution?” “How would you feel about (insert solution) as a solution? By doing this, you can get meaningful information about: customer’s needs, obstacles to a good fit, ideas to improve your solution, etc. 3. A winning value proposition With the information about the customer segment and needs, we can define a winning value proposition. A value proposition tells prospects why they should do business with you rather than your competitors and defines why you are different and worth getting attention, it includes: target segment, key problem, key benefit for the customers, unique way of delivery. A simple template would be: “We help (..who?..) achieve (..what benefit?..) by doing (...the unique way that the new product is doing..) Tips : Focus on what matters to the customers. Any product feature is ideated based on the needs of the customers, and ranked based on how big the pain is and the company’s key strength. Being able to solve the main problems uniquely can give you a lead from the competitors. 4. Align the key points Once we get the main points as stated above, we can ask ourselves this : “Will customers use and buy the product?” In order to achieve product-market fit, we keep iterating until we get a consistent commitment from customers. This means that we keep tweaking the product features and its commercial elements. 69% of design-led firms perceive the innovation process to be more efficient with design thinking. (Source: Parsons New School) Innovating by making something that is 10x better. After you have defined your problem correctly, what you want to do is try to come up with something that is 10x better than the existing product. This way you create something that is easier for customer to distinguish and compare the key value that you offer than your existing competition. Putting this into priority, you add much more value that makes the problem that you have defined worth solving. In the past, people used to travel with horses. People were in dire of need for faster, better horses. This was a huge problem that has a lot of demand. Henry Ford saw this problem but instead of giving a better horse he came up with something radically different and even ridiculed at first. He came up with the first automobile. If he chooses to give the customer a slightly better horse then he would move his innovation from 1 to 2. There may be another competitor that create a better horse than him which makes the competitor moves from 2 to 3 and et cetera. This is what it called going from 1 to certain number of N. Instead, Henry Ford created a new alternative that is 10x better than the current product, made his innovation revolutionary and drowning in customer. This made Ford dominated the transportation industry. This phenomenon of going from zero to one does not happen only once in history. Another good example of this when Samsung, Sony Ericson, Nokia, LG competes for a better smartphone then gets crushed by Apple’s revolutionary touch screen technology. This gave rise to the new era of smartphone technology and another zero to one phenomenon occurs. Even though these companies are set with the same defined problem and goal which is to make a better faster smartphone. A different solution can be proposed to tackle the same problem but could result in extraordinarily different result if the ideation is correct The goal of prototyping is to figure out many possible options that you or your team can execute. This involves brainstorming with your team and coming up with simultenously removing features or value that is less needed. Because obviously you can’t fill up all the features you can think of in your first prototype. This is why in this stage is also important to set up milestones for your future generation of your prototype. What you need to keep in mind is that is okay to build something far from your grand design , in a way, that is the purpose of a prototype: make something shitty but decent enough. 4. Prototype Elon Musk C E O O F S P A C E X , T E S L A , S O L A R C I T Y “ T h e f i r s t s te p i s to e s t a b l i s h s o m e t h i n g i s p o s s i b l e t h e n p ro b a b i l i t y w i l l o c c u r.” Introducing minimum viable product. A minimum viable product is a terminology to define the bare minimum of your product that is acceptable for your targetted customer or user. You should keep in mind that your prototype will be tested on your decided early customer so make sure that you deliver your core value of the product. An easy example of this is if you want to make an automatic massaging chair for people to sit on then your first prototype as a minimum viable product to make something that people could sit on. Then you iterate on your product milestone by milestone to reach your grand design. The important part is to hear the customer feedback and to know that you are going the same direction with what your customer wants instead of making your product that only YOU wants. 2016 Solugen 2019 How much a prototype can tell about your innovation. When it comes with innovation, often times it requires some or even huge capital. You can raise money by doing a crowd fundraising but it risk your innovation being stolen by third party by launching your product pre- maturely. You can also raise money by pitching to investors, this is where a functioning prototype comes with a crucial role for your innovation, whether it would see the light of day or not one of the great example that i love is a company called Solugen. They use synthethic biology to create hydrogen perxoide. In 2019 they have a huge chemical plant and multiple trucks to ship their hydrogen peroxide but when they pitch to investor they serve with a beaker. A beakert that proves that their method and equation actually works Great you have made it to the last step of the design thinking process. Which is testing. The last step is the most frequent step that the previous steps because it requires you to have trial and error and the more you gain feedback the more helpful the data will be for your innovation. In this stage you should have done your board meeting to discuss and fix which features you’ll add to your prototype. Now its time to test it to your early customers. 5. Test The example that I would explain here is Airbnb which shows a clear progression that follows human-centered design. Everything that you have come up will be tested to the decided criteria of the people that you want to help. Take an example of the picture above, Airbnb started with a simple static landing page that only consists of new listings, places to travel, date to stop by, and how many nights. It’s important not to come up with way many features that your early adopters will find confusing and hard to navigate. So you test your early prototype and take notes based on their feedback and then iterate on those. Design thinking doesn’t end with a step. It’s a repetititve cycle. When you have tested your prototype you go right back to the first step which is to empathize which means trying your best to understand what’s wrong in your customer point of view. Then you correctly define the problem that will be followed by proposing an idea to that specific problem from your customer. Understanding and following these steps mean that your product is based on a human-centered design which is the point of design thinking. The cycle of design thinking. 46% of design leaders citing an emotional bond with customers as a defining characteristic of an advanced design practice. (Source: Adobe/Forrester) When it comes to innovation we need to remember that we not only create something for ourselves but for the better of the human race. That’s why it’s crucially important to follow human centered design as its proven to be a successful method that is widely used for billion dollar companies and even successful start ups. This handbook starts with the fall of Airbnb and starts with the uproar achievements of Airbnb, I hope you’ve learnt a lot about the design thinking process and understand how it could leverage growth of your innovation. Sam Altman C E O O F O P E N A I “A s l o n g a s yo u ke e p d o i n g t h e r i g h t t h i n g a n d h ave t h e b e s t p ro d u c t , yo u c a n b e a t t h e b i g g e r c o m p a ny.” Human-centered design. 50% of design-led companies report more loyal customers as a benefit to having advanced design practices. (Source: Adobe) Congratulations! By now you have learned about design thinking: how beneficial it is, how important it is, and how it can turn a struggling business into a billion dollar company. In reality, the process of empathizing, defining, ideating, prototyping, and testing is not a linear process that needs to be done one at a time in an orderly manner. For example, you could still be defining the problems while the design team may have made a rough prototype of the idea. Or, you could receive valuable insights in the testing phase that made you want to change the whole problem statement. It is never as simple as it seems, and using design thinking needs a lot of practice and experience to be able to maximize its benefits. If you want to practice design thinking and don’t have a clear issue or situation that you are facing, we recommend reading the Sustainable Development Goals (SDGs). SDGs are a collection of 17 global goals designed to be a “blueprint to achieve a better and more sustainable future for all”. We recommend using this because each topic has a very close relationship with humans, and how we view the world and interact with our surroundings. As a human-centered approach, design thinking may be proven to be one of the best frameworks in resolving the sustainable development goals. Good luck! Trying to innovate to solve UN’s sustainable development goals. Practicing Design Thinking.