We begin by understanding the people we want to create value for. We develop empathy for them. We draw from the designer's toolkit to create and implement new ideas they value.
Human behavior is the fundamental unit of analysis in business.
Value is the human interpretation of a product or service to satisfy needs in particular situations. Value is at its core a subjective determination, and is inseparable from the underlying needs through which it has been determined. Entrepreneur Steve Jobs once said, "You‘ve got to start with the customer experience and work back toward the technology - not the other way around." Following his advice, we begin our problem solving process by understanding the people we want to create value for. We use this understanding to connect their values with better products and services.
To understand what it is that people value, we must understand the way they see their world — themselves, their needs, their relationships, their fears and their hopes. We must explore what we call the "Microdepth Perspective."™ To do this, we visit with them them in their everyday environments, often in their homes or places of work. This approach cuts through evasive and pat explanations and helps uncover hidden meaning and motivations, some of which people may not be fully aware. We employ a number of proven rapport-building and information-eliciting tactics throughout our visits. We listen, watch, experience, and develop rapport. We build empathy. We note context. We uncover desires, needs and aspirations. We reach the depth necessary to reveal their "internal narrative," enabling us to understand what it is that they truly value.
Understanding the internal narrative is often not enough. Building on our Microdepth Perspective, we conduct analyses from social media and other big data sources to understand what we call the "Macrodepth Perspective."™ While not as rich from an explanatory standpoint, this type of understanding is useful for a number of reasons. First, it provides a look at a person’s external narrative — what she/he wishes to share with the world about life. This can provide an interesting point of contrast to the internal narrative uncovered in in-person visits, and can act as a corroboration of in-person visit discussions about what people tell others about their values and behavior. Second, it can track how well different ideas resonate with people. Perhaps most importantly, this data can be accessed regularly to highlight the latest trends of interest to people on an ongoing basis. Sources for this type of data include dedicated Facebook pages, Twitter, and online blogs.
Putting these two perspectives together, we are able to build a rich insight framework for understanding customers and creating products and services that they value.
Innovation requires a proven process.
Innovation is the creation of value through the implementation of a new idea. This is a two-part process. It consists firstly of identifying where value should be created and secondly of determining how that value could be created. We describe the first part as problem framing, and the second part as problem solving. The first part follows from the second. Innovation cannot happen without both. It's that simple!
Innovation need not be a nebulous business function. It can be well understood and managed effectively. We think of innovation as a process that includes Six Dimensions: Asking, Learning, Thinking, Creating, Measuring and Iterating.
Each of these six dimensions plays a crucial role in the innovation process. The tabs below describe each in further detail.
Before we can generate any answers, we must be sure we are asking the right questions. The innovation process begins with problem framing, which is a crucial but commonly neglected part of the process. Teams too often assume that they are asking the right questions. We begin problem framing in the world of concrete experience. We explore this world by asking "what" questions. Next, we move into the world of abstract experience by asking "why" questions. Asking why helps us establish causal connections between meaning, values and behavior. At this point we are finally able to state the problem. We begin problem solving by asking "how," seeking many possible answers to the problem. Finally, recognizing concrete constraints, we ask "which," and make rational choices to identify the best answer.
Because innovation requires the creation of the yet to be, the outcome of any innovation process cannot be known a priori. Learning is our path into the unknown. Learning begins with observation, which consists of both extensive fieldwork and intensive interviewing. Here we employ ethnographic and rapport-building interviewing techniques to learn the rules of meaning that define the values of another person. With the use of frameworks, we analyze learnings and through visualization we synthesize learnings. Finally, we conduct small experiments to hedge the uncertainty that accompanies any potential innovation.
When we begin the innovation process, we must leave behind our existing perceptions, and the constraints we attach to them. We begin by diverging into another person's world. What is perceived in this outside world must then be incorporated into our internal world. We assimilate our learnings, and gain an empathy for the context of the problem. Empathy allows us to frame the problem, which in turn allows us to establish creative imperatives. We begin creating by converging our learnings into well-established answers to the problem. Lastly, recognizing that resources are limited, we converge our answer into a solution that accommodates the financial and technological constraints of reality.
In problem framing, we draw an abstraction from concrete experience. We create insight. In problem solving, we create concrete solutions based on our insight; we bring the abstraction down and back to its specific meaning, to the concrete; but the insight is what has helped us to frame the problem and define the type of solution we want to create. It has helped us to innovate — to reshape the world as we wish it to be based on our purpose and mission.
Our assertion that there can be a process for innovation does not imply that its outcome is certain. In fact, the outcome of innovation is necessarily uncertain, because innovation requires the exploration and creation of the yet to be. We think of this concept as mapping uncharted territory.
Nonetheless, we can be certain of the forms that innovation can and cannot take. This is because every innovation is the product of an insight and a solution. By measuring the originality of each, we can determine whether the outcome is a replication or an innovation, and to what degree. By allowing teams to quickly gauge the impact of potential innovations, the Insight-Solution-Matrix™ increases the efficiency and reduces the risk of the innovation process.
What could the world be like tomorrow? Although it will ultimately be determined by human choice, nobody can really say with certainty. In many business functions, we can make a prediction by extrapolating information about what happened in the past, and then try to create the future based on this prediction. But an extrapolative strategy is not well suited for innovation. Innovation requires an iterative approach to strategy.
These four transitions serve as connections, ensuring that each step in the innovation process is informed by the previous. Iterating through each step this way allows us to account for and manage the inherent uncertainty in the innovation process.
Innovation requires an alignment of insight, strategy and capability.
We think of strategy as a discrete set of choices that link an organization’s capabilities with an organization’s market insight. Effective strategy determines which insights an organization finds relevant and which capabilities an organization deems necessary. Sustainable competitive advantage is the result of a unique combination of insight, strategy and capability.
Too often, teams encounter conflicts that impede innovation. They pursue an insight that is not supported by their strategy, or their strategy is based on a faulty insight. Other times they cannot match a unique combination of insight and strategy with the right capabilities. Our approach integrates these three requirements of innovation. We use generative tools from the discipline of design to develop insight, and analytical tools from the discipline of strategic planning to turn insight into value. We measure and iterate until we find the alignment needed for innovation.