WE LIKE WINNING

We all engage in business. Every day, we take part in business. It may not be obvious, yet from the moment we wake, we are consumers — by turning on a light; running water; dressing; eating breakfast; gassing up the car; stopping for coffee; and, of course, texting and emailing. Throughout the day, you engage in activities that contribute to the creation and delivery of a product or service.

The more a product or service fulfills a need, the more we are attracted to it. The greater our attraction is, the stronger the offering. The stronger the offering, the more powerful the brand. The more powerful the brand, the
more value the product or service has.

Why are you in business? 

I often ask audiences, “Why are you in business? What is it you’re trying to do?” The most frequent and confident response is, “To make money!”

That’s not a wrong answer. There’s a great deal of truth in it. After all, one of the measures of business success is profit. Profit is part of the endgame; the scorecard. Making money is the measuring stick of capitalism.

In my view, the purpose of a business, regardless of the product or service and whether it’s a for-profit or not-for-profit enterprise, is to win the customer. That’s what business is all about.

I then ask, “What do you offer the customer that allows you to be successful and make money?” Answers include:

  • “Superior customer service!”
  • “Added value!”
  • “A product our customer can depend on!”
  • “We give them quality!”
  • “I offer them something they can’t get anywhere else!”
  • “We provide expertise!”
  • “A wide selection of options and choices!”
  • “We give our customers peace of mind!”
  • “To bring value to people’s lives!”
  • “We provide solutions!”
  • “Helping our customers reach their goals!”

It’s interesting when members of the same team give different answers. If there’s going to be misalignment among members of a group and a conflict over who is right and who is wrong, this is where it starts.

Winning the customer

Winning the customer is the result of delivering a product or service in a way that motivates the customer to buy it.

They choose to spend their money on your offering rather than on someone else’s—your competitor. Competition is a key driver and motivator of business. The foundation of our capitalist system is our shared desire to compete. The winners reap the benefits, so it is natural that we compete to win.

When a customer pays enough for your product or service to make a profit, you can invest that profit to increase your ability to win and build your business to win even more.

Winning isn’t our only motivation; several others contribute to our propensity to participate, including the social benefit we create and deliver.

A powerful aspect of an organization’s alignment resides in what is being created and delivered. Behind every product or service there is a purpose—a reason why the product or service has value. Finally, there is how the product is created and delivered to the customer.

These three are the centerpiece for what it takes to win in business, and together they provide the foundation for how the four elements of the Business Code, the customer, brand intention, culture and leadership, come together. In my book, True Alignment, we’ll explore how these forces influence the cultures of our teams and organizations, engage us in our leadership preferences, and result in the consistent thinking and behavior business demands.

 

Edgar Papke is the co-author of Innovation By Design and author of True Alignment and The Elephant In The Boardroom. He helps leaders and their organizations align to create greater levels of innovation, performance, and fulfillment. He can be reached by email: edgar@edgarpapke.com

STRUGGLING WITH INNOVATION

Throughout the history of business, we have found ourselves trying to figure out how to maximize our human potential. Meaningful innovation is the most important issue that organizations continue to grapple and struggle with.

As mentioned in a previous post, in our pursuit of innovation, we have created complex organizations, with many moving parts, all adding to the complexity of our solutions, of our lives—until we come to the place of recognizing what the great designer Dieter Rams pointed out many years ago: “less, but better.”

We want to innovate how our organizations can work more simply and allow for shared capacity to solve problems and innovate more freely.

To give you a sense of the magnitude of how important innovation is perceived to be to the success of today’s organizations, one just has to look at the title of KPMG’s 2016 Global CEO survey, aptly titled “Now or Never”. The executive summary delivers a clear message:

“[t]wo-thirds of chief executive officers (CEOs) believe that the next three years will be more critical than the last fifty years. The forces creating this inflection point are the rapidly evolving technology and the speed of transformation it unleashes. In four years’ time, 4 out of 10 CEOs expect to be running significantly transformed companies.”

A review of the results of a number of global surveys of CEOs, C-level executives, and leaders from 2015 to 2017, including the major studies conducted by KPMG, Fortune, IBM, and PwC, provide further insight. With the exception of the Fortune survey (500 companies), most of the surveys we reviewed included more than 1,200 participants. Among the key findings:

  • Fostering innovation is one of their top strategic priorities, placing among the top six in every survey.
  • Most CEOs are grappling with how to engage their cultures in the change necessary to be more innovative.
  • A significant majority (seven out of 10 CEOs) say it’s important to specifically include innovation in their business strategies.
  • The majority of survey respondents identify the need for transformational change in their organizations.
  • Eight out of 10 are concerned that their existing products and services may not be relevant in three to five years’ time.
  • The majority of respondents say their organizations are struggling with the speed of technological innovation.
  • Gartner reports that 89 percent of companies believe customer experience will be their primary basis for competition in 2016, versus 36 percent four years ago.
  • Accenture reports that 81 percent of executives surveyed place the personalized customer experience in their top three priorities for their organization, with 39 percent reporting it as their top priority.

Innovation and Tempting Failure

What is equally as telling is that, while innovation is consistently among the top six strategic priorities, less than a third believe their organizations’ cultures encourage risk-taking or safe-to-fail environments.

This is important to recognize. Among the more powerful aspects of motivation and human behavior are the needs for predictability and safety.

From childhood through to adulthood, we are literally taught, trained, and reinforced to find the safest paths. As a result, satisfying these needs is paramount to how people perceive the ability to express themselves and take risks. We discover that it’s not a good idea to tempt failure.

However, the process of innovation includes failure. Whether an organization’s temperament and messaging allow for exploration, experimentation, and the potential subsequent failure says a lot about how innovative an environment it provides for its members. It also doesn’t always fall within the context of processes and systems that are designed to limit risk. Or, ways of solving problems and making decisions that advocate adherence rather than possibility thinking.

This is about culture. This is about the pursuit of understanding human behavior and the role that awareness plays. These challenges are clearly defined in the KPMG report of findings:

  • Thirty-six percent of CEOs say their organization’s approach to innovation is either ad hoc, reactive or occurs on a silo basis.
  • Only one out of four says that innovation is embedded in everything they do.
  • Only 29 percent feel that their organization is highly capable of creating a safe-to-fail environment.

This data becomes even more powerful when one considers that only one out of five CEOs note that innovation is at the top of their organizational agendas. This last piece of insight tells us that when identifying an organization’s key strategic priorities, a top-six finish is likely still not good enough.

Why?

The most likely explanation is that, for CEOs and leaders, and the people in the companies and institutions they lead, the risk of being innovative is often what keeps their cultures from being more innovative. They are afraid of the risk of failure that comes from thinking outside the box, letting go of the familiar, seeking the possible over the predictable, all while falling into the trappings of that which they perceive will keep themselves safe.

This is a stark reminder that, as a leader, if you’re not willing to fail, others will not take a risk to succeed.

The data also raises the question of how the most successful organizations in the world go about innovating at the level they do, disrupting industries and market segments, quickly turning what were just yesterday stable technologies and ways of life into quickly outdated or obsolete ones. How do they go about creating new forms of industry and markets where none existed? How do they create more meaningful customer experiences and work across internal silos? What is the code to cracking their culture, and what do they do that is so different from the also-rans that they outperform? What are they doing that others aren’t? How did they identify the gap between the average and the means to becoming exceptional innovators?

 

Edgar Papke and Thomas Lockwood are the authors of  Innovation By Design and founders of InnoAlignment, a consultancy dedicated to assisting leaders in designing and building cultures of innovation.

 

INNOVATION IS WHAT WE DO BEST

“Imagination is more important than knowledge. For knowledge is limited to all we now know and understand, while imagination embraces the entire world, and all there ever will be to know and understand.” —Albert Einstein

The collective imagination is humankind’s greatest genius. Throughout our human history, as we developed and created the world around us, the sharing and building of one idea on another has been, and always will be, our best recipe for innovation.

The world we continuously create for ourselves is the manifestation of our collective imagination, the natural desire to come together in community; to collaborate, explore, and learn; and to create what we want and desire to have. It gives us the ability to respond to our basic needs, as well as solve even the most complex of problems. It fuels the innovation that is the foundation of our competitive global business society.

Innovation is who we are

Humankind’s desire and drive for innovation is breathtaking. Innovation is who we are. It is what we do best.

As our societies evolved, we creatively designed social structures that met the needs of and further relied on our shared ability to innovate. As we did, we were reminded that along with our innate desire to innovate, we have an inborn desire to compete. When these forces come together, innovation is accelerated. The social structures that we relied on for survival and connectivity evolved into enterprises of commercial means that have become the fixtures of our global society.

These new enterprises and organizations became the vehicles that took us on the journeys of the scientific, industrial, and more recently information revolutions. All along the way, we continuously increased our level of innovation and ramped up the pace of change in our world.

Today we find ourselves at a place in history in which our capability for innovating and creating change has provided us with incredible levels of technology and know-how.

Every day we find ourselves exposed to new ideas

Moment by moment we are introduced to an array of new products and services, some of which are delivered to us by purpose-driven, design thinking organizations and enterprises whose main concern is to figure out how to create more meaningful innovation and customer experiences. We are now operating in a new global era in which a new digital economy is emerging—a new economy driven by pioneering technology that allows for virtually everyone and everything in our world to be connected, with new pathways for information and knowledge abounding: the Internet of Things, the interconnection via the Internet of computing and smart devices—electronics, software, sensors, actuators, and network connectivity—that enable objects to collect and exchange data.

All this adds to a world that presents us with the means to faster and faster, innovate more and more.

With all the knowledge and technology available to us, and the means of immediate communication and instant access to information at our fingertips, why does our focus constantly return to how we can become even more innovative, to solve bigger and more complex problems?

Throughout the history of business, we have found ourselves trying to figure out how to maximize our human potential. Even today, and more than ever, companies and institutions of all types and sizes are concentrating on creating more innovative cultures.

This is not a new breakthrough in thinking. Being successful has always relied on the ability to work together and be creative. More than science or the collection and use of data, the quest to understand how to create higher levels of innovation and empower our creative intelligence seems to be a more elusive aspect of how we innovate.

The better we become at innovation and creative collaboration, the more we want to figure out to get better at it—alas, human nature.

In pursuit of innovation, we have created complex organizations, with many moving parts, all adding to the complexity of our solutions, of our lives—until we come to the place of recognizing what the great designer Dieter Rams pointed out many years ago: “less, but better.”

Less, but better

As complex as the world is today, we look for finding solutions to the resulting challenges and emotional stress that all the moving parts and advanced technology creates. The more complicated means of communication and interaction move us to a place from which we seek greater simplification.

We have arrived at a place in our history that causes us to pause and reflect on the complexity of the organizational systems that humankind has created, looking for ways to overcome the needless barriers to communication and working together they represent.

Why? So we can find better, faster, and, yes, simpler ways to work together to solve problems more efficiently and effectively.

 

Edgar Papke and Thomas Lockwood are the authors of  Innovation By Design and founders of InnoAlignment, a consultancy dedicated to assisting leaders in designing and building cultures of innovation.

 

UNDERSTANDING THE CUSTOMER EXPERIENCE: PART FOUR

Part Four: Awareness Design, The Fifth Order

Over the past two decades, and with the furthering of social media, our business environment has evolved into one in which the relationships between companies and their customers are becoming more open and interlinked. With the acceleration of changes in technology that advance our capability to communicate and create a broader array of customer and user experience, the application of design has also accelerated.

As a result, the true market leaders in the design of the most innovative customer experiences are creating a context in which customers are becoming active members in the design of the very products and services that they are buying. More and more, customers get to influence how products and services are created, branded, sold, and delivered.

With these shifts, comes a new set of requirements for organizations, their leaders, and the people in them to better understand the motivations of their customers. They must better understand the customer desires for attention, competency and caring and how to engage in their delivery through brand experience. To attain success, more open systems and engaging means of participation are required. Ultimately, this requires the application of design thinking to engage the customer in a manner that aligns their experience with the brand intention.

 

Relentless, Rapid Change

How we have used design thinking has changed rapidly and we now find ourselves responding to a new way of experiencing our world. More and more, we are questioning how and why we interact with one another in the way we do. We question intention and purpose, what our motivations are, and whether those align with the intention and purpose of the organizations we buy from. For this reason, we recognize that to be successful, the providers of products and services need to engage and align with their customers at more emotional levels and with greater consciousness of what they are seeking and why they are seeking it.

If we add to this need for greater awareness to the development of our capacity to innovate, the way in which we participate with one another will continue to expand and change. The shift to improved transparency also requires us to more consciously design and develop the cultures and learning capacities of our organizations that actually include and give attention to both external and internal customers.

The evolution of design that has unfolded over the past century is likely best explained by Richard Buchanan’s Four Orders of Design. Buchanan, a professor of design, management, and information systems, suggests that as an organization matures in its use of design. It tends to move from visual design and graphic communication to industrial design and products, then to brands and interactions, and then, finally, to systems. Buchanan summarized in the Fourth Order that attention shifts to the design of systems in which people interact with one another, including businesses, organizations, education, and governments.

 

Taking It To The Next Level

A great way to define design thinking organizations is to see them as learning organizations, using design thinking to increase understanding of real problems, of customers, of obstacles, of options, of knowledge, and of one another. In effect, by using design thinking to empower creativity and collective imagination, organizations develop the means to step further toward what lies at the core of human-centered experiences – our basic human needs and motivation. By adding the customer to the mix, one can readily experience the power that comes with it.

Powered by design thinking at scale, a new level of awareness is enabled. Design thinking actually is the creation of awareness and the sharing of knowledge. Design thinking provides a methodology that both naturally and intentionally leverages the collective imagination and transforms the cultures of organizations into being more innovative. Along with providing the means for cultural transformation, it also provides organizations with the opportunity to step into the Fifth Order of Design – Awareness. In doing so, as part of the process, companies are able to engage customers in such a way that they become more aware of their own personal experience. Furthermore, as a key ingredient to their involvement, they are able to discover and better understand how and why they are motivated as customers.

By applying the Fifth Order of Awareness Design, along with setting the stage for designing the intentional interaction of people, we move from the intellectual exercise of product and service design to the emotional aspects of human behavior. This involves a keen understanding of who and why, resulting in the creative expression of how. What better way to discover new possibilities than through inviting the customer to explore their awareness of their own motivation and desire? They’re asked to integrate that learning into the design of a product or service and their ideal experience.

 

The Future of Awareness Design

Where does the Fifth Order eventually take us? As we tap further into human motivation and create the context for increased customer awareness, we improve the probability that, as customers, we will elevate and expand the role and value of emotional intelligence. As a result and consequence of increasing consciousness, we will escalate our expectations for how products and services more directly respond to and fulfill our desires and needs. We will become, almost certainly, more demanding and want to play a more integral part in the design of what we wish to buy and expect even more transparency of how it happens.

Needless to say, the Fifth Order provides a bounty of opportunity, much of which will come to light as we unfold its potential and creatively expand its application. From the broadened development of design thinking processes that further engage customers, to the application of design awareness, to AI and new technologies for immediate customer and user responsiveness, and to its use in tackling wicked problems, Awareness Design may likely be the most powerful aspect of design imaginable. If not, it will very likely be a powerful step towards finding it.

 

Edgar Papke is an award winning speaker, leadership coach, and business consultant. He and Thomas Lockwood are the co-authors of Innovation By Design and founders of InnoAlignment, a consultancy dedicated to assisting leaders in designing and building cultures of innovation. Edgar is also the author of the books True Alignment and The Elephant In the Boardroom and can be contacted by email: edgar@edgarpapke.com

UNDERSTANDING THE CUSTOMER EXPERIENCE: PART THREE

Part Three: Designing Loyalty to Brands

A goal of any product or service is for the customer to emotionally identify with its brand and, as a result, for the customer to trust enough in their experience that they are willing to continue to buy and use it into the future. Furthermore, the aim is that the customer will become an advocate for that brand. The resulting benefit is brand loyalty.

 

The Aim Is Trust

Since brand loyalty and the trust associated with it is the aim of just about any company, it’s evident that it should also be an outcome of how design thinking is applied to the creation of any product or service. In making brand a priority outcome, it also reminds those involved in the process to focus on the emotional aspects of the customer’s experience and the resulting trust. After all, brand loyalty, like any form of human trust, is about the meaning and trust associated with the experience.

As we continue to peel away the layers of human-centered design and apply empathy, we find ourselves on the journey toward further understanding human emotion and the underlying sources of desire and motivation.  In the last installment of this series, I focused on the three key human motivations that reside at the core of our experience as customers and users: attention, competency, and caring.  As customers, these three motivations are the keys to how we relate to our experience and how our emotional requirements are met.

 

The Creative Alignment of Brand and Emotion

Focusing on the three human desires allows us to better design products and services, aligning them to meet a customer’s emotional requirements. These are requirements that, when met, provide the emotional fulfillment that translates into the customer’s perception of value. The customer’s choice to come back for a particular product or service results in their loyalty to the brand.

Recognizing the relationship of emotion and brand provides us with an endless set of opportunities through which to understand the customer and more intentionally engage in the rich design of human-centered solutions. It also provides a much more abundant lens through which to empathize, develop more insightful contextual inquiry, and increase the focus on the understanding of the second perspective. Furthermore, the ability to articulate a brand intention offers the ability to more readily define how ideas may align to the customer’s motivation, help in the design of key questions and inquiries, and create an awareness of how out-of-the-box ideas can bring benefit.

 

Six Brand Intentions, Six Paths to Loyalty

Building on the three aforementioned human motivations for attention, competency, and caring, we find that there are six distinct ways in which we brand products and services. In the book True Alignment, I detail the six brand intentions and provide insight into, and examples, for each of the six. What is important to realize is that each is a natural extension of the underlying human desire and motivation. Each provides a framework for the collection of information and data, as well as its application in the design process.

 

Connecting Customer Desires to Brand Intentions

 

The first of the three human desires is attentionThe two brand intentions that result from this motivation are community and customization.

 

Community

Community describes services or products that invite and deliver community membership, offering relationship, affiliation and connection, the reciprocity of attention, and sharing a common identity with others. Examples of innovative brands delivering community include Facebook, Starbuck’s, Harley-Davidson, and Disney.

Customization

Customization is described as the design and delivery of products and services to reflect the customer’s wants, delivering customer empowerment, assumes that the customer knows best, and focuses on their ownership of the solution. These include such brands as Etsy, Land’s End, and 4imprint. In the case of attention-centered brand intentions, the participation of the customer in the design thinking process comes rather naturally.

 

The second customer motivation is competency. While the two brand intentions of pre-eminence and low price may at first appear to be contradictory, they are both driven by the application of expertise and know-how.

 

Pre-Eminence

Pre-eminent brands include SAP, McKinsey, BMW, Intuit, and Apple. The focus of design is on delivering product and/or service superiority, delivering innovation and cutting edge uniqueness, or providing tailored solutions by applying expertise and competency to solve the customer’s problem.

Low Price

Low price is focused on delivering price advantage and on innovating to provide operational excellence and efficiency, resulting in customer savings. This includes the sense of competency associated with getting the best price or deal. Brands pursuing delivery of this brand intention include Amazon, IKEA, Target, and Dell. In the case of competency-centered brands, the customers involvement in design is better aligned through the application of well-defined processes and approaches.

Pre-eminence and low price allow the customer to trust in the competency of the product and service provider, as well as help the customer to recognize their own competency and capability.

 

 The two brand intentions that respond to the customer’s motivation for caring are physical wellbeing and personal actualization.

 

Physical Wellbeing

Physical wellbeing focuses on the design and delivery of products and services that deliver physical health and welfare, help one to feel good, and create a physically enriching experience. Physical wellbeing brands include Whole Foods, TempurPedic, Nutrilite, and Weightwatchers.

Personal Actualization

Personal Actualization brands include Oprah, The Hunger Project, Tony Robbins and the various offerings of spiritual growth and personal development. The focus is on supporting personal growth, delivering customer self-actualization and psychological realization, and helping the customer to pursue the ideal self. When it comes to the caring brand intentions, design thinking is free-wheeling and best served through an emphasis on creativity and free expression, and the customer is engaged through the desire to explore what’s possible.

 

Aligning Innovation to Brand

For our book Innovation By Design, my co-author, Thomas Lockwood, and I researched and conducted interviews with 21 highly innovative organizations. One aspect of the success of the study group members is the direct result of their brand loyalty – the emotional investment of customers resulting from their ability to innovate in alignment to their clearly articulated brand intention. Such alignment is demonstrated both through the consistency through which they pursue the design of solutions that respond to their customers’ emotional desires and motivations. They are able to leverage the alignment of their brand intention in how they engage in the design thinking process extremely well.  

Having a clear understanding and alignment of their design thinking process to their brand intention provides a more focused approach. It also provides for a sense of clarity for those involved in the process to assure that their efforts are not outside the parameters of their customers’ expectations, nor that of their organization. The result is the consistent delivery of innovations that solicit customer trust…and loyalty.  

 

Edgar Papke is an award winning speaker, leadership coach, and business consultant. He and Thomas Lockwood are the co-authors of Innovation By Design and founders of InnoAlignment, a consultancy dedicated to assisting leaders in designing and building cultures of innovation. Edgar is also the author of the books True Alignment and The Elephant In the Boardroom and can be contacted by email: edgar@edgarpapke.com

UNDERSTANDING THE CUSTOMER EXPERIENCE: PART TWO

Part Two: Designing Customer Happiness

What makes for a happy customer experience? How can you better design a user experience that evokes happiness? What are the key elements you need to consider?

There’s a broad set of influences and circumstances that are part of every customer experience. At face value, these elements fall into two particular categories: those that we perceive as predictable and feel a sense of having influence on and those that we look upon as unpredictable or uncontrollable. The latter includes elements like the kind of day a person is having and a host of many other factors that are often considered outside the realm of predictable aspects of a customer’s experience.

There are also challenges associated with defining what “happiness” is. Once we are able to define it, how do we consciously apply it to better empathize with customers and design more meaningful customer experiences? How do we create interactions that leave the customer feeling not just satisfied but, rather, deliver an experience that provides the customer with the feeling of happiness?  

In the current edition of The New Yorker, David Owen provides a profile of HappyOrNot, the company that offers the ability to measure customer satisfaction through the use of simple terminals at the point of the actual customer experience. As an example, as customers left a chain of convenience stores, they were offered to rate their experience by pressing one of the terminal’s buttons labeled “very happy, pretty happy, pretty unhappy, or very unhappy.” The idea is that if one collects enough of the immediate responses to the question of whether – in the moment – the customer is happy or not, it results in enough data to discover what makes the customer happy, as well as what gets in the way. Still, in order to be successful, we need a definition for, and an understanding of, what human happiness is.

Happiness Is…

In the simplest of terms, happiness is defined as a state of well-being and contentment, the result of a pleasurable or satisfying experience. Our happiness is the emotional informant of how we experience a product or service and how we ultimately determine the meaning and trust in the things we buy. This defines how we come to trust and become loyal to specific brands. For this reason alone, it’s important for us to know what the sources of happiness are and how we can use data, observation, and contextual inquiry to better understand and apply them. As human beings, defining what makes us happy is a natural pursuit. From the perspective that we are all, twenty-four hours a day, in one way or another, customers, the idea of happiness is at the center of our experience.

The Customer Code

As a way to better understand the sources of happiness, in the book True Alignment, I provide a framework for understanding, interpreting, and applying three sources of emotional fulfillment that make up what I call the customer code, which provides insight into the human desires for attention, competency and caring.

On the upside, we are happy when our desires are being met. On the downside, we are unhappy when our desires are not being responded to. This also means that happiness exists when we do not feel a sense of fear that results from not getting our desires met. For this reason, it’s vital that we pay attention to the three customer desires and motivations: attention, competency, and caring.

1. Attention

Attention fulfills our need to feel important and supports our desire to know that we count, that we matter. The opposite is to feel ignored. As customers, we interpret feeling ignored as not being valued or significant. This is a powerful psychological force and, as with most emotional responses, it is immediate. Think about the last time you called for customer service and went through several prompts before you got a person on the phone. The innovative design of chat and messenger are means through which services pay more immediate attention to the customer. It doesn’t take much for the lack of attention to get in the way of our happiness and leave us feeling anxious, upset, or angry. This is why it’s hard for even the greatest of brands to recover from ignoring the customer. It also explains why the connectivity afforded by social media has become such a dominant force in marketing.

When it comes to the need for attention, our happiness is derived from feeling important and significant. It is also why we are more content when we are listened to and actually feel heard.

2. Competency

Competency is the sense of control and emotional wellbeing that comes from feeling like we made the right decision. As part of our customer experience, we expect providers of products or services to be competent in creating and delivering whatever it is we’re spending our money for, including the level of reliability and quality we associate with it. As a result, we make comparisons about the quality, appearance, and associated pricing because we want to get the best value for our dollar, which allows us feel competent and in control. Whether we’re buying online or experiencing direct contact with a person making the transaction, we expect the experience to be designed in a customer-oriented and competent manner, allowing us to feel, and be, more successful.

As customers, when we perceive we made a good decision, the source of happiness is feeling competent that we made the right choice. When we perceive that we made a bad choice, we feel incompetent and experience the anxiety that accompanies the embarrassment of making the wrong decision. We are left feeling stupid and that we failed. Not a good outcome for anyone, this feeling most often results in us trying to find someone to blame. When the expected competency is not provided, we are naturally disappointed and resent the provider for letting us down. Yet, ultimately, we question whether we were incompetent in making the actual buying decision. If we are fooled or make a bad decision, we no longer feel competent. Competency is a powerful source of happiness.

3. Caring

Caring reflects the happiness and contentment we get from others treating us for who we are, fellow human beings. When we pay for a product or service, we expect our experience to be one through which we are treated with dignity and respect, and to get what we are promised. In this sense, our customer experience begins with how transparent and honest the provider is in marketing, advertising, and selling. Caring conveys that you’ll be truthful with me and that I can trust in how you offer and deliver to your promised customer experience.

Unfortunately, all too often, we seem to have become accustomed to accepting less than we bargained for. We know that advertising is not always accurate and, more often, it tests the boundaries of truth and reality. Still, we expect that the makers and deliverers of the products or services that we want will inevitably do the right thing and come through on their promise.

While truth in advertising is one example, environmental responsibility, fair trade, and social benefit are examples of how caring is experienced in broader ways. Along with our singular experience of integrity and trust, the failure to create a shared value is interpreted as a lack of caring about us as a community of customers and users, and our larger world. When it comes to caring, our happiness is measured by how truthful the product or service provider is. What they do is measured in terms of what is ethical and “right” and, ultimately, honest.

Happiness Data and Inquiry

At face value, data on customer happiness allows us to better understand an individual’s immediate emotional response and offers us insights and clues into an actual experience. It’s important to recognize how powerful contextual inquiry and the integration of data to human-centered design can be. To be successful requires us to have the ability to, first and foremost, be able to define what “happiness” is for our customers. Then we can more effectively apply our use of empathy to better understand the human desire that lies at the source of that happiness.

It all points back to the commitment to inquiry and empathy. Once we are open to relating to one another’s perspectives, we can better understand our own. After all, the reason we spend every moment of our lives being customers is to pursue our happiness. It’s our human nature to do so.

UP NEXT:

In Part Three of this series on understanding the customer experience, we’ll explore the alignment of brand intention to the design process.

Edgar Papke is an award winning speaker, leadership coach, and business consultant. He and Thomas Lockwood are the co-authors of Innovation By Design and founders of InnoAlignment, a consultancy dedicated to assisting leaders in designing and building cultures of innovation. Edgar is also the author of the books True Alignment and The Elephant In the Boardroom and can be contacted by email: edgar@edgarpapke.com

 

UNDERSTANDING THE CUSTOMER EXPERIENCE: PART ONE

Part One: Perspectives of Empathy

In this week’s blog, whether you’re a novice or experienced user of design thinking, I invite you to begin exploring how you can better understand the human experience and use design thinking to design and deliver great customer experiences, as well as apply it to solve the most complex of problems… even the wicked ones. In doing so, we’ll delve into and unfold a better understanding of the emotion and motivations that lie at the core of our human experience. We’ll peel back the layers of what makes up the customer experience and explore our unrelenting pursuit of human-centered design. In doing so, you’ll likely broaden your perspective and thinking, and discover how you can more creatively engage in, and contribute to, the delivery of great customer and user experiences. Along the way, you may also find the means through which to solve even the most perplexing of problems you face.

Since last November’s release of our new book Innovation By Design, I have traveled across the United States, delivering workshops focusing on “How to Design and Lead Cultures of Innovation.” Throughout my interactions with attendees, inevitably, the conversation focuses on the need for empathy, and the interpretation of human motivation. A common conclusion we reach is that without having an understanding of the human motivation and desire, it’s pretty much impossible to understand the customer or user experience (let alone to be able to interpret what and why people are attracted to buy or use a particular product or service).

Like most endeavors, the quality and value of the steps we take in any process or plan directly reflect the clarity with which we understand the desired outcome. In other words, it pays to begin with the end in mind. Adhering to this thinking shifts our attention to recognizing the importance of the very first step we take. In any business, the end game is the creation, offering, and supplying of a product or service that offers a solution to customer’s problem and fulfills their desire or need. It is this fulfillment that lies at the heart of the customer experience and business success.  

The Evolving “Megatrend”

As an approach to understanding the customer experience, design thinking is very likely the most useful and powerful approach developed to date. It is also probably why design thinking has been so broadly adopted by innovative thinkers and organizations everywhere and why we’ve come to recognize it as an evolving “megatrend” in business. It’s one thing to provide a process for problem solving. It’s another thing to capture and elevate our shared human experience. Design thinking differs from other problem solving methods by offering a more creative, human-centered approach that requires a more significant level of understanding of the human motivation. This is also what makes it that much more applicable to a broader set of business and social problems than most other methods.  

Why does design thinking work so well?

Let’s start at the top and begin by looking into the actual process and the core steps or phases of design thinking. The following steps are relatively consistent across the variety of tailored approaches:

  • Empathizing
  • Defining the Right Problem
  • Ideation or Creating Solutions
  • Prototyping
  • Testing

A simple explanation is that right at the outset, design thinking centers squarely on the human experience. It thereby allows us to not only better understand a customer’s behavior, but also to better interpret and understand the emotional influences and motivations behind that behavior. Ultimately, this deeper understanding of a customer or user’s experience allows us to design products and services to more fully and accurately respond to and fulfill our underlying human desires.

Of importance is recognizing that in order to successfully reach the end game and offer a solution that responds to a human desire, one needs to understand the significant role that empathy plays. The realization that being effective is using empathy and requires the development of the knowledge and skills necessary to engage in contextual inquiry. Without having a framework for interpreting human behavior and motivation, it is difficult to truly appreciate empathy and be open to its influence. Without this, it’s rather difficult (if not impossible) to seek and define the right problem that needs to be confronted and solved. Hence, the first step in the design thinking process of empathizing is vital to achieving the right end game.

Two Perspectives

One of the keys to achieving true empathy and arriving at the right end game is to embrace the idea that when we engage with others, there are always at least two perspectives. Embracing this simple yet powerful idea is coming to the understanding that to be successful in taking the first step of design thinking.

The first is our own perspective, requiring that we have an awareness of the views, beliefs, and values we hold. These elements are fundamental to understanding our own experiences. This is made even more powerful when we begin to examine why we think about, see, and feel about things in the manner we do. This form of self-inquiry lends itself to us better understanding our own motivations and desires and how they inform our relationship to, and interpretation of, our own experiences. We thereby reach a point at which we not only better recognize our own biases, we begin to recognize that others think, see, and feel differently than we do. Furthermore, we begin to develop the ability to explore our own individual perspective and uncover how it informs our interpretation of another person’s experience.

The second perspective is that of the other person and requires us to have the ability to be open to it. One can easily see why being conscious of the first perspective is the key to being open to listening to, exploring, and ultimately, to understanding another person’s experience and being more empathetic. In simple terms, we must be conscious of our own set of values, beliefs, and motivations to be open to exploring those of another person. Only when we are conscious of our own first perspective can we fully embrace the second perspective, as well as begin to truly understand others.

There’s a great deal of truth in the expression, “To understand others, I must first understand myself.”  Among my workshop attendees, there is significant evidence that they understand this at an intellectual level. It’s when we move into deeper exploration and begin to connect to the emotional and motivational level, that they are more challenged. In fact, many do not have a framework or approach to better interpret a customer’s emotional experience. By no coincidence, many of them have not explored their own experiences at that level.

The result?

If we’re unable to interpret our own emotion and motivation, it becomes very difficult to empathize with the experience of others. All too often, in the end, what we believe is an ideal customer experience differs from that of another person. Or, in other words, what we think we’re delivering through our product or service to satisfy a customer can so easily be far off the mark. Furthermore, without having an understanding and consciousness of the first perspective, it’s almost impossible to move from the first perspective (our own) to a second perspective, making it impossible to engage in true empathy. Unfortunately, this lack of knowledge and understanding is also what gets in the way of co-creation, collaboration, and teamwork, as well as the open inquiry necessary for curious confrontation and the soliciting and understanding of differing points of view, including our understanding of the customer.

On the other hand, through the ability to be more conscious of our emotion, motivation, values and beliefs, we unlock the incredible creativity that we are capable of and that allows us to do what human beings do best…innovate. It enables us to engage in design thinking and leverage our natural ability to participate in valued collaboration with one another, freely express ourselves and share our ideas, and pursue knowledge and find the right solutions to event the most difficult of problems.

The Next Question

That leads us to the next question. Is there a framework and approach that helps us to empathize with the customer, as well as with one another?

In my next blog, I’ll invite you to explore a proven framework through which you can better interpret and understand the emotional and motivational aspects of the customer, as well as those you work and live with. In doing so, we’ll uncover the means through which we can develop our ability to understand the first and second perspectives, and increase our ability to empathize and creatively solve problems together…even the wicked ones.  

Edgar Papke and Thomas Lockwood are the authors of  Innovation By Design and founders of InnoAlignment, a consultancy dedicated to assisting leaders in designing and building cultures of innovation, a consultancy dedicated to assisting leaders in designing and building cultures of innovation. Edgar is also an international award-winning speaker, leadership coach, and the author of the books True Alignment and The Elephant In The Boardroom.

CHANGE THE PROCESS, CHANGE THE CULTURE

As we unfold the new calendar year, I’d like to begin by focusing on how leaders and their organizations and teams can be more innovative in taking on the challenges that lie ahead.   

Design guru Thomas Lockwood and I dedicated a great deal of the last two years to researching and defining the makeup and characteristics of innovative organizations. We synthesized our findings in our new book, Innovation by Design. As the result of our research, along with identifying the need for alignment, we defined the Ten Attributes that the organizations in our worldwide study group all share. In doing so, we inevitably found ourselves at the intersection of design thinking, innovation and corporate culture. Through better understanding this convergence, we also arrived at the appreciation that by changing the approach to innovation – or altering the process – the leaders of organizations can influence the mindset of their members to be more possibility-oriented in their thinking and behavior, and to act more innovatively. This insight helps us to better understand the influence of design thinking and why the attribute of design thinking at scale is as powerful as it is.

In part, for organizations to reap the benefits of design thinking at scale, it requires leaders to undertake three key strategies:

  • Train people in the use and application of design thinking.
  • Apply design thinking organization-wide for problem solving, decision making, and planning, including its application in strategic planning, product and service design, as well as process and system design, thereby ultimately maintaining a focus on and alignment to the customer and user experience.
  • Incorporate leadership role modeling in the use and support of design thinking throughout their organizations.   

 

Scaling Innovation

We went into our study focusing on organizations that are recognized as using design thinking as a source of innovation and business performance. What we didn’t expect was the scale at which some of the companies and organizations are applying it. Here is a snapshot of the significant numbers of people that have been trained at a few leading companies:

  • SAP has trained 20,000 employees
  • IBM has trained 50,000 employees
  • Intuit, over 10,000 employees (that’s is the entire company)
  • Kaiser, 15,000 people
  • GE Healthcare, 6,000
  • Marriott, 5,000
  • Deutche Telekom, 8,000
  • Philips, 5,000
  • Visa, 10 percent of their workforce.

This set of numbers tells a story in itself.

In some of the companies, design thinking was strategically seen as a function, a means through which to engage its membership on a larger scale. In others, we observed how design thinking spread, adding a belief in innovation and dramatically increasing its value. In some, it was approached from the top down while, in others, it started as means for which to solve a particular problem in one part of the organization and people were naturally drawn to its qualities and wanted in on the game. In still others, it was a part of human resource and organizational development strategies that were delivered through training and facilitation. What was consistent is that, regardless of how it was happening, how it was introduced, implemented, and integrated, people are drawn to participating in design thinking.

Eventually, people perceive their role in the organization as one of being a contributor to the innovative process. As a result, all three key elements of culture – participation, expertise and authenticity – are influenced. The changes become apparent in the observable shifts in behavior, that further manifest in the beliefs and values of an organization. Eventually, this changes the mindset of people and their experience, and their interpretation and mindset about the culture.

The Lessons

One big lesson is that any organization, of any size, can use design thinking as a means to influence culture and achieve greater levels of innovation. Regardless of size, the scaling through an organization, and whether it is 10 people or 300,000, the more people know about how to engage in design thinking, the greater the level of innovation. We also found that among our study group of innovators, the scale of adoption and use varied, as did the manner in which they implemented and integrated it (we include a full chapter about this in the book, Innovation by Design).

The other big lesson is the need for aligned leadership – that success requires that leaders demonstrate their commitment to design thinking and its use as the go-to creative and problem-solving process. This is accomplished through leadership’s role modeling and support of the use of design thinking throughout their organizations. When it comes to culture, leaders are responsible not only for articulating mission, vision, and strategy. They are accountable for role modeling and reinforcing the processes and behaviors of innovation. Ultimately, they are the influencers of how to use the process of design thinking to influence changes in behavior. The result is the change to an organization’s culture and the mindset of its members to think and act more innovatively. When it comes to leading an innovative culture, it’s always about alignment.

 

Edgar Papke and Thomas Lockwood are the authors of  Innovation By Design and founders of InnoAlignment, a consultancy dedicated to assisting leaders in designing and building cultures of innovation.

GENEROSITY: SEVEN ACTS OF INFLUENCE

To pay homage to the season of giving, and for my last blog of 2017, I thought it appropriate to share some thoughts about the role of generosity in leadership and in our lives. This includes Seven Acts of Generosity from our book, Innovation by Design. We can all apply the Seven Acts of Generosity in our lives and further trust in our relationships.

One of the most powerful forms of influence is generosity. From a leadership perspective, while it is often overlooked, the influence of generosity is always present, even when we’re not paying attention to or looking for it.

How can we best define what generosity is?

Currently, our most popular definitions focus on three types of “giving”resources, money and time. Interestingly, many studies show that, of the three, we are more likely to give money and resources than we are willing to give of our time. Even more interesting is the fact that the more current and frequently found definitions of generosity fail to explore it as a form of influence. They are aspects of influence that go well beyond the measurable cost versus benefit often attributed to generosity and the giving of money, resources and time.

This leads us back to exploring the longer-standing definitions of generosity. Here are three that appear with consistency:

1) The habit of giving freely without anything in return.

2) Freedom from meanness or smallness of character.

3) Acts of giving characterized by noble spirit.

All of these definitions transcend much of our current thinking about generosity and provide the framework for a deeper understanding of how we influence each other. They also provide insight into how we convey generosity on a daily and ongoing basis and through which we can achieve greater levels of mutual respect, mutual benefit, and trust.

As evidence of this influence, there’s extensive school of study on the connection of generosity to how our brains work, including our resulting physical and emotional responses. This includes studies exploring the hormone oxytocin (commonly referred to as the love hormone) and its link to parental bonding and the positive feelings of trust that result in caring behaviors, including generosity and the human desire to connect through giving. This further supports what we know about human nature and our desire for generosity, which is at the core of so much of our spiritual and religious belief systems. As Mother Teresa expressed, “At the heart of God is generosity.”

To help you put this all into practice, here are seven powerful acts of generosity from Innovation by Design that you can apply immediately, in all of your relationships to achieve greater levels of mutual respect, mutual benefit, and trust. 

Seven Acts of Generosity

APPRECIATION. Showing appreciation to people begins with having a positive attitude toward others and recognizing them for their value, for who they are, and what they contribute to the world. To show appreciation is to praise individuals for their strengths, beliefs, and competencies, and to recognize their contribution. While we spend a great deal of time looking for grounds to criticize one another, when people feel appreciated, they feel safe. When they feel safe, they feel confident. When people feel confident, they perform at higher levels. And, they trust you more.

LISTENING. One of the most generous gifts we give to one another is the act of listening. To listen genuinely with the intention to understand and know another person is how we establish true mutual respect. There is a generosity in relationships wherein people are committed to consciously hearing one another and listening for understanding and meaning. It often takes time and patience to really listen to one another. In today’s fast-paced world of multiple priorities and almost continuous engagement in the multiple tasks we’re confronted with, the act of generous listening has limitless value and influence.

GRATITUDE. The act of gratitude begins with simply saying “thank you.” Unpretentious and powerful, in any language, these simple words of gratitude are available to us in virtually any situation we may find ourselves. Because of this, it is likely the most often overlooked act of being generous. Saying “thanks” not only shows people that you’re paying attention to their actions, it signifies that you are grateful and appreciative of what they are giving and of their contribution. When we show gratitude, we are acknowledging a benefit that we are receiving from one another.

KNOWLEDGE. Knowledge is power and power is influence. In a world in which the level of our knowledge, skill, and competency is often the means by which we are measured, when we give of our abilities and generously share our know-how and competencies, we are providing one another with an increased ability to achieve and to succeed. Take a moment and ask yourself who outside your parents had the greatest influence on your life. It is very likely to be someone who taught you something—a teacher, boss, coach, or spiritual guide who was sharing their knowledge with you. Too often leaders miss the opportunity to coach and teach. The sharing of knowledge is one of the greatest gifts we can give to those we lead.

COMPASSION. The generosity of compassion is intimately tied to the giving of empathy and sympathy. When we act compassionately toward another person, we demonstrate consideration and kindness. Compassion is often described as being empathetic to another people’s point of view and striving to gain an understanding of their emotions and, ultimately, their fears. It is when we are able to understand another person’s fear, through the awareness of our own emotion, that we can be fully present to the relationship. Compassion speaks to the heart and soul, and conveys an ability to be a part of a shared experience. This is the origin of the notion of kind-heartedness. After all, we are all human beings and share the same basic desires, needs, and fears.

ACCEPTANCE.  Think for a moment how you treat someone that you are tolerating versus how you treat someone you willingly accept for who he or she is. There is a requirement that goes with the second of these two options, which is the necessity of seeing others through open-mindedness. When we are open-minded, we move beyond tolerating others in our relationships, to genuinely accepting others for who they are, with all their goodness, as well as their shortcomings. Acceptance of one another conveys a generosity of human spirit. It acknowledges our differences as a natural outgrowth of our likenesses and what we all have in common. It is the generosity of accepting the conditions that accompany any relationship. After all, it’s a long and arduous road trying to get people to change who they are, especially when it’s for your own benefit.

INTIMACY. The ultimate act of generosity is the giving of one’s self to the world and engaging others in intimate relationships. This is the key that unlocks the power and influence of authenticity. As much as acceptance invites others to be themselves and to be open with you, intimacy is your invitation to yourself to be open and to be authentic with others. As much as intimacy defines our closeness to others, it also speaks to the closeness and familiarity we have with ourselves. When the internal and external align, that alignment appears in the confidence to be open about what we think, see, and ultimately, what we feel.

Edgar Papke and Thomas Lockwood are the authors of Innovation By Design and founders of InnoAlignment, a consultancy dedicated to assisting leaders in designing and building cultures of innovation.

CULTURE AWARENESS: SIMPLIFYING THE PATH TO INNOVATION

Culture informs people how to individually and collectively achieve success, and to understand what is acceptable and unacceptable behavior. As a result, it is at the core of how people come together to innovate. That being said, how does a leader assess and understand the culture of their organization enough to know what its sources of innovation are? And, how can we simplify the path and know how to get there?

These are not uncommon questions. In fact, more and more studies and ideas are focusing on how leaders and organizations can better understand how innovative they are and how they can better leverage the sources of innovation at their disposal. This is not a new phenomenon. Throughout the history of business, we have found ourselves trying to figure out how to maximize our human potential. Today, more 
than ever, companies and institutions of all 
types and sizes are concentrating on the creation of more innovative cultures.

To get a sense of the magnitude of how important innovation is perceived to be to the success of today’s organizations, one just has to look at the title of KPMG’s 2016 Global CEO survey, aptly titled “Now or Never. ” The executive summary delivers a clear message, sharing that “two-thirds of CEOs believe that the next three years will be more critical than the last fifty years. The forces creating this inflection point are the rapidly evolving technology and the speed of transformation it unleashes. In four years’ time 4 out of 10 CEOs expect to be running significantly transformed companies.

In response to the pursuit for greater innovation, the marketplace now offers a host of tools and instruments, all aimed at collecting enough data – and the right data – to tell how well the members of a team or organization are able to
 work together to be more innovative. As a result, in pursuit of innovation, we have created intricate organizations, with many moving parts, all further adding to the complexity of our lives—until we come to the place of recognizing what the great designer Dieter Rams pointed out many years ago: “less, but better.” For, when all is said and done, more than science or the collection and use of data, the quest to understand how to create higher levels of innovation leads us back to the quest to better understand human nature.

What most of us have come to realize is that we’re arriving at a place in time that what will serve us best is simplicity. We’re looking for solutions to the resulting emotional stress that all the moving parts and advanced technology creates in our lives. By doing so, we are able to release the creativity required for the further innovation we seek. It’s a matter of doing it in smarter and in simpler ways.

The solution that many of the world’s most innovative organizations have learned to rely on is the use of design thinking. In conducting the research for our new book, Innovation By Design, Thomas Lockwood and I conducted an in-depth study of 21 of the world’s most innovative design thinking organizations. Among a host of great discoveries, including the identification of 10 key attributes, we found that while every organization has a unique culture, those that succeed are able to figure out how to integrate design thinking. That is, through better understanding their culture, they were able to implement and integrate design thinking into it more successfully.

The organizations in our study group learned to use design thinking to simplify and better leverage the human-centered processes through which to innovate.

What they further demonstrate is the ability to apply a systematic approach to understanding and better leveraging their unique culture. This is the attribute we call Culture Awareness: Understanding how to implement and use design thinking in a manner that is in alignment to the organization’s culture. In our book, Thomas and I provide the framework for how they were able to accomplish this success, including the definitions and keys to understanding the three culture types: participation, expertise, and authenticity cultures.

The successful introduction and implementation of any change is reliant on the ability of an organization’s leadership to have an in-depth understanding of culture. In doing so, they can better understand the basic tenets of behavior, and how individual and collective innovation and success is achieved. As the stories of 21 of the world’s most innovative organizations in Innovation By Design demonstrate, such understanding is one of the great undertakings and keys to successfully simplifying and leveraging innovation. The value of having a framework for assessing and understanding culture cannot be understated in leading innovation. Nor can the need for simplicity and a focus on human nature.

Edgar Papke and Thomas Lockwood are the authors of Innovation By Design and founders of InnoAlignment, a consultancy dedicated to assisting leaders in designing and building cultures of innovation.