Design-led innovation is a process that shifts the role of a designer to work across an organization to radically change a company’s view of the value proposition offered to customers to co-design, and to generate a unique and sustainable competitive advantage. With the relative newness of design-led innovation, case study research into the complexities faced by companies with the implementation and integration of this process is quite sparse. To add a new perspective, this research presents a case study of one Australian manufacturing company operating in the mining equipment, technology, and services (METS) sector, and how design-led innovation fits within their family-owned and engineering-driven organizational and cultural framework.
All businesses treat design differently so it is in sync with their brand identity. There is no set formula for design. As Nathan Sinsabaugh wrote in his Wired article, “Design is about understanding people in the context and culture they live in to develop genuine empathy, and testing and iterating solutions with customers to explore the validity of decisions.” This way of thinking doesn’t suit the mathematical mindset of traditional business innovation, so you’ll need innovative people working in a creative environment that encourages out-of-the-box ideas and intuition.
Design is about creating solutions and providing what users need. That’s the essence of design-led innovation: being user-friendly. If your clients and customers like engaging with you, that’s good news for everyone. So if you’re interested in the advantages of design-led innovation, then perhaps it’s time to change the way your company thinks.
Design-led innovation is broadly defined as a method that allows a company to consider and evaluate radically new propositions from multiple perspectives, typically spanning user needs, business requirements, and technology demands.
Key to this process is that design is core to a company’s vision, strategy, culture, leadership, and development processes. The design-led innovation framework outlined below Figure, provides a conceptual structure to assist the development of innovation through collaboration across the entire organization; it integrates the operational functions with the strategic vision by combining internal and external sources.
Design thinking uses a method of prototyping to reduce the risk in a business model concept by testing it with the marketplace; it allows for the creative development of an idea. By taking a holistic systems perspective, design thinking creates strong value propositions that interweave through business model development so the value received is greater than the sum of the parts. Design as an innovation mechanism is an iterative process that can assist in both uncovering problems with stakeholders, analyzing some possibilities, and then synthesizing multiple elements to form new solutions. During this process, the practitioner moves between the concrete and abstract worlds of understanding (Beckman & Barry, 2009) to build new value propositions.
Design-led innovation builds on this theory by internally aligning the solution with the company’s strategy, resources, and brand. Design and innovation as organizational processes work with the staff who deliver the resultant innovation, not in isolation from organizational systems. Design-led innovation can also align corporate ideologies to fit and potentially leverage the company’s internal capabilities, resources, and brand (business model) in order to generate an innovative solution that creates a competitive advantage.
Design thinking is a foundational activity within design-led innovation, by leveraging a creative systems perspective that integrates the design of the business models. Design-led innovation is a philosophy that “examines every core facet of the business, to realign business strategy with customer needs and possible market futures” (Pozzey et al., 2012). Design-led innovation is derived through a creative interrelationship between these fundamental business elements to generate true value for the customer and to capture profits for growth, as shown in Figure 2.
Improvisation is the ability to create and implement a new or an unplanned solution in the face of an unexpected problem or change. It is often seen as a spontaneous, intuitive, creative problem-solving behavior that mostly happens “on the fly.”
Improvisation has also been studied in organizational strategy and product development. Studies have found positive correlations between improvisation in product development and team performance. It is considered a spontaneous behavior (collectively or individually), and therefore dependent on team members’ attitudes, experience, motivation, intuition, and individual skills. Despite a number of studies on improvisation in the management context, there is no consensus on the most effective approach to develop this competence in project teams.
Improvisation may seem incompatible with the well-defined processes that govern most mature business practices. Hiring teams don’t often screen for improvisation skills, and most employee training programs focus on developing leadership or technical skills rather than helping employees to become better improvisers. However, improvisation is in fact key to organizational agility. Managers and employees who are capable improvisers will steer their companies through crises and paradigm shifts, from technological breakthroughs and changing trade regulations to environmental disasters and the myriad challenges associated with the Covid-19 pandemic.
- Imitative improvisation, exhibited by the least-experienced players, consists of observing what more-experienced people are doing and matching their responses with minimal variation. For example, in one scenario, we observed a new player whose character was entering a coven for the first time. Unsure of what to do, he looked at the more-experienced players and adjusted his costume and make-up on the spot to be more in line with their styles. While this is the simplest type of improvisation, it is an effective starting point that enables newcomers with limited experience to get involved.
- Reactive improvisation: using inputs from both the environment and other players to develop your own original reaction to an unexpected situation, without relying on others’ actions as a guide. For instance, when players faced an enemy attack and had to defend a fort, they spontaneously reacted to the threat by moving their troops and continuously reorganizing their defenses, demonstrating a novel reaction to both their fellow players’ actions and those of their enemies. We found that this type of improvisation was generally developed after players had already mastered imitative improvisation, as it required players to build on their existing experience to extrapolate new, original courses of action.
- Generative improvisation is about probing into the future and proactively trying new things in an attempt to anticipate and even catalyze (rather than react to) what could happen. Because it is fundamentally speculative, generative improvisation is inherently the riskiest but it’s also often the most effective for developing truly unique, innovative ideas. This type of improvisation was exemplified by a moment when two players decided on the spot to embark on a dangerous mission aimed at retrieving a powerful artifact in order to avoid potential problems in the future, without any specific external event triggering that decision.
- Build awareness of how different types of improvisation skills are developed
As a first step, simply educating yourself and your team about the different types of improvisation skills and how an emphasis on competition or collaboration can impact their development is crucial. Greater awareness of these skills can inform team composition, ensuring that newcomers are paired with more experienced improvisors from whom they can begin to learn imitative improvisation skills. It can also inform team allocation, enabling organizations to identify teams or individuals with strong improvisational skills and assign them to the projects that are the most unstructured and uncertain.
- Balance collaboration and competition
Managers need to carefully manage this tension, pushing their employees to develop collaborative skills without hampering the competitive instincts of ambitious newcomers. An emphasis on collaboration is ultimately necessary to foster generative improvisation, but without a strong competitive drive, employees may struggle to develop the reactive improvisation skills that they’ll need as a foundation for further growth.
- Nurture social structures; especially when working remotely
Finally, the importance of strong social structures cannot be overstated. To foster true, generative improvisation skills among their employees, managers must create a psychologically safe environment of rich social interactions that engenders trust and collaboration, enabling employees to gain inspiration from each other’s subtle cues and work together to come up with new ideas without excessive fear of rejection. And of course, this sort of environment can be challenging to maintain in the best of times, but it’s even harder virtually. As such, especially in the face of limited in-person interaction, managers should pay extra attention to supporting both formal and informal mechanisms for building strong social connections between team members.