Teaching Organization Design in the Digital Age -Session1 | Design Thinking: Concepts and Processes

Speaker A Gene is going to talk. I don't think Gene really needs an introduction because coming from Darden and Design for Growth and I think we're all familiar with all the work, if you're in the design thinking world, probably familiar with Gene's work. And rather than me talk, Gene will talk for 1015 minutes like that. Then Ken will respond a bit and then hopefully we'll have a little bit of time for some questions and interaction with the floor. And I'll just kind of be over.

Speaker B Here and keep trying move this upstairs successfully. Great. Wonderful. Well, it's lovely to be here. I'll tell you, when Chuck first contacted me about being part of this PDW, I said, Chuck, I'm a Strategist. And not only that, I'm like a strategic conversation version of a Strategist. So very much conversational process, micro kind of how do we have conversations that help us to invent powerful futures together? I said, I know virtually nothing about organizational design, so I'm not really sure what I can contribute. And he assured me that my role would be merely to share the perspective on strategic thinking that I've worked with and then leave it to you to figure out what that has to do with organizational. So I'm just issuing that as my caveat as I get started. In some ways, I think what we've taught in the design thinking space is this notion of designing anything at kind of a generic level with a methodological approach. I think the challenges and specifics or even whether it's particularly valuable for you in your world of organizational design is really a fascinating question that I'm looking forward to being part of. So let me jump in a little bit with this notion of what does it mean to design. So if we look design theory, although design thinking kind of seems as though it's just appeared relatively recently and has achieved a lot of kind of hype and talk design theory has been around for a very long time. So if we go back to the origin of a lot of the major design schools where theorists have talked about the design process over time and of course, we can go back, really to people like Horst Rattel and this notion of the wicked problem and this category of problems that do not lend themselves to traditional linear problem solving methodologies. Right? And so there's really a richness in this original literature that looks at wicked problems and argues that in order to solve them, we need a particular approach to designing. And then that approach. As I've reviewed the literature over the years, I've always looked at it through the lens of a strategist because I think it's a compelling description of what it means to design for someone in the strategy area because it is so focused on systems level design and the integration of the pieces into the whole. It is very much possibility driven. And one of the things we'll talk about in design thinking is in business we often tend to be constraint driven in our approach to designing and design starts squarely in the future. So this possibility focus is very important. It is hypothesis driven. As a strategist, this has always been of interest to me. My original work in strategy was as a consultant for the Boston Consulting Group. I taught strategy consulting for many years to our MBAs. And long before I was thinking about design and long before I was familiar with Ido and their worker design thinking, we were teaching hypothesis driven thinking to our MBAs because the core capability set in my view of a strategy consultant is the ability to generate and systematically test hypotheses. In some ways what's different about design thinking in its current version is the role of in market experiments. Traditionally, as strategist and hypothesis driven process, we would rely on historic data, right? And now we find with design thinking and not just design thinking, but lean thinking, the Lean startup, small bets. All of this kind of energy in the business world today is around experimentation and actual in market testing of ideas. So hypothesis has been key opportunistic this notion of emergence. How do we have a process in strategy? We always talk a lot. Henry Minsburg. I see Henry will be talking on Monday about again back to this notion of planned strategies versus emergent strategies. So design at its best allows emergence as we are discovering, right? So again, it's this model of a learning process in which we're continuously learning and factoring it in. It is intensely values driven. Right? We were just having a great discussion before the session started about where does design start? IDEO says it starts with empathy. A strategist would say it starts with purpose, it starts with intention. Right? And it is through that intention that we frame the nature of the design challenge we set off. So this notion of driven through the kind of values and intentionality of the system is key paradoxical. As a strategist, I think this is the single most valuable contribution of design we know in the strategy world. Any great strategy, any great design has to incorporate three elements. It has to incorporate possibilities, what, if anything were possible. It has to recognize constraints because we live in a world where anything isn't possible and it has to recognize uncertainty. Places in which we build design predicated on a set of predictions that we don't control and that may or may not prove to be true. So this notion of working at the intersection of the tension between possibilities, constraints and uncertainties is kind of core to the design of wicked problems that's certainly core to strategy. And then finally, and this is really the mind bender for the objectivists in the world of strategy, we tend to think that strategy is discovered, we uncover the right strategy. Whereas design would argue strategy is invented as strategists, we pick one version of the future that we choose to privilege over competing versions of the future. And that version that we select in some ways is no truer than the versions we choose not to select. Once we recognize that this question of interaction with the people who will be implementing the strategy, we shift from in a rational, kind of objective sense, explaining the logic of the strategy to them, to instead connecting with them in a persuasive process. Because ultimately the successful strategy is not the right strategy in an objective sense. It is the strategy that is most compelling to the people who must change their behavior to implement it, right? So at kind of a high level, this is this notion that is very old. I mean, we could go back 50, 60, 70 years to these discussions in the design theory now that's been translated in this day and age into a real interest in design thinking. And if I could just get the slides, go forward, let's see design thinking, lots of different definitions of it. This is one of the popular ones basically calling it a human centered innovation process that emphasizes certain activities, observation, collaboration, learning, visualization, prototyping, concurrent business analysis. And this is one view of what design thinking is. It is merely a bundle of tools, right? And in that way, I think it's very flexible in that whatever our design intention is, we can choose among a variety of different tools to help us do it. We have chosen in our work at Darden, though, to position, instead of just a bundle of tools as a systematic approach to problem solving and try to build a methodology and a process behind it. And in that way we find in our work with managers. And as we talk about teaching in the digital era, I think one of the challenges we have is to take this act of designing, which is somewhat foreign to managers in general, and make it more familiar. And so process has been an important part of that. But like all definitions of design thinking, there is at its core this emphasis on what designers like IDEO call empathy, but what business strategists would tend to call identification of unarticulated needs. So I think it's a language difference, but it's essentially the same process that focus on possibilities and then this notion of hypothesis testing and iteration that we have a tentative first step that is really just the first step on a path to an Iterated solution. So as we look at that, as we talk about design thinking, as we focus on it, so we're talking about learning focused, hypothesis driven focus on inventing, rather than just discovering significant attention to problem exploration and finding as opposed to just problem solution. So again, when we go to work with managers with this, the decision bias characteristic of most managers makes it very hard to hold them in the problem space and they move too rapidly to the solution space. And of course, it's the quality of insights that are generated in the problem space that allow for truly creative alternatives to emerge in the ideation space. So this set of activities in design thinking that hold managers in the problem space, I think is one of the critical differentiators of it as a problem solving process that is particularly valuable. The other very valuable notion I face is this emphasis on the concrete and the visual. In some ways, one of our challenges in the strategy world has always been we deal at a level of abstraction. So the reason strategies don't get implemented is because they don't really mean anything to the people who must implement them, right? They're slogans, their mission statements, they are detached from the day to day activities of the people. We need to implement these new strategies. Design cycles continuously between the abstract and the concrete. And it is that cycling back and forth, that identification at a fairly abstract level of our intention and of design criteria, that then circles into the specification of particular ideas and that then is tested so we can circle back to the abstract. And it's that connection of the two that I think makes it powerful. One of the important ways that it's connected in the design field is through visualization. And so a core tool of design is this notion of making whatever we're talking about visual, often through imagery rather than through text. And this, of course, is a particularly challenging one for managers because most of us are not trained to be particularly visual. But again, the notion is, as we start to look at design, in my world of strategic conversations, one of the key aspects is it facilitates a conversation that is much more public and much more visible to everyone engaged in it through using some of these different techniques that they use. So I'll just conclude by saying three core processes, I think, that almost everyone would agree to. There are, needless to say, as many different sets of vocabularies around design thinking as there are consultants doing it. So IDEO has theirs, luma Institute has theirs, brog has theirs. Darden has ours. The Stanford D School has theirs. The wonderful part, though, is when you unpack them, they are essentially in agreement about three core activities. Some kind of need finding stage with its toolkit, some set of ideation techniques, and then finally some kind of experimentation testing methodology. And I'll just end by saying at Darden as we've implemented it and we've taught it and we've now taught it pretty extensively online through several rounds, of coursera course, which had 40,000 plus people registered who occasionally showed up and now more in depth in executive education online courses as well as face to face courses with executives and the MBAs. We've been working with this model which basically says, let's understand what is let's ideate, let's conduct some thought experiments before we move to in market experiments and then let's figure out how to design what we call learning launches. Quick market in market experiments. Believe it or not, as we've taught it over the past five years, this turns out to be insufficiently precise for managers to learn design thinking in our experience. So we have ended up designing this kind of absurdly detailed 15 step process, which as my favorite apology for this is from a woman named Corin Hansen who headed into its design services, who said basically people can't play jazz until they learn their chords. And so in many ways, this detailed methodology is designed to deal with managers'anxiety about the uncertainty and ambiguity of the process, walk them through a carefully orchestrated process so that they can then kind of ignore it and play jazz as they gain confidence and facility with the tools. I think it's very interesting, and I'll leave you with that, to think about whether or not and I'll leave a question mark. A methodology like this would be truly helpful given the challenges, particular challenges that organizational design presents. So with that, I will stop talking and look forward to future conversations.

Speaker C One of the delights being invited here, I got to look at Jean's videos, her coursera, and look at some of what design thinking is so I might be able to say something about it. And I might highly recommend a video on the Good Kitchen, a redesign of Danish food service, state service to shut in people. It is a magnificent example of interdisciplinary study looking at all stakeholders, coming up with truly imaginative solutions. A gift to society, really is a better society because of design thinking done by the state, done by a government agency, an enlightened one at that, a Danish one, an enlightened agency that really cares about people. So that was a delight then to reflect. I once went to a design thinking conference at Case Western where they celebrated architecture in their new management school. And it was about design thinking and management, inviting people in, management who tend to be more rational to get involved in the way the architect thinks. And we walked through this lovely building that had been created there and it was really a very impressive trying to get us. So what do I know? In reflecting on my own history, I was trained in the Myers Briggs. How many people know the Myers Briggs types? A few of you. I remember teaching many of the managers, sensor thinker, judgers, transactionalists, rigid engineers. Who were the designers? Who were the architects? INTJs, intuitive, introverted, intuitive thinker judgers. When you mapped them, they were like night and day. And so what we're trying to do is train cats to be kangaroos. I don't know. It seems like a very difficult process. Okay, that's all I'm saying is and I knew about cultural integration. I was trained at UCLA as an organizational behaviors organization developer facilitator. What does that mean, we grew up in North America. Rigid silos, any organization problem. You needed to take people across the disciplines, bring them and give them templates. What did we do? We invented all kinds of wallpaper graphics. Jeff Ball and his friend facilitated graphics put complicated systems. We developed strategic planning processes, war rooms with graphics on the wall. Iterating through. We had templates and structures to help people cross silos, to solve recurring organizational problems in a new way. So we have Roots and Burns and stalker. In England, they decided that R D did in fact have a different culture and had to be separated from manufacturing. And then the contingency theorists said, and we need all these liaison intermediators who can help these people talk to each other because they have such different values efficiency and widgets and long runs versus tailors and so forth. And so the field has been, how do we get these silos and design jobs so that we actually understand and can empathize across the silos? Major problem in organization design and development. The Japanese and the Orientals know they rotate people across silos. They're general managers. We don't. It's rigid and jarring and shaking and tension filled. So we're in the job of trying to bring these people together. So it's an old problem, and this is a wonderful new approach. Still, the old problems are there. So what in the world can we bring to this? I can say that we can point to some really good work you're starting out, but I come from the Global Design Society and we're based on the work of Elliot Jackson, Wilford Brown. Levels of work complexity. If you think of large world organizations, they don't really need more than seven levels. Think of GE. Think of Exxon. They may have a couple of extra levels, but they can do it with seven. And if you think of the five unit business model, which was adopted by GE about 1970, it came from Elliot Jacks, and it goes from Frontline. Frontline manager, director, VP, and business unit heads. It's in Ramsharan's book on leadership pipeline. These levels are not new. They're now in culture. Right? And then the additional levels of six and seven are corporate EVPs and the CEO of a global corporation. So we know the levels. And Jax has defined levels of work complexity that require human capability to work at that level. If the person doesn't have the ability to work at true VP level systems thinking forward, they're going to fail in assignments which require that, and every level is the same. So let's think perhaps about design thinking. Design thinking can be used at every level in the organization. Maybe we should think maybe the tools are a little different. Maybe the assignments are a little different. As opposed to saying, well, it's all one mass market. But teaching executives, I'm sure you teach them a little differently than you might an MBA. Right? Different problems, different things. So the hope I would give you is at the strategic level there's a guy by the name of Stu Winby came out, associate Tech came out of hewlett managing the Hewlett Packard merger. He has developed accelerated design decision making. Spent more than a million developing a lab where executives at level four, five, six are brought in for short periods of time in an intensely structured environment. One way glass. Notetakers every modern appliance for recapturing and doing the graphics work and they put them through iteratives. Iterative strategic planning. So they have new iterations every couple of months, wholly thought out. And then they go test them with their facilities. They do this within companies. They do it across in a partnership arrangement like in health districts in New England or in Minnesota. So bring very top executives in doing this. So that's an example, I would say that is blessed by seven. The seven probably isn't in the room. There are fives and sixes working together. The other thing we know, design thinking is often used for products, testing them for market. But I'm suggesting it can be used for designing organizational processes as well. Identifying talent, talent pool management processes. There is a marvelous book I would highly recommend to you called Systems Leadership by Ian McDonald, Katie Burke and Carl Stewart. It comes out of the Jack's work with 25 business units in Australia and CRA a huge mining company. And putting the levels in was not enough. You had to redesign the systems at each level 1 minute. We had to design the systems at each level to work. And there are instructions and templates for how to build those systems. Now I would say that also design thinking can be used for continuous improvement at operations at three, probably at two. And there are probably versions of it to get frontline workers collaborating even across functions, working to observe the customer if they see them, to bring creativity and design thinking to their work. So what I add in these comments is basically why not take a look at this? There is hope. There are prototypes and templates. Why not look at this from a level's point of view and see if we can sharpen up and making sure each project is that much more successful. There's tremendous promise in the effort. And one thing I might note just as if I have a few more seconds, what I noticed about Good Kitchen, they were external consultants working inside. They were the ones that had the INTJs and the people who did the interdisciplinary thinking and the surveys and the staff was bright enough to use it, but it wasn't inside. Now, if companies are willing to invest heavily in training their own people, I'd say that's amazing. But I would say the percent of companies now willing to do that is pretty small. So it's something to be explored and expanded. Thank you very much.

Speaker A We have time for maybe one question or if there's any burning questions.

Speaker D Gene, you talked about that this is emphasis on problem, not on solution and keeping constraints and possibilities and values and so on. And if you look at, in some sense simplifying this down, some of the decision theory, decision problems and so on, case studies, whether they're a strategy or anywhere division's curriculum have some of those elements to them. So I guess my question is, as an academic, how does this fit with the rest of the curriculum at Norton in terms of this kind of decision?

Speaker B Well, like decides to I was going to say like the entrance of anything new and controversial. It sits as an elective that students take when they want it and has for some time. Next year we are for the first time integrating it into the core first year as the backbone structure to a major project class. One way to think of this design thinking is as a project management system for certain types of projects. So we will be assigning all first year students to teams of these fairly messy, kind of high level policy type problems and then we will kind of be surreptitiously using the design thinking toolkit to structure their work as they go through the system. But in terms of a design thinking class where it would sit, some of it sits in strategy. Of course, as we talk about strategic planning, some of it clearly sits, I think, in leadership in some ways. Some of the most successful company efforts we're seeing in this area are companies like Mars that have integrated design thinking into their core leadership development curriculum of their managers because it is such a way to facilitate leadership and conversation and more creative thinking and things like that. So I think there's a big part of it in leadership. Certainly it's always been in the product development curriculum, so it's in our entrepreneurship curriculum. It's an interesting question as to how distinctive does design thinking meet the tests of discriminant validity? It clearly meets the convergent validity test. Having looked at the methodologies, whether it meets the discriminant validity test and is all that intact as a system and a theory? I don't think so. It's clearly been out there in other places. What the methodology does is, I think, integrate a bunch of theories and practices that have long existed in different places and parts of the curriculum and areas of academic interest and pull them together in a kind of a systematic way. But I don't think you can call it in any way theoretically new or a union. Thank you.