Design vs. Discovery: Which Way to Innovation?

By William Duggan

“Design thinking” is slowly but surely taking over the field of innovation. The result is terrific design.  But that’s not the same as innovation. Below, William Duggan argues the importance of “discovery”, a method that combines solved parts of a problem to arrive at true innovation.

 

I love designers

I really do.  There are lots of them in my neighborhood, Tribeca in downtown Manhattan. They make great friends and neighbors, and great guests at parties and dinners and gallery openings. Architects, product designers, graphic designers, film-makers, commercial artists – the world of design is filled with the most interesting people you can ever hope to meet.

I say this because I want to make clear that I have nothing against designers. As professionals, they are great at design.  But here’s the problem:  companies these days are so desperate for innovation that they hire designers to do it. “Design thinking” is slowly but surely taking over the field of innovation. And designers are flattered and glad for the work.  So they take it.  The result is terrific design. But that’s not the same as innovation.

The confusion arises from the word “creative.”  Companies think that artistic people are creative, so that’s who they need to help them innovate.  But innovation means something “new and useful,” and artistic people are no better at that than anyone else – except in their own fields of architecture, commercial art, etc.  And even there, most of their work is not innovation, but simply excellent design and execution of their artistic products.

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Companies think that artistic people are creative. But innovation means something “new and useful,” and artistic people are no better at that than anyone else – except in their own fields.

This confusion about what “creative” really means has deep roots in science too.  When I first started studying creativity, I was surprised to discover that 99 percent of innovation methods that people use today are based on a model of the brain that neuroscientists abandoned more than a decade ago.  In essence, all these innovation methods tell you to do some kind of research or analysis, and then you brainstorm to come up with your creative idea.  Design thinking is a method of research and analysis.  Brainstorming, as usual, follows.

The theory of brainstorming is that you turn off your analytical left brain, turn on your intuitive right brain, and creative ideas pop out.  But neuroscience now tells us there is no right or left side of the brain, when it comes to thinking.  Creative ideas actually happen like this:  the whole brain takes in past examples, stores them in memory and then selects and re-mixes them to make a new combination.  You can see right away that a brainstorming meeting is no help at all for doing any of these steps.

Ironically, brainstorming works best when you don’t need an innovation.  People actually brainstorm mostly to solve problems they already know how to solve with their current expertise, at least as a group.  When you brainstorm, you really throw out ideas from your personal experience – these come to mind fastest and strongest. If you have a problem that the total personal expertise of six or ten people can solve, then brainstorming is very efficient. But if the solution actually lies outside their personal expertise, brainstorming is a trap: you toss out ideas and get conventional wisdom, not innovation.

Creative ideas actually happen like this: the whole brain takes in past examples, stores them in memory and then selects and re-mixes them to make a new combination.

Let’s take a look at the steps of design thinking to see where the method goes wrong. Design thinking started out as a method of product design, but then the designers proposed to use their same methods for all kinds of business problems. We find a popular version of design thinking in a recent handbook, Business Model Generation. The book lists Alexander Osterwalder and Yves Pigneur as authors, but tells us that the Innovation Hub – “An amazing crowd of 470 practitioners from 45 countries” – co-created it. So the handbook is a good summary of current thinking on this subject from a wide survey of the field. Countless methods of design thinking follow the same basic model that you find in this book.

In particular, the book gives you “techniques and tools from the world of design that can help you design better and more innovative business models.”  The two key steps are to list the nine “building blocks” of all business models and then fill in the blocks using six methods from the world of design. Here are their nine building blocks: Key Partners, Key Activities, Key Resources, Value Proposition, Customer Relationships, Channels, Customer Segments, Cost Structure, and Revenue Streams. That’s fine, but how do I then decide what “key partners” to choose?  Or which “key activities”?  These nine items break down the problem into smaller pieces – they do not tell you how to find a solution.

The solution comes next, from six design methods you use to fill in the blocks:

• Customer Insights = ideas from customers.
Ideation = brainstorm new ideas
Visual Thinking = convert your thoughts into images
Prototyping = build a quick-and-dirty model using your preliminary ideas
Storytelling = what your customers experience as they move through your model
Scenarios = different directions your model could lead

The first one, customer insights, is certainly a good idea.  Customer insights are helpful to have.  Certainly you should learn as much as possible about what customers do and think. That information helps you understand the situation you face.  It does not give you creative ideas.  And it is especially hard to get customer insights about an innovation that does not yet exist.  Customers can comment on existing products and services but that’s all.  And if a product or service is something new and very different from what they already know and use, customers tend not to like it at first.  Why?  They’re used to the old product or service and they don’t want to take the time to learn how to use the new one. That’s why innovations that end up succeeding often do poorly in early focus group tests.

The second item, Ideation, is another name for brainstorming. We’ve already dealt with that.  In this key step, design thinking is no different from the host of innovation methods that came before it.

As for Visual Thinking, it’s good to convert your thoughts into images, but first you must have the thought.  Visual thinking gives you no help there.  Same with Prototyping, Storytelling and Scenarios:  they don’t tell you how to get the idea that you then prototype, explain in a story, or imagine as different scenarios.

Above all, design thinking is a pitch for designers themselves to join or lead innovation teams for all kinds of business problems. After all, innovation amounts to the design of a new product, service or business model: so designers can certainly help. Yet the attempts so far to formalize design thinking for business are mistaken.

Design thinking started out as a method of product design, but then the designers proposed to use their same methods for all kinds of business problems.


But I love discovery even more

Ironically, good designers often use a better method of innovation in their own artistic design work than they use for “design thinking” for business.  When they do actual design, they are masters of eclectic combination, which fits quite well how the brain makes creative ideas. If designers can apply that same skill to business problems, in addition to their visual expertise and customer awareness, they can play a key role on any innovation team. But the correct method to use is not the list of steps for design thinking. We can call it “discovery” instead.

Here’s how it works.

You start with a problem or situation where you aim for an innovation. You break that down into elements of the problem.  Then you search for examples elsewhere that solved each element.  You then see a subset of examples that come together in your mind as a new combination that solves the problem.  That idea is your innovation.

This method matches how your brain works and what innovators actually do.  The key is that you don’t just discover any old thing: you discover examples that solved parts of your problem.  Part of the discipline of discovery is the ability to see all human achievement as potential examples for later use.  That doesn’t mean you put everything you ever see, hear or read on the shelves of your brain – if you did that, your head would explode. But it does mean that everything is a candidate to go on the shelf.  You must consider all things, even if you select very few.

Here’s an example that illustrates how an innovator discovers a subset of examples from a wide set of activities to arrive at a creative idea.

It’s 1997, and Reed Hasting has just sold a successful software company, founded ten years before when he was just out of college.  He’s living in San Jose, California, and goes to the video store to return the movie Apollo 13.   It’s woefully late, so he pays a $40 late fee.  He’s dismayed and embarrassed. How will he tell his wife?  Hmm…does he have to tell her?

Oh, great!  Now I’m thinking about lying to my wife about a late fee and the sanctity of my marriage…

He drives from the video store to his gym club.  On the way there something strikes him:

Whoa!  Video stores could operate like a gym, with a flat membership fee…I wonder why nobody’s done that before?

Here we have two examples coming together from two very different sources. The first is American video stores, which at the time were big boxes filled with racks of videocassettes that customers browsed through to rent and pay for one at a time. Blockbuster was the largest chain in the country. The second example is gym clubs, which were open spaces with lots of machines that members used freely. If you list all the elements of Blockbuster, and all the elements of a gym, you could imagine dozens or even hundreds of possible combinations. Hastings selects a particular subset of elements from Blockbuster as one example and a particular subset of elements from the gym club as another example.

You start with a problem where you aim for an innovation. Then you search for examples elsewhere that solved each element of the problem. You then see a subset of examples that come together in your mind as a new combination that solves the problem. That idea is your innovation.

In taking the Blockbuster example, Hastings assumes that the elements work. There were many Blockbuster stores at the time, and they seemed full of stock and customers. Afterward he checks to make sure video rental is a big enough business to sustain his idea, but for the moment he knows enough to judge that the elements that form his example contribute to Blockbuster’s success. Same with the gym club example: Hastings sees the flat fee for members as a successful part of the gym club formula. And gyms at the time seemed like a thriving industry. Again he can check the numbers afterward, but he knew enough to judge that the example he picked was a worthy one.  Even when he does check the numbers, it’s impossible to pin down precisely the dollar contribution of any particular element, like a flat fee, to the overall success of a company or industry.

In combining these two examples, Hastings displays tremendous presence of mind.  One moment he sees his gym club as a place to exercise:  the next moment he breaks down its elements and finds an example to apply to a completely different industry.  This is exactly the kind of presence of mind you need for discovery and innovation.After combining these two examples, Hastings keeps going.  Amazon was two years old at the time, and already served as a source of examples for many new online business ideas. Amazon pioneered many of the features of e-commerce that we now take for granted, including safe payment with credit cards.  Hastings takes many e-commerce features from Amazon to add to his new combination.  He strips his Blockbuster example of its physical form and uses an Amazon mail-order example to go online instead.

Part of the discipline of discovery is the ability to see all human achievement as potential examples for later use.

For this switch to e-commerce, Hastings needs one more example. A friend tells him about a new technology for movies that just reached the American market from Japan: the digital video disc, or DVD.  It’s far lighter and smaller than Blockbuster’s videocassettes. That makes it much easier to mail.

I ran down to Tower [Records] and bought a bunch and mailed them to myself and then I waited…And I opened them up. And they were fine.  And I thought, “Oh my God.  This is gonna work!”

The time you would normally take for design? Try using it for discovery instead.

You probably recognize the company by now: Netflix.  Hastings combined previous examples from Blockbuster, gym clubs, Amazon and the new DVD technology to create his innovation.  Every example was partial, even the DVDs:  they made recording movies easier too, but Hastings did not take that part for his combination. Some film-makers did, and that led to other innovations.

Note that the combination Hastings came up with had little to do with his own past experience or software expertise.  Certainly thousands of people knew enough about Blockbuster, Amazon, gym clubs and DVDs, to have the same idea. His knowledge of software probably helped him implement his idea, although the idea itself included no actual software innovations.  Thousands of software experts knew how to do what Hastings did to make his Netflix website. Perhaps his software expertise helped give him confidence in the idea because he knew he had the technical skill to do it.  But none of the examples that made up his idea came from his own software experience.

This Netflix story comes from a 2006 interview with Hastings by Lesley Stahl for CBS News.  It does not tell us everything about what went on in Hastings’ mind, but we learn enough to see how he used discovery to arrive at his innovation.  A company can’t copy his method exactly – we can’t just rely on a chance event like a late fee to trigger our search.  But we can come close.  Break down your problem, then search for days or weeks or as long as you have, for examples elsewhere that solved some part of the problem.  The key is to start early enough in your planning cycle to give yourself enough time to search.  The time you would normally take for design – use it for discovery instead.

 

Reprinted by permission of Columbia University Press. Excerpted from Creative Strategy: A Handbook for Innovation by William Duggan. Copyright 2013. All rights reserved.

About the Author

William Duggan is senior lecturer in business at Columbia Business School, where he teaches creative strategy in graduate and executive courses. He has given talks and workshops on creative strategy to thousands of executives from companies in countries around the world. His book Strategic Intuition was named Best Strategy Book of 2007 by Strategy + Business.

 

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