Digital Transformation: Design Thinking (Method)

The digital transformation of society causes familiar points of reference to fade away and complicates innovation - design thinking is the means to new approaches.

Design-Thinking-Workshop

Kai Hebenstreit

Kai Hebenstreit ist Gründer, Geschäftsführer und Dozent bei manymize®. Er ist Experte für digitale Unternehmensstrategien, digitale Geschäftsmodelle und Produktstrategien. Seine Digitalerfahrung hat er als Designer und eCommerce-Berater unter anderem bei GetIt (KPS Digital), LBi, Ogilvy und BBDO gesammelt. Zu seinen Kunden auf Unternehmensseite zählen unter anderem die METRO AG, Dr. Oetker, Unitymedia, Porsche und Volkswagen. Seit 2012 beschäftigt er sich intensiv mit der Digitalen Transformation von Unternehmen.

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Design-Thinking: Methodical for digital innovation

Design-thinking is a method with which an entrepreneurial challenge is viewed from different perspectives. Design “in design thinking refers to the inventive, methodical generation of ideas and approaches. It takes into account three areas of activity. The people and their needs as a mental guardrail. technology as a tool for achieving goals and economy as a limiting framework. Thinking “in Design-Thinking refers to changing the way of thinking.

The advantages of design thinking will be discussed later in this article. The digitization of society and the digital transformation are leading to the dissolution of industry boundaries, and markets are changing. The industry, its own company and the markets are no longer constants. Design thinking is the methodology for generating new knowledge. In this insight we shed light on the peculiarities of the change in thinking, the process and practical experience with design thinking. We also show how other methods dock with design thinking.

Design Thinking – An Introduction

The goal of design thinking is not an individual’s Eureka moment, but the achievement of an interdisciplinary team. Design-Thinking focuses on the problem understanding and wisdom of the group. Only then does the understanding of the solution follow. In today’s digital society, the needs and desires are the new fixed points of thinking. Digital technology helps to solve everyday obstacles and problems. To achieve this, the focus must be on new ideas, approaches and concepts. Your own industries, branch rules and branch boundaries are increasingly disappearing as a point of reference. Derivations of success or failure from the known are therefore more and more often no longer generating innovation. Digital intruders think differently and generate innovation from the changing needs of customers. They generate ideas, condense them and test them on the market. The tool is design-thinking – it changes the way of thinking, creates new perspectives and leads to new options for action.

Design Thinking – The 2 domain and 4 types of analytical thinking

Analytical human thinking is divided into two directions. Each direction consists of two other ways of thinking. This results in a total of four different ways of thinking. The first line of thought always refers to known facts. From these facts it forms derivations and patterns. These patterns lead to an understanding of successful options for action. The known facts are taken from the activities of the market. Within the familiar framework of industries, markets and products we are looking for promising samples. Thinking does not leave the frame – thinking does not create a changing innovation. Derivative thinking is taught in management. When value-added was rigid and the needs of customers in general could be met with these value-added services, it was sufficient to be better than the competition within the known framework. Today, competition is created by companies that use digital strategies and concepts to rethink value creation, industries and markets and satisfy their needs in greater detail. They leave and ignore known limitations and focus on applying the second line of thought. This focuses on generating new knowledge. The findings are not confirmed in the first step, but they can be validated on the market. Based on the validated findings, confirmed individual facts emerge. Knowledge-oriented thinking connects them to new systems. This creates both innovation and the new template for derivation-oriented thinking. This makes it relatively clear why business leaders can understand new business models and derive the success factors, but they were not able to generate innovation themselves beforehand – a methodology is needed to be able to change the models of thought. This methodology is design-thinking.

“Deduction proves that something has to be; induction shows that something is actually effective; abduction merely indicates that something can be.” – Peirce: Collected Papers (CP 5.171)

Design thinking generates new insights into what can be. It thus delivers templates that are confirmed or refuted on the market with suitable startup methods. This results in knowledge about the actual effectiveness. Based on this knowledge, new systems (business models, brands and products) are formed, of which it is known that it “must be so” in order to be successful. The starting point for “what can be” is man and human behaviour. EmotionalCommerce© is used to set up customer archetypes and analyze the everyday life of the customer in order to generate “what he can do” with design thinking. Let us now take a detailed look at the ways of thinking.

Derivation-oriented analytical thinking

Design-Thinking: Deduktives und Induktives Denken
Derivative thinking starts with an observable cause, a fact. From this, the effect is derived in the best possible way. The process leads to a new understanding of interrelationships – new recurring patterns and processes are recognized and transformed into options for action. This thinking always leads to results when known, observable and repeating patterns (constants) occur. It is backward facing and always looks at what is already there. That’s why this thinking is so wonderfully suitable for well-known markets, industries and value-added products. And that is why it is unsuitable for generating digital innovation.

  • Deductive thinking

    Deductive thinking is based on derivations or derivations (If-Then statements). General, observable rules and patterns will be transformed to your own applications and challenges. Logical consequences for one’s own actions arise from given patterns. The tools of deductive thinking are best practice, case studies and market research. At best, it creates new variants on the market of established offers.

  • Inductive thinking

    Inductive thinking is applied when the application case and the produced results are clearly visible. Rules for action are derived from this information (correlation). The higher the occurrence of application cases and results, the more precise rules are derived. However, these rules are not necessarily correct (or causal) because not all factors can be observed and analyzed. At best, inductive thinking also creates new variants within the existing framework.

Knowledge-oriented analytical thinking

Digitale Transformation- Erkenntnisorientiertes Denken
Knowledge-oriented thinking is always applied when there are no observable patterns in the environment. It can also be called trial and error. By means of assumptions and actions, new patterns and insights are formed from hypotheses. New mental models of the environment emerge from these new insights. Knowledge-oriented thinking is forward-looking. It assumes that new findings conceal the knowledge for future successful behaviour. The knowledge-oriented thinking is based on the current situation and a known quantity. In the new digital markets, this size is people, their needs and above all their behaviour. From this constant hypotheses are developed and tested in interaction with the customer.

  • Abductive thinking

    Abductive thinking starts with a known quantity. In the digital markets, these are well-known added value and above all the new needs of customers (behavior and expectations). Hypotheses are formed from the known, which make a solution probable. The hypotheses are error-prone and must be confirmed empirically on the market with the customers. Abductive thinking provides new and hitherto unknown insights and thus the basis for innovation. Lean startup / customer development and the business model canvas methodology are based on this way of thinking. EmotionalCommerce® provides the basis for the hypotheses with behavioral psychological persona.

  • Reductive thinking

    Reductive thinking starts with new insights and experiences. New rules and facts are generated from these individual components. A new mental model is created and thus a template for derivation-oriented thinking. If empirically confirmed in the market (e. g. with a Minimum-Viable-Product) a solid foundation for innovation and new solution systems on the basis of digital technology is created (new market, new industry, new products).

The prevailing management doctrine focuses on inferior thinking. This makes sense, because generally known systems have to be organized and controlled. Success factors, added value, benefits and needs are generally known and are served by all market participants. Differentiation takes place in the details, but not through radical innovation. The digitisation of society leads to new expectations and attitudes of customers towards products and services. These new needs are not adequately met with existing systems (industries, markets, products). Management needs a new way to change mindsets and think innovation. This methodology is design-thinking, combined with EmotionalCommerce and Lean-Startup / Customer-Development.

Design-Thinking: Origin and user

Design Thinking was invented by the founders of the design agency IDEO in 1991 as an innovation method and has been consistently developed since then. Since then, countless other companies have adopted the methodology and developed their own training programmes. The SAP founder Hasso-Plattner is one of the best-known representatives of the methodology. With the Hasso-Plattner-Institute he has integrated design thinking into the curriculum of well-known universities (e. g. Stanford University). Thus, design thinking is not only a proven and accepted method, but also proves a lot of success. In Germany, experts can be trained as certified design thinking experts at the Hasso Plattner Institute in Potsdam. We also conduct design thinking workshops with our customers ourselves, combining the learning of the methodology with concrete results.

The design thinking rules

For design thinking workshops, a number of rules have been tried and tested. We would like to introduce these to you here only briefly. You will find them in one form or another in this insight. Try to adhere to these rules in principle, even if it may be difficult, for example, not to express criticism.

  • Visualize your ideas
  • Strengthen wild ideas
  • All the time only one person speaks
  • Think and evaluate from the perspective of the customer hierarchy categories (persona)
  • Use the ideas of others to build on it
  • Stay with the topic and don’t stray from
  • Generate as many ideas as possible
  • Reject criticism, evaluate democratically and fairly
  • Have fun and get motivated out of the workshop
  • .

Design Thinking: The Process

The design thinking process consists of up to six individual steps in four phases, depending on the task at hand. In the first phase, the foundation for knowledge-oriented thinking is laid by modelling with EmotionalCommerce Persona of the customers, as well as possible everyday usage environments. These two components form the foundation. In the second phase, the problem area is defined. How and where are hurdles, how and where are new behaviours not answered? During this phase, a large number of unconfirmed ideas and approaches emerge that leave the familiar. In the third phase, these ideas are then systematically brought together, discussed in detail and evaluated. In the fourth phase, additional methods are used to seek confirmation on the market from real customers. We look at these four phases in detail.

  • Laying the starting point

    Knowledge-oriented thinking starts with a known component. This component is the customer or user. Its behaviour generates or hinders economic success. In the first phase, the aim is to transform the fragmented knowledge about the target group into as meaningful a persona as possible. For example, we use EmotionalCommerce©. This creates a behavioural psychological view of customers and the market. Which new customer archetypes are created, for example, by the change in values, new life goals and new needs? In which situations does the company come into contact with customers. Where and when services are purchased and used (context in everyday life, life phases, life goals). The results are customer archetypes and everyday situations. Both are visualized for workshops and help to accelerate thinking.

  • Defining and Exploring Problem Space (Abductive Thinking)

    The problem area is about gaining a detailed understanding of missing behaviour and the problem itself. Obstacles are determined with the help of persona and everyday models. Digital business models can be used as a starting point. All ideas are quickly sketched and visualized. From a deeper understanding of the new needs, insights and expectations of users, spontaneous ideas and approaches emerge. These can be very extreme. Criticism is not allowed at this stage. With the pool of ideas, the hypotheses, it goes into the next phase.

  • Evaluate and select the solution area (reductive thinking)

    The hypotheses are refined, expanded and concretised through group work. The results will be presented to all participants. With the help of appropriate democratic evaluation methods, a closer selection of ideas is made. The evaluation is based on the persona and the usage context. These are then refined and reworked in subsequent rounds, visually and with the help of simple prototypes. At the end of the phase, a small selection of hypotheses and rough prototypes emerges. These are worked out in the fourth step and tested with different methods on the market (MVPs) or implemented, depending on the task at hand.

  • Further processing with other methods (empirical validation)

    The results of the design thinking workshop can be validated with a variety of methods with customers and users. The spectrum ranges from user acceptance tests (applications) to testing of minimum-viable products on the market (business model). Digital strategies and communication approaches can also be tested to a certain degree on the market. For more information about the characteristics of minimum-value products, see this insight. EmotionalCommerce© accompanies the entire process as a method for generating empathy.

In this section, we have presented the rough course of the design thinking process. In addition, it has become visible where other methods dock with design thinking. Above all, we have outlined how on the basis of EmotionalCommerce© a well-founded behavioural psychological basis is laid on which thinking and acting in innovation projects is based. In this way, the innovation is secured to a limited extent by human behaviour and the risk is limited. Design-thinking can be applied in strategy, tactics and concept.

Findings from design thinking practice

Theory and practice are usually far apart. This is why we would like to share some practical findings with you here. Workshops show very quickly what works and what does not. Consider the following findings when conducting a design thinking workshop.

  • Space makes music

    The result of a design thinking workshop depends heavily on the chosen environment. Performances in one’s own meeting room activate familiar associations, current tasks are present, thinking is limited. Find space outside your company for important design thinking workshops. Think of special places, avoid classical seminar rooms if possible.

  • Visualize ideas

    Design-thinking thrives on visualization and making ideas representational as quickly as possible. Even if the talent for drawing is not pronounced, they avoid text and try to visualize their idea. Visualizations are easier to understand and create a common understanding of the matter.

  • Orient yourself to the everyday life of real people

    Who wouldn’t want the 20-year-old Yuppie with pockets full of coal and the urge to develop himself as a customer? In reality, digital offers are aimed at people with a stressful and planned everyday life. Money and time are scarce. Sometimes only one, sometimes both. Develop solutions of value for these people with the help of behavioral psychological persona. Orient yourself to the everyday life (day, week, month, year, phase of life). Develop solutions that make your daily life better.

  • Have fun

    Even if a design workshop is hard work and hard work and hard, important problems have to be solved – no reason not to leave the workshop motivated. Create a relaxed atmosphere in which ideas and thoughts can unfold freely. Have fun thinking about new ideas and approaches to solve everyday problems.

  • Work together

    Wherever people interact with each other, conflicts are not far away. Whether it’s the daily trench warfare over responsibilities or professional preferences – these things have no place in the design thinking workshop. The workshop is not about them, but about the customer and suitable digital solutions. Work together, have fun and overcome common hurdles in thinking and acting.

  • Every idea has a right to exist

    There are no hierarchies in the workshop. There is no superiors and no right to omniscience. Make sure that every idea is justified. The Design Thinking Workshop is about diversity of ideas and new perspectives. Young, inexperienced or reluctant employees should be able to express and explain their ideas freely. Perhaps the knowledge of these employees hides the opportunity for innovation.

  • Every idea must prove itself

    Ultimately, it is always about finding ideas with a high quality and impact. Therefore, ideas have to prove themselves. Either by being put to the vote or validated on the market with customers. Behavioural psychological attributes (empathy) help to view and evaluate ideas from the customer’s point of view. This increases the quality of the hypotheses and prototypes.

Design-Thinking: Workshop structure

Design-thinking workshops can be held on almost any topic and question. Our Design-Thinking_Workshops lead to first approaches and ideas after only 2-3 days, which are then refined and tested. As a rule, an innovation project usually alternates between design thinking workshops, prototyping, test phases and learning phases until a suitable result is achieved. When it comes to extending or optimizing a product, a design thinking workshop is sufficient. Strategic projects are rather complex and generate, condense, test, learn and refine a sequence of ideas.

Preparation of the Design-Thinking Workshop

The design workshop is prepared with the customer. In the preparatory phase, the foundations for the design thinking workshop are laid. This includes a more precise definition of the task, the development of the persona and the definition of usage situations in everyday life of this persona. The preparation usually takes 1-2 days. The assignment determines the focus of the Design Thinking Workshop.

  • Determine moderator

    The moderator knows the design thinking methodology. He guides the participants through the process. In addition, he or she should be present in advance when setting up the persona and the usage contexts. The moderator does not have to be an expert in your industry. He is only present as a guide through the design thinking process. Ideally, he is trained in behavioural psychology to provide detailed information on behavioral aspects in the process. This is especially important in the solution finding phase. We therefore work with our EmotionalCommerce© methodology.

  • Assign participant

    Recruit people from different departments for the workshops. Make sure that these people are professionally experienced and still have an eye for related topics. If possible, integrate customers into the workshops. Participants do not need to be creative. On the contrary, design thinking thrives on diversity. The group should therefore be as heterogeneous as possible. Invite 6,9 or 12 participants – 3-person groups can be formed from all sizes. Keep the workshop size small. Not everyone who wants to participate has to participate.

  • Determine location and date

    A design thinking workshop unfolds its effect in an unusual, inspiring environment. We therefore recommend booking a location away from the company for strategic design workshops (business model, digital product). Resorts or special conference hotels are available. For the duration of the workshop (minimum 2 days, better 3 days) all participants should stay together at this place. This way, even after the official program, an optimal exchange takes place. Conceptual design workshops in which no superordinate strategies are developed can also be held in the company. These will take 1-2 days. Put the workshop at the end of the week, so that the results are reflected unconsciously on weekends.

  • Visualize customer types (users)

    Collect all available information about your customers before the workshop. Send a questionnaire to the participants and your employees to extract knowledge about the customers. The information will then merge and form between 3-5 persona (user). Add more profiles to the persona – the “decision maker”, the “controller”, the “influencer” and the “saboteur”. These persons act in the B2B context through different people, in the B2C context through family members, friends or other groups. Sometimes it’s just your own voices that contribute to a decision. Ideally, make sure that your persona is equipped with behavioral psychological attributes.

Phase I – Divergence: Exploring the problem area from different perspectives

In the first phase, a deeper understanding of the problem is created for the customer in the context of the task at hand. The focus is on the needs of customer archetypes and the usage context. From a deeper understanding, the first quick, superficial ideas and approaches emerge. These approaches emerge without critical evaluation and are refined towards the end of the first phase. At the end of the phase there are different approaches that have already been selected. We will now take a detailed look at the individual phases. The dates refer to a group of 9 participants.

  • Short-Intro: Short introduction

    Introduction to the process and rules of the design thinking workshop. Presentation of the initial situation and the persona. Distribute the persona as a flyer to all participants. Position or hang personas in the room additionally. Further information may be provided during this phase. This may include, for example, information on changing standards, goals or behavioural patterns. Proven digital business models may also be presented in order to provide a basis for reflection (e. g. in the case of digital business strategies).

  • First step – understanding usage contexts and problem definition

    Use different situations. Start with a normal day in the life of the persona. Collect moments where you can add value with existing resources. Pay attention to moments when the target group cannot or only with difficulty reach your goals. Mark such moments. Then move from the week view, month view, year view up to the view of relevant life phases. Align each time period with behavioural elements (long, medium and short term goals, norms, existing or missing skills). If necessary, use our EmotionalCommerce© methodology. Duration of the first step about 1-2 hours.

  • Second step – developing ideas and approaches (quantitative)

    In this phase, ideas are developed in short time intervals (maximum 15 minutes). Each participant independently develops 5 approaches to solve the problem. The participant considers the problem from the point of view of the customer hierarchy types (empathy). The ideas are visually presented as stories (The persona makes…, um…, then…). Texts and lists are not allowed. Each participant will then briefly present the ideas he or she has come up with to the group and staple them to the wall. The presentation should last a maximum of 5 minutes per participant, criticism and discussions are not allowed. This is followed by the democratic evaluation of each idea (poker card method). Each participant (and the moderator) receives a set of 5 cards (Ace, 10,9,8,7). The higher the card, the higher the rating. The ace serves as a veto card. If a participant plays the card, he/she must raise his/her concerns. The card can only be played once per participant in the overall rating and is then withdrawn by the moderator. A maximum of 5 minutes is allotted for the presentation of the objections. The vote will then be taken again. The score is attached to the ideas with a post-it. If ideas are rated with the same number of points, they will be evaluated again. All other ideas are not affected. The 9 ideas with the highest number of points will be adopted in the next step. All other ideas are collected by the moderator. This step takes about 1.5 hours.

  • Third step – Refinement of ideas and approaches (Qualitative)

    Groups of three persons are formed. The groups are put together as heterogeneously as possible by the moderator before the workshop. Each group develops detailed solutions from the 9 ideas. These solutions are explained and documented with the help of small drawings in the form of a short usage story. At the end of the fourth step, all 27 short concepts are stapled or glued to the wall. The maximum duration of this step should be 3 hours.

After the first phase, release the participants to work late. Document all generated contents carefully (photos). Evaluate the ideas systematically on the basis of the persona and make comments. Start the next day with the second phase.

Phase II – Convergence: Testing the range of solutions

In the second phase of the Design-Thinking Workshop we systematically develop from the 27 ideas.
precise approaches and visualize them with simple prototypes. Creative tasks, presentations and evaluations alternate with each other. At the end of the second phase, 3 concrete prototypes were developed from the 27 rough approaches, which are worked out and validated in the third step.

  • Short presentation and evaluation of ideas

    In the first step, the groups from phase 1 present their ideas to the group. Each idea is considered from the point of view of the customer’s archetypes (empathy) and then evaluated for technical and economic feasibility. All pro- and contra-arguments are collected and pinned to the ideas.
    This step takes about 15 minutes per batch. A maximum of 2.5 hours should be planned. The ideas are then evaluated using the already known poker method. The best 3 ideas are then transferred to the next step. The other ideas are collected and archived by the moderator.

  • Prototyping and formulation

    In the last step, the participants are gathered in the well-known 3-man teams. Each team is now building a prototype of the application with pen and paper. To this end, the individual interactions between the user and the idea are considered and conceptually thought through. At the end of the phase, the teams present their ideas. Plan a maximum of 1-2 hours for this step. The next step is to build a final implementation for each original idea from the three group variants of the 3 original ideas. Discussions are shortened by voting (poker card). The result is three complete solutions that are easy to understand through a visual prototype. These three solutions are transferred to the third phase and worked out by the moderator’s team (e. g. PowerPoint presentation, usable prototypes, minimum-viable-product). Schedule about 4-5 hours for this operation.

The tasks of the workshop participants end here. The developed approaches are formulated and optimised by the consulting firm. Depending on the task and the objective, the characteristics take on a different form. We look at these forms in the third phase, which then runs between consulting and decision-makers. Participants are released into the evening and receive a short documentation of the work results as feedback. Remember that they also ask all participants for suggestions for improvement and evaluation.

Phase III – Combination with other methods

In the third phase, the results of phase 2 will be further processed by the consulting team. Depending on the task, different methods are used. These methods lead to different results. The results should always be tested directly with customers, users or the market. If the assumptions are confirmed, the prototype can be converted into a solution. If assumptions are questioned by feedback, this feedback is incorporated into the customer archetypes and the problem definition. These form the basis for the next Design Thinking workshop. In this way, solutions are developed in harmony with real needs and wishes. Through the successive cycles, insights are quickly collected and can be combined into new mental models and system concepts in the sense of “reducing thinking” (i. e., the learning and application of new knowledge is accelerated). Here we will briefly outline the individual methods.

  • Strategy & Business Model: Customer Development & Lean-Startup

    Design-thinking is combined with proven and innovative startup techniques. These methods are used to develop new solutions directly on the market and with customers to maturity. The focus is on learning. We have already described the three techniques in recent insights. The Insight on Lean-Startup / Minimum-Viable-Product can be found here, the Insight on Customer Development can be found here and the contribution to the Business Model Canvas can be found here.

  • Digital applications: User Experience & Human Centre Design

    This methodology focuses on the user and is used in the conception and design of applications. User Experience Design is consistently and consistently applied to generate competitive advantages, customer loyalty and economic added value with optimal user experiences. EmotionalCommerce© can also be optimally docked to UX-Design because both methods focus the user. We will report on this in the following Insights.

Design-Thinking: Videos from practice

Stanford-University: Virtual Crash-Course


Example of a practical application of design thinking. The individual steps and processes are shown. The video provides about 10 weeks of theoretical knowledge in about 120 minutes. We recommend watching the video if you are interested in a detailed design-thinking workshop.

Conclusion on Design Thinking

In this insight we got to know a new method with which it is possible to change the modes of thinking. Management is usually educated strongly on deductive thinking. Digital transformation eliminates the constants from which deductive thinking can start. Therefore, inferring thinking is not suitable for innovation projects. Design Thinking is a methodology that changes the way we think and delivers results quickly. Together with other methods such as EmotionalCommerce©, Lean-Startup and User-Experience- and Human-Centred-Design, solutions for many current challenges can be found. Design thinking workshops are efficient and effective, fun and effective. Talk to us about it. You already have experience with design-thinking? We look forward to your experiences.