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Implementing Lean Marketing Systems

Using Design Thinking for Growth Guest was Tim Ogilvie

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Implementing Lean Marketing Systems Tim Ogilvie is the CEO of Peer Insight, an innovation strategy consultancy, where he has made pioneering contributions to the emerging disciplines of service innovation, customer experience design, and business model exploration. His projects seek to create organic growth by using design thinking methods to link new customer experiences to scalable business models. “Design thinking� is a topic that recently burst onto the scene accompanied by lofty promises but precious few practical details. Designing for Growth: A Design Thinking Tool Kit for Managers is the book that provides those details. Going beyond the basic theory and philosophy of recent books about the topic, it shows readers how to apply design thinking in a step-by-step way to solve complex growth opportunities. Authors Jeanne Liedtka and Tim Ogilvie assure readers that business leaders already have the power to design for the 21st century–they just need to figure out how to use it. And they say that any leader of innovation in an organization has likely been practicing design thinking all along. Written in an approachable, hyperbole-free tone, Designing for Growth: A Design Thinking Toolkit for Managers will help business owners, executives, managers and staff discover the strengths they already have and teach them how to develop some new skills, providing the tools and templates to make readers instant brown-belts in design thinking.

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Implementing Lean Marketing Systems Joe Dager: Welcome everyone. This is Joe Dager, the host of the Business901 podcast. With me today is Tim Ogilvie who's the CEO of Peer Insight, an innovations strategy consultancy, and he is the coauthor of "Designing for Growth," a new book which is subtitled "A Design Thinking Toolkit for Managers." I want to thank you, Tim, for joining me. I would like to start off by asking one of your questions, "Who your book is meant for, designers, innovators or is it a book for business managers?" Tim Ogilvie: Great question. It is definitely targeted for the practicing manager, the person who's got a responsibility to grow their business and who does not have any training in design; plain and simple, is looking at ways to grow their business. That's our target. Joe: Is it a business management tool versus, something for innovators or for design engineers? Tim: Well one of the challenges in innovation, Joe, is the vocabulary isn't very uniform or shared. Unlike in the quality profession where we have really precise language, we just don't have that in the world of growth and innovation. Design in particular is just a really fuzzy word that means a lot of things to a lot of people. What we've done is to try to effectively demystify what design thinking is. There's certainly been a lot of hyperbole and a lot of talk at an abstract level. And my coauthor and I thought, we need to reduce this to something really practical that's a tool that people can use. What you find as I know you spent time with the book is, it's very much written in layperson's terms with the least amount of fancy jargon and the greatest amount of very Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems practical stories of how everyday managers are quitting the tools to use. That's the thing I'm proudest of. Personally I'm vocabulary challenged; often will find a really precise fancy word, and so fortunately your clients really coach you to put it in plain English. My coauthor has been really great that way, to keep the entire book in usable plain English for the practicing manager. Joe: One of the things I hesitated about is, when I did see your coauthor being from, I think, Columbia Business School, I thought is this going to be like a textbook? What is it going to be? That was one of my first thoughts when I was looking at it on Amazon, and it's not at all. Tim: Jeanne is just the most pragmatic strategy professor in the world, and I have been teaching with her for four years. When she invited me to coauthor the book I knew it would be super practical, super usable, but I totally understand your hesitation. The expectation of the academic world is nuanced, precise, vocabulary laden, and what we managed to create is actually completely story based and practical. And again, for me that's easy. My whole world is practicing with real managers on the ground. But for Jeanne, it's an amazing trick for my coauthor, and she has pulled it off. Joe: Is this book a reflection of what you do at Peer Insights? Tim: Oh yes, very much so. When she approached me she said, "Tim, you have to help me write this book, because I don't have stories - the access to all those stories and the people doing this - in the same way that you do." She knew what we did as a firm, and Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems we've been teaching together for four years, and so we knew that would come together quite naturally. But I think our usual role in the world is to help companies solve growth problems, and design thinking is a set of tools that are optimized to solve growth problems. So this is a very close approximation of our role in the business world. Joe: Can you kind of give me an idea of how you would define design thinking? Tim: Yeah. I'm trained as an engineer, and I grew up in the quality movement in the late '80s and early '90s. And in the quality movement we use a method of thinking I would refer to as analytical thinking. You have a data set to work from and you reduce that data set to a series of insights, and you build potential new answers based on that. Design thinking is another problem solving approach that is a complement to analytic thinking. Design thinking is perfect for situations where we're looking at a future that doesn't exist yet. Joe, if we're trying to figure out a future that may or may not come into existence, we don't have any source of data. The analytic tools break down very quickly. Then as a practicing manager you think, "Well, I don't have tools for that." Design thinking is the tools for that, to say, hey, we can actually prototype alternative futures. Rather than creating data for them, we can simply have target users experience those prototypes. We can observe from their own behaviors and preferences which ones are working better than others. So, very much, the core of what's in a design thinking approach is extreme focus on the user and their experience; visualizing multiple options, testing those in the hands of the users, and iterating very quickly from less appealing options to more appealing options. Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems It just relies on experimentation which analytic problem solving processes don't need to rely on those as much because, in the world of analytics, we have source data from which to work. Joe: When you come out of a business management school, it seems like MBAs are all very driven by analytics, are they not? Tim: Well that's what we're trained in and, for that matter, even before MBA we start getting trained in analytics in fourth and fifth grade is the reality of it. We stop being trained in design because it's not very practical. We're not going to be able to get a job, most of us, as designers. It's a shame that we stop developing those gifts because we all have them. But the beautiful reality of design thinking is you haven't lost your gifts for creative exploration at all. They're so innate to humans. And when we show the tools to a manager, who's an MBA, like you said Joe, and extremely analytics oriented and you put these tools in their hands, they say, "I'll never do it the other way again." They instantly have success. They don't have the vocabulary for it necessarily, but they have the instincts and the intuition perfectly. If I may, I'll tell you a story. One of my favorite design thinkers that we profile in the book is Dave Jarrett. Dave's a senior partner at Crowe Horwath accounting and consulting firm. So, of course, Dave has an MBA; Dave has a CPA. Do you think he's hyper analytically developed? Absolutely. But what he found was that, when they were developing new solutions for clients, they were creating data where none existed. They were treating that data as if it was real. They Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems were building whole solutions that might cost $25,000 to create the prototype, getting it perfect before they took it to the customer. Then they'd go to the customer and the customer would say, "Oh, it's not really what I need." It's like, as Dave says, "You get a lot of false starts." We worked with Dave and solved that and introduced these tools of rapid prototyping. Today what Dave does is, he'll get a group of people in a room. They'll spend a day or a day and a half experimenting with what new solutions could be. They'll turn those into a simple storyboard, a sketch if you will, and go out to customers on day three, before they've spent $25,000 creating a prototype. They'll say, "Hey, here's the scenario we see, and here's the direction we're working toward. What do you think?" What was really fun about Dave's experiment was that he'd schedule an hour with his clients, and his partner said, "You're insane. Your clients don't want you out there halfcocked with something you haven't thought through." What Dave found was just the opposite. That, he said, he'd schedule an hour for these meetings, and the clients were spending two hours completely loving the invitation to design something with us, and they'd have all kinds of enthusiasm. He'd be back a week later with a more highly evolved version of it, and they'd say, "Oh, that's getting much closer. Now it just needs this or it needs..." Within a few weeks they really had figured out what the prototype was that was worth building, and they already had a customer for it before they wrote the first line of code. Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems That, to me, is a guy who's a born again design thinker even though, as we said, he's effectively trained exclusively in analytics and math and in science. Joe: That kind of brings me to a couple of my questions about prototyping and co-creation. You explained the co-creation process to me, because it's out there working with the customer. Versus, I think a lot of people think of co-creation is, that you're getting this customer in this room. You're talking about what each other needs and things like that. But it's not. You're showing him something, working with him through a process, constant prototyping somewhat. Is that a fair analogy? Tim: Yeah, very fair. I think the listing that you're talking about also happens, but it happens upstream. As you're really thinking about whether this is a problem you think you can solve. Of course you're working closely with your customer and you're asking him what's frustrating. Most of our clients have that context already in hand, whether it's an internal customer or, more classically, an external customer. The difference in co-creation and prototyping is you're actually mocking something up visually that, again, it could be a crude sketch or it could be a wiring diagram. Most often we're taking it out of PowerPoint, easily the worst tool for this type of innovation. We're getting it onto a poster, so something that you can lay out on a table like a blueprint, or something you can tape up on the wall. We're asking them to interact with it with their hands, and put a Post-it note at the parts they don't understand or put a Post-it note to fill in a blank.

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Implementing Lean Marketing Systems You can imagine, it's just completely participatory. You're out of language at that point and you're into images, even if they're crude, stick figure images. You're accessing a different part of your customer's brain and a different part of their competence. When I think about Christi Zuber, who's a nurse at Kaiser Permanente, she was asking their nurses in the field to describe a particularly stressful process that they go through every day on the floor. One of the ways she asked them to do it was, she said, "Draw a sketch of what this part of your day is like," and she would have nurses drawing. At first the nurses would say, "Well, it's stressful, but everything's stressful." So we're in language, and it's not working. And they're drawing a picture of themselves on roller skates with people on either side of them shouting at them. Now you're getting somewhere. You're starting to see the real stress that she's feeling. The idea of the roller skates tells you, oh she feels like she can't go fast enough, that she has to find ways to move even faster. She feels like she's being shouted at from two different directions. There's an information flow requirement here that we need to manage. But you're really starting to get, as I say, your customer's competence starting to come through. In the same way that a quality engineer knows that using an Ishikawa diagram is a fantastic way to stimulate people to think about the different potential failure modes in a process. Joe: Well, I think of this as really just a great extension of Lean. Lean is learn by doing, a hypothesis, a PDCA cycle. With these iterations it's a great way of really taking what I call Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems a new level to Lean, because design thinking adds some great skills to it. Especially I look at your organizing framework of what is, what if, what wows, what works, really was a great bridge between a PDCA cycle to a normal business practice. Tim: So I agree, and I have seen Lean experts struggle with design thinking at the front end in a couple of ways. I think philosophically you're right. It's absolutely perfectly aligned. At a practical level, there is in a Lean world, very often a source of data and a set of data tools that are hugely valuable and a certain comfort. Those typically don't really exist in a design problem. If you're looking at futures, we often just don't have data. I think that comfort with using eight or 10 customer interactions as your data, as opposed to, which is obviously all qualitative, and think, "Twelve observations, I can't get any quantitative insights from that." And we agree. So getting some comfort level with small sample sizes, I think, has been a trick. I think there's also Lean practitioners - the desire to get to the answer quickly and get to implementation - that Lean has this wonderful sense that there's a clock ticking. But design thinking seeks at the beginning to keep it open and generate more and more new alternatives, and, in fact, experiment with multiple alternatives in a way that, it's not against the principles of Lean, but as I say, we've seen some Lean practitioners want to jump too quickly to the answer is just intuitively speaking to them. What we urge in design thinking is wait, spend more time and give the customer three alternatives to experience, and not just one. Not just the one that you think is the most likely. That discipline of exploring multiple options is classic designer's discipline. The

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Implementing Lean Marketing Systems designer doesn't believe there's a perfect solution. They believe that there's one that will just be more preferred by users, and the user's behavior will tell you which one that is. Joe: I think that's a great way of looking at it, because it is. We end up sometimes making it a single one instead of going out there with like three. I think it's an excellent way of putting it. Tim: The rule of threes is obviously really human magic right there. If I go to my customer and I say, "I've been working on this thing and here's what I think it is." Go back to Dave Jarrett at Crowe Horwath. He used to take the client a 50-page PowerPoint, and then say, "Hey, what do you think?" The client looks at this beautiful -- they've thought of every question, they've walked through every answer, and he says, "Boy, they're doing this. It doesn't matter what I say. They've put a lot of thought into this." And so he tends to say, "Yeah. I like it." But then when you build it, he may not use it, right. In the design thinking world, you come to him with three different story boards, and you say, "Hey, which of these is more interesting to you?" Now, they're just sketches, and there are three of them, and so you haven't sent a signal to him that you're building any of them. You've signaled that you're open to these three, and in fact if he's got a fourth in his mind that you haven't thought of, you're probably open to that. So, it's just a different degree of tolerance for being in the unknown at the front end of the process that often can really set you free. A firm that a lot of us admire is Google. They test things that they don't think will work. You think, "Well, that sounds stupid." But Gmail is a classic 20 percent times opportunity Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems or offering that they thought probably wouldn't work. Of course, look at the incredible popularity of Gmail. You know, the basic premise behind Gmail is what if you get free email, you let us see it, and a bot gets to read your email messages and serve up ads that you think will be relevant based on what you were talking about in your email. Most people would say, if you did a survey, "Well, that's just an invasion of privacy, and I don't think so." But look at the way Gmail turned out. It does that. I use Gmail. It serves me ads based on reading my personal email messages that I send through Google, and I don't mind. It's just the idea of testing something that you think will fail, as long as you make the test affordable. I think that's another key of design thinking is, we like to place bets, but we like to keep them small. Right? Make the leaps of faith. Design thinking can help you make your leaps of faith smaller leaps. So you can learn very quickly and say, "Oops, I'm not going that way. I'm going the other way." Joe: Design thinking's been around a while, hasn't it? I mean, what's bringing it to the surface now? Tim: I think it's the economic times. I agree completely that there have been firms that have competed on design and have used design thinking to solve problems, but in the '90s none of us really needed it. You could grow by acquiring firms that were similar to yours and integrating them, right, through applying Lean and Six Sigma. You could grow by expanding geographically into a market that you weren't serving yet. You could get both in a way that was more mathematical and required less of a leap of faith. Or, you could get Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems growth where you could actually forecast the ROI in advance and agree that it's acceptable. All right, that growth engine for most companies just isn't available anymore, right? The market's not growing at that rate. We've got global saturation in most markets with the exceptions maybe of India and China. The growth rate's just not there. So, you've got a guy like Jeffrey Immelt of GE, and if he tries to do what Jack Welch did, he'll get fired because he's going to get six or seven percent year on year growth. He's got to do something else. The heyday of M&A, and Six Sigma, and Operational Excellence as giving you double digit growth is over. So, guys like Jeffrey Immelt and guys like A.G. Laffley at P&G said, "I got to do something more than that." I think these were kind of the bellwether firms that said, "Hey, let's unleash design thinking and see if that could be a new engine of organic growth that gets us into the double digit growth that I promised my shareholders." Joe: Can I simplify it and say maybe it's just because back then demand exceeded supply, and now supply exceeds demand? Tim: That's beautiful. And of course, the world's also flat in terms of the way the Internet makes distribution, especially anything that's IT based, extremely cost effective. That's part of the same supply and demand phenomena. I think you've nailed it. Joe: Could that be a reason why design thinking has taken a hold in Europe earlier than it has in the U.S.? Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems Tim: Yes. First of all, design thinking has an appeal to Europe because design has an appeal way beyond what it has in the U.S. Europe has been very design centric. The design education is more extensive. The amount of public money that gets spent on design is ten to one more than the way we use public money here in the U.S. We rely on the private markets to take care of the way government services work, and so, Europe, in general, is much more design forward and has a positive feeling about design. American business has been extremely efficiency oriented and competed on design until the last decade, with the exception of firms like Disney, perhaps, and Apple. But those have been the exception to the rule. I think we're obviously realizing potential, and lots of American firms are competing based on customer experience design and design thinking. We're changing our tune. We're not going to change how we invest public money, I don't think in any meaningful way. But we're certainly having a growing appetite for design thinking. Just to give you an example, there's a wonderful educational program in Chicago based at the Institute of Design, and they're teaching people masters in design management, and every one of these students is getting a job the day they walk out of the door. They can't expand the program, the D school at Stanford, and the Carnegie Mellon's design school they just can't produce enough graduates. The industry is sucking them up at a 100 percent rate. You can clearly see the demand by businesses for skills that are optimized for design thinking is easily outstripping the supply from an educational standpoint.

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Implementing Lean Marketing Systems Joe: Tim, in your book you provided a framework, and I think that's an ideal framework to get into business managers, but do you practice them ten tools? Are you using these on a regular basis and are they just the surface? Do you use a lot more? Tim: Joe, I would say I'm like a reformed smoker. I think there's nobody who's more rabid about anti-smoking than a reformed smoker. I'm a reformed non-design thinker. I like to get to the answer quickly and get into execution surrounded by people who are design trained. In the past eight years, I've learned the discipline to always use the tools of design thinking. So, now it's a learned habit, and a very conscious habit. This is one of the challenges a Six Sigma black belt has is, they have their habits and they've been very successful based on those habits. Design thinking is going to ask them to create some new habits. Truthfully, we use these tools everyday on our internal projects when there's no client. We apply them. I will say that I think the book lays them out in a way that might be artificially linear. Right? Visualization happens at each stage. Prototyping can happen at lots of different stages and for simplicity and clarity we've left them it in a single place in the book. So I think, as you practice with the tools in the book, you'll say, "Oh, I can be prototyping this thing way early." I think that's absolutely right. You might find that you're using some tools in multiple places along the series of four questions. But we use them all everyday. In terms of are there more to the tools that are there, the basic ones? We'll get you were you need to be on every project.

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Implementing Lean Marketing Systems Joe: How did they develop? It's something that you just work from? Because mind mapping, per se, isn't the Tony Buzan type of mind mapping that you imagine. It's a little different than that. Tim: There are more tools, potentially. But we like to keep it straightforward so that it encourages a proxy manager to step in and try it. We polled a bunch of design practitioners in great design firms that are prime companies and people we admire. We looked at the tools that we use, and this was, to us, the most simple and elegant set of tools. I will say the mind mapping, I have a synonym for that, which is sense making. So, imagine you're a Six Sigma black belt and most of the data that you've been processing in an upper lower control limits, or a design of experiments, you're going to have this quantitative data and there's a formula for making sense of it. In the design world, a lot of our data is going to be in many variable forms. When we go observe customers interacting with something, they're going to look at clicks on a website, we're going to test language and see what different language occurs to people. So, we'll look at verbatim key words that they're using. So now you get this big hodge podge of data and we need to make some decisions. There's no algorithm that tells you how to do that. So, mind mapping is the process that we lay out in the book that says the only way to make sense of multiple data sets that is mostly qualitative is to lay it all out in front of you like a yard sale, and get in a room and start generating potential themes with a small group of people that are very immersed in it. To me, it's the signature aspect of design thinking that tells you you're really stretching yourself if you've got three or four, five different sources of data an insight that you need Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems to make sense of. It's the reason why design firms often occupy these open spaces with huge white boards and tackable surfaces. The iconic image of innovation is a big mess on the whiteboard with Post-it notes and photographs and a handful of people pulled close thinking about what it might mean. It is an absolute key part of the process. What I realize is you don't have to get the answer exactly right. What you have to get is a new hypothesis that you think the other guys don't have. That's what you have to get to. Then you can go test the hypothesis in your prototypes with your customers. If they don't hold up, you can come back to the yard sale you have spread out on the wall and ask yourself the question, "Hey, now we have new data, what direction does that nudge us in?" It's a very iterative process. Taking a few bites of the apple in the conference room, getting back out in the field with customers, coming back in the conference room. Again, it may not be the linear process that helps you to calculate your upper and lower control limits, but it's a very human process. We all get it. We've all done this. It's really natural to explore different alternatives and to recalculate once you get some feedback on one of those alternatives. Joe: What I liked about the book, probably more so than anything else, is that it took some of that messiness away from design thinking that I always see. Like you mentioned, the pictures of it is just all these guys with Post-it notes all over the wall, and it's kind of like, "Where do I go from here?" It's OK, but being that left-brained guy, I need some structure to do it for me. I think that's what that framework gave me. It gave me some structure and build upon that to be able to go from point A to point B, but still maintained

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Implementing Lean Marketing Systems that sense of, that it is a hypothesis all the way through and it continues to be a hypothesis. Tim: Yeah, I'm really comfortable that we've got that part right, and the trick of it is to get a person who likes to go to his customer with something really perfect and really buttoned up, and I think the one place it takes real courage is to say, I'm gonna go see my customer and show them something that is makeshift, something that is cobbled together, something that doesn't pretend to be ready for prime time. That's why Google has done us all a great favor. The idea of beta is cool, right? Ten years ago, beta said we hadn't done your homework. Today, put something out on beta says, "I trust my customers to know what it is that they want and to guide me in the right direction." But I say what Google does isn't necessarily what every firm is ready to do and that's one reason why I love David Jarrett at Crowe Horwath. He just had the guts, and his partner said, "I think your clients are going to laugh at you." Right? And they said, "I'm willing to take a risk." He went out and showed his clients cartoons. One of the things they showed was an inventory solution for automobile dealerships, and he had a cartoon of a bunch of red cars and a bunch of blue cars, and one of the red cars was saying, "I'm going to be stuck here forever." And the blue car says, "I'm only going to be here for an hour and a half. I'm the color and the model that's the most popular." It was to lay out the idea that they didn't have good information about which types of cars were the most likely to sell, and they were getting stuck with a bunch of slow moving inventory on their lots. Just that simple little cartoon that he took out to discuss a potential inventory management solution was all he needed to get his car dealership customers to start sharing ideas for Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems what the new inventory management solution could be. That takes real guts, to go to your clients with a cartoon of two cars talking to each other because I think he does call for a little bit of courage. All of us have customers who trust us like that. Joe: I think it takes really a different mindset for a sales person to handle this type of thinking, doesn't it? Tim: It is a different mindset. For every one of us, I think, to be as professionals, to be comfortable not knowing the answer. That's, I think, the crux of it and so maybe if nothing else it just says there's a certain amount of self-honesty, right? That I'm trying to solve a tough problem? It doesn't lend itself to analytic tools because there's no existing source of data that I can calculate my most likely future outcome with. It's still my responsibility to do something about it, getting comfortable that I'm going to start by not knowing the answer. The book says, "Hey, so don't start with your most crucial customer count, where you're already on probation." It says, "Start with an internal customer that you trust, that trusts you, that will work with you on this. Pretty soon you'll find that you will get your sea legs really quickly. Joe: You're supposed to be the expert. I would say you have to have enough confidence to say that, "Yeah, I'm an expert, but I'm not an expert about your business. So let me learn more about yours." Tim: A part your business is they say, "That's one of the tough challenges. We're going to solve this. We're going to figure it out together." Inventory management for a car dealership is always a core process, right? And yet it still isn't solved beautifully because they still have slow moving inventory. Dave Jarrett knew that that was a place that he Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems could go, and that they were well prepared, and both he and his customer were going to explore some unknown areas. I think it takes a certain amount of courage, and so not everybody is going to want to jump in, but companies don't need everybody in their firm to go crazy during design thinking. We just need the people who are responsible for growth, to have permission, and to have the tools to do design thinking. Not everybody's responsible for growth and so I think at P&G they're not trying to get a 100 percent of their employees to be design thinkers. But they sure like to have 15 percent. That's probably a good way to think about it. Joe: A take-off on that is then, how does an organization support the use of design thinking? Tim: It's not native, for sure, in organization. Big organizations are built for control risk mitigation, for executing the existing business, and yet as we found in the GE example, if they just stick to the knitting they're only going to grow at five to six percent a year and that's going to get a CEO fired. I think somewhere you going to have a guy who says, "We have to grow and I'm prepared to take prudent risks to make that happen." I think that's one thing, that's just to make a commitment at the top level to innovation and growth, which means accepting a certain tolerance for failure, and especially of constructive failure that you learn from. A lot of us have actually heard that message from our senior leaders so I think we're in a good place as an economy from that stand point. But a second thing is to start to think of design thinking as tools and not a philosophy, because it's very hard to implement a philosophy if you can't make it tangible and real to the practicing manager. As I said, I came out of Georgia Tech in the late '80s and I taught Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems people in a factory floor how to compute upper and lower control limits who had not had a high school degree. I taught them how to do problem solving using the Ishikawa diagram, how to use a Kanban to communicate with the downstream business process that they were connected to. These are people without a high school degree, many of them, and so those tools work. There's no doubt. They're practical. Well, innovation is not there yet. We're not at that level where, a bible like Dr. Deming’s or a bible like Dr. Juran's bible, that you could turn to and say that this is now reduced to practice. That was part of our goal, was to say, "If we can't turn design thinking into tools that a motivated, smart manager can use, then it will never become the economic gift to society that quality has become." Quality has been an amazing success story in the world in terms of what it has contributed to productivity and the well-being of people in our society. It's amazing. I don't know that design thinking will achieve that, but it has the same potential. That's a big part of this book, was to say, "Let's try to start the dialogue and make it a more pragmatic one about tools and methods that everyday people can use without going to Stanford Design School or the Illinois Institute of Technology. Joe: I think that's a great message, Tim. I agree with you. People and businesses typically get started in quality through the tools. That's how they get started and that's how people learn it. Then you go to the next level where you really start building a culture but without the tools you can't jump into the culture. Tim: I mean, it's a big field. If you want to change you're organization, our organizations are still made up of people and that person who needs to say, "Hey, the skills I brought Design Thinker exposed as Left Brain Dominant Copyright Business901


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Implementing Lean Marketing Systems that got me here are not what you're asking me for now. You're asking me to do design thinking now. I wasn't trained in that, and so how can I picture myself being successful in that world?" If you want them to get on board, you've got to put a tool in their hands and let them demonstrate their confidence in themselves. We did that with quality. When I came out of Georgia Tech and went into manufacturing, I thought everyone was going to be doing it. Instead we had a VP of production and a VP of quality, and they had an argument on the loading dock on the 30th of the month as to whether we we're going to ship that order or not. And the VP of quality said, "It's not high enough quality because I inspected it." And the VP of production said, "I got to make my order." It was an adversarial system, and here we are 25 years later and the quality is all baked in because at our workstation we self-inspected and we fulfilled with a Kanban, and we got single minute exchanges. All of these amazing breakthroughs have happened in that time period. So I think, well, innovation and growth, design thinking is not there yet. But, I think if we take a 25-year view of the potential, it can be an even greater gift to the world if we can reduce it to practice, really have a constructive dialogue about which tools are working the best and how to deploy them. Joe: Is there something that you would like to add to this conversation that maybe I didn't ask? Tim: I have a sense that there's a change in the leadership philosophy of U.S. organizations that will be necessary. This appetite for affordable experimentation and this idea that the most competitive company, it knows how to pick where to learn and how to learn afford-ably. That's still truly not really codified and taught in schools and so it's hard Design Thinker exposed as Left Brain Dominant Copyright Business901


Business901

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Implementing Lean Marketing Systems for me to picture how that change happens. Clearly some of it might be generational. There are those of us in charge that grew up during the M&A and Six Sigma era of the '90s, and we'll pass the mantle of leadership to people who grew up in the 2000s, and maybe that will be part of the answer. I think part of it is going to have to be to get the academic world to support the research around leadership environments that encourage experimentation and failure. That, to me, seems to be one of the things we're doing to make it harder instead of easier. Maybe I should say, that seems to be part of one of the missions is to create this really solid grounded academic understanding of permission. Joe: I think that people are already doing it though, Tim, because my take on it is that's what the gaming industry has done with our kids. With the Wii's and the Xbox's and gamefication is that trial and error and hypothesis is that's how them kids learn, and that's become part of our culture. Tim: I think it's really interesting, play is becoming more part of our culture than it was in the '80s and '90s and play might actually be -- I think you're on to something -- play might actually be the gateway to design thinking. Because if you think about it, I want to conduct a learning experiment, I can do that if I think of it as, "I'm just playing with this and it's not going to cost that much and I'll learn something and then we'll take another run at it based on what we want." Joe: That's how they've adjusted the learning. I mean they've grown up with Mario, Mario and Luigi beating against a wall finding an opening. That's all trial and error. It is how they learn the game. Look at the use of instruction manuals anymore.

Design Thinker exposed as Left Brain Dominant Copyright Business901


Business901

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Implementing Lean Marketing Systems Tim: Yes, I totally see it. The 25 year horizon that I'm talking about will be heavily fueled by a much more open attitude towards constructive experimentation and playful exploration, and you can only see how that will be great for Lean and Six Sigma just as it will be for design thinking. Ultimately, I don't see design thinking as the panacea that's going to stamp out all of our misguided notions about how business works. We know a lot about how business works, right? I just say it's another set of tools. Personally I feel like I'm in an exciting time period where it's struggling to be born in the mass market. It exists wonderfully in the design department, right, but the design department isn't in charge of too much in American business today, and the idea about design thinking isn't, "We just need to have 10x larger design departments." But the idea, it's the same thing for quality. We've had that VP of quality and he had a staff, and the answer to quality wasn't to quadruple the size of his staff. The answer was for him to put himself out of business by making every production worker their own quality inspector. That's going to be the answer for design thinking, too. If you have every, ultimately, every worker who has as many growth responsibilities using design thinking to solve problems, in addition to analytic methods, then that will be an amazing future. Maybe 25 years is too long a horizon, Joe, as you talked about the generational change in philosophy. Maybe it will happen in 15 years. That will be exciting. Joe: I think there is a possibility of that. Well, I would like to thank you very much, Tim. I thoroughly enjoyed the conversation. This podcast will be available in the Business901 website, and also on the Business901 iTunes store. So, thanks again. Tim: Thanks so much for giving me the opportunity to share my thoughts. It's been fun. Design Thinker exposed as Left Brain Dominant Copyright Business901


Business901

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Implementing Lean Marketing Systems Joseph T. Dager Lean Six Sigma Black Belt Ph: 260-438-0411 Fax: 260-818-2022 Email: jtdager@business901.com Web/Blog: http://www.business901.com Twitter: @business901 What others say: In the past 20 years, Joe and I have collaborated on many difficult issues. Joe's ability to combine his expertise with "out of the box" thinking is unsurpassed. He has always delivered quickly, cost effectively and with ingenuity. A brilliant mind that is always a pleasure to work with." James R. Joe Dager is President of Business901, a progressive company providing direction in areas such as Lean Marketing, Product Marketing, Product Launches and Re-Launches. As a Lean Six Sigma Black Belt, Business901 provides and implements marketing, project and performance planning methodologies in small businesses. The simplicity of a single flexible model will create clarity for your staff and as a result better execution. My goal is to allow you spend your time on the need versus the plan. An example of how we may work: Business901 could start with a consulting style utilizing an individual from your organization or a virtual assistance that is well versed in our principles. We have capabilities to plug virtually any marketing function into your process immediately. As proficiencies develop, Business901 moves into a coach’s role supporting the process as needed. The goal of implementing a system is that the processes will become a habit and not an event.

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