This is an abstract from a speech delivered at BAI Beacon 2017 together with Douglas Hampton-Dowson, Creative Director at Reality Interactive, a company that specializes in creating innovative digital experience in the retail space.
A Navy submarine has periscopes, and periscopes need controllers to operate its complex mechanisms. The US Navy used to spend $150,000 for each new periscope controller every time one broke or needed a replacement. Someone, someday, thought that there must be a better way. So they put together a bunch of Navy people, designers from The Johns Hopkins University Applied Physics Lab, and engineers working together for a couple of days in the same room. They used Design Thinking processes to understand the needs of submarine operators, come up with a multitude of ideas, and prototype a few solutions.
One of these ideas called for replacing the periscope controller with an Xbox 360 controller (yes, the video game console). This controller can be purchased at regular stores and even online, and only costs $28. But would it work?
Over the course of a couple of months, the team built a working prototype with a simulator, and validated that the Xbox controller was in fact able to control the periscope. Fast forward a few years, and all the Virginia-class submarines today have periscopes that are driven with a video game controller, saving not only money, but also making training much faster (who hasn’t played a video game before?). Big shout out to Josh Smith and David Nobles for leading the JHU/APL Tactical Advancements for the Next Generation (TANG) effort. Learn more
Design Thinking - what & why
If you’re in business today, you likely either want to innovate, or you’re being asked to innovate. You need a way to get to workable innovation reliably. The brilliant thoughts in the shower are rare. We cannot rely on that to generate innovative ideas for our business. We need something more reliable, a process that helps us find ideas and validate them with real people.
Design Thinking is a process that helps designers, product managers, and innovators understand user needs, generate ideas, and transform ideas into possible design solutions that are validated by real people. So instead of waiting for the light bulb to appear, this process helps you get to useful innovations regularly and reliably.
The term “Design Thinking” originates from a HBR article by IDEO’s CEO Tim Brown. He wanted to offer a way to merge design with a new way of thinking about customer needs.
Good designers know they can’t do it all at once, so they break it into steps. Design Thinking as a process has been described in many ways by different organizations. They all come down to three basic principles:
Most people, if they are smart, when presented with a problem they can understand it. But designers know that even if they have some understanding of a problem, it’s only from their own perspective. There might be many more aspects that they don’t understand, and opportunities that they may be missing to learn something new. So they go out into the real world and talk to real customers, observe how they use a product, and develop empathy for their needs and problems. By changing perspective to the customer’s, designers are able to learn and define the needs in greater detail, and come up with better ideas.
What most people do when they have a problem is they think of a solution, see a pattern of how that problem was solved in the past, and apply a similar solution to it. But what designers do, even though they may have a solution in mind, they’ll put that to the side. They know that the first idea is often a bad one. So in this phase they spend time on brainstorming a lot of different possibilities. They think of multiple solutions, then they put pieces of solutions together, and what they end up with is better than their first idea, or any of their ideas.
We start from the understanding that we won’t solve a problem the first time. It’s going to take a lot of trial and error to find the right solutions. You’ve probably heard of phrases like “rapid prototyping” or “fail fast”, and this is the phase when these things are occurring. This is the space to build prototypes of our solution and test them with real people, get their feedback, and learn from it. The goal is to validate the details of our solution, and the overall customer experience we want to deliver.
Design Doing at a Bank
A nationwide US bank wanted to design the branch of the future. Like every bank in the US we realized that branches are a double-edge sword: on one end they foster community engagement, brand visibility, and first-line support for customers. On the other, they are often a cost-center and a large real-estate expense for banks.
So how to transform the branches to make them more innovative, engage our customers, and align with our strategy of digital-first? We decided to adopt Design Thinking processes to ideate new ideas, incorporate customer feedback, and validate what idea worked better.
Introducing iPad tablets for bankers
We realized that in order to drive digital adoption in our branches, we had to make our bankers more digital first. For us, that meant making them mobile, with the use of tablets that could be used to demo our tools, and meet the customers away from the desk, anywhere in the branch.
Besides this general idea, we didn’t know what we want to use the tablets for. Other banks were already testing tablets - iPads, Android, or Microsoft Surface - with a variety of use cases. Other institutions, outside of financial services, were also using tablets.
At a LensCrafters store customers could snap a photo of their face and try different types of frames using an app. Nordstrom was testing a similar concept for sunglasses. AVIS rent a car had tablets in the rental lot for quick check-in, skipping the rental counter all-together.
How we approached it
We had no idea on what to use the tablets for. So instead of coming up with a huge plan, we acquired a couple of iPads and placed them on the desk of a couple of bankers. And then waited to see how customers and bankers used it.
The first try was a failure. No customer picked it up. They just seemed to ignore it. When we asked, they said that they thought it was the banker’s personal iPad and not one available for them to use.
We then changed the setup by placing a couple of stands and putting the iPads on the stands, facing the customers. At this point customers started using them.
At first there wasn’t much on the iPads, but we followed the same process in creating a suite of apps. We quickly created a prototype of an app, placed it on the iPad, and observed how customers used it. If they didn’t like it, we changed plan and tried again with a new prototype. If they liked it, we developed the prototype further, ultimately creating an app.
In just a couple of months we were able to test and validate a lot of assumptions around the devices, the apps, the stands, the Wi-Fi connection, and a lot more, and we used all these insights to take the project to the next step and plan a full rollout to all branches.
Creating a digital bar
The idea for the Digital bar was a piece of furniture placed in the middle of a branch, with a bunch of iPads on top. Customers would be invited to do their banking there, rather than wait to see a banker. It would speed up service while at the same time educate customers on our digital tools.
We wanted to validate the idea: would customers like to do self-servicing in the branch, or just wanted to see a banker? Was saving the wait time a big benefit? Would they be able to use the iPad on their own, or would they need assistance?
We decided to start with a few basic prototypes. We bought a bar-height table and a couple of stools from Target and setup a “digital bar” in one branch. We placed the iPads, and then started observing how customers behaved.
Failure & alternative
This idea made a lot of sense on paper, but when rolled out in practice it was actually a failure. During an observational visit, we noticed that almost every customer when greeted and invited to the digital service bar, said “no thanks, I’m old fashioned” and kept walking to the teller line. They had no interest in trying the digital bar. They preferred to wait in the teller line as they had always done. Since the line was moving reasonably quickly, there wasn’t enough of a motivation to change behavior.
We needed to entice people to use the digital bar instead of the teller windows. We came up with the idea of removing a teller from the counters and re-assigning them to be a “bartender” on the digital service bar. This change made the wait on the teller line longer, and the digital service bar’s promise of faster service more appealing. At that point we started seeing more customers stop by the digital bar and show interest in learning how to do transactions on their own using digital tools.
Walking tours and exploration
Ideas don’t come in a void. Building context for the team and learning what’s already out there is imperative. We decided to go on an exploration tour and organized a few trips to New York city to learn about what other retail companies were doing in their “flagship” stores. We visited not only Citi and Bank of America, but also TWC, Samsung, Apple, LensCrafters, and several others. They were all experimenting with new models inspired by digital innovation, and we were looking for ideas and inspiration.
Design Doing at Time Warner Cable
The Reality Interactive design team was hired by Time Warner Cable to reinvent the customer experience at its retail locations. For this challenging task they selected the flagship store in New York City, which also held the unfortunate record of having the lowest customer satisfaction across the entire company.
A new retail experience
The team reinvented the store experience with a new layout, digital experiences, and large spaces where customers could spend their wait time exploring new services and technologies offered by the company.
The redesign brought a lot of improvements, driving the store to generate an unmatched 66% YoY growth and win lots of awards. Customer feedback was great, instead of waiting in line, now people waited in the lounge area, and a rep would call them when it was their turn.
Yet, the team felt they hadn't cracked it entirely. When observing customers in the store they noticed that instead of spending the available time exploring the store and the other services provided, the customers just sat down, or spent time on their own phone.
The new store was built around the idea of exploration, but no one was exploring it. The only time the customers were interacting with the company was at check-in, and during the service time. All the wait time in between was a lost opportunity to engage with them. The team knew it had to crack this last piece of the puzzle to deliver a really valuable experience.
Not a new problem after all
The first idea was to look at competitors, and how they were solving the problem. But when the team looked at them, it seemed everyone was doing the same thing. The team realized that unless it really changed point of view, it had no way to come up with innovative solutions.
The team then started looking at other industries.
It studied Dunking Donuts, and learned how customers wait in line in front of a selection of donuts and other products, stimulating their desire for more sugar-induced pleasures.
It studied Sephora, and in particular the check-out line. The line is always long, but somehow Sephora managed to turn the wait into a profitable opportunity for the company by stocking the line area with all sorts of merchandise, stimulating the need for impulse shopping and keeping customers busy. Similar ideas are employed at other retailers, like Barnes & Nobles, and Best Buy.
Finally, the team decided to spend an afternoon at Ikea. Not only has Ikea revolutionized the shopping experience for furniture, but also has created stores that act as vacuum tornados for their customers: once you get in, it’s hard to get out. They achieve this by strategically placing merchandise throughout the store in ways that customers can use and experience it, and by creating paths that swirl through the location and force customers to get exposed to all product categories.
A new retail experience, reinvented
Using all these insights, the team redesigned the Time Warner store experience once more. By now, TWC had been acquired by Spectrum, and the rebranding was also an opportunity for a new store experience.
Reality Interactive completely redesigned the store layout creating paths that customers should follow while waiting in line for a service representatives. A digital service bar becomes the cornerstone of the new store, offering customers the opportunity to solve their problem in self-service, or learn about new products while waiting in line. Instead of expecting the customer to actively exploring the store, they are guided in the exploration, are presented products along the way, and are exposed to new products and services while walking down the line.
How can you do it
There are many ways to connect with your customers and learn from them. For example, I recently worked for a company in North Carolina that provides its product managers access to market research created from customer interviews. The problem is that the research is conducted independently by a third-party, and the product managers are only given the moderated content of the interviews, with no access to real customers. On top of that, the third-party charges the company $2,000 per customer. That makes research extremely expensive, and also not effective (as the feedback is diluted and filtered by a third-party).
The most important takeaway I’d like for you to take is that creating a culture of user-centered design and employing Design Thinking techniques should not cost a fortune. Certainly, there are companies that build in-house Design labs and User Research labs. But finding customers, connecting with them, and learning of new ways to improve your product can be done in a much simpler way.
For example, in one of the teams I worked with, we were able to take that cost down to $25 - the cost of an Amazon gift card we gave to every customer that accepted to spend a few minutes with us for an interview. We cut off the third party, and looked for customers on our own. We just intercepted them at a branch, or invited them to meet with us using Craigslist. And because we were talking directly with the customers, we were able to learn much more from them, and iterate multiple tests in a short amount of time.
This reduced the cost, provided better feedback (and observation opportunities) and improved the speed of testing.
At the Hard Yards, we can help you build a Design Thinking practice for your projects. Our consultants and trainers bring real industry experience to each project, having conducted research and ideated new solutions across a variety of projects.