Design Speaks Business - XD Leadership Alliance - 10.30.2018

Congratulations design leaders! With the popularity of Design Thinking, Design Sprints, Human-Centered Design, etc., and the business impact design has created for companies like Apple, Intuit, Ford, Nike, Whirlpool, and Domino’s, Design has earned its seat at the table. We made it!

But with great success, comes greater expectations. As design leaders have taken their seats, built organizations to support them, and incorporated design into organizational ways of working, business leaders continue to struggle with understanding the value design brings to everyday processes, funding decisions, resource allocation, and overall business viability. At this table, design leaders are often outmatched by their counterparts in articulating the value of design while design work is going on. Without being able to clearly articulate that value, design leaders run the risk of being pushed back into service line or peripheral entities.

In this talk, Ryan will review his approaches to connect design success to business success, to use design skills to develop business potential, and to justify design keeping a seat at the table.

Transcript

1. FINANCIAL EXPERIENCE DESIGN 2018 Design Speaks Business Approaches to communicate the business viability of design Ryan Rumsey @ryanrumsey
2. Innovation Source: Norman, D. A., & Verganti, R. (2014). Incremental and radical innovation: Design research versus technology and meaning change. Design Issues, 30(1), 78-96. WE KEEP USING THIS WORD
3. Radical Incremental Innovation Source: Norman, D. A., & Verganti, R. (2014). Incremental and radical innovation: Design research versus technology and meaning change. Design Issues, 30(1), 78-96. WE KEEP USING THIS WORD
4. Radical Incremental Improvements within a given frame of solutions (i.e., “doing better what we already do”) A change of frame (i.e., “doing what we did not do before”) Innovation Source: Norman, D. A., & Verganti, R. (2014). Incremental and radical innovation: Design research versus technology and meaning change. Design Issues, 30(1), 78-96. WE KEEP USING THIS WORD
5. Radical Incremental Improvements within a given frame of solutions (i.e., “doing better what we already do”) A change of frame (i.e., “doing what we did not do before”) Innovation NOVEL UNIQUE ADOPTED Source: Norman, D. A., & Verganti, R. (2014). Incremental and radical innovation: Design research versus technology and meaning change. Design Issues, 30(1), 78-96. WE KEEP USING THIS WORD
6. Radical Incremental Improvements within a given frame of solutions (i.e., “doing better what we already do”) A change of frame (i.e., “doing what we did not do before”) Innovation NOVEL UNIQUE ADOPTED Source: Norman, D. A., & Verganti, R. (2014). Incremental and radical innovation: Design research versus technology and meaning change. Design Issues, 30(1), 78-96. WE KEEP USING THIS WORD
7. CHANGING MINDSETS SIGNIFICANT INVESTMENTS POPULAR CULTURE THE STATE OF DESIGN Design is very en vogue Source: Idea by Creative Stall from the Noun Project; Investment by Creative Stall from the Noun Project; e-book by Creative Stall from the Noun Project
8. IT WORKED! Design Business Technology Our favorite Venn
9. IT WORKED! Design Business Technology Our favorite Venn Innovation
10. ELEVATED AND CELEBRATED FINANCE LEGAL BUSINESS HR TECHNOLOGY OPERATIONS MARKETING RISK SECURITY CEO STRATEGY THE TABLE Businesses are transforming
11. ELEVATED AND CELEBRATED FINANCE LEGAL BUSINESS HR TECHNOLOGY OPERATIONS MARKETING RISK SECURITY CEO STRATEGY THE TABLE Businesses are transforming DESIGN
12. IF IT AIN’T BROKE So, why I am here?
13. A DESIGNERS PERSPECTIVE ON RANKING PRIORITIES Source: https://medium.com/@katearonowitz/who-sets-your-priorities-6283910549c0; https://twitter.com/mrabdussalam/status/923902822969733121 1. User 2. Business 3. Team 4. Self - Kate Aronowitz; Design Partner at GV
14. A DESIGNERS PERSPECTIVE ON RANKING PRIORITIES Source: https://medium.com/@katearonowitz/who-sets-your-priorities-6283910549c0; https://twitter.com/mrabdussalam/status/923902822969733121 1. User 2. Business 3. Team 4. Self - Kate Aronowitz; Design Partner at GV
15. A DESIGNERS PERSPECTIVE ON RANKING PRIORITIES Source: https://medium.com/@katearonowitz/who-sets-your-priorities-6283910549c0; https://twitter.com/mrabdussalam/status/923902822969733121 1. User 2. Business 3. Team 4. Self - Kate Aronowitz; Design Partner at GV
16. NEW CHALLENGES, SAME SONG How do your business partners perceive the value of design in your organization?
17. NEW CHALLENGES, NEW PERSPECTIVE How do your business partners perceive the value of design work in your organization?
18. A TREND I’M NOTICING FROM THE TOP While many companies have invested significantly in design, investment in design work is often still questioned.
19. COMMUNICATING VALUE Source: Tom Mulhern and Steve Portigal Same language, different expectations Design Business Talks about… Innovation Breakthroughs Disruption Results Impact
20. COMMUNICATING VALUE Source: Tom Mulhern and Steve Portigal Same language, different expectations Expects… Schedules Agendas Examples Proof Numbers Expects… Trust & Patience New behavior New thinking “Imagination”
 “Creativity” Design Business Talks about… Innovation Breakthroughs Disruption Results Impact
21. COMMUNICATING VALUE Source: Tom Mulhern and Steve Portigal Same language, different expectations Expects… Schedules Agendas Examples Proof Numbers Expects… Trust & Patience New behavior New thinking “Imagination”
 “Creativity” = misalignment Design Business Talks about… Innovation Breakthroughs Disruption Results Impact
22. Design Business Technology FRAMING VALUE FROM EACH LENS
23. FRAMING VALUE FROM EACH LENS Desirability Will this be adopted by our users? Viability Is this good for business? Feasibility Can this be executed?
24. FRAMING VALUE FROM EACH LENS Desirability Will this be adopted by our users? Viability Is this good for business? Feasibility Can this be executed? Ever notice these circles overlap?
25. FRAMING VALUE FROM EACH LENS Desirability Will this be adopted by our users? Viability Is this good for business? Feasibility Can this be executed? According to this Venn, designers should spend ~20% of their time demonstrating how desirability is good for business.
26. FRAMING VALUE FROM EACH LENS Desirability Will this be adopted by our users? Viability Is this good for business? Feasibility Can this be executed? According to this Venn, designers should spend ~20% of their time demonstrating how desirability is good for business. Many business partners have embraced this overlap. They are closer to design than designers are to business.
27. THE STAKES ARE HIGH FINANCE LEGAL BUSINESS HR TECHNOLOGY OPERATIONS MARKETING RISK SECURITY CEO STRATEGY THE TABLE DESIGN
28. IT WON’T BE EASY The most difficult challenge I’ve had in my career is not designing for users, it’s designing for my colleagues and stakeholders.
29. WHO IS THIS PERSON? Hi. I’m Ryan.
30. WHO IS THIS PERSON? An Experience Strategy is how we create market differentiation with a distinct experience offering.
31. WHO IS THIS PERSON? The Experience Strategy team provides a novel approach to management consulting to address the gaps between business and design strategy.
32. WHO IS THIS PERSON? The Experience Strategy team applies design and business methodologies with the objective of determining the business viability of experiences.
33. PERSPECTIVE ON MY THINKING UX CX
34. PERSPECTIVE ON MY THINKING The perceived value customers have in interactions with your company. The perceived value users have in interactions with your product or service. UX CX
35. A TINY PIECE OF A LARGER COLLABORATION Business Technology FINANCE LEGAL HR OPERATIONS MARKETING RISK SECURITY STRATEGY
36. A TINY PIECE OF A LARGER COLLABORATION Business Technology Design FINANCE LEGAL HR OPERATIONS MARKETING RISK SECURITY STRATEGY
37. A WORLD OF METRICS Surrounded by metrics focused on driving “what” and “how” decisions.
38. TAKING THE PERSPECTIVE OF MY PARTNERS DX (Design Experience) The perceived value colleagues and stakeholders have in interactions with my design work and our design teams.
39. THE STAKES ARE HIGH FINANCE LEGAL BUSINESS HR TECHNOLOGY OPERATIONS MARKETING RISK SECURITY CEO STRATEGY THE TABLE DESIGN
40. NEW CHALLENGES, SAME APPROACH Articulating how design work fits into business processes is a design problem to solve.
41. FRAMING PERCEIVED VALUE = Perceived Value Perceived Benefits - Costs Costs
42. READING BETWEEN THE LINES To calculate value, designers must do better with calculating the benefits of their contributions.
43. PERCEIVED VALUE “The key to deliver high perceived value is attaching value to each of the individuals or organizations — making them believe that what you are offering is beyond expectation — helping them to solve a problem, offering a solution, giving results, and making them happy.” - Izhar Oplatka Source: The Management and Leadership of Educational Marketing: Research, Practice and Applications (Advances in Educational Administration)
44. NEW CHALLENGES We need to frame the value of design work to business leaders by framing the value of design work through business lenses.
45. REFRAME DESIGN VALUE Welcome to bSchool! (How might we leverage design to develop business potential)
46. LEVERAGING OUR COMFORT ZONES 1. Embrace business culture 2. Remix your craft 3. Do the math 4. Put it all together
47. EMBRACE BUSINESS CULTURE 1. Culture is a manifestation of process. Source: growth chart by Creative Stall from the Noun Project; air balloon by Creative Stall from the Noun Project; Planning by Creative Stall from the Noun Project LEVERAGE BUSINESS TOOLS SHOW ADOPTION USE CASE STUDIES
48. SETTING THE PACE AND QUALITY OF DECISION MAKING Business leaders are accountable for setting the pace and quality of decision making
49. WIDE RANGING Some lenses of business EMPLOYEE VALUE ECONOMIC VALUE CUSTOMER VALUE PARTNER VALUE SHAREHOLDER VALUE SOCIETAL VALUE ORGANIZATIONAL DESIGN BUSINESS PROCESSES PROCESS DESIGN STRATEGIC DIRECTION PERFORMANCE METRICS SUPPLIER VALUE
50. What do they need buying? “What am I paying for?” EMBRACE BUSINESS CULTURE
51. Inspiration: Leah Buley, Co. COMPETITIVE FORCES MARKET OPPORTUNITY DIFFERENTIATION A PLAN Key concerns informing business HUMAN INSIGHTS INSPIRATION/VISION CHARACTERISTICS BREADTH & DEPTH Key concerns informing design <— What’s happening around us? —> <— What do people need? —> <— How can we uniquely help? —> <— What would that look like? —> <— What do we need to do? —> DESIGN TRENDS RESOURCE ALLOCATION Know where alignment is EMBRACE BUSINESS CULTURE
52. FINANCE LEGAL BUSINESS HR TECHNOLOGY OPERATIONS MARKETING RISK SECURITY CEO STRATEGY THE TABLE DESIGN How does the table communicate? EMBRACE BUSINESS CULTURE
53. Vision and Strategy Financial “To succeed financially, how should we appear to our stakeholders?” Objectives Measures Targets Initiatives Customer “To achieve our vision, how should we appear to our customers?” Objectives Measures Targets Initiatives Learning & Growth “To achieve our vision, how will we sustain our ability to change and improve?” Objectives Measures Targets Initiatives Internal Business Process “To satisfy our shareholders and customers, what business processes must we excel at?” Objectives Measures Targets Initiatives EMBRACE BUSINESS CULTURE How is success communicated?
54. EMBRACE BUSINESS CULTURE How is progress communicated?
55. EMBRACE BUSINESS CULTURE Stars Question Marks Cash Cows Dogs High Market Share Low Market Share High Industry Growth Low Industry Growth Cost Leadership Differentiation Focus Cost Focus Differentiation Cost Differentiation Narrow Broad Porter’s Generic Strategies BCG Portfolio Evaluation Market Penetration Product Development Market Development Diversification Existing New Existing New Products & Services Markets Porter’s Growth Strategies How was the business model determined?
56. EMBRACE BUSINESS CULTURE How do vendors ensure accountability? SLAs 1. We work in JIRA. Every request must be accompanied by a JIRA ticket. 2. We respond to all design requests within 24 (business) hrs. 3. Every request will be followed up by a Kickoff Meeting. 4. If no Kickoff Meeting is needed for a request, we will close the ticket. 5. We will provide a Plan & Estimate (based off the Kickoff Meeting) for every request within 10 business days. 6. Work will only be backlogged when the Plan & Estimate are approved by both Design and the LOB. 7. Work will only be prioritized within a bi-weekly planning meeting. If you don’t show to the meeting, your work won’t be prioritized. 8. If feedback has not been provided within 5 business days, the ticket will be blocked.
57. Same song, new verse SWOT Scenario 1 Strengths Weaknesses Opportunities Threats • No extra cost expenditures towards capabilities or planning • Resources will not be allocated and can be focused on business as usual tasks • Flat cost structure will not impact enterprise operational expense ratio among other key scorecard metrics • No remarkable growth can be expected outside of increasing productivity • Members will continue to have to re-inform representatives in the phone channel of their situation • Members will continue to not be adequately in marketing messages • Resources not spent on new capabilities could be directed towards training and employee incentives • Allows for further research and on current economic climate and focus on other potential future opportunities • Flat expenditures allow for other areas of the enterprise to focus on market disruptive endeavors • USAA remains vulnerable to market disruption • Member satisfaction may diminish as experience expectations grow across the industry • Decreased member retention and utilization as their needs remain unfulfilled • Sub-optimal mission fulfillment Balanced Scorecard Experience Score 84.00% B Business Performance 86.9% B Technical Performance 91.9% A Adoption 64.5% D Communication 87.9% B EMBRACE BUSINESS CULTURE
58. REMIX YOUR CRAFT 2. Colleagues and stakeholders are human too! APPLY DESIGN TRAITS APPLY KNOWN FRAMEWORKS SELL SOMETHING ELSE
59. What are the traits of great designers? REMIX YOUR CRAFT
60. What jobs do your colleagues and stakeholders need to get done? REMIX YOUR CRAFT
61. How does the value proposition of design work align with those jobs-to-be- done? REMIX YOUR CRAFT
62. What do your colleagues think vs. feel? Say vs. do? REMIX YOUR CRAFT
63. How many of you have a journey map, conducted a diary study, or simply observed your colleagues and stakeholders to understand their pains and gains? REMIX YOUR CRAFT
64. REMIX YOUR CRAFT Exercise: What do your colleagues and stakeholders value? Strategyzer, https://strategyzer.com/canvas/value-proposition-canvas ; http://www.givegoodux.com/getting-stakeholder-buy-in-for-ux-work/
65. REMIX YOUR CRAFT Exercise: What do your colleagues and stakeholders value? (10 minutes) • Take 5 minutes to identify the jobs, gains, and pains of your colleagues and stakeholders. • Take 1 minute each to quickly shape a new value proposition for design work from your team. • Take 1 minute each to share.
66. DO THE MATH! 3. The scary portion of the talk! Source: success by Creative Stall from the Noun Project; banking by Creative Stall from the Noun Project; flow diagram by Creative Stall from the Noun Project LEVERAGE BUSINESS ASSUMPTIONS IDENTIFY OPTIONS QUANTIFY PROJECTED ROI
67. DO THE MATH! Desirability meets viability through numbers
68. ROI OF RETENTION - A HYPOTHETICAL SCENARIO = x x Number 
 of customers Annual customers value Projected rate 
 minus
 current rate Incremental dollars 
 earned $1,900,000 x (12% - 10%) $100 $3.8 million x = for example Start with business assumptions
69. = x x Number 
 of customers Annual customer value Projected rate 
 minus
 current rate Incremental dollars 
 earned $1,900,000 x (12% - 10%) $100 $3.8 million x = for example ROI OF RETENTION - A HYPOTHETICAL SCENARIO
70. = x x Number 
 of customers Annual customer value Projected rate 
 minus
 current rate Incremental dollars 
 earned $1,900,000 x (12% - 10%) $100 $3.8 million x = for example This is business viability. Costs can’t exceed this! ROI OF RETENTION - A HYPOTHETICAL SCENARIO
71. = x x Number 
 of customers Annual customer value Projected rate 
 minus
 current rate Incremental dollars 
 earned $1,900,000 x (12% - 10%) $100 $3.8 million x = for example This is business viability. Costs can’t exceed this! Behind this is a segment. That segment may contain one or more personas to align to. ROI OF RETENTION - A HYPOTHETICAL SCENARIO
72. = x x Number 
 of customers Annual customer value Projected rate 
 minus
 current rate Incremental dollars 
 earned $1,900,000 x (12% - 10%) $100 $3.8 million x = for example This is business viability. Costs can’t exceed this! Behind this is a segment. That segment may contain one or more personas to align to. Here’s your target to test different solutions against. In this hypothetical, can we project an increase in retention? ROI OF RETENTION - A HYPOTHETICAL SCENARIO
73. = x x Number 
 of customers Annual customer value Projected rate 
 minus
 current rate Incremental dollars 
 earned $1,900,000 x (12% - 10%) $100 $3.8 million x = for example This is business viability. Costs can’t exceed this! Behind this is a segment. That segment may contain one or more personas to align to. Here’s your target to test different solutions against. In this hypothetical, can we project an increase in retention? ROI OF RETENTION - A HYPOTHETICAL SCENARIO Without a base value, we can’t calculate an ROI.
74. ROI OF RETENTION - A HYPOTHETICAL SCENARIO (12% - 10%) Here’s your target to test different solutions against. In this hypothetical, can we associate an increase in retention with a prototype or test? Identify options for testing. Options drive accountability. TEST B (TIME ON TASK) TEST A (DO NOTHING) TEST C (SATISFACTION %)
75. Show costs and benefits of each option Year 1 Year 2 Year 3 Total (Present Value) Total (Risk Adjusted) Total benefits $1,500,000 $3,600,000 $4,100,000 $3,800,000 Total costs -$500,000 -$200,000 -$100,000 $800,000 $1,000,000 Net Cash Flow -$-500,000 $800,000 $3,300,000 $3,300,000 $2,800,000 Total ROI 280% PUTTING IT ALL TOGETHER - DO THE MATH
76. PUTTING IT ALL TOGETHER 4. Recommendations for a business case. Source: notes by Creative Stall from the Noun Project; banking by Creative Stall from the Noun Project; Checklist by Creative Stall from the Noun Project; teamwork by Creative Stall from the Noun Project EXECUTIVE SUMMARY PROJECT DEFINITION FINANCIALS PROJECT ORGANIZATION
77. FINAL THOUGHT Investing in design work is a business decision. Business leaders will prioritize design perspectives of users when it’s good for business. When it’s good for business, the perceived benefits of design work become actual business value.
78. Ryan Rumsey @ryanrumsey Thank you!