The conditions of uncertainty and complexity that characterise emerging markets, as well as the threat of disruption to large established companies, require innovation through the application of design principles.
Design can give companies an edge over their competitors when applied to strategy and innovation, Terry Behan, a design strategist specialising in emerging markets across Africa, India and the Middle East told a Gordon Institute of Business Science (GIBS) Forum.
Behan, who has completed a portfolio of projects in education, the Internet of Things (IoT), global healthcare and financial access, explained that design-led companies like Apple, Coca-Cola, and Nike have outperformed the S&P 500 over the past 10 years by 219%.
He advised those operating in emerging markets to “embrace the madness. South Africa is one of the most complex emerging markets because of its diversity of language and race and its extreme inequality. You never quite know who you are designing for.”
Integrating a design mindset into an established environment
Behan explained that design is an act of improving or creating products, services, and experiences that move humanity forward and also seeks to redress the imbalances of the past. Design can act as a service or as a strategic enabler.
“There is a lot bearing down on the global and South African market which is going to fundamentally shift business models in the next four to five years. If you are an established enterprise the chances are good that you will be rapidly disrupted in the next 24 months,” Behan said.
Generative conditions, such as the decline in the cost of data and technology, open source code; access to capital and a millennial mindset was allowing people to build things themselves they previously weren’t able to.
Developing a design mindset in an established environment means a shift away from an internal focus: “It is not about the business with a product to sell, but rather the user or community of users and discovering what their unmet needs are,” Behan said. “Always overlay good design with common sense to discover whether there really is a need,” he added.
Behan said landing design in an established enterprise was very different from doing so at a startup in a number of ways:
Structure and process
How you structure the design process within your organisation is key, he explained and has to be intentional. “Don’t stick your design team in a corner. Design delivery stuck in a product house can only deliver limited value.”
Sponsorship by the executive structure of the business, including finance and funding for projects and an active role in delivery would ensure optimal results.
“Top-down, enterprise-wide and unfettered support is ideal.” He recommended large organisations follow a tangential model where design sits adjacent to the top structures of the organisation, but retains some freedom.
Design leadership is a political role, which requires leaders to be multilingual in order to speak to tech, finance, and risk, as “these functions are not interested in design empathy, but only in risk mitigation and capital.”
“What will happen to capital and risk on the balance sheet in the next couple of years if we don’t make a change and drive innovation through design?” Behan asked.
He emphasised the need to identify the organisation’s key leaders who understood the shifts and changes happening in the economy and society, and the subsequent need for design to transform organisations. “Find common cause with them and create a platform for the change to occur. It is important that we have enough people who can see the horizon.”
Kill bad ideas fast
Behan said it was necessary to weed out bad ideas “before they see the light of day” and establish at an early stage of the process whether ideas were supposed to survive in the first place.
He advised assessing ideas according to their position on the value/risk matrix:
While start-ups play in the high risk, high-value space, large established corporations look for low risk, high-value ideas. However, often projects end up in the high risk, low-value space. “Rather, articulate the right questions to eliminate these projects at the beginning,” he said.
The importance of underlying data
The importance of good quality data cannot be overemphasised, Behan said, as this forms the basis of the business case. “You have to interrogate the data, or it could be inaccurate and could kill what would have been a good idea.”
Opportunities for design
Design as a strategy to unlock value must be structural and focused on simplicity by brutally assessing the viability of projects up front.
Behan said that while there is much opportunity in the design space, organisations tend to focus on areas that are heavily overtraded such as financial services and mobile telephony. Alignment to the United Nations Sustainable Development Goals was the “biggest, richest pot of opportunity on the planet,” but was often ignored, he argued. These include the eradication of poverty, zero hunger, clean water and sanitation, clean and affordable energy and responsible consumption and production.
“There is no shortage of need and interestingly, no shortage of capital to address these,” he concluded.