- Commercial growth can be hindered by offerings that do not effectively address the most important customer needs
- Design thinking focuses on empathizing with users to understand needs and iteratively developing concepts to create the most effective solution for addressing those needs
- Product managers should integrate design thinking into activities that involve needs identification and offering design
Back in 2009, Airbnb was on the brink of shutting down. The company’s revenue was stuck at US $200 per week, and its three young founders were forced to max out their credit cards to survive. While investigating how to move forward, the team used the website to search for listings posted by Airbnb hosts in the New York City area, and realized that the listings reflected poorly as a result of low-quality photos that the hosts took of the available rooms. The three founders decided to travel to New York, rent a camera, spend some time with customers listing properties, and replace the amateur photography with beautiful high-resolution pictures. Within a week, Airbnb’s weekly revenues doubled and became the start of their well-known rise. Individual team members are now encouraged to propose new features and take measured, productive risks to explore new directions for growth. Employees can also propose new features as part of the onboarding process to bring fresh and innovative ideas to the table.
In this scenario, traditional business thinking dictate diving into spreadsheets of existing market and competitive data, huddling teams internally to brainstorm on new ideas, and analyzing the information gathered to come up with a solution. Instead, what Airbnb did was leverage design thinking as an outward-in approach to solving their business problem.
Design thinking is a problem-solving framework that starts with empathizing with users who experience a specific need, to collect deep user insight for clearly defining the need in focus for the organization. From there, solutions for the need are iteratively constructed using concepts and tested to identify the most effective solution for addressing the need. The entire process is carried out in a flexible and iterative fashion, as concept development and testing may spark new ideas, while testing these ideas with real customers may reveal additional insights that redefine the need.
Product managers must integrate design thinking into their product commercialization and lifecycle process to foster a customer-focused approach for offerings. Otherwise they risk being too internally focused and out of touch with the market segments they serve.
The following three tips can help product managers better leverage design thinking principles as part of their activities:
- Go beyond capturing needs in customer interviews. Using a broad, non-leading approach to questioning customers encourages the interviewee to expand on answers as much as possible, such as “What are the top initiatives and priorities in your role? What keeps you up at night? What’s the hardest part of your job/day/role?” Beyond capturing complaints or needs, product managers should gather data to quantify the extent of the need or opportunity and uncover deeper personal insight. Find out how frequently a problem occurs, how severe it is in the mind of the interviewee, and if it is easily detected when it happens or goes unnoticed until the impact is felt.
- Construct multiple ideas to identify the best solution. Traditional business thinking encourages seeking out one best solution to a need, whereas design thinking encourages generating and testing different ideas to arrive at the best solution. Once a need is well understood, product managers should generate multiple ideas that could address the need. Clients of the Forrester SiriusDecisions Product Management research service have access to the research brief “Ideating Potential Product Concepts to Address Customer Needs,” which provides suggestions for concept generation such as setting a target for a certain number of ideas first (ideally between 5 and 10) to prevent fixating on an initial or preferred idea. In addition, approaches such as focusing on the downsides of a particular solution or looking at other industry domains to see how similar problems were solved can help generate more solution ideas.
- Don’t forget the metrics in the concept testing process. Design thinking emphasizes the use of concept testing to gain a deeper understanding of users. In addition to setting the context for the test and the premise for how the theory behind the concept will be evaluated by users, product managers must not forget to determine the appropriate SMART (specific, measurable, attainable, relevant and time-bound) metrics used to measure the test. For example, if there is a non-functioning “publish to social media” button in an application, an appropriate metric could be the percentage of users in a given type who click the button.
Product managers can use these tips to stay in touch with their users and commercialize offerings that align to users’ needs and mannerisms. In this way, design thinking moves from theory to drive the commercial success of products. To find out more about best practices for identifying, prioritizing, and applying customer needs, contact Forrester SiriusDecisions today.