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Management by Empathy

Learning with Experience Design

Matthias Müller, MSc

Director, Mensch Design Innovation GmbH

Mythenstrasse 58, CH-8400 Winterthur

mdii.ch, mueller@mdii.ch

+41 79 570 09 64

Experience based paper

for “Management makes the world go round. Learning for the future in management

and organizations”

Conference M/O/T Management School, 2010, Vienna

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Abstract

For decades, companies have declared customer orientation to be their uppermost

goal. What is the key to customer orientation today? How does it work in companies

like Apple, Nespresso (Nestlé) or Patagonia for example, who are particularly

successful in their markets? The answer is that these companies have moved on

from selling “naked” products and services to delivering experiences that are full of

value. Their value proposition is not limited to the features of their product but covers

all interactions with the customer, incorporating customer needs and the promise of

the brand: The customer gets to be a long-term partner in a partnership that is not

only defined by economic or emotional benefits but by a value the customers

perceive as meaningful for their lifestyle, for their life. Sustainability is achieved by

satisfying needs that originate in the customers' beliefs and values.

Experience Design provides the mindset and the tools enabling companies to offer

these meaningful experiences. Our concept of Experience Design is based on four

skills: explore the customer, prototype your offer, reframe your strategy, use the

energy of the team. The underlying competence to these is empathy: the urge to

understand, compassion for the need of the customer, the need of employees and

the need of society. Empathy is the one basic competence needed to create

sustainable value in the economy of the future.

Introduction: looking behind the terms

“Experience”

When was your last delightful experience? Was it a bike tour in the sunset, an

intensive workshop at work or a particularly friendly service in a shoe store? What

constitutes such an experience? What makes you say, yes, that was delightful, that

was great? When would you say that was meaningful for my life?

“Design”

Is design just pretty decoration or is it the real thing – or maybe both, or neither?

Three answers:

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“Design is the fundamental soul of all man-made creations ... It is all about the effect.

To come up with a truly good design for something you have to fully understand it."

Steve Jobs (Hirstein, 2010)

“For me, designing is a mentality, a way of observing, intuitively understanding by

continuously questioning.” Gijs Bakker (2010)

“Design must be meaningful. And 'meaningful' replaces the semantically loaded noise

of such expressions as 'beautiful„, 'ugly', 'cool', 'cute', 'disgusting', 'realistic', 'obscure',

'abstract', and 'nice ...” Victor Papanek (1971)

“Empathy”

New literature sees empathy as the driving force of civilization (Rifkin, 2010): Co-

operation based on empathy is declared superior to confrontation. One could try to

refute this argument with Darwin. But careful: Darwin's concept of survival of the

fittest is often misunderstood. To be fit means to be able to adapt. The strongest is

the one who adapts best – and this is where empathy comes in, the competence to

act and react with compassion. This is what Tonya M. Peck, Senior Program

Manager in the Microsoft Corporation, asks from designers and managers (2010):

“We must be different by demonstrating compassion, curiosity, openness, a comfort

with ambiguity, and an unconditional positive regard for our experiences with one

another.”

1. The challenge: the future is here

A participant at an Experience Design Management training sums it up neatly: "In the

future, it won't be my boss who decides but the customers and the market." This

statement summarizes what management and organizations are faced with in the

future. A future that has already arrived for customers. Taking place is what Charles

Bezerra (2010) calls the “transference of guilt”. A customer who had a problem with a

product or a service used to think he himself was to blame. Today, he would see the

company as the “guilty” part if something didn't work as expected – and expectations

are rising. Customers simply refuse to get frustrated.

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This "customer emancipation" has global repercussions. Customers post videos on

YouTube or discuss and rate companies in comments and blogs: 70% of all bloggers

in the U.S. write about products and brands (emarketer, 2009). And this is only the

beginning of a movement heading towards co-creation. More and more, companies

try to directly include their customers' knowledge in their product and service

development processes (openinnovators.net), and to profit from the “wisdom of the

crowds” (Surowiecki, 2004).

What does this development mean for the management and the company of

tomorrow? The customer cannot know the actual capacity of a company and what

solutions would be technically feasible. A quote that is attributed to Henry Ford puts it

plainly (Christensen, 2007): “If I‟d asked people what they wanted, they would have

asked for a better horse.” Ford was able to identify his customers' needs and had the

knowledge and the skills to work out a disruptive solution to satisfy them. It is still

crucial for companies to have that knowledge about the feasibility of solutions plus an

intuitive feeling for coming technological innovations.

However, not every innovation or improvement is conceptually sound and accepted

by the market. Telecom companies for example still employ thousand of staff and call

agents just for dealing with customer complaints and fixing faults (often without

developing the instruments which make the company learn from this rich source).

And when top-notch companies are affected – those maybe especially so –

launching an innovation that proves defective, like the aerial of the iPhone 4 from

Apple (Ionescu, 2010), the high expectations for innovation become apparent.

“Innovation isn„t what innovators do, it‟s what customers and clients adopt!”

(Schrage, 2010)

2. The answer: Experience Design

With the introduction of the terms “Experience Design”, “design thinking” and

“customer-driven innovation”, the discussion about the purpose of companies (and

thus management) has shifted. Companies now need to create “value” and

“meaningful experiences”. But why? Rodney Fitch explains it best: “Only one

company can be the cheapest, the others have to use design” (Egan, 2010). Design

is presented as the skill that allows companies to develop product and service

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experiences that do need not to be low-cost. The point is not the naked product or

service performance but the creation of a holistic experience, perceived by the

customer as relevant and meaningful. Design as “making meaning”

(Shedroff/Rhea/Diller, 2008).

The term Experience Design has not yet been formally defined. It develops in a

dialogue between economy and science. An important benchmark was set by Nathan

Shedroff in 2001 with his publication “Experience Design 1”. An important overview is

edited by Thomas Lockwood: “DesignThinking” (2010). Among other things, it

describes the shift in meaning of the term design over time, away from product

design to an approach whereby design is primarily a communication process. Design

as an interdisciplinary creator of solutions has been highlighted by institutions such

as the British Design Council or the Design Management Institute in Boston for over

30 years.

Kimbell (2010) explains Experience Design with the toaster principle: Before,

designers, managers and companies would work on designing individual products

and services and bring them to market – for example a toaster. Today, the challenge

consists in realizing entire toaster projects. And it is essential to understand the

physical environment of a toaster and all social interactions around it to be able to

create a solution with added value. Design in the sense of “beautifying objects” is

history. Schrage (2010) offers a similar argument: “Great designers facilitate great

interactions around great design(s).” Great communication (and not great forms) is

the key to a great solution .

These hypotheses, focusing on thinking in systems and the power of the

communication process, are the basis of our approach. The core skills in our

definition of designful management are:

Explore your customer – basic competence: empathy

Prototype your offer – basic competence: iterative creation

Reframe your strategy – basic competence: think in new frames

Use the energy of the team – basic competence: theme-focused teamwork

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What does the management need to learn for the future?

1. The skills and tools of Experience Design.

2. The mindset and the relevant actions which help creating the “experience

oriented” company.

This paper primarily focuses on the first part of the answer. We will illustrate the four

skills with practical examples and introduce the key tools.

3. Explore your customer

Practical example:

At an innovation workshop in the telecom industry, a team of six

participants from different departments analyzed the needs of

older customers. At first, it seemed their needs were strongly

connected with their financial status and their educational

background. In a first phase of storytelling no common

denominator could be found and no possible innovation story

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created. Then, after a first brain storming and a further

storytelling, new perspectives emerged. A deciding factor was

that there were two fathers on the team. From observations of

interior arrangements (incl. the displaying of family pictures) and

random remarks during the interviews, the team derived that the

customers' affection for their grandchildren and their joy in seeing

them grow up was their common denominator. The team of

developers then correlated this insight with the information of the

two fathers that a child's first mobile phone was a kind of initiation

ritual into the grown-up world, and as a result they created the

“Cell Phone Bus”. The grandparents could visit and explore it

together with their grandchildren, be presented with information

on benefits and risks of cell phones and also buy a first cell

phone if they wished. In a first feedback round, the reaction of

the visited customers was very positive and in tune with the ideas

of the development team.

The project, however, was not implemented. More on that later.

Visiting customers in their own environment

The team in the example above opted for the most obvious way of exploring the

customer, i.e. a personal visit at home. Four basic aspects need to be considered:

a) There should be two or three visitors, not fewer and not more. One or two

visitors analyze the customer's environment and observe his/her non-verbal

communication.

b) A question/hypothesis is brought along to be answered by customer research.

c) The interview follows an outline, starting out in a light conversational manner,

touching the research topics without focusing on them. Towards the end,

opinions are asked and behavior directly observed (if the product in question

is a lifting jack for example, it makes sense to observe the customer using the

current product version).

d) The visits are evaluated through storytelling, i.e. in a narrative method.

Customer research and storytelling combined constitute the “deep dive”.

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Deep diveHypothesis about customer needs

Storytelling Story

Evaluation ofhypothesis

Customer research

New Hypothesis

Customer research and storytelling are further possibilities to gain information on

customer needs. They include:

The use of personas to constantly test decisions in developing processes

against virtual customer profiles

Role-play, applied to make knowledge about customer needs relevant in the

company

Become your own customer and experience the interaction with your own

company

Mystery shopping at the competition

Touchpoint observation at points of sale, in call centers or with the field force

Customer panels for customers to exchange ideas and opinions

Storytelling

The tool of storytelling originates in the narrative method of psychotherapy and the

concept of “narrative empathy”. The observers evaluate their observations in form of

an narration. This narration presents the customer and – implicitly – the viewpoint of

the observer. It offers the opportunity to reflect one's own perception. So, functioning

as a mirror of the observed, the narration combines and integrates different

information levels such as direct statements, assumed hidden needs, physical

environment, forms of behavior.

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We use a three-level storytelling method which bases on the iceberg model by

Virginia Satir (Caflisch, telus.net): Behavior is the tip of the iceberg (level 1), the

coping attitude of the person is the water line (level 2), values, vision and yearning

are below the water (level 3).

Level 1: words, behavior

Level 2: declared needs, thoughts

Level 3: hidden needs, emotions

It is helpful to visually illustrate this three-level story with drawings and symbols to

avert any pseudo-analytical thought processes.

The stories about customers are brought together and narrated. With comments and

questions, the listeners point out missing aspects and test the frame of interpretation

the group worked out in the deep dive.

In our example with the “Cell Phone Bus”, the experience was not the explicit wish of

the customers. It was a hidden need that could be successfully determined by

consolidating customer analysis with the experience of the storytelling narrator – in

an emphatic process.

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The “empathy map” by Osterwalder/Pigneur (2010) presents a more structured form

of storytelling. It highlights these six aspects: hear, think and feel, see, say and do,

pain, gain. They are not as highly integrated as in the three-level storytelling, but they

also base on the hypothesis that there is a difference between what is said and what

is felt. Meaning that there are relevant aspects and needs that are not articulated by

the customer in an interview and can only be determined in a multidimensional

evaluation process.

“Empathy map” by Osterwalder/Pigneur: Business Model Generation, 2010.

4. Prototype your offer

Practical example:

A group of freelance business consultants were fascinated by the

insights in Surowiecki's “Wisdom of the Crowds”. They discussed

the effects it would have on their work if customers were turning

into co-creators. What will the business consultant's job look like

if the customer becomes the consultant of businesses? The

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group agreed that understanding the customer will be the core

skill, correlating customer responses with business resources.

The group developed a prototype of a public innovation platform

for customers to comment on products and express suggestions

– which were then evaluated by experts in a specific storytelling.

The project was financed through advertising. In a structured

feedback using role-play, the consultants learned that only few

businesses today would want their innovation plans to be public

and welcome a discussion of their plans at a preliminary stage.

As a second prototype, the consultants therefore developed a

purely internal tool, for company staff only. Individual interviews

with company representatives, however, revealed a wish to know

more about customers and to involve them in the innovation

processes. So the consultants developed a third prototype, a

platform that can be used internally and/or by invited external

“employees”, depending on the topic.

The example highlights the fast and efficient interacting between prototyping and

structured feedback, which is key to Experience Design: the prototype as the

hypothesis of the future and the structured feedback as the instrument of

continuation and differentiation.

Prototyping creates a new awareness regarding the development work in

businesses. Solutions are no longer based on analysis, argumentation and the

weighing of interests – which tended to drag out project meetings. Prototyping is

based on an attitude introduced in solution-focused short-term therapy: to imagine a

future state and immediately establish it.

The standard iteration in the prototyping circle has four phases: setting up the design

challenges or design briefs, designing/customer research, prototyping, validation and

feedback.

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Start: DesignChallenge

Customer Research/

StorytellingPrototype 1

Validation Feedback

Feedback/Challenge 2

ResearchPrototype 2

Validation Feedback

1st Iteration

1 2

Prototyping Circle

The first solution proposals are formulated in rapid iterative prototyping. Here,

solutions are developed and assessed at a very fast rate (as in the example above).

It is all about discovering opportunities, testing customer reactions and spotting any

major implementation difficulties. The longer the prototyping process, the slower the

iteration and the more important the securing of benefits for both customers and

company. The team of consultants in our example developed their subsequent

prototypes during the here described phase of discovering and testing. They worked

with a specialized software company and in the process discovered further options to

increase customer and company benefits.

Securing the benefit

Prototyping process

growing activity

Discovering and testing options

Diminishing activity

Rapid prototyping Slow prototyping

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Structured feedback

The most important feedback on prototypes is customer feedback. Procedure is

simple and it can be obtained spontaneously at a touchpoint, e.g. at a store, or in an

already scheduled interview like in our first example. Usability consulting companies

offer a wide range of options to validate solution proposals (Usecon, Useeds). As of

recently, there are also online platforms (atizo.ch) to assess ideas and solutions with

end customers.

Internal feedback is constructive too, if taken as creative input and obtained in a

structured way. The founder of structured feedback is Edward de Bono. He criticized

“logical analytical thinking” for being a medium to confirm thinking and for engaging

thinking in a conflict about right and wrong (2009). With his “six thinking hats” (2010)

he introduced an approach which ensures efficient continuous development of

prototypes in the context of Experience Design. The feedback givers are assigned a

certain position or part to give their feedback from.

The shortest form of structured feedback is the “watering hole” (Carlson & Wilmot,

2006), offering the feedback givers just two positions to choose from.

Position A: In your view, what are the strong and indispensable features of this

solution?

Position B: What needs improving with this solution? Do you have any

suggestion as to how?

Applied consistently, this method has the power to transform organizations. At a

training week for Experience Design managers, three promising innovations were

developed, but it was the watering hole that convinced the participants as the most

meaningful achievement. They recognized the tool's positive effect. It triggers verbal

exchanging of ideas that are unburdened by justifications and can instantly be put to

use.

Further tools: customer journey, design principles

There are two more tools to be briefly introduced. They both are key instruments in

Experience Design.

The customer journey embraces the customer's entire chain of experiences, from the

initial contact with a product up to its replacement or termination. It is split up into the

relevant interaction stages between customer and product.

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The design principles are a strategy implementation tool. When a solution is realized,

they help to synchronize the company's brand promise, the experience portfolio and

the customer needs.

5. Reframe your strategy

Practical example:

The HR (human resources) department of a Swiss group realized

that in their company, like in many other European companies,

their staff was growing old faster than the general population.

They also realized restructuring plans had a tendency to lay off

older employees with the results of enormous costs for

severance plans, a loss of knowledge and a weakened social

cohesion in the company. The HR therefore decided to develop

new concepts to stop the draining of older employees, primarily

focusing on financial incentive systems. But the project faltered;

there was no spark, no ideas came up. Opting for more creativity

they hired an external consultant. In a first step, the consultant

discussed the needs and resources of the older employees with

the HR management and then let the management and the older

employees develop personas together to determine what really

makes older people tick. The hypothesis gradually emerged that

financial instruments were not essential factors but that the

primary need of the employees consisted in perceiving their

professional life as fulfilled and meaningful. This hypothesis

made the HR change their strategy, now focusing mainly on the

employees' needs and defining them as the main resource in

finding economically promising solutions. Moreover, the HR

department did not position itself as a solution-generating

supplier but as a platform for the older employees to take an

active part in shaping their future. After two prototyping

workshops, four projects were worked out and all got

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management approval. Three of them were implemented by the

respective employees within half a year.

How could project strategy and self-image of a department by shifted without a major

change program? The department first needed to let go of their central assumption

that financial status, once attained, was incontestable and therefore an indispensable

factor in all staff policy. The department's management had the opportunity to learn,

however, that sustainable and dynamic solutions can be found when the needs of the

“customers” are taken into account and – in this specific case – when the skills of the

target group can be used to generate a value for both themselves and the company.

The strategy was achieved by in-depth customer analysis and by incorporating their

energy for change.

It is a fact that in many instances the strategic scope is too narrow to allow changes.

In our first example of the cell phone bus (page 7), the brand was flexible enough but

the shop strategy clearly did not allow additional sales channels and so the project

fell through. Our experience shows that company staff (incl. the top management)

have the skill to understand customer needs and to design valuable product or

service experiences based on these insights. However, a kind of inner censorship

kicks at an early stage, arguing like this: “That isn't our market”, “This isn't in our

strategy and it's too much hassle to change it”, “Our brand doesn't allow this kind of

customer approach” or “There isn't anybody in the company who could pull this

through”.

It would go beyond the scope of this paper to lay out how a customer-oriented

strategy can be developed and implemented in full detail. But we would like to

present the three basic conditions:

The strategic process and its reframing have to be continuous, meaning that

management and staff have to consistently assess existing and emerging

customer needs.

The brand has to be a key factor in strategy development. Its development

should also entail the generating of emotional added value for customers (and

staff) (Olins, 2006).

Innovation is to be understood and developed as a core process of the entire

organization.

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The following tool support the company in identifying the demand for the reframing of

a human-centered and value-oriented strategy development at an early stage.

Value proposition templates

The value proposition is the engine of Experience Design and in many companies it

is also the driving force of innovation. It is basically comparable to a business case,

but unlike standard development projects it is not only factored in the middle of a

project but it is the starting point of all activities. The value proposition defines

customer and company benefits based on customer needs assessment, correlating

the assessment with market conditions and internal resources. A widely known

template is NABC by SRI (Carlson&Wilmot, 2006). Here, the proposition consists of

four steps: N = what‟s the unmet customer‟s need, A = what‟s the approach, B =

what‟s the benefit, C = what‟s the competition. In our example with the HR

department, the strategy reframing originated in the in-depth analysis of the need (by

means of dialogue, personas, feedback sessions). The department realized they had

been focusing on the wrong need.

Costar, the value proposition developed by Friedman, Gyorffy and Gyr EDG (Gyr,

2010), is more detailed than the NABC. The business case is divided into six

elements:

Costar

Customer Who‟s the customer and his unmet need?

Opportunity What‟s the opportunity on the market?

Solution What‟s the solution?

Team What‟s the team, which can create the solution?

Advantage What‟s the advantage of the solution compared to

internal and competitor‟s solutions?

Result What‟s the result? What are the benefits – for the

customer and the company?

The value of this tool is its systemic nature. All Costar elements are interdependent.

If the designer discovers that he could increase the advantage by slightly changing

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the solution, the tool allows him to simultaneously check if the customer need is still

addressed and if the change still translates into an opportunity on the market.

Thinking in value propositions leads to strategically relevant questions:

Is the project in agreement with the existing strategy?

Will it generate such a benefit as to justify a strategy reframing? Or would a

spin-off be a better idea?

Does the solution originate in wishful thinking that doesn't make any strategic

sense?

As with structured feedback, the consistent application of a template in setting up a

value proposition can change a company substantially. The template provides the

company with a new grammar of change and innovation – you could say it instills the

drive to innovate.

Both public or purely internal software applications involving value proposition

thinking can greatly contribute to a consistent customer-focused strategy

development. An examples is the program Qplus (2010).

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6. Use the energy of the team

Practical example:

At a conference for store managers in the telecommunications

industry under the heading "Improvement of the Store

Experience", the store managers were asked to define

measures, based on their customer observation, for creating

meaningful experiences for the customer, without changing

neither branding nor store architecture. Only four weeks before,

the company had announced the stores imminent merger of the

separate business lines of mobile telephony and fixed network

solutions. The head of the mobile phone stores invited the

regional managers of the fixed network stores to the conference

so they could get to know each other better. After setting up an

insight gallery of customer assessments and customer needs,

five groups worked out different solution proposals. Two groups

then presented a program to improve the teamwork of the soon

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to be merged stores and to attend to common customers even

more efficiently. At the end of the conference, one of the store

managers concluded it was important to remain level-headed

and to include the staff at the stores in future discussions.

Why did this conference yield results that in many other merger situations could not

even be achieved in extensive culture change programs?

The theme-centered interaction model by Ruth C. Cohn (1975) sheds some light.

Theme-centered interaction (TCI) is determined by four factors. At its core is a

triangle consisting of the individual (Me), the group (We) and the theme (It). This

triangle is embedded in a globe, representing the context, the world we live in.

Me We

It

Globe

According to Cohn, the theme-oriented group process is the most powerful when in

balance. When the "Me" feels in good hands in the group and contributes to the

developing of the "It" – when a common understanding emerges in the "We" and the

"It" is experienced as relevant – when the development of the "It" is not influenced by

hierarchical structures or personal dispositions. And when the process is perceived

as a meaningful contribution to the "Globe".

Obviously, that is exactly what happened at the store manager conference. Through

the customer observation and the formulation of hypotheses on the hidden customer

needs the teams experienced the defined theme as highly relevant, i.e. the group

and each individual thought it beneficial to solve the task. And in tackling the task, a

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group understanding developed that the "We" should also be addressed – the "We"

of the store managers of the merging business lines. It was fascinating to see how

the store managers at the end of the day did feel as a collective, i.e. had worked out

a common perspective for the future. Their focusing on the major task of "What can I

do for my customers?" together enhanced the we-feeling and released

implementation energy that each individual perceived as relevant.

It is not easy to achieve all this in a design process since the creation of meaningful

experiences for customers presupposes the cooperation between all disciplines

throughout the whole process. In storytelling, IT and marketing, external sociologists

and psychologists are just as involved in the detail definition of the customer journey

as are strategy and shop management. Why this interdisciplinarity?

1. Our experience shows that only interdisciplinarity can ensure that relevant

knowledge can be used in the relevant stages of the design processes.

2. Multidisciplinarity throughout the design process reduces the perception of

complexity. The design team does not have to deal with new conceptions and

requirements but learns to integrate right from the start.

3. When a design team perceives the complexity as manageable and has

learned to integrate the different perspectives in the team in the creation of an

"It", the implementation energy increases as well. The integration of thinking

causes an energizing of implementation. Or as in our example, it generates an

energy perceived as so powerful that the need arises to put it into perspective.

It is often helpful to include the function of a facilitator in the design process. His task

is that of a social designer. He checks the balance of It – Me – We so that the best

possible solution for both customers and company can be worked out in the design

process. Tim Brown puts into words what sometimes causes a dilemma in practice

(2009): “Design thinking is the opposite of group thinking but paradoxically it takes

place in groups.” Multidisciplinarity, the addressing of hidden customer needs and the

set goal to devise fast, meaningful solutions through prototyping can prove too

challenging, even for management teams. That is why we recommend bringing a

facilitator into play on a case-by-case basis.

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7. Skill versus process

The skills and their tools presented do not constitute a process. There is no fixed

sequence (except for the innovation process, where the skills “prototype your offer”

has to follow “explore your customer”). These are skills companies should acquire to

be able to design meaningful experiences for customers in the future. The

management should acquire them and let them further develop in the company.

These skills teach to distinguish. Am I the cheapest supplier or do I need design? Do

I know my customers' needs or only the technical possibilities? Does it make more

sense to argue or to co-create? Does a proposal need feedback or a decision?

Processes remain the communication channels in a company, possibly yielding the

best result, depending on the task, and helping to plan the use of resources. The four

skills presented here are applicable in many processes, from the purely internal

provisioning, strategy or project process to the process describing a company's

interaction with the world. These four skills advance customary processes and

enhance them with a better understanding of the customer and a more efficient

devising of solutions.

“Use the energy of the team” is a skill which nourishes all the others. Multidisciplinary

communication is mandatory to explore the full potential of the other skills. Whereas

“explore your customer”, “prototype your offer” and “reframe your strategy” provide

content, “use the energy of the team” designs the social process – which makes us

return to Schrage‟s quote about the ability of designers to “facilitate great interaction.”

8. Conclusion: the crux of the matter

In our opinion, a gap exists between the behavior of management today and the

behavior of customers. The management analyses markets and manufacturing

conditions to enable themselves to supply the market with products and services at a

profitable margin. The company's role is that of an efficient engine to achieve these

objectives.

Customers today express themselves on a global scale and demand product and

service experiences that are full of value, consistently raising their expectations

within the five levels of value: economic, functional, emotional, status/identity and

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meaning (Rhea, 2010). Customers understand the company or brand as their

partner, who helps them to live a simpler, better or richer life.

Levels of value

Economic:what‘s the price

Functionaldoes it work

Emotionaldo I like it

Statusdoes it reflect my ambition

Meaningis it essential,full of meaning

Easy to substitute

Hard to substitute

The customer is still an unexplored field. Truly discovering it requires empathy from

the management and the skill to relinquish the old beliefs and move on to the realm

of experimenting. Here holistic thinking is applied to create value for customers and

companies by way of designing experiences. This is what we call Experience Design.

The management will have to let go of the idea that experimenting is transitional. To

experiment will mean to do business.

Future challenges: individualized usage, cradle to cradle, social design

1. The obvious challenge for companies will be to perform the balancing act

between standardized production and individualized usage, or perceived

individualized usage. The solution will be to synchronize the processes of

usage and production in a uniform and holistic way. Experience Design will

need to describe closely interwoven production and usage cycles. It might

lead to a fusion of the production and usage process.

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2. Listening to exacting customers reveals the second challenge. Their need is to

no longer exploit the environment but to apply sustainable methods. This need

is also fed by “design” catastrophes threatening the existence of global

companies and business models, such as BP's “accident” in the Gulf of

Mexico or the recalls issued by Toyota. Experience Design will be creating

values of sustainability and environmental care. According to the cradle-to-

cradle principle by Braungart/McDonough (2002) in future, designs will have

to incorporate the degradation of pollutants, the option of “upcycling”

(refinement by recycling) and avoid “waste”. In eco-efficiency, terms like waste

disposal and dumping are history. “Cradle to cradle” thus replaces “cradle to

grave” and could become the dominant design principle in the near future.

3. More and more, social design and business design will blend into one another.

Customers are citizens. They have learned to engage themselves in order to

improve their physical environment and society because they are part of it,

because it belongs to them (actual example is the protest against Stuttgart 21,

2010). Business will be confronted with this attitude and it will have to satisfy

the need of active participation. If companies do not offer this function they

will simply be passed by (Randall, 2010).

In a paper written for a conference in Vienna, it is fitting to conclude with the words of

a designer who was from the Danube city himself and who expressed thoughts which

we let our minds experience only decades later: Victor Papanek (1973): “In an

environment that is screwed up visually, physically, and chemically, the best and

simplest thing that architects, industrial designers, planners, etc., could do for

humanity would be to stop working entirely. In all pollution, designers are implicated

at least partially. But in this book [“Design for the Real World”] I take a more

affirmative view: It seems to me that we can go beyond not working at all, and work

positively. Design can and must become a way in which young people can participate

in changing society. As socially and morally involved designers, we must address

ourselves to the needs of a world with its back to the wall, while the hands on the

clock point perpetually to one minute before twelve.”

It is our standpoint that it is the task of the management and their organizations to

become such “socially and morally involved designers”.

23

Many Thanks

for inspiring and challenging:

Marlies Lenglachner

Nina Maria Wieser

Karin Hilzinger

Lisa Friedman

Herman Gyr

Ulrich Sieker

References

Books

Braungart, Michael / McDonough, William: Cradle to Cradle: Remaking the Way

We Make Things, Random House, 2009.

Brown, Tim: Change by Design, HarperBusiness, 2009.

Carlson, Curtis R. / Wilmot, William W.: Innovation: The Five Disciplines for

Making What Customers Want, Crown Business, 2006.

Cohn, Ruth C.: Von der Psychoanalyse zur themenzentrierten Interaktion, Klett-

Cotta, 2009.

De Bono, Edward: Six Thinking Hats, Penguin, 2010.

Diller, Steve / Shedroff, Nathan / Rhea, Darrel: Making Meaning, New Riders Publ,

2008.

Lockwood, Thomas (editor): Design Thinking, Integration Innovation, Customer

Experience and Brand Value, Allworth Press, 2009.

Martin, Roger: Design of Business: Why Design Thinking is the Next Competitive

Advantage, Mcgraw Hill Professional, 2009.

Osterwalder, Alexander / Pingeur, Yves: Business Model Generation, John Wiley

& Sons, 2010.

Papanek, Victor: Design für die reale Welt, Springer, 2008.

Rifkin, Jeremy: Die empathische Zivilisation, Campus, 2010.

Shedroff, Nathan: Experience Design 1, New Riders, 2001.

24

Surowiecki, James: The Wisdom of the Crowds, Anchor, 2005.

Articles, websites, presentations

Bezerra, Charles: Divers of Complexities, 8/9/2010, presentation held at “Transforming Design. Design/Management Europe 14”, London.

Bakker, Gijs, 2010, link: http://www.viennadesignweek.at/event.php?id=103.

Caflisch, Nora (Noni): An Application of Satir's Systematic Brief Therapy, link: http://www3.telus.net/newhorizons/Amasters.html. Christensen, Clayton: “Built for innovation”, 2007, link: http://www.forbes.com/forbes/2007/1112/137.html. De Bono Edward: Wir denken, um die Wahrheit zu beweisen, article in brand eins, 11/2009.

Egan, John: Corporate Design Foundation, link: www.cdf.org/issue_journal/baas_ sir_john_egan_on_design.html.

eMarketer: Bloggers and (Personal) Brand-Building, November 6 2009. link: http://www.emarketer.com/Article.aspx?R=1007366. Gyr, Herman: Silicon Valley‟s Simple Secret – A Shared Discipline of Innovation, presentation held at EPFL Lausanne, 9/2010. Hirstein, Andreas: Da wäre noch eine Kleinigkeit, article in NZZ am Sonntag, 24/01/2010. Ionescu, Daniel: Apple Responds to iPhone 4 Antenna Problem, 25/6/2010, link: http://www.pcworld.com/article/199853/apple_responds_to_iphone_4_antenna_problem.html Kimbell, Lucy: From User-centred Design to Designing for Service, 8/9/2010, presentation held at “Transforming Design. Design/Managememnt Europe 14”, London.

Olins, Wally: “Getting emotional with . . .”, 2006. link: http://www.design-emotion.com/2006/04/07/getting-emotional-with-wally-olins/

openinnovators.net link: http://www.openinnovators.net/list-open-innovation-crowdsourcing-examples/

Peck, Tonya M.: Integrative Thinking, Feeling and Being, 9/2010, link:

http://www.dmi.org/dmi/html/publications/news/viewpoints/nv_vp_tp.htm

Q+, Enterprise Development Group, link: http://www.enterprisedevelop.com/pdf/EDG%20Q%20Innovation%20Management.pdf

25

Randall, Stephen: The Social Web and your Business‟s Five-year Survival Rate, article in Design Management Institute Review, volume 21, number 1, 2010.

Rhea, Darrel: Design Research and the Customer-driven Innovation Strategy, presentation held at 6/9/2010, Designcouncil UK, London.

Schrage, Michael: Experimenting with “Design Transformation”, 8/9/2010, presentation held at “Transforming Design. Design/Management Europe 14”, London.

Stuttgart 21, Website of the protesters, link: http://www.kopfbahnhof-21.de

Matthias Müller, MSc.Born 1961, Switzerland

Founder and director of Mensch Design Innovation Gmbh, mdii.chInnovation Training and Organizational Consulting

EducationDesign Management in Berne (Swisscom internal) and Design Management Institute, BostonMaster of Science in Organizational Development, University KlagenfurtTeacher for German, French, History: University Zurich, Lausanne

WorkInternal facilitator and educator for design management (Swisscom AG)Internal advisor for organizational development (Swisscom AG)Courses in creative writingOnline portal management (bluewin.ch)Head of newspaper arts department (St. Galler Tagblatt)Music criticJournalistTrainer for social workersSocial engagement: co- direction of a youth club, president of Kammerchor Winterthur, co-founder of community centre Bahnhof-Toess, facilitator in the project „city development of Toess“

Further educationMediationLarge group interventionsTheme focused interaction (Cohn)Icelandic: culture and language

PublicationsArticles, interviews and short stories in newspapers, magazinesChildren‘s book „Yoko taucht“