Service design — the thinking model to leverage business innovation in the next decade

Over the past few years of working with the design of user experience, service design and design thinking in relation to business innovation, I have found more and more discussion. In Chinese design circles, at one point in time, especially when the concept of service design started to spread widely in the Internet industry, there was a great sense of excitement about discovering a new “wealth code” and “secret to promotion”.

Today, sustainability issues make the transition to a more sustainable economic system increasingly necessary (Martin, Doroteya, and Steve 2018). In this context, embedding sustainability as a prominent perspective throughout the organization is essential to embed sustainability into business.
Organizations need business transformation to achieve sustainability. In this process, Kay, Surina, Mohd, and Shafie (2010) claim to have undertaken activities to identify the organization’s business mission, long-term goals, opportunities, and threats, and to identify alternative strategies. These activities take place between people, institutions, and technological systems, and like Jesus, Lea and Ville (2017) suggest, service design can provide methods and tools to coordinate and realize these interactions in innovative ways.

It is therefore argued that service design can act on organizational elements through three levels of organizational change, service design interventions and service interaction design to facilitate the strategic transformation of organizations towards sustainable business.

At the same time, by classifying organizations according to their capabilities and capacity for sustainability, the ideal goal of growing into a ‘confident’ organization is set.

Finally, a variety of sustainable strategies are proposed to seek strategic transformation to enable other types of organizations with less capacity to achieve sustainable business. More evidence and supporting details will be explained in subsequent paragraphs.

Foundations of design practice

We call design a “sensitive issue” because it is always a little subjective. Even the most practical tool product needs some proper design and packaging. However, ‘functional packaging design’ makes sense and is designed to bring profit to the business.

There are few design-related aspects in the project process, before and after the design.

For this reason, some clients feel that design is only a support component. A designer’s work is only icing on the cake for them and not essential in the team. If it just supports, it can be removed. If it can be removed, it is unimportant. And unimportant means not being respected.

However, without design, there is no proper guidance or appeal. Design is subtle, and a good website is one that is just a pleasure to use and enjoys continuing to use. So why does all this valuable work seem to pale into insignificance in the business conversation? I believe it is about the way in which design cuts through to commerce.

A recording artist receives between 8% and 10% of the royalties for every record sold, whereas the designer who designs and packages that record only gets paid once. This is because the designer’s work is perceived as a one-off burst of creativity, producing only a static image. Yet, no one discusses the creative process, which includes countless hours of revisions, iterations, interviews, metaphorical research, album research, and so on.

Having said that, it would be considered extortionate for a designer to demand royalties for every album that features their work. For a musician, such a fee makes perfect business sense, but a designer cannot do so.

As designers move up the career ladder, they will slowly take on more business needs than actual design needs. This leads to a situation where the business-minded designers are freed from the project and are only involved in art direction, while the designers who design prototypes and interfaces may not care about the business at all. Sometimes a project manager can come in and balance things out here, but this is not a reliable solution.

The only solution is to create a good environment in the team where team members draw inspiration and experience from each other. This environment can start with a mission statement that follows the company’s standards, workflows, and constant experimentation.

Just going public is not enough, in an increasingly unpredictable world economy companies sometimes have to do a switch between survival and growth models during the year.

If the design is only treated as a complementary function, it is either the first thing to be cut for a company or the last thing to be added.

To break this vicious cycle, design needs to become part of the business, not just a glorified, good-looking thing. Whatever happens, business is for those who are prepared. It has the capacity to withstand pressure and be flexible when needed. If the design industry can survive adversity, then designers will certainly stick to their guns.

The business value of design

In order to develop business value, we must have a clear understanding of what success means to everyone involved. If we focus on business design, does that mean we abandon design execution? Or do we drive and convince our clients that design can be transformative for them?

Business-led decisions are seen as primary, which makes design-led decisions secondary.

When starting to design requirements we need to be familiar with the business, we need to learn to study how features and products and indeed the industry as a whole works. The business objectives therefore determine the overall design efficiency before the design begins.

After the business logic of the product becomes clear, it is time to sort out the requirements so that users don’t have to go through the same kind of tangled process that we did. That’s really where the design concept comes from, but the concept itself doesn’t have the power to execute; it has to become attractive in order for people to start caring and for them to know what they can do.

Then we translate the concept into ‘design’, which doesn’t just come out of nowhere. So, when do business end and design begin?

Design is not in conflict with business, it’s just translated into an executable way.

It’s not just about digital products. Once designers have made a better interface, they can enhance it to a better user experience. And once they have perfected the user experience of an individual product, they can contribute to the overall experience of an entire industry, an economy, or even a nation. Designers have a long way to go to not only become an expert in design but to get stakeholders to accept design as a role.

How design affects the economy

Conventionally conscious, design is considered to be an important part of the design-driven industry. As in, great web design is only for web designers. So, if you are in a business that is far from the creative and cultural industries, design becomes less important. This is actually an outdated notion that doesn’t fit the current context of the times.

A study by Forrester showed that companies that invested heavily in UX saw a reduction in customer acquisition, retention and daily activity costs, as well as an increase in market share. The design increased turnover, equating to a return of $100 for every $1 invested in UX.

When Walmart redesigned its website, it saw a 200% increase in visits; Truck Works redesigned its brand and saw a 49% increase in revenue; IKEA saw a 12% increase in revenue after it upgraded the shopping process on its website with a human experience, and JavaPura coffee machines saw a massive 21% increase in revenue six months after the redesign.

This led to almost half of the internet and hardware start-ups attributing their rapid growth to design. The larger the business and the greater the turnover, the higher the profile of design in business operations.

If the design does not bring in profit, then it will only be used as decoration. Decoration has its own value of existence and may not be a direct source of income. However, the value of good design is not broken down; it is healthy and solid.

Companies that see design as a major asset in their corporate management do better than their competitors in terms of new product introduction, market share, and international growth.

The problem with this type of corporate management is that it can only be achieved through iterative practice, and the experience of commercializing design is something different from what is learned in design schools.

Display design values

Lacking knowledge of business analysis, metrics and terminology, it can be difficult for designers to explain the value that design brings. Sometimes a trust-based solution is all that is needed, but mostly designers have to show their work and give reasons for the design decisions they make.

Large design firms have developed their own way of presenting their designs, which is quite rare, and smaller firms must back up their decisions with facts. More importantly, these facts must represent different business outcomes, and this is where A/B testing in design can come into play.

If design doesn’t rely on factual data, it starts to feel like it’s making art, which is always subjective.

The reason our projects stop is a direct result of the confusion between business values and subjective decisions. Metric design is a business practice that will ensure that the work we are doing goes in the right direction.