Table Of ContentINNOVATION BY DESIGN
How Any Organization Can Leverage Design Thinking to Produce
Change, Drive New Ideas, and Deliver Meaningful Solutions
THOMAS LOCKWOOD AND EDGAR PAPKE
Copyright © 2018 by Thomas Lockwood and Edgar Papke
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INNOVATION BY DESIGN
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Our work is dedicated to the Creative Class. By the way, that’s everyone.
CONTENTS
The Context
Chapter 1: Better Innovation
Chapter 2: Design Thinking Organizations
Chapter 3: Collective Imagination and the Fifth Order of Design
Chapter 4: Designing Culture
Chapter 5: Culture Types
10 Attributes
Chapter 6: Design Thinking at Scale
Chapter 7: The Pull Factor
Chapter 8: The Right Problems
Chapter 9: Culture Awareness
Chapter 10: Curious Confrontation
Chapter 11: Co-Creation
Chapter 12: Open Spaces
Chapter 13: Whole Communication
Chapter 14: Aligned Leadership
Chapter 15: Purpose
Conclusion: Looking Forward: Future Possibilities
Notes
Index
The Context
Better Innovation
“Imagination is more important than knowledge. For knowledge is limited to all
we now know and understand, while imagination embraces the entire world, and
all there ever will be to know and understand.”
—Albert Einstein
The collective imagination is humankind’s greatest genius. Throughout our
human history, as we developed and created the world around us, the sharing
and building of one idea on another has been, and always will be, our best recipe
for innovation. The world we continuously create for ourselves is the
manifestation of our collective imagination, the natural desire to come together
in community; to collaborate, explore, and learn; and to create what we want and
desire to have. It gives us the ability to respond to our basic needs, as well as
solve even the most complex of problems. It fuels the innovation that is the
foundation of our competitive global business society. It is our collective
imagination that provides us with the source of the innovation through which we
create a better world and through which we find ways to guide and change the
human experience. Humankind’s desire and drive for innovation is breathtaking.
Innovation is who we are. It is what we do best.
As our societies evolved, we creatively designed social structures that met the
needs of and further relied on our shared ability to innovate. As we did, we were
reminded that along with our innate desire to innovate, we have an inborn desire
to compete. When these forces come together, innovation is accelerated. The
social structures that we relied on for survival and connectivity evolved into
enterprises of commercial means that have become the fixtures of our global
society. These new enterprises and organizations became the vehicles that took
us on the journeys of the scientific, industrial, and more recently information
revolutions. All along the way, we continuously increased our level of
innovation and ramped up the pace of change in our world.1
Today we find ourselves at a place in history in which our capability for
innovating and creating change has provided us with incredible levels of
technology and know-how. Every day we find ourselves exposed to new ideas.
Moment by moment we are introduced to an array of new products and services,
some of which are delivered to us by purpose-driven, design thinking
organizations and enterprises whose main concern is to figure out how to create
more meaningful innovation and customer experiences. We are now operating in
a new global era in which a new digital economy is emerging—a new economy
driven by pioneering technology that allows for virtually everyone and
everything in our world to be connected, with new pathways for information and
knowledge abounding: the Internet of Things, the interconnection via the
Internet of computing and smart devices—electronics, software, sensors,
actuators, and network connectivity—that enable objects to collect and exchange
data. All this adds to a world that presents us with the means to faster and faster,
innovate more and more—all evidence of how we leverage our collective
imagination to creatively solve problems and meet the needs of humankind.
Innovation is what we do best.
STRUGGLING WITH INNOVATION
With all the knowledge and technology available to us, and the means of
immediate communication and instant access to information at our fingertips,
why does our focus constantly return to how we can become even more
innovative, to solve bigger and more complex problems? Why does so much of
our attention remain centered on finding ways to organize and work together
better to further leverage our ability to innovate? Why is meaningful innovation
the most important issue that organizations continue to grapple and struggle
with?
Throughout the history of business, we have found ourselves trying to figure
out how to maximize our human potential. Even today, and more than ever,
companies and institutions of all types and sizes are concentrating on creating
more innovative cultures. This is not a new breakthrough in thinking. Being
successful has always relied on the ability to work together and be creative.
More than science or the collection and use of data, the quest to understand how
to create higher levels of innovation and empower our creative intelligence
seems to be a more elusive aspect of how we innovate. The better we become at
seems to be a more elusive aspect of how we innovate. The better we become at
innovation and creative collaboration, the more we want to figure out to get
better at it—alas, human nature.
Purpose-driven, design thinking organizations and enterprises create more
meaningful innovation and customer experiences.
In pursuit of innovation, we have created complex organizations, with many
moving parts, all adding to the complexity of our solutions, of our lives—until
we come to the place of recognizing what the great designer Dieter Rams
pointed out many years ago: “less, but better.”
As complex as the world is today, we look for finding solutions to the
resulting challenges and emotional stress that all the moving parts and advanced
technology creates. The more complicated means of communication and
interaction move us to a place from which we seek greater simplification. We
have arrived at a place in our history that causes us to pause and reflect on the
complexity of the organizational systems that humankind has created, looking
for ways to overcome the needless barriers to communication and working
together they represent. Why? So we can find better, faster, and, yes, simpler
ways to work together to solve problems more efficiently and effectively. We
want to innovate how our organizations can work more simply and allow for
shared capacity to solve problems and innovate more freely.
To give you a sense of the magnitude of how important innovation is
perceived to be to the success of today’s organizations, one just has to look at the
title of KPMG’s 2016 Global CEO survey, aptly titled “Now or Never.” The
executive summary delivers a clear message, sharing that “[t]wo-thirds of chief
executive officers (CEOs) believe that the next three years will be more critical
than the last fifty years. The forces creating this inflection point are the rapidly
evolving technology and the speed of transformation it unleashes. In four years’
time 4 out of 10 CEOs expect to be running significantly transformed
companies.”2
A review of the results of a number of global surveys of CEOs, C-level
executives, and leaders from 2015 to 2017, including the major studies
conducted by KPMG, Fortune, IBM, and PwC, provide further insight.3 With the
exception of the Fortune survey (500 companies), most of the surveys we
reviewed included more than 1,200 participants. Among the key findings:
• Fostering innovation is one of their top strategic priorities, placing among
• Fostering innovation is one of their top strategic priorities, placing among
the top six in every survey.
• Most CEOs are grappling with how to engage their cultures in the change
necessary to be more innovative.
• A significant majority (seven out of 10 CEOs) say it’s important to
specifically include innovation in their business strategies.
• The majority of survey respondents identify the need for transformational
change in their organizations.
• Eight out of 10 are concerned that their existing products and services may
not be relevant in three to five years’ time.
• The majority of respondents say their organizations are struggling with the
speed of technological innovation.
• Gartner reports that 89 percent of companies believe customer experience
will be their primary basis for competition in 2016, versus 36 percent four
years ago.
• Accenture reports that 81 percent of executives surveyed place the
personalized customer experience in their top three priorities for their
organization, with 39 percent reporting it as their top priority.
What is equally as telling is that, while innovation is consistently among the
top six strategic priorities, less than a third believe their organizations’ cultures
encourage risk-taking or safe-to-fail environments. This is important to
recognize. Among the more powerful aspects of motivation and human behavior
are the needs for predictability and safety. From childhood through to adulthood,
we are literally taught, trained, and reinforced to find the safest paths. As a
result, satisfying these needs is paramount to how people perceive the ability to
express themselves and take risks. We discover that it’s not a good idea to tempt
failure.
However, the process of innovation includes failure. Whether an
organization’s temperament and messaging allow for exploration,
experimentation, and the potential subsequent failure says a lot about how
innovative an environment it provides for its members. It also doesn’t always
fall within the context of processes and systems that are designed to limit risk.
Or, ways of solving problems and making decisions that advocate adherence
rather than possibility thinking. This is about culture. This is about the pursuit of
understanding human behavior and the role that awareness plays.
These challenges are clearly defined in the KPMG report of findings:
• Thirty-six percent of CEOs say their organization’s approach to innovation
