Digital transformation has become a necessity for organizations to stay competitive in today’s world, especially in the post-pandemic market. A recent report by the World Economic Forum states that digital transformation has the potential to add $100 trillion by 2025 to the world economy. Now what is digital transformation, and more importantly what is it not? It is not simply about automating your business processes through RPA or any other tools, that is a tiny part of digital transformation. It’s more about putting your users at the centre of your business and delivering value to your consumers (users or customers) through digital technologies such as AI, ML, Cloud Computing etc along with humans and processes. Further, it is about challenging the status quo and creating new revenue streams and business models through the adoption of digital technologies. Hence, digital transformation is more about your customers and business rather than the technology, which is only a means to an end here.
For example, let us take the case of Uber. Uber revolutionized the automotive industry by creating a stellar experience for the end users through their app, focusing on end users and their pain points and solving them. They shifted the dynamics from ownership to ridership and created a new business model in the industry. Here, Uber digitized the user experience of moving from point A to B through cutting edge technologies, but the focal point was the end user and that is what design thinking is all about. It’s about putting your users first, empathizing with them, understanding their problems, and coming up with a solution which improves the user experience by a great margin.
After understanding your users and their problems, the next step in design thinking is to define the most important problem users want you to solve – a problem for which users are ready to pay and are forced to use your company’s product. If Henry Ford had asked users what they wanted, they would have asked for faster horses. He instead focused on the problem they were facing, which was moving from point A to point B in a shorter period of time. He defined the problem clearly and designed an alternative solution for them which significantly enhanced the user experience and gave them a solution which they could not have envisioned. Design thinking is sometimes counterintuitive, it pushes you to focus on the problem rather than the solution. It is most important to define a problem which users are desperate to see get solved.
This is precisely where digital transformation and design thinking intersect. In my experience, companies now understand the importance of digital transformation however many are merely following their competitors who are doing better, without completely understanding the nuances of their own business and user needs. This is where design thinking can come to their rescue, enabling the companies to refocus on their users and their pain points and clearly define the problem their customers want them to solve. These companies can then work on that precise problem through the latest digital technologies to provide solutions that enhance the user experience by 10-100X.
Further, Design thinking also safeguard the companies in the solutioning stage by putting focus on an agile approach in which value to the customers is delivered in an iterative manner through continuous deployment and feedback from consumers. This way, the product can be iteratively improved to reach the most desired state of product market fit.
Again, the key point is to keep the focus on consumers and enhancing their experience through digital technologies and newer business models. All in all, Design thinking is a quintessential tool for all the companies embarking on the journey of digital transformation.