Design Thinking: This Will Change Everything

Note: this blog post is a re-print of an article that I recently had published in an insurance product development journal (Product Matters!). I wrote this article in October of 2012, so when I re-read it last week I was a slightly afraid of what I would read! But after reading I decided that I should share this article with the readers of my blog. I hope you enjoy.

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Ernest Hemingway was once challenged to see if he could write a very short story that carried the emotion and power of some of his longer works. He came up with one that contained just six words. My guess is that the challenger was thinking they would at least get a few paragraphs. So what were those six words?

For sale: Baby shoes, never worn.

Read the sentence out loud and reflect upon the meaning, and you’ll feel how potent this short sentence is.

Just as Hemingway’s short sentence packs a lot of meaning into just a few words, Stanford’s Design Thinking Boot Camp is a three-day intro to Design Thinking that provides the knowledge, insight, and experience of a semester-long class. In fact, I was asked to craft my own six-word sentence about my experience at the d.School and it was this: “Life will never be the same.” I won’t try and unpack everything that sentence represents, but as you will hopefully see, Design Thinking is a game changer and I now have a new set of tools to apply to any problem. How can life be the same after you experience something like this?

One of the principles of Design Thinking is “Show…Don’t Tell.”  You learn Design Thinking by doing, not reading. So rather than writing a long article on Design Thinking, I want to introduce you to the steps of the process, and some ways that these steps can be applied to insurance product development. If you really want to “do” Design Thinking, I’d highly recommend you speak to the fine folks at the d.School.

Background and Overview

Let’s try a quick exercise. Think of someone you know that is creative…who did you come up with? My guess is that 90% of people think of someone who is a painter, musician, or writer. Design Thinking rejects the relationship of “creative” equaling “artistic.” Anyone can be creative: an actuary, an accountant, a lawyer. Children are by default creative, making a safari adventure out of a sheet and two chairs or a spaceship out of a refrigerator box. We start out imaginative, but somewhere along the way, we lose touch with our creative side. Design Thinking seeks to unleash the creative potential that lies latent inside of each of us.

Honestly, it’s only been in the last couple of years that I viewed myself as creative. Things that others may see as boring and not allowing for creativity, I see as my craft—an artistic endeavor. Design thinking will allow you to approach your work with the same mindset and look for ways to creatively solve problems.

With that said, let’s dive into the Design Thinking process. The five parts of the process are Empathy, Define, Ideate, Prototype, and Test. As I mentioned above, I’ll interject examples of how this can be applied to insurance product development.


When most of us think about design, we think about aesthetics—making products that are appealing to the eye. While aesthetics are an important part of design, Design Thinking always starts with the human element. Therefore empathy is essential to solving a problem with Design Thinking. What are some ways to gain insight? You need to spend lots of time talking and listening to your user (the person for whom you are designing a solution). Ask lots of open-ended questions. Ask “why” often. Try to evoke stories and emotions. As you’ll see later in the process, stories are an important foundation for the other steps in the Design Thinking Process.

So how do you increase empathy among members of your team, or others in the company? You have to talk with people. Here are some ideas.

Example 1

If you were questioning, “How do we improve the customers’ experience with our company?” a great place to start would be watching what customers do when they open statements/prospectus/bills from your company (or any company for that matter). Give a customer a stack of mail and have them open it. Watch how the expression on their face changes when they open a handwritten letter, versus junk mail, versus a two-pound prospectus packet. Ask the customer to talk about companies they love interacting with—what is it about these companies that delight them? What products do they adore?

Example 2

If you were questioning, “How do we help people save for retirement?” you could start by conducting interviews. Go to a place where people are (obvious, yes?). I have found that it helps to get the conversation started by offering a gift card (of a small monetary value). Ask them questions about retirement. Are they ready? How are they saving? What worries them? I’ve also found it’s helpful to ask lots of “why” questions, such as, “Why is that?”

Now you may be saying, “I can get all of this data from quantitative studies that have a larger and more reliable sample size than five.” And you are right; data can give you a sense of people’s worries, problems, concerns, etc. But data cannot provide stories and a human connection. For someone like me who has spent my career focused on quantitative analysis, the qualitative focus of Design Thinking felt like California feel-good nonsense! But after having experienced it first hand and seeing how companies like IDEO have used it to deliver groundbreaking innovation, it’s hard to argue with the results.


The definition portion of the process helps create a user point-of-view statement. The point-of-view statement is like a problem statement, but with feeling and emotion. This provides a great platform for ideation (brainstorming). Always start the creation of this problem statement with thinking about needs—“needs” as verbs, not nouns. Examples of needs, by this definition: To feel responsible, to show love, to enjoy time with a spouse, to provide for our kids college education. The following are not needs: security, a second home, replacement income.

After exploring needs, you craft the point-of-view statement. It’s similar to those “Mad-Libs” you played as a kid. Here’s the format: “USER” needs to “NEED STATEMENT” because “INSIGHT.” So let’s look at an example of a problem statement using this format:

An independent and energetic retiree needs to feel secure about not outliving her assets because her biggest fear is being a burden to her children later in life.

This statement is packed with emotion and compels us to want to come up with a solution. Also, we are not solution biased. At this point it may not even need to be an insurance product to solve the problem. This allows us to do what is called “ideate” without constraints (more to come on that). I’ve also selected what Design Thinkers call an “extreme user.” Identifying and empathizing extreme users allows us to come up with solutions and insights that often apply to a broader user group. Having a powerful point-of-view statement will allow us to come up with great ideas as we move to ideation.


Ideation is what most of us usually think of as brainstorming. It’s a little embarrassing to think of what I’ve called “brainstorming” in the past. There were no empathy insights and I didn’t clearly have a user point of view. Hopefully it is starting to become clear how important these steps in the process are.

As I mentioned above, we are solution agnostic. Ask a Design Thinker for help designing a bridge to go over a canyon and her first response will be, “Are you sure it needs to be a bridge?”

At this point, some of you will think, “If I work for an insurance company, why should I brainstorm solutions that I know I can’t create?” The answer is that your “wild” solution may provide insight that leads to a product you can create or a solution you can manage. Here’s an example using the point-of-view statement above: An independent and energetic retiree needs to feel secure about not outliving her assets because her biggest fear is being a burden to her children later in life and not being able to buy birthday and Christmas gifts for her grandchildren.

One wild idea is that we create a magic jacket that always has money in the pocket if she needs it to buy gifts for her grandchildren. If she takes her grandchildren to the mall and she doesn’t have money for the gift, the magic jacket will supply a crisp $20 in the pocket.

Clearly, this solution epitomizes a wild idea, but it’s an idea into which you can delve deeper. How would it feel to wear and know that this jacket is in the closet? Can we do anything that would provide the same feeling or meet these needs?

Prototype and Test

Prototyping is the stage in the process in which you create something with which the user can interact. This goes back to the Design Thinking principal of “Show…Not Tell.” A prototype can be a skit that shows the experience, sticky notes that show an interface, or construction paper and post-its to show the layout of a call center.

The key to prototyping is that it needs to be low resolution / low fidelity (say low-res or lo-fi if you want to sound like a practitioner!). It’s important to construct a low-fi model because:

1)      You want to get feedback from your tester as quickly as possible so you improve

2)      Testers are more willing to give feedback if the model is less refined

Think about point #2 —if someone on your team brings a PowerPoint presentation he has spent months of his life working on, missed his kid’s soccer games for, and has lost a couple of years of life expectancy because of, wouldn’t it be difficult to tell your team member that his presentation was completely off the mark? Now imagine the same presentation: It has headings, but the body is a mixture of sticky notes and drawings of graphs. At this point, it’s much easier to lend feedback and make changes.

Building a low-resolution prototype is essential to being able to quickly gather honest feedback and continue working toward solution. And that’s all that testing is—having the user (or a user) interact with your prototype and receiving feedback. As with all of the steps of the process, this is another opportunity to gain empathy for your user. As the user interacts with your prototype, what problems does he have? What emotions does he feel? This empathy learning can lead to improvements as you further iterate on solutions.


My hope is that this brief intro into Design Thinking has given you an idea how the process can be applied in a wide variety of settings to solve problems. As mentioned above, the best way to learn Design Thinking is by experiencing it yourself, so if you are interested contact me, the d.School, or any practitioner of Design Thinking to experience it for yourself. But before starting take note: Life will never be the same!

The power of small batches

Please allow me to start this post with a recommendation…everyone* should read The Lean Startup, by Eric Ries (*NOTE: by “everyone” I am only referring to those who want to become smarter, more creative, be inspired and have your mind blown).

With the recommendation out of the way, I can now post the blog equivalent of a retweet from chapter 9 of Eric’s fabulous book.

Think of the simple exercise of stuffing envelopes. I do this every Christmas. I have 100 1) envelopes, 2) cards, 3) labels, 4) stamps.

So what’s the fastest way to complete the task of stuffing the 100 envelopes? Two choices

  1. label 100, stamp 100, stuff 100….or
  2. label 1, stamp 1, stuff 1 x 100

I’ve always pursued method #1, but after reading The Lean Startup, I now see the power of small batches (method #2).

“…in process-oriented work like this, individual performance is not nearly as important as the overall performance of the system.”

When working with large batches, we consistently underestimate the time required to switch tasks. We don’t consider the time required to sort and stack the piles of incomplete envelopes.

Another huge benefit of small batches is the ability to spot problems and course correct (pivot). Thinking about the envelope example, what if the envelopes had been the wrong size? We would have wasted the time of labeling and stamping. If we worked in small batches, we would have spotted the issue almost immediately and been able to save time.

The efficiency of scale disappears with large batches because, as Ries explains, it is more difficult to deal with the size and complexity associated with  large batches. (seems simple when put that way)

You have made it this far into the post and you’re thinking, “what does letter stuffing have to do with me?” Let’s translate the letter task into a more generic job function…

You create marketing pieces for someone (let’s call him Jay) to review. You need to create pieces for five different products. You have two choices in front of you.

  1. Create all five pieces —> send to Jay —> begin next task
  2. Create 1 pieces —> have Jay review (repeat 5 times) —> begin next task

Most workplaces tend to be set up in silos, reinforcing path 1 as the “best practice.” Path 1  “promotes skill building, makes it easier to hold individual contributors accountable, and most important, allows experts to work without interruption. Unfortunately, reality seldom works out that way.”

Why is this? Think about the time involved in switching tasks while dealing with the batch – this takes time. Think about the potential that all five pieces have a common defect – this would drain time. Think about the likelihood for Jay to interrupt you after you have “completed” the task. Jay will have questions – this takes time. It may be counter-intuitive, but path 2 (small batches) will be faster.

Small batches and startups

What do small batches have to do with startups? The better question is what do small batches have to do with “lean”?

The lean startup borrows ideas from the lean manufacturing movement, where the objective is to eliminated wasted production. Working with small batches allow a startup to test a hypothesis more quickly. (note: I almost typed, “small batches allow a startup to ‘go to market’ more quickly, but as Ries shows us, the goal of a product launch in the eyes of a startup is to test a hypothesis – another post is coming on “gettting credit for learning.”)

Including unnecessary features, testing more than one hypothesis, developing a detailed business plan are all examples of large batch waste.

Small batch bourbon

Anyone who has had great Kentucky bourbon will not be surprised by the title of the blog post. Small batch bourbon is superior to large batches. In fact, single barrel is the best of “small batch.”

Are you struggling with issues associated with large batches? Can you make a change to process that would allow you to work with smaller batches? The next time a colleague proposes a “divide and conquer” approach, tell him or her about envelope example and try your hand working with a small batch.

Strategy is hard work

I recently read a wonderful blog post by Roger Martin regarding JC Penny’s dramatic strategy #FAIL over the past two years. (note: I do read other authors, I just haven’t gotten around to blogging about them!)

The blog post is “Memo to JC Penney: Execution Is Not Strategy“. I won’t repeat the entire post, but here are some key takeaways:

  • Strategy is a coherent set of choices about where-to-play (WTP) and how-to-win (HTW) and, if that WTP&HTW is significantly different than the current one, a credible path for getting from the present to the targeted state.
  • JCP had a plan for betterment and not winning — one of the most common mistakes in “strategy.”
  • JCP did not identify a set of shoppers with whom it could win — for whom JCP was their best alternative, to which they would look loyally for their shopping needs for some set of goods
  • JCP needs to decide how is it going to provide a superior value proposition to competitive alternatives in that chosen space. This is a tough task.

The last bullet point made me think of the blog post title. Developing a winning strategy is always difficult. Having the patience to think through multiple paths and determine “what must be true” of each path takes patience AND practice. You have to recognize that your first idea is probably not your best idea. You have to be motivated by your winning aspiration and be ready to change where you play and how you win.

If that all sound easy please get in touch with me! That said, I’m convinced that this work is worth it. Companies that have winning strategies deliver more value to their customers, employees and shareholders. Their hard work is rewarded in the end.

Do you or your company have a strategy? Or like JCP are you focused on betterment and not winning?

Change the posture of your dialog

Ok, I will admit it; I do not have the best posture. I often find myself hunched over my laptop or slouching in a meeting, but posture is important. Slight changes in posture can have important long run impacts on overall health (e.g. less back pain). This is also true in sports – I grew up playing competitive golf and I remember every instructor stressing the need for good posture at address of the ball. Standing too upright or leaning over too much invited a whole host of issues. Standing in the proper athletic position (think Tiger Woods) increases the likelihood of executing the shot as desired.

So how does this relate to strategy? I asked myself the same question when I came across this section in Playing to Win. According to Lafley and Martin, changing the posture of dialog at P&G was crucial to helping P&G develop and execute successful strategy. Here’s why (from PTW):

No individual, and certainly not the CEO, would try to craft and deliver a strategy alone. Creating a truly robust strategy takes the capabilities, knowledge, and experience of a diverse team – a close-knit group of talented and driven individuals, each aware of how his or her own effort contributes to the success of the group and all dedicated to winning as a collective.

So what did Lafley and Martin do to help foster the collaboration necessary to win? They changed the dialog from advocacy (arguing for your position) to assertive inquiry. (aside: can the internet please create an “assertive inquiry” entry on wikipedia – it doesn’t exist yet!)

Here is the framework that Lafley and Martin installed (aside: I would love to know how)

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Like my hero, Nate Silver, I like to deal in probabilities. I get extremely frustrated when someone on the opposite side of an issue as me, will not admit that there is some non-zero probability that he or she is wrong. That posture feels arrogant and prideful – the opposite of the collaboration that is needed to win.

I love the humility embodied in the questions above. By asking questions, you signal to the other person that you care about their view and you want to hear more. You admit that you could be wrong and you want the group to get to the best answer rather than be right.

As I mentioned above, I am fascinated to know exactly how Lafley and Martin affected this change in dialog at P&G. I have a general idea:

Step 1: CEO begins using assertive inquiry

Step 2: CEO’s direct reports see that assertive inquiry is important and follow suit

Step 3: Assertive inquiry works its way through the organization

So what do you do if your CEO, boss, partner, etc likes to advocate and states their opinions as facts? Try assertive inquiry to get some insights into others thought process. In other words, start with yourself and change the posture of your conversation.


What is strategy?

As I have started to read more and more about strategy, I notice the word itself is often used (and misused). I admit that I’ve been guilty of misusing the word “strategy.” A google search for the word “strategy” turned up 529 million hits.

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Looking at the news turns up head-lines like “Will a new global strategy lift under armor stock?”. Or “Obama repeats strategy in student loan fight.” As you’ll see neither of these headlines accurately use the word “strategy”

Given my need for clarity around what strategy is (and is not), I wanted to devote a post to the subject. As I mentioned previously, I loved Lafley and Martin’s Playing to Win  – it has inspired several posts that I want to share.

What is strategy?

Michael Porter, the father of business strategy, wrote a seminal paper entitled “What is strategy” in 1996. This paper has become the most cited HBR article, ever.

In “What is strategy?” Porter defines strategy as “the creation of a unique and valuable position, involving a different set of activities.” There is a lot going on in this definition and Lafley and Martin provide a valuable framework for unpacking Porter.

Lafley and Martin’s take

Building off of Porter’s work, Lafley and Martin, define strategy as

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Strategy is a “set of choices about winning” and as I mentioned in my previous post, “winning” can be a noble aspiration.

Having only read Lafley and Martin’s book a month ago, I have found the question set to be extremely valuable. They represent an easy way to teach yourself and others strategy. One of my favorite antidotes from the book relates to the idea of teaching strategy. This is from A.G. Lafley

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“I was going to teach strategy until P&G was excellent at it.”

Turning the framework on yourself

You’ve read this far and you think, “I don’t run a business” or “I’m in college” or “I’m not a manager.” How can you apply what is in Playing to Win? By applying the framework on yourself – your career, your marriage, your family, etc. Take your career as an example. I’ll use a hypothetical example:  Jen just started at E&Y and she wants to one day become a partner.

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Now Jen has a strategy. She will evaluate choices she has in light of this strategy. Her strategy will help clarify what choices she will make.

What must be true? (WMBT)  – this is a refrain that Roger Martin uses often and is a great way to brainstorm the requirements to successfully execute. I used WMBT to help work out Jen’s strategy.

For example, what must be true for Jen to learn how to sell and bring in business for E&Y? She must learn from the company’s best salespeople. Notice that this is just one answer….there are other answers to the question. The answer could have been, “Jen needs to read the top ten books written on how to sell.” That said, Jen must make a choice, she can’t do an unlimited number of activities in order to become a good salesperson (in this case she could read books AND learn from others at E&Y).  Strategy is a set of choices about winning.

The better the choices, the better the strategy and the more likely that executing on the strategy will lead to the winning aspiration – for Jen, making partner. Also, not making a choice, is a choice.

What is your winning aspiration? And what are the series of choices you are going to make to help ensure that you win?