Digital technologies are rapidly and fundamentally undermining the economies of scale that have been central to driving productivity in the industrial age:
- Distributed manufacturing. 3D printing technologies are enabling cost effective, localised production of fully customised products, challenging the dominance of mass production
- Distributed ledgers. blockchain technologies are obviating the need for central registers and enabling verifiable peer-to-peer transactions, challenging the raison d'etre for institutional mediation
- Distributed energy. photovoltaic and battery technologies are allowing homes and localities to harness and store energy, making access and proximity to the national grid irrelevant
As linear, industrial era business models give way to platform driven, ecosystem enabling models, when people can both produce and consume goods almost anywhere, and have limitless choice, what draws them to a product, service, place or an organisation? The answer, is design.
A succession of speakers, at the 'Design as Strategy Forum' in Sydney last week, shed light on the transformative power of design in their particular fields, and the value that it unlocks for customers, businesses, governments and society. Even the military.
In this digital, interactive and interconnected age design has taken on the more utilitarian role in the service of people, well beyond the aesthetic role it was confined to in the industrial age.
Increasingly, the abductive reasoning skills of designers are being used to address system level challenges such as 'transforming financial services' or 'redesigning healthcare'. And in this context of driving innovation, it is variously referred to as design thinking or as human centred design. It is less concerned with what you make, but why you make it.
Sir George Cox, an engineer by training and the former head of the Design Council in the UK, stated some ten years back that design is what links creativity and innovation.
Any economist will tell you innovation drives productivity, which in turn drives profitability and prosperity.
It follows that developing an organisational culture that embraces design thinking, and systemic capability in design methods, is critical to driving prosperity in the digital era.
In a rapidly chancing,VUCA world, human centred design methods enable organisations to harness the creativity of their employees; to explore new possibilities and generate a steady flow of good ideas; and to execute at scale only those which have been validated to provide value to the customer and capture value for the organisation.