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Introduction to Design Thinking
Hello students, I am Anirudh Agarwal, and today, we're going to study design thinking. Before we get into the details
of the course, I'd like to ask you, how do startups compete with incumbent firms? How do startups mid-ranking firms
compete with the sharks, and that is quite complex because everyone wants to increase their market share, but we
see time and again that startups mid-ranking firms became the next unicorns and the established firms, incumbent
firms lose the market share.
One of the finest examples where market monopolies, such as Kodak, Sony, General Motors lost to startups like Canon,
Tesla, Apple, and that makes us ask this question what makes certain startups and mid-ranking firms so special. Well,
there are many reasons what makes them special, but one of the reasons that is common among firms like Tesla,
Apple, Zerodha, is the user interface, is their design, and we're going to dig deeper into what makes their designs
special. We're going to understand why design thinking is such an important topic to study?
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Think about it, what is design? Think about what is art and what is engineering? What is the difference between art,
design and engineering? We can be combined art, design, engineering. Now, it might look a very abstract question,
but there lies the power of design, the power of where certain design can make firms extremely competitive, while
incumbent firms with the ossified mindset can lose their market share.
If you look at the Dow Jones index, you would see that some of the most innovative firms have the highest market
share at the Dow Jones, the firms like Microsoft, Oracle, Apple, Facebook have an extremely high market share. What
do you think? What makes them take? What makes Facebook as one of the market leaders less than 20 years, while
firms like BPTP, Actionmobil have lost the top 10 rankings that they whole held for nearly 30 years. Think about it.

And the idea I want to embed in your mind is it's the design, it's the people as the center of the services and products
and not having people around products and services, but having products and services for the people, putting people
in the center, that's what makes design thinking so special.
So, what is design? It is the adjustment of all parts proportionately so that one cannot add, subtract or change them
without impairing the harmony of the whole. Design is bringing elements of engineering, elements of aesthetics,
beauty into a product and a service that creates higher value that a simple utility-oriented product would provide.

So, for instance, if you look at a normal tap, you know, you go to an Indian village, and you look at a normal tap, it is
made up of copper or brass with a small washer and a knob. You would go to any village; you would find that tap. Now,
compare that tap with Jaguar, which is one of the market leaders in these kind of sanitary products. What makes jaguar
so special?
So, a simple tap made up of brass in a village in India would cost 100 rupees and a Jaguar product would cost close to
5000 rupees. The value addition of 50 times, while the function is the same. That is to stop the flow of water and to
let the flow of water when we desire that's what the tap does. Both the Jaguar and a normal brass tap does the same
thing. The value that the design creates for Jaguar is 50 times more for the same functionality.
The same goes with one of the market leaders in air cooler that is Symphony. Symphony was one of the first companies
that redesigned a desert cooler into something more aesthetically pleasing. What is a desert cooler? It's just a simple
motor and a pump, a water pump. You combine a motor and a water pump, put three pads around it and you have a
voila, a cooler, a desert cooler.
But look at Symphony what it did? It redesigned the water cooler into something more artistic, more designed, more
user-friendly, slightly more technological, and it became a market leader in India and still holds one of the leading
positions on the stock exchange, very highly traded. Although, what it does? It sells a simple utilitarian product called
desert cooler. So, that's the power of design how a design could enhance the valuation of a company and bring trust
of the consumers to the company.

Another example is McDonald's. Now, McDonald's thought about the users as workers who want a quick food, quality
food, nutritious food, but quick and at a given price range, and they created a chain of restaurants all providing the
same set of food, with the same set of users in mind to the entire United States, and of course, after that, it expanded
to Europe, Asia and Latin America, but what they had in mind was clean food, cost-effective food, quick food for the
booming Americans, who are working in a more construction or labour-oriented industry. So, they had people in their
mind, and they created the products to suit the people that they had in their mind.
Another example where design and people-oriented thinking changed the industry is, but of course, the iPhone. Just
before the iPhone, the market leaders were Nokia and Motorola. They had numerous instances where they are
engineers and market researchers asked them to change the model to bring in more UI into their phone offerings to
bring in more technology, but they were in for highly optimised speaking device, and then there came Steve Jobs with
this idea of iPhone that had battery time of eight hours, compared to Nokia that had a battery time of 108 hours.
Imagine, the difference was close to 15 times, and everyone in the industry said this phone is not going to survive. It
just offers a talk time of eight hours, yet it gave multiple options to the users.

It gave an option to browse the internet. It gave an option to use some of the best software in the form of applications
on the phone. It gave an option to turn phone into a tablet or a tab, and yet, it was surprisingly easy to use compared
to some of the previous firms where phones were combined with internet and rest is all history.
Today, the highest margins of profit go to Apple. It is one of the leading companies in the world in product design and
product marketing. So, clearly, design gives an advantage to firms. It's very important for us, product managers,
product marketeers, members of highly innovative firms too to think innovatively, creatively and bringing elements of
the corporation that give innovation the center stage of corporate language and corporate communication.
You know monster.com and LinkedIn are two websites that are providing something different. So, monster.com was
a platform where job seekers and job givers can come together and interact. Well, we had a LinkedIn, which was
basically a social networking website for professionals. However, now LinkedIn is fast emerging as a platform, a space
where job givers and job seekers are meeting, and it is taking the market share of monster.com.
My question to you is why and what makes LinkedIn so special that is able to take the market share of monster.com.
Think about it. What makes LinkedIn so special? What are the elements in LinkedIn that are not there in monster.com?
One of the things I want to bring to your notice is that design is not just what you see. It can influence your
consciousness and subconsciousness.

For instance, there was an experiment where the users were given 7 Up bottles of different colours. One was darker
shade of 7 Up, one had a lighter shade of 7 Up, and those who drank the darker shade of 7 Up felt that it tasted more
like a mixture of lime and lemon, while those that had a lighter shade of 7 Up felt that it tasted more lemonish. Now,
it's very counterintuitive, how can the design of a bottle influence the taste.
So, clearly, design can go deeper than just how it is communicated at the interface. It can deeply impact the human
psychology, the conscious and the subconscious. Another thing about design is that design can make brands
memorable.
So, if you look at the iconic symbol of Pepsi, it hasn't changed in the last so many years. So does, the Apple, the iconic
symbol of a bitted apple remains so very much ingrained in our conscious and subconscious that we recognise the
products by the symbol. So, is Amazon, UPS, Shell, FedEx, McDonald's and Adidas. So, design can make brands
memorable and the more we invest early in the design, the better it is incorporating design at the initial stage can go
a long way in developing trustfulness, loyalty in the brand.

I would like to introduce you to the concept of design thinking. Design thinking is generally defined as an analytical
and a creative process that engages a person in opportunities to experiment, create prototype models, gather
feedback and redesign. Now again repeat, it is a process that engages a person or a group of people in elements that
combine art and engineering into something, aesthetically pleasing and functional, and then try it on people to see if
the people like it, take the feedback, redesign it and then re-engage with the people, the users.
According to Braha and Reich, the design process is characterised by being iterative, exploratory and sometimes a
chaotic process. It starts from abstract specifications or what one may call a brief, a design definition, problem
identification and terminates with the description of a product.
While gradually refining the product specifications, intermediate states of the design process might include conflicting
specifications, product descriptions, imaginations, the specifications may change, the user likelihood of liking the
product may change, and they could be unexpected problem discovered during the process, which are there and then
addressed. In this case, design follows a cycle of mutual adjustment, creative process between specifications defined
earlier and the lessons learned during the process of designing the product to a final solution that everyone likes.
Design process is not a top-down approach where the top scientists or a top management decides a product and the
end user uses it. It's an engaging process where the decision makers at the top, the budget allocators, the designers,
the project managers, the marketeers and the end users are holistically involved in creating a product that can give
value to the end user and the value to the corporate house.
Typical process of a design thinking is you learn about the user by putting yourself in the user's shoe, you define the
problem, you understand the problem, you ideate, you engage with different stakeholders, ideate further and you
define the problem into a product or a service, prototype the product or a service, test it, test it among yourself, test
it with the lead users or the users, learn the results during the testing phase and implemented a scalable version.
Now again, I would say it might look quite obvious. Some of you who must have worked in the industry, it might look
quite obvious, but it is not, you know, putting yourself in the shoes of the user isn't that easy, it requires specialised
training, it requires empathy, it requires imagination, thinking and a great deal of discussion and teamwork before you
can really understand the user, and thereafter, it requires creativity, skill set to define the user's need into something
that is workable, something that is shared by all, something that can be researched, developed, anchored, and
something that can be created. So, although it looks quite obvious, it is not so obvious. It requires a deeper level of
thinking, a deeper level of empathy and ability to be creative.
So, first step that is most commonly used is empathy. Now, you would be looking at this image where there are two
child and they are crying? My question to you is why do you think these two children are crying. Now, again ask? Why
do you think these two children are crying? Think about it. Are these two kids hungry? Have these two kids done PP in
their diapers? The head of the bold kid is so rough that is scratching the cheek of the of the other kid? Are they both
fighting while they're are sleeping? Obviously not. So, what do you think, why are they crying?

Put yourself in the shoes of the child and think about, why are these two children crying? Well, the more you think
about this image, that is a starting point to learn to empathise. Now, these are small kids, and by simply trying to
understand why the children are crying. You put yourself in the shoes of the children, you think am I hungry, have I
done pp in my diapers? Am I scratching myself? Is someone pinching me? Is there linen on which I'm lying is it too
rough for me? Is the linen on which I'm lying is it clean or is it dirty or is it wet?
You know putting yourself in that shoes and asking these questions makes you feel that how many different ways you
can cry and that is the starting point of what empathy is to put yourself in the shoes of the child and then think why
am I crying? That is what empathy is.
Well, when you empathise, you try to understand the context, what is the context, and your next step is to define the
problem? And one of the easiest ways of defining the problem is to follow a standard template of design brief.
Now, design brief is an interaction between a problem solution seeker and you as a designer. Now, that problem
solution seeker could be the user, could be a corporate client, could be a top management of the company, and you,
as a product manager/designer the interaction between you, you can write that down in a template called design brief,
and what essentially does is, it understands the client, the context and defines a problem or a problem solution or
gives leads to certain directions where designers can brainstorm. So, the next step is to come up with a with a problem
definition, and the best way is to use the design brief template.

Once you have had the design brief with you, you share the design brief in your team, assuming the team is composed
of professionals from different domains like art, sociological, domains, psychologists, engineers, they all come up with
different set of expertise who understand the problem from different mindset and institutional logics.
A design brief is a is a series of statement/template that brings all of your team members on the same level. Once
everyone is on the same level, you start the process of brainstorming. Now, what I would suggest is, of course, once
you have a design brief, you would go out in the field and observe the users on whom you would want to experiment
or develop a new product service. You would want to learn about them, take a survey, understanding is more, come
back and then brainstorm. That's my approach. Or you can directly brainstorm. It's up to you.
I would suggest once you have had your design brief, you go out, see the users, understand them further, then come
on both brainstorm, ideate, and ideate with an open mind. Let the ideas come on the whiteboard, no matter what, no
matter how silly those ideas are, let them be on board, and then, there would be a moderator who would work around
and select some of those ideas, some of those clusters of ideas and turn them into a direction where the team would
work and create a prototype.
Prototyping is a costly affair. You can have an easy prototype and you can have an extremely expensive prototype. So,
for instance, you must be going to let's say air shows or auto shows. In both air shows and auto shows, you must be
seeing concept cars. Now, concept cars an extremely expensive prototypes, which can cost close to million or million
and a half dollars to prototype.
While you can have some really cheap prototypes, where you design the product on a on a software like CATIA, Solid
X, or Rhinoceros, or some more easier software's available now, and then you present the 3D model to the client or
you can present something on a PowerPoint. You can actually present a software as you would use it on a PowerPoint.
You can design the software interface and present on the PowerPoint. You can simply design, draw it on a piece of
paper, multiple designs of the product or service and show it to the users and the clients and take their feedback and
then go on the final stage of prototyping.
Once you have had your prototypes, you go, take the feedback. Whatever feedback you get on the prototype, you
redesign it, redevelop it and then you go to the top management, get the budget allocation and then you scale the
product at a mass level, with a very strong production strategy, supply chain strategy and a market strategy.
What kind of firm, what kind of problems design thinking addresses? Think about it. And I have a list for you. Design
thinking can help you address incremental design issues.
For instance, if you look at MakeMyTrip. It's evolution from 2010 until now, and if you look at the website how it has
evolved, how it has used multiple services, especially artificial intelligence, how it has incorporated elements of
artificial intelligence into providing right services to its customers, as an example of how design thinking can help firms
innovate, service quality.

You know, service quality is the interface where the customer interacts with the firm directly, that’s what is service is
about that. The interaction distance between the firm, that is the company and this customer is minimum the distance.
So, for instance, if I go into a to a hospital, how are the services provided in a hospital? So, if you go to a government
hospital like AIMS Delhi or you go into a private hospital like Max Saket, the quality of services provided are completely
different and that issue can be addressed through design thinking.
Usability issue. So, for instance, let's assume that you're into trading and you trade using HDFC securities, you trade
using Zerodha, you trade using ICICI. These are all trading apps and each of them have slight difference in their
interfaces. Slight difference on how the transaction occurs, slight difference, how the security protocols are governed
in each of these apps, slight difference in how the transaction occurs, slight difference in how the transaction costs
are.
Now, if you want to create your own trading app or you want to develop a given trading app and make it more
competitive, you would want to understand what the user wants. You would want to understand what the competition
is like, but you would also would like to understand your users take user feedback and redevelop your app, and that
is a usability issue. These problems can be addressed using design thinking principles.
Artificial intelligence is one of the finest and most upcoming tools that you can incorporate in providing services to
your clients. Now, I give a most common example. I use PowerPoint. You must be seeing this PowerPoint. Now, I've
been using PowerPoint since the last 10-15 years. Now, only recently am I using this unique feature inside PowerPoint
are called design ideas. Now, what it does is, it gives me automatically specific designs that I can use to structure my
content on PowerPoint. It is purely driven by artificial intelligence. I put in 10 pictures. I don't have to realign pictures
using my hand and mouse. The design ideas inside PowerPoint realize all those 10 pictures automatically in different
formats that look aesthetically pleasing, and that is the beauty of design ideas.
Now, what the design ideas does? It eliminates an individual who could be hired to realign my pictures in PowerPoint
in an aesthetically pleasing way. It eliminates that individual and it does it automatically, and it solves my problem.
Now that strength of artificial intelligence Is going to increase over a period of time, and you as a designer have to
learn to use the power of artificial intelligence into design thinking.
The human machine interface is another example where design thinking takes precedence. Anywhere, where an
individual is interacting with a machine is the human machine interface, and human machine interface has a lot of
information asymmetry that is, I don't know what the machine is like, what's going to do to me, how dangerous it is,
and a design philosophy into the machine can make the machine more benign, more user friendly, more aesthetically
pleasing, and so, here we see a lot of application of design.
Service interface. As I said like how the services are offered to people, is an area where design thinking can go a long
way.

Often in my class, I talk about the Digital India campaign by prime minister Modi. It's a fantastic campaign. It really
revolutionised India, but there were a lot of people who are uneducated, who don't know how to use internet, but
also forced to use internet, and they were all people like a 75-year-old, 80-year-old, whose children are living abroad
who are not educated enough to understand how to use internet? Now, you have to design your products and services
to address the need of this market. This market is also digital or part of the digital platform.
Now, you have to imagine how they interact, how they use products and services, what are the missing elements in
your services, in your applications, softwares UIs, that these people need and then you to put them into practice, and
that is something that, as a design thinker, you need to think through, you need to contextualise. Software human
interface and product human interface. Now, these are areas where as you as a design thing can bring a lot of
innovation, lot of creativity.
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Introduction to Design Thinking

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Powered by upGrad Education Private Limited

Powered by upGrad Education Private Limited

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