Design Thinking is an approach to problem solving where the design of the products and services we produce is centered on the user and tailored to their needs. It is about thinking in an unconventional manner in order to create that which delivers the most value to the customer.
It consists of 5 simultaneous phases:
- Empathize
- Define
- Ideate
- Prototype
- Test
1) Empathize Here we collect information in order to understand the customer. We listen to the stories and observe the daily lives of the people we plan to serve our product or service to.
2) Define We define the problems, needs and desires of the customer. We analyze the information gained through empathy and identify the root causes of the customer’s pain points.
3) Ideate We devise ideas for innovative solutions, challenging any assumptions we are making by stripping them away.
4) Prototype We create the innovative solutions we conceptualized in the previous phase. These can be low fidelity (lo-fi) prototypes which only partially resemble and behave like the final result, or high fidelity (hi-fi) prototypes which are closer to the final result. Lo-fi prototypes are cheaper and quicker to make but hi-fi prototypes can be used to attract more prospective customers through the close imitation of the final product/service.
5) Test We have the customer try the prototype and determine how much value is created. We can iterate on the solution based on the feedback we get from the customer when they test the solution.
After we have created the prototype and iterated it into the final product, the question is how can we be compensated for removing the pain points of the customer. That is the other half of entrepreneurship - monetizing the results. Having the information on the customer as a result of Design Thinking helps here too.
If we know our customers, we will have an idea of how much they are willing to spend in order to use our solution. If we lack this knowledge, we simply return to the empathy phase and collect more information.
Conclusion
Design Thinking is pivotal to effective entrepreneurship because we create products and services that address the issues that customers face without any unreliable speculation being involved.