Why Business Strategy & Planning Need Design
Updated: Dec 28, 2021
Fortune 500 companies like Apple and Nike, disruptive companies like Kickstarter and Airbnb, even major universities like Harvard and Stanford have started to utilize strategic designers for key business decisions. Inclusion of design in top positions has come about due to the proven effectiveness that their expertise brings to the table. This blog will uncover why it is important to include design in all business strategy and planning processes. First, let's dive into what business strategy and planning encompasses so that I can then make a case for design.
Business Strategy & Planning 101
Business strategy is the formulation and implementation of a company's major goals and initiatives based on assessing internal and external environments. People who are involved in business strategy provide the overall direction for the company.
Strategic planning is the process of organizing the company's objectives. It involves developing policies and roadmaps to achieve those objectives and then allocating the necessary resources to achieve the desired results. There are five basic steps to business strategy:
1. Define a Vision Statement
A vision statement is typically one sentence, or a very short paragraph. It is an inspirational, and usually idealistic statement, that is used to define the future goals of a company. The statement should include how the vision impacts the company both internally and externally.
2. SWOT Analysis
After defining the vision statement, a SWOT analysis must be conducted. The primary objective of using a SWOT analysis is to understand all the factors involved in making a business decision. The letters in SWOT stand for:
Strengths (internal)
Weaknesses (internal)
Opportunities (external)
Threats (external)
When a company is doing a SWOT analysis, the main focus should be research. The company needs to have a full understanding of what they are doing well, where they need to improve, who their competition is, and what their competitive advantage is. They also need to focus on defending and scaling their existing business, building emerging businesses, and scoping out viable future opportunities. There are a few factors that a company has to think about when conducting a SWOT analysis:
External Factors: Social, economic, political, regulations, technology, competitors
Internal Factors: Shareholders, suppliers, customers, resources, company culture, company structure, creditors
3. Strategic Plan Formulation
Once a SWOT analysis is complete, all research should be fully documented so that a clear strategy can be formed. Creating a strategic plan involves taking the vision statement plus all the research and turning it into something actionable. Here are a few things to focus on when creating a strategic plan:
Set short, mid, and long term SMART goals (Specific, Measurable, Attainable, Reasonable, Time-Bound)
Selecting Key Performance Indicators (KPI's) in order to track progress throughout all phases
Set cascading goals for departments
Set cascading goals for individuals
Set a budget
4. Strategic Plan Implementation
Now that the strategic plans have been formulated, it's time to implement the plan. First, the plans need to be communicated to the whole organization to understand its ultimate goal. Expectations, established schedules and milestones should be set. Finally, if any training or resources need to be allocated, this would be the time to do it.
5. Monitor and Control
To ensure that all plans are on track and progress is being made, monitoring and control need to happen. This step involves progress reviews, testing, pivots, and stakeholder involvement. Once the process comes to an end, a postmortem review should be conducted to identify best practices and improvements for future projects.
Why Bring in Design?
Every single company is a product. Please reread these words because I don't think people focus on this enough. Every single company is a product. It doesn't matter if a company sells a product or a service; no company has popped out of thin air and simply existed. Every company has had to create their vision and branding from the ground up. They have had to research their market and competition. They've had to build their company's policies and procedures and innovate to stay ahead of the game. Guess what designers are really good at? You are so right; designers are great at creating, researching, building, and innovating, and they can provide excellent qualitative reasoning. If this is true, why aren't more designers getting a seat at the table when it comes to business strategy and planning?
Having design involved in a company's business strategy and planning processes allows for a holistic view and a wider set of fundamental problem-solving skills that can significantly impact business outcomes. In the way accounting is a business tool to help make strategic financial decisions for the company, design should be a business tool that facilitates strategic decision-making based on the consumers' emotional and psychological needs and responses. (Yes, this means I believe designers aren't just there to make things look pretty, but rather they there to make an emotional and psychological connection with the consumer).
Side Note: In my last blog, "7 Steps to Better Design Thinking", I talked about how this human-centered design methodology leverages the designer's skill set to produce robust and intuitive solutions to complex problems that blend users' needs, future innovations, and the business' requirements. If you haven't read that blog already, I would strongly recommend reading it.
The Benefits of Including Design
If a company wants to include design in their business strategy and planning meetings, what does this look like, and how does this benefit the company? Let's re-look at each step of the strategic planning process, but this time let's bring in the designer.
1. The Vision
Here, we are writing that short impact statement that defines the future goals of the company. Some people may think there is no reason to bring design into this step because there is nothing a designer could offer, especially if the vision statement is about its profits, operations, production, etc. While most opinions should be respected, this opinion is why many companies get stuck in mediocracy. Let's look at why design is important in this step:
Design
Most people can write out inspirational goals, but here's the thing, a designer can quickly design out high-level iterations that provide a tangible vision for stakeholders. If the vision statement involves a product, the designer can quickly prototype or mock-up multiple possible variations to quickly cancel out ideas. If the vision statement is a process, the designer can quickly map how that process would affect the company's departments.
Storytelling
Designers are great at telling compelling stories, which means they can take a vision and turn it into an impactful statement that truly sells the vision. Storytelling is also a great way to align the vision statement with both the company's and consumer's needs.
The Why
Designers are trained to design for the right problem, not what the user thinks the problem is. This is important, because during a brainstorming session, when everyone wants to set the company's next vision, the designer will help ensure that vision is the right solution for the company. A designer will want to know the root of the company's problem and how the goals will cascade throughout the company. They will want to make sure the vision is feasible, desirable, and viable. Lastly, they will want to know the key performance indicators (KPI's).
The Balance
When one person is advocating for the company, the designer must advocate for the user and product integrity. Both these perspectives are important, and it's what creates the balance needed to provide a strong, holistic vision statement.
2. SWOT Analysis
Conducting the SWOT analysis is where we are uncovering internal strengths and weaknesses and external opportunities and threats. Again, people will question why a designer should be involved during a SWOT analysis. The answer is simply that designers should always be a part of a SWOT analysis because they are great at research!
Understanding the Market & Competition
A designer's perspective in business strategy and planning meetings involves an in-depth knowledge of industry and consumer trends, competitive analysis, and future innovations. A designer is constantly gaining knowledge from broad credible sources, including but not limited to: books, articles, conferences, classes, users, and trend reports. Designers are huge resources when it comes to understanding the market, the trends, and the consumer.
Understanding Users
A designer conducts user interviews with the product owner to help identify user's frustrations and pain points. These user interviews usually lead to investigating common internal issues to better understand what the user is experiencing. Designers also define and work with user personas, which means they have a strong understanding of how the company's consumer base functions, their behaviors, and their pain points.
3. Strategic Plan Formation
This step is where we are turning our vision statement and research into something actionable. At this point, people may have gotten on board as to why a designer should be in the brainstorming and research parts of business strategy & planning, but strategic plan formulation? Really?
Yes! Designers need to be a part of the strategic plan formulation! Along with other department heads, a designer can help ensure people don't put in unnecessary effort.
Integrating Findings & Saving Money
By bringing in a designer at the strategic planning stage, versus the end stages, the designer can integrate their findings from design research into business decisions at an earlier stage. This means the designer has research to support whether an idea is feasible, viable, or usable, which will cause a reduction of time to market for new products. Overall, if a designer can say, "This won't work" at the beginning versus the end, the company saves a lot of money. On the other hand, if the designer can say, "This will work, but we will need such-and-such," then the company can create that into the initial budget, instead of going over budget 12 months into the project.
Reducing Effort & Saving Money
No one wants to waste time planning out procedures and processes, only to find that what they have been working on won't actually be feasible in the end. A company also doesn't want to waste money having their entire team working on a product, only to find out that another company has already created a better product that is hitting the market next month. Bringing the designer in at the strategic planning phase allows the company to reduce effort, in-turn saving money.
Innovating & Saving Money
Designers are great at innovating and thinking outside the box. Allowing a designer to give input on planning, processes, and procedures will allow a company to save money by coming up with more innovative ideas for completing tasks.
4. Strategic Plan Implementation
In this step, a designer should be focused on supporting the company's strategy by implementing departmental strategies to accomplish the desired goals. They should focus on collaborating with product and development teams to set strategy meetings and user testing dates. All milestones should align with the company's established schedule.
5. Monitor and Control
In the last step of strategic planning, we are looking at monitoring and control. Truthfully, companies usually bring in designers at the end of the process for a reason. Overall, designers can play an important role if any testing needs to be conducted or if a pivot needs to happen. They can also package up the final product with a beautiful bow to present to stakeholders.
Overall, designers are advocates for the user and product integrity. When every company stays in business by pleasing their users and creating a great product or service, it only makes sense to have designers in strategy-focused positions. By allowing designers to have a seat at the strategic planning table, companies will save time and money, create better products, and form a better connection with their consumer base.