Traditional approaches to innovation are largely a product of a manufacturing mindset - a hangover from our industrial past. Today, most developed economies are dominated by the service sector, with services accounting for 70%-80% of GDP. This has lead to the emergence of what Pine and Gilmour (1998) have dubbed the ‘experience economy’. Service design offers organizations a toolset for creating better service experiences through holistic, cross-departmental co-creation.

2. SD 101:
An Introduction To
Innovation Through
Design

3. Traditional approaches to innovation
are largely a product of a
manufacturing mindset - a hangover
from our industrial past.
Today, most developed economies
are dominated by the service sector,
with services accounting for
70%-80% of GDP.
This has lead to the emergence
of what Pine and Gilmour (1998)
have dubbed the ‘experience
economy’.

4. Agrarian Industrial Experience

5. Products and services are no longer mutually exclusive.
Companies, like apple for example, are increasingly tying
their products (Macbook) to services (iTunes).
Unlike products, however, services require sustained
interaction with the service user. To create value, the service
provider relies on the service user’s participation in the
service journey.
This creates significantly more opportunities and threats to
the brand experience than a static product creates.

6. Design is a method that gives organizations the skills necessary
to identify service users’ needs, and to engineer solutions based
on available organizational resources.
Contrasting with the organization-centric ‘boardroom’ approach
to innovation (where ideas are developed with minimal input
from service users and delivery personnel), design directly
involves stakeholders in an iterative co-creation process.
Co-creation helps to better identify real-world needs, and
emphasizes risk minimization over risk taking by identifying
potential problems early on.

7. Service design is the specific
application of the design
process to services.
Both front-end and back-end
processes are considered,
giving you a birds-eye view of
your organization.
Though related, customer
experience (CX) is focused
only on the customer.
User experience (UX) is
focused only on the
touchpoint.

8. Service design’s aim is to
devise holistic solutions
to improve the complete
experience.

9. Service design can help with any
number of complex challenges:
Choosing appropriate technology
platforms.
Developing new and improving
existing branded service
experiences.
Improving employee experiences.
Digital channel development,
transition, or adoption.

10. The Design Process
Research
Define
Prototype
Test
Launch
Measure

11. If you have high intolerance of uncertainty,
this will be a good exercise for you.
Iterative processes mean multiple loops
back and forth to find the right solution.
Doing so reduces risk of failure through
rapid prototyping and testing.
An Iterative Processes

12. Design
Psychology
Sociology
Business Management
Anthropology
The Methods
Service design borrows tools and
methods from business and the
social sciences:

13. The Tools
Quantitative Qualitative Visualization Testing

14. Sustaining a culture of design
and innovation comes from the top.
You need to know your purpose and how
to translate that purpose into services that
meet people’s real need on their own
terms.
You also need to set up the systems
and processes that facilitate collaboration
and free-thinking.
First, Purpose

15. While individual innovations are important,
developing a sustainable innovation
program is key to long-term competitiveness.
These firm-level dynamic capabilities that
underpin innovation are known as service
innovation capabilities (SICs).
SICs allow an organization to adapt to their
environment through the repeated and
continuous innovation.
Then, Capability
Development

16. Strategizing Capability: An organization must
possess a high degree of clarity in
understanding who the customer is, what
services to offer, and how they can be efficiently
delivered. 1
Knowledge Management Capability: Refers to
an organization’s ability to manage and deploy
knowledge assets for innovative purposes
through knowledge-centred activities. 1
Service Innovation
Capabilities
1. Blommerde & Lynch (2014). Dynamic Capabilities for Managing Service Innovation: Towards a Conceptual Framework

17. Networking Capability: Refers to an organization’s
ability to exploit its existing ties with external
entities and to explore new ones. 1
Customer Involvement Capability: Refers to the
extent to which service providers interact with
current or potential customers, the organization’s
understanding of customer usage and benefits,
and their role in creating value with the customer. 1
1. Blommerde & Lynch (2014). Dynamic Capabilities for Managing Service Innovation: Towards a Conceptual Framework
Service Innovation
Capabilities

18. Research on SME competitiveness has
shown that design-driven
organizations created on average
250% more wealth than non-design
driven organizations.
1
Design-driven organizations have a
9% higher employment growth rate
than non-design driven organizations.1
Design-driven organizations have a
9% higher employment growth rate
than non-design driven organizations.1
1. Design-Driven Innovation - Why it Matters for SME Competitiveness, Northern & Western Regional Assembly
The Results

19. Are You
Ready for the Experience
Economy?