Business Strategy and Design Thinking
- Published: September 7, 2016
- Written by Peter Schooff
Peter Schooff: Hello, this is Peter Schooff, managing editor of bpm.com and today I have the great pleasure to speak once again with Dr. Mathias Kirchmer. Probably are familiar with his name, he is one of the founders of BPM-D. Dr. Kirchmer is an innovative executive and thought weaver in the ever-evolving world of BPM. He was also the managing director and global leader of BPM for Accenture as well as the CEO of IDS Scheer for the Americas and Japan. Also, Dr. Kirchmer is just finishing up, I think, his third edition of the book High Performance Through Process Excellence.
First of all, Mathias, thank you so much for joining me on another podcast.
Mathias Kirchmer: Thank you very much, Peter, for having me. It's a pleasure as usual.
Peter Schooff: To kick things off, why do you think Business Process Management Discipline is well-suited to execute this strategy of an organization?
Mathias Kirchmer: It's a great question. Most of organizations are still organized around functions. There's the sales, production, shipping, and management. Managers work and improve things in the context and boundaries of those functions. Process and process management looks at the connections between those functions. How do sales, production, and shipping fit together, and more importantly, how do they create a result of value for the client that is delivered to the market? Process management is all about improving and optimizing that result of value for the client, hence the market impact.
If you'd now look at business strategy, business strategy is, by definition, an enterprise-wide approach. Strategy needs to be executed across the whole organization to make a difference in the market with your clients. That means it's a perfect fit with the notion and definition of process and process management. Therefore, Business Process Management has now really become the management discipline to move strategy into people- and technology-based execution – fast and at low risk.
Peter Schooff: Excellent analysis. On your website for BPM-D, I've noticed that you've been talking about design thinking. Can you give us an overview of design thinking and how it fits into this picture?
Mathias Kirchmer: Yes, lately, we worked with several of our clients on this topic. This is basically a logical consequence of what we just discussed. If you use process and the discipline of process management to execute strategy it's not just about creating efficiencies, like cost or time savings, but it's also about improving the top line, improving revenues, and that means you need new creative ideas. You need innovation. That's exactly where here design thinking comes in, where design thinking adds significant value: it helps creating creative ideas and innovation regarding business processes. Design Thinking help to achieve process innovation and deliver innovative ideas for process improvements.
Design Thinking basically consists of four major components. On one hand, it's all about empathy. You look at your processes from a client point of view. It's about checking other areas outside the current scope. For example, as a business engineer, you can learn a lot from jazz musicians and the innovative behavior of a jazz band. Third, design thinking is about rapid prototyping. You don't wait until a solution is really finished and includes all functions and feature, but to try it out quickly, create value and you learn by doing. Last but least as a fourth component is around story-telling. That means you define the direction about an improvement, about an innovation, through the appropriate stories that keep things on track. Design thinking has become one of the new improvement methods that brings creativity and innovation to process management.
Peter Schooff: In saying this, can you give me an example in the real world where you've seen these design thinking has created new ideas or innovation?
Mathias Kirchmer: Let’s look at a simple example, a biotech company that delivers individualized drugs to clients. The big challenge for them has been the final configuration of those drugs, which is very time consuming and also very resource consuming because you have to track all the different components of such drug. Instead of trying to develop a solution for that from scratch, they looked into different other industries.Very interestingly the machinery industry and some great input for them. Many companies that produce machines have been to configuring those machines to order. They had been doing that for many years and collected a lot of experience regarding those configuration processes.There exist very sophisticated configuration approaches, processes, and related tools. The biotech company could “borrow” and reuse those approaches and solutions, developed in a complete different industry, in a different product context. They did not wait until functions and features of the software were 100% adjusted to the new environment, but tried it right away out – and achieved good value through this rapid prototyping approach. They really resolved a key issue for their client who didn't want to wait such long time for their drugs. They basically really addressed that whole issues through a design thinking approach.