This requires every business to transform how they work and what they offer customers. How they engage customers is critical as all of us will need to change our lifestyles and habits. We argue that transformation requires design. Design of the business model, design of new ways of working and design of products and services.
The why, what and how of sustainable transformation
Confronted with the challenge of adapting to more sustainable modes of business leaders ask three critical questions:
First they need to understand why they should care and prioritise sustainability – leaders need to understand the challenge in all its complexity; from the broadest moral sense of responsibility to society and future generations, to the specific risk and opportunities it poses to their business. Addressing why means engaging with their responsibilities as business leaders and corporate citizens.
Secondly leaders want to know what they can do. To identify tangible strategic choices they can make to reduce business impact or migrate to more sustainable models. This is often a very technical discussion, about the material and financial flows of a business, and traditionally involves an analytical approach to adjusting the material impacts of the business.
The third question is how. How do we transform the existing business – with its people processes and systems – that is set-up to optimally deliver against an existing model with existing customers, shareholders and cultures.
For successful transitions all three questions need addressing.
How do we move together, at speed?
Increasingly businesses are understanding the why. The evidence of ecological crisis is more and more startling and the momentum has been building to a point where in 2020 we saw an explosion of commitments to ‘zero carbon’ goals in many businesses. The risks are clear, the obligation to act is clear and the consensus has shifted to a point where some companies risk becoming laggards.
Accompanying the clarity of why firms should act has followed a growing industry focussed on what to do. From green investment products to circular business models solutions are exploding. Businesses’ technical ability to analyse a problem and devise solutions is kicking in.
Which brings us to the biggest challenge. How do we make this transformation at speed? How do we engage our people, our customers, our sector in a transformation that delivers on these ambitious goals? The challenge here is human and systemic. Human inertia and resistance to change when the future we are being asked to move to is different, possibly scary and definitely involves doing new things in new ways. Whether it is internal teams who need to re-think their processes, customers who need to adopt new technologies or shareholders who need to back new business models, we have to address the human factors. Systemic in that many people and organisations need to move together. Businesses with their customers, investors and many other stakeholders.
Our challenge now is to move fast – to deliver on commitment made and goals set. Many businesses have established ambitious goals and now are facing the hard work of making the transition. They are also well aware that they need to do this together with others – this is not a lone venture.
If the commitment is building and the technical solutions are falling into place how do we ensure speed of transition if humans and their complicated motivations and behaviours are the key to change?
The critical role of design
Let’s unpack the challenge. We have human needs and motivations to consider, we have the need for teams to change their ways of working and we have the need to change in ways that reduce the fear factor and help us to define, test and explore the future. Finally we need to take a systemic approach that considers all the many different humans in the mix – as we mentioned, employees, customers, shareholders, partners etc etc.
Design has many of these qualities. The focus on human experience and motivation, a collaborative approach, the ability to envision alternative futures in tangible ways that make it easier to engage with them. Plus design is able to zoom from a wider systemic picture into the details that enable action in a structured form. Specifically design is able to do three things that can move us forward
I am going to use the example of how the design team at insurer IAG helped speed their organisation’s climate agenda to illustrate this.
Connect with human experience
Design is rooted in a connection to people and their experience. We can use this ability to ground vast challenges like climate change in a more human perspective. Design can help to understand changing human needs and help teams respond to these needs.
For example; the IAG team conducted research to understand the emerging needs and concerns of their customer groups and projected these fifteen years into the future to create profiles of their customers and their future needs. These were expressed through narratives and artefacts as a way to engage the business in a very grounded future for their customers.
Facilitate creative collaboration
Good design is a collaborative effort. Designers are able to work with others to use creative approaches to re-think and envision alternative futures or solutions to challenges. This is done by helping people access the generative methods natural to design but not often part of an executive toolkit.
The IAG team used their customer futures to engage teams across the business in tangible futures for their customers and from there develop solutions to their challenges. This approach began to open the teams up to change in the way they thought about their business and how they might need to change to address a changing climate in ways that were relevant to customers and therefore the business.
Make the future tangible
The natural starting point for a business facing a challenge – and even more so with climate change – is to use data and modelling to measure impact and progress. Where they can become stuck is in translating that into narratives that drive action. Firms often get caught between the strategists and the business units. Design has the ability to create stories and tangible artifacts that give people something to work towards and align around.
The IAG team were able to take the emerging ideas from their creative collaborations with teams and create both stories about what IAG could be doing with and for customers in the future and also specific concepts for new products and services that would address specific needs and could be moved into a development pipeline.
A sustainable transition can feel like a technical challenge that is backed by strong leadership and clear goals. Most businesses are able to do the analysis and understand the problem. Where they can struggle is with the soft side of change. How do we all discuss something that is an existential threat to us and to business. How do we start to make moves into a future that is unknown?
The team at IAG helped to ground the challenge in the context of customers and the business units that serve them. This translated the high level goals and targets set by the board into specific options and actions for different teams across the business. A narrative for change was then developed that enabled action.
As design writer Marty Neumeister said in The Designful Company; “These are the kinds of problems you can’t manage your way out of. You have to design your way out of them.” we need the creativity and groundedness of design to connect corporate and societal goals to human lives – for both those in the firm and their customers.
View webinar with Harriet Wakelam (IAG), Mike Barry, and Livework’s founder Ben Reason here.