Why should I ‘Design’ my sustainable business model?
In my previous article “What does a sustainable business look like?”
I explained what a sustainable business model is and I introduced the idea of ‘designing’ this model.
In this article I’ll expand on this to discuss the ‘Design Thinking’ approach and explain why using it will help you design a more robust business model that creates more value for your customers, generates more profit for your business and helps safeguard the future for the next generation.
What is Design Thinking?
Design Thinking is an approach to problem solving that puts human needs at the heart and that aims to achieve a good balance between speed of execution and rigour. It encourages both taking action and taking time to understand, reflect and refine. It seeks to find a solution that will work, without getting hung up searching for perfection.
It’s not a panacea for every problem but an approach that makes it more likely that we will find a good solution in a timely fashion.
This makes it a good fit for tackling business problems. In business we need to need to solve problems quickly, but we also need to be confident that our solution will work. Above all we need to keep the needs of our customers at the centre of everything we do if we want to continue to be successful.
How do I do ‘Design Thinking’?
There has been an awful lot written about Design Thinking with many slightly different versions published. Personally, I like the model published by the design agency IDEO*, partly because it was written by the originators of the idea, but mainly because it’s written in plain English.
- Frame a Question that creates a meaningful and inspiring challenge. In our case the question is likely to be a variant of “How do I create a sustainable business model that fulfils my customers’ needs and makes money” that is personalised to the individual circumstances of your business.
- Gather Inspiration from understanding your customers’ needs and the key changes happening within your business, your industry, the economy and wider society.
- Generate Ideas for sustainable business opportunities. The Circular Design Guide** is a really useful source of resources, ideas and case studies to stimulate creative thoughts and ideas. This is a great opportunity to involve a wider group of employees as the more ideas, good or bad, at this stage the better.
- Make Ideas Tangible by capturing the ideas on the Business Model Canvas and its sister, the Value Proposition Canvas. These are your prototype business model designs. Sometimes at this stage the business model is only partially complete. That’s ok as it gives you a starting point for testing and further refinement.
- Test to Learn by writing hypotheses and questions about your business model that you can go out and test with your customers. You must then go out and actually test these with your customers, partners or other experts as needed. Use what you find to refine and improve your prototypes. Keep going around the loop until you have a solution that works. You may need to drop back to earlier steps. That’s fine too, the object is to get a solution that works for your customers, your partners and your business.
- Share the Story. Your new business model will only gain real traction if you get buy in from all your key stakeholders including the business leadership, employees, partners and of course your customers. One of the most effective ways to do this is through telling stories that enable people to understand and be inspired by your new idea.
What does this mean for my sustainable business model?
You’ve chosen to create a new business model because you want to leave a positive legacy for the next generation and you want to create a sustainable future for your business. This means that your new business model needs to be:
- Both inspirational and rooted in reality
- Have customer needs at its heart
- Deliver competitive advantage
Design thinking is a useful approach because:
- It focusses on customer needs
- It encourages you understand the problem from all angles
- Its emphasis on testing and refining makes it more likely to find a solution that actually works
- It keeps you moving forwards with solutions that work, not getting bogged down in trying to find the perfect solution
- It encourages creativity and ‘out of the box’ thinking
- It creates a story that customers and employees will find inspiring and motivational
So, using the approach of Design Thinking can help you create a robust business model that fulfils your ideals and your customers’ needs, creating a profitable business that is sustainable now and for the next generation.