Design thinking offers a way to make business decisions that is especially suited to exploring uncharted territory and solving complex problems. But leaders need to know when to apply it, and they have to prepare both their employees and managers to do so. The authors have identified the characteristics that make an organization "design thinking-ready" along with a strategic approach to adopting it.
In August 2017, Concentrix Corporation (CNX) partnered with Photon Life Insurance Company (PLI), a leading insurance provider in India, to support PLI's customer management service. On February 1, 2018, Mohit Khanna, global operations manager at CNX, undertook a promising task to improve PLI'S customer persistency at minimal operational cost. If all policyholders with an approaching due date were to be called, then the number of service agents required would be very high, leading to significant operational cost increases. Khanna's challenge was to design a contact prioritization strategy that could be implemented at minimal cost and improve persistency.
In 2018, the legacy business of Somedia AG (Somedia)—traditional media such as newspapers, radio, and TV—was in structural decline. While its business portfolio still delivered positive financial results, it became clear that this would only be the case for a few more years. Susanne Lebrument and Thomas Kundert, the two main figures in charge as this pivotal moment in the firm’s history emerged, tasked themselves with finding new business areas that would secure sustained profitable growth and, thus, compensate the declining legacy business. The firm had a rich history and was a well-respected institution in southeastern Switzerland; as such, Somedia’s existing resources and capabilities would provide points of departure for new business development and diversification. Lebrument and Kundert’s key strategic challenge was to change the current business trajectory toward sustained profitable growth that would compensate for the decline and eventual disappearance of Somedia’s legacy business.
In August 2021, the founders of We are Marlow Corporation (Marlow) were considering the company’s future. Marlow was a direct-to-consumer (D2C), subscription-based business that sold lubricated tampon kits. The company was about to receive full approval from Health Canada to sell its products and the founders needed to shift their focus to a marketing strategy for their upcoming launch. They needed to decide on their target market and pricing scheme and how they would allocate their promotional budget to sell as many units as possible. The founders wanted a plan that would contribute to Marlow’s long-term sustainability and growth.
The brief case 'Donna Wilde and the Weathermen' sets the stage for a discussion of how to lead teams in an environment undergoing exponential change. The team has spent years working on a project about which they are passionate, but the CEO is skeptical and it gets put on ice. Wilde is left pondering if and how they can exert the leadership needed to bring the project back to life. The case is based on the experiences of a real team and company (whose identities are disguised).
In February 2021, the Indian government announced new regulations to increase the accountability of social media companies for misusing their platforms in spreading fabricated news, misinformation, and obscene material. The new rules were not welcomed by some prominent social media companies, including Twitter. The giant microblogging network claimed that the new rules were designed to suppress freedom of speech among the citizens of India, one of the largest democracies of the world. However, Indian regulators argued that the new rules were required to prevent abuse on open social media networks. Twitter contended that it was self-regulated and argued that its users’ voices should not be regulated because it would clearly amount to suppression of the right to free expression. In a changing political and legal environment, how could Twitter meet increasing demands from regulators to moderate content, while remaining aligned with its mission, vision, and ethical standards? Were the self-regulatory mechanisms of social media companies adequately effective without interference from external forces?
This role-playing exercise aims to tackle issues related to inter-organizational collaboration to scale up innovations. The role-playing experience helps learners discover, appreciate, and learn to govern inherent tensions in inter-organizational collaboration. The exercise is set in the Canadian auto parts industry, which could benefit tremendously from more sophisticated robotic technology to assist the manufacturing process. The role play asks learners to engage in an inter-organizational collaboration agreement. Each participant will represent a company whose in-house knowledge, resources or capabilities can contribute to developing a robot.
In February 2016, the principal dealer of several European luxury automotive dealerships learned from Audi of America LLC (Audi) that he would have to relocate one of his dealerships to a new location. The relocation would be to a new market area and the dealer would most likely lose his current customer base. Instead, the dealer used the opportunity to create a new business model for auto retailing that could enable him to maintain his market share without having to comply with Audi’s relocation requirement. His new concept, named “Carcierge” and opened in 2016, was showing initial success, but the dealer wondered whether the boutique sales model he developed would be viable in the long run.
In 2019, Paratent Event Rentals Ltd. was facing the possibility of year end net losses. The co-owners of this Canadian business had recently invested in premium inventory, but a lackluster first quarter showed that they were not forecasted to get return on their investments. A new method of cost allocation was proposed to get Paratent back on track. When choosing between three conflicting future contracts, both the old and new methods of cost allocation needed to be implemented and considered. Using qualitative and quantitative analyses, Paratent needed to decide which job would be the most profitable and which cost allocation method to use in the future.
In the pandemic, financial inclusion icon BancoSol faces a government-mandated year-long deferral of all loan payments, followed by the sudden Covid death of its CEO. In a Bolivia mired in political turmoil following a failed presidential election, with clients not obligated to pay either interest or principal from March to the end of 2020, the bank faces a severe cash deficit. This is exacerbated by the regulatory determination that, as the deferrals are mandated, loans must be deemed current and performing and resulting profits continue subject to income taxes that must be paid. BancoSol management must decide how to respond to this crisis. When the mandated deferrals come to an end, the bank regulators issue instructions as to how the restructuring must take place. As the total deferred amounts add up to 85% of its loan portfolio, this is a critical matter for BancoSol. Prior to the regulatory instructions, management had painstakingly designed its own restructuring program. Convinced that it is the optimal way to proceed, management strongly recommends its implementation regardless of contradicting the regulatory instructions. The deteriorating financial condition of the bank adds urgency to the decision. In the midst of these issues, in February 2021, Covid suddenly claims the life of the bank's longtime CEO, Kurt Koenigsfest, the architect of the modern BancoSol. With the bank's very existence at stake, Esteban Altschul, the chair of the board of directors, must come to grips with how the restructuring of the deferred loans will take place and how the various management gaps exposed by Koenigsfest's death will be filled. At the same time, convinced that the future leadership of BancoSol is linked to its adaptation to the digital age, Altschul must assess the efforts of the bank to-date in this area and how it should proceed in the future.
This case illustrates the efforts of the Mahindra Group's Agri Business and Farm Equipment divisions to drive sustainability-oriented action aimed at improving the lives of rural communities and preparing them to adapt to the impacts of climate change. It briefly describes the far-reaching consequences of climate-related disasters in terms of loss of food and nutrition security; livelihood; crop production; and losses in manufacturing, especially in developing countries such as India that are highly reliant on agriculture. The approach adopted by the Mahindra Group to tackle challenges in agriculture, such as water scarcity, food wastage, and energy-intensive practices, through affordable and energy- and resource-efficient technology is discussed. There are intense deliberations among the leaders of the Mahindra Group businesses about the way forward and concerns regarding climate-friendly innovations, which, from the perspective of the Chairman, ultimately translates into creatively reconciling the conflict between environmental goals and profitability goals. The Chairman and the Chief Sustainability Officer are firm in their belief that there are immense business opportunities in aggressively implementing sustainable practices. The leadership of the Mahindra Group is deliberating on how they can collaborate with rural communities and devise ways to improve farm-to-market linkages, reduce the costs of farm inputs, and scale up energy-efficient technology.
Thirty-five years after its founding, the Red Bull energy drinks business continued to show strong growth globally. Over the years, the company had expanded its product line with different variants, such as sugar-free and flavoured Editions. More recently, the company had launched a sub-branded The Organics by Red Bull range that sat outside the energy-drinks category, and the AlphaTauri functional-fashion brand. The company had renamed one of its two F1 teams Scuderia AlphaTauri to provide a unique promotional platform for the fledgling fashion brand; one that was overtly endorsed by Red Bull. The case provides a basis for discussing the (dis)synergies between Red Bull and these extensions from a brand, consumer, and marketing perspective. An extensive set of PowerPoint (PPT) teaching slides that include 7 different videos - a Red Bull brand purpose video, cartoon medley, Flugtag commercial, Soap Box Race commercial, Backyard Digger (BMX), former UK CMO interview, the AlphaTauri launch - are available to Educators by request.
Haier had come a long way since Zhang Ruimin took it over as a failing Chinese Collective-Owned Enterprise in 1984. Since then, he'd been able to transform it into one of the world's leading appliance manufacturers, known for quality and innovation. Haier was also noted for its bold geographical expansion, which had included buying iconic European brands, such as Candy, and, in 2016, the venerable General Electric Appliances (GEA), one of the world's most established white-goods firms. Along the way, Haier pioneered a new managerial philosophy: RenDanHeYi, a policy of staying close to the user (a term Haier preferred to "customer") where employees were encouraged to act as entrepreneurs and held accountable for their actions. More recently, it had put the digital agenda at the heart of its approach, leading a revolution in household appliances and aspiring to be the leading ecosystem brand in the Internet of Things (IoT) - a distinction duly conferred on it by BrandZTM in 2019.
Ecosystems offer a new way to bring multiple firms together in order to deliver new value propositions. By working together, the hub firm and its complementors can create innovative 'product plus service' bundles that span traditionally separate industries to offer an experience that simply wasn't available before. Such experiences can delight customers and give firms a powerful point of differentiation against competitors.