In a recent report released by McKinsey from a five-year study of 300 companies, the global management consulting firm found that organizations that adopted design-based principles and methods had 32% more revenue and 56% higher total returns to shareholders compared with other companies.
Over those five years, McKinsey based their findings by looking at over 2 million pieces of financial data and 100,000 design actions. This is one of the most significant studies in this area and certainly validates and quantifies what many organizations and the design community have known for years.
It’s also important to note that these findings were consistent in what are often considered more complex or multi-faceted service organization and industries, including medical technology, consumer goods, and retail banking.
The study highlighted four different areas that increased revenue and total returns most, then ranked all 300 companies on these four areas using a metric they’re calling the McKinsey Design Index (MDI):
- Tracking design’s impact as a metric just as rigorously as you would track cost and revenue.
- Putting users first by actually talking to them. This helps to think outside of a standard user experience.
- Embedding designers in cross-functional teams and incentivizing top design talent.
- Encouraging research, early-stage prototyping, and iterating. Just because a product or service is launched doesn’t mean the design work ends.
This is a great start to validate the impact of design practices and thinking has on the bottom line. It’s also important that those leading or participating in design make the effort to provide similar information to the C-suite to demonstrate the value of the work we do.
You know those brands.
Those that are the envy of their category. Those that have grown to an iconic or near cult-like status. Businesses that have created a rabid and loyal customer base. Brands that always seem to be able to launch the most successful offering, that deliver a seamless experience and that always leave their customers recommending them to friends or colleagues.
What’s most compelling is that these brands have multiple competitors offering the same options for customers and at the same price.
What sets them apart is Service Design.
Service Design is a multi-disciplinary practice and methodology that allows you to plan and provide valuable service experiences for your customers while ensuring you have the ability to effectively deliver those services in a sustainable way.
It makes certain that what your customers experience through your services sets you apart and that you have the systems, processes and capabilities to provide those services to realize positive business results.
In defining Service Design, Forrester Research states, “Like customer experience (CX), service design focuses on the design and implementation of interactions that happen across the entire customer journey. Service design also designs the behind-the-scenes activities that enable those experiences to be delivered as planned.” 
It’s what has helped build those iconic brands, including Nike, Starbucks, Disney and more. These are all companies that use Service Design.
It can be utilized for either an internal or an external user of services.
It looks at all interactions your customers experience across channels over the life of the service delivery – which is referred to as “front stage”. It also considers the internal elements impacted by the delivery of those experiences that the customer doesn’t see – referred to as “back stage”.
Front Stage = User experiences
Line of sight —————————————————————-
Back stage = Internal elements of service delivery
Service design is user-centred, meaning a critical component of the practice is discovery. Discovery of the needs of your customers, their pain points and opportunities to provide them value and the best experience possible. This includes tools such as stakeholder maps, personas, service safaris, customer journey mapping and more.
It’s also collaborative, both with the user of your services and across internal teams. This ensures more effective ideation and that ability to not only determine the right solutions to improve the experience but also to eliminate those ideas that won’t have the right impact or that can’t simply be delivered. Service Design is about designing with people and not just for them.
It relies heavily on evidencing, or the practice of visualizing ideas in terms of physical artifacts or prototypes that allow for testing with users and the ability to further define detailed requirements. This process alone can result in significant savings prior to unnecessary development.
Finally, it maps out current and future state experiences to identify areas of focus, allowing organizations a user-centred process to prioritize action and initiatives for further planning and execution, resulting in a clear strategic roadmap. Common tools include Service Blueprints or a Business Model Canvas.
Customer expectations are growing faster than most companies can meet. What’s important is that your business focus on what are the right experiences you can offer your customers and have a clear understanding what it will take to deliver them effectively.
This is where Service Design can help. Forrester Research, How Does Service Design Relate to CX?
If you haven’t guessed, we’re pretty passionate about service design. We believe in the impact it can have on delivering great experiences for people. It can help business find a competitive advantage and support public services and non-profits to serve people in the best way possible.
So Morgan and I along with our colleague Trent Haus have founded a Saskatchewan chapter for the Service Design Network (SDN). SDN looks to “connect people with like-minded passionate service designers from companies, agencies, universities and with curious innovators who embrace and apply this approach for the better of their organizations and for people.”
Our intent is to leverage this great network of people, resources, case studies and events to help promote the growth of service design in Saskatchewan.
We want people to understand, learn, advocate and improve their practice of service design within the province. We know we have passionate and talented people here and we want to see that grow. We believe SDN is a great vehicle for that.
So take the time to check out SDN. We recommend becoming a member. It has a wealth of information and support to help you provide great experiences, whether they’re internally or externally.
Also, be sure to follow SDN Saskatchewan on Twitter and on LinkedIn. This is the best way to stay up to date on the events and happenings of the chapter.
If you provide a service using a number of different channels, you likely have developed a strategy for each of those touchpoints, whether it’s a mobile strategy, a social media strategy, a retail strategy, etc. The problem is that your customers don’t care about touchpoints. They care about your overall service experience and how it helps them make their lives better.
A stellar mobile app won’t create brand loyalty for the airline that offers a lousy service experience. Great selection in your store won’t be as valued if the purchase process is painful. The best approach to drive strategy is to start with the service experience. Make sure that the journey your customers experience when using your services is optimized from beginning to end, no matter the touchpoint they use.
The key is to plan and design the service experience and then create your channel strategies to support that experience so that each touchpoint makes the desired customer journey a reality. This way, you end up with a customer experience by design as opposed to one by default.
Service Design helps you identify the needs, pain points, opportunities and concepts to help you design the experiences your customers want. Gaining insights using tools like Journey Maps and planning end to end service experiences with Service Blueprints will allow you to identify how you can develop your various channels to add value to your customers and create advocates to build your brand and your business.