This document discusses how integrating design thinking with IT project development can lead to more successful outcomes. It proposes a 3-D model consisting of three phases: Discovery, Development, and Deployment. In the Discovery phase, both design thinking methods like ethnography and traditional strategic analysis are used to understand user needs. For a project with the Virginia Employment Commission, user archetypes were identified which enriched the request for proposal. The Development phase involves creating prototypes and visual representations of concepts to get user feedback. Iterative testing and refining occurs. Technical requirements are defined later based on the user vision. Once a strong prototype and business case are established, the potential service moves into the Deployment phase where a final

1.
Design Thinking + IT-Mediated Services =
Innovation Excellence
By Jeneanne Rae
Carl Fudge
August 2009

2.
Design
Thinking
+
IT
Mediated
Services
=
IT
Excellence
__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
Design Thinking + IT- million?” Both of these are described in Nelson’s
(2007) paper, “IT Project Management: Infamous
Failures, Classic Mistakes, and Best Practices.” On
Mediated Services = the flipside, firms that get it right re-use developed IT
platforms and associated data again and again to
Innovation Excellence create new sources of value. They creatively adapt
existing functionality to enable new products and
services, as described in Kohli and Melville’s (2009)
writing on “Learning to Build an IT Innovation
IT-mediated services are becoming increasingly Platform.” In the realm of IT at least, the rich do
significant in the public and private sectors today. appear to be getting richer.
While some examples of high profile successes exist,
too many IT projects become high-cost resource Various explanations for the high rate of IT project
drains that disappoint both the organizations that failure have been put forward. Technological issues
invest in them and their targeted users. A major may be in play, such as difficulty choosing an
reason for this is the frequent mismatch of appropriate software development methodology, a
expectations between developers and users. belief in technology “silver bullets,” or a management
Developers approach these projects as “IT team that is not effectively coordinating internal and
deployments,” focusing closely on technical outsourced developers. Other reasons include a lack
specifications but not fully taking into account the of complementary capabilities, scope creep,
needs of real users, who expect a quality service to insufficient project sponsorship, over promising and
be delivered. The entire notion of creating a service under delivering, and poor interface design.
for an end-user is often lost on development teams,
resulting in the creation of user experiences that are Though these reasons do contribute to suboptimal
underwhelming and subsequently fail to capture the results, many IT project failures are ultimately rooted
results – financial or otherwise – that were projected. in a mismatch between what is demanded and what is
supplied. The value proposition to users is that of a
Because of this mismatch of expectations and the service, such as an online benefits management tool
opportunity to apply design thinking to bridge the gap, that provides a human resource service to
the practice of IT-mediated service development employees, while developers perceive that what is
(services mediated by electronic technologies) is ripe being delivered is an IT project, a business
for change. We propose a new, integrated automation system, a computer system upgrade, or a
perspective rooted in design thinking called the “3-D new database. This difference in perception is a
model,” in which all decisions about the development significant hindrance to success and directly inhibits
of new IT-mediated services are grounded in the the user’s goal of a delightful and valuable solution,
perspectives of real users. Not only will this approach such as Apple’s iTunes music delivery service.
help organizations create new and delightful
experiences that impact the bottom line, but it can While the technical features of an information system
also enhance organizational culture by providing a are undoubtedly important, the overall experience of
framework to achieve continuous improvement of the service is paramount. In the era of services,
products and services. We describe this new happy users translate to the bottom line as
approach and illustrate its effectiveness in a specific organizations gain competitive advantage through
case example: the Virginia Employment services that make them more “sticky” or allow them
Commission’s unemployment insurance system. to reap cost savings through efficiency gains e.g., by
replacing call centers with online, self-service
Why IT Projects Fail So Often software. The mismatch between a development
IT projects do not have a strong success record approach focused on IT specifications and ever
overall and according to the Standish Group (2006), increasing user demand for quality services leads to a
only 29% succeed, while 53% are challenged and model that is ripe for an overhaul. An empathic
18% fail. The reality is that they are risky endeavors approach rooted in design thinking is a critical missing
due to the human and technological complexities link in the development of IT-mediated services,
involved and the significant financial investment which we now describe.
necessary. Failures lead to management frustration
and financial loss, notably shown by two examples: Integrating Design and Innovation Using the 3-D
the FBI’s Trilogy project to upgrade its computer Framework
system, a $170 million “train wreck in slow motion,” The solution that we have developed comprises an
and Nike’s inventory glitches after an ERP integrative process that blends design thinking with
implementation, about which CEO Phil Knight traditional innovation and IT system design activities.
famously quipped “This is what I get for our $400 The resulting fusion provides a framework for
1

3.
Design
Thinking
+
IT
Mediated
Services
=
IT
Excellence
__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
organizations to complement time-tested The Discovery phase continues with field research in
development strategies with design thinking and start the form of ethnography, latent needs finding,
building an organizational culture of innovation as empathy for the end user and user journey mapping
well. The process involves three phases: Discovery, which is conducted by objective personnel trained in
Development, and Deployment (see Figure 1). We will design research methods. They function as explorers,
illustrate the framework by describing a real client invested in discovering where information
project that we worked on with the Virginia breakdowns occur and seeking to understand the
Employment Commission (VEC), to develop a new IT user’s context and state of mind. This information
mediated service for use in the public sector. often provides clues for potentially impactful
innovation opportunities. To find these clues, an
ethnographic model of the user’s experience is
generated, noting pain points and emotional wants
1. Discovery Phase and needs along the way. This process is referred to
The Discovery Phase is a combination of business as user journey mapping (see Figure 2), and is pivotal
and design thinking and includes framing the problem in laying the groundwork for creating a customized
and researching user needs. It kicks off by stating all service innovation that will delight users and
assumptions about the opportunity’s context, user, anticipate and counteract future information
and competitor to frame the research needed to prove breakdowns.
or disprove the dominant logic of a sector or industry.
Figure 1. The 3-D Model illustrates the main steps in IT-Mediated Service Innovation
Rather than using deductive logic (reasoning from a to an improved future and seeks to build ideas up,
general theory to a specific instance) or inductive unlike critical thinking which breaks them down. There
logic (reasoning from a specific instance to a general are no judgments in design thinking, a core value that
law or theory), design thinking uses “abductive” eliminates the fear of failure and encourages
reasoning, drawing on the logic of possibility and maximum input and participation. Also, the process is
exploring alternative world states to reveal the intuitive rather than generative: in brainstorming, for
possibilities of what could be. Design thinking is linked
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4.
Design
Thinking
+
IT
Mediated
Services
=
IT
Excellence
__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
example, understanding patterns is almost always different alternatives while the big picture focus is the
more useful than identifying the best ideas. overall customer experience.
In addition to leaning heavily on design thinking As Consultants, we were engaged by the VEC who
methods, effective IT-mediated service innovation needed to create a Request for Proposal (RFP) for
requires the incorporation of traditional strategy and potential vendors of a complex service delivery
marketing analyses, too. A strategic lens ensures that system designed to automate activities such as
the work performed moves the organization towards administration of unemployment benefits. The
its most important goals, such as improving its user success of the service depended upon accurately
experience and driving loyalty. Marketing analysis is specifying the service needs in an RFP, which proved
often used as the starting point to seek deeper insight to be a difficult task for the VEC leadership.
from certain types of customers, e.g., the most
profitable, most diverse geographically or segments Aneesh Chopra, then Secretary of Technology for the
that are attached to certain channels. While this State of Virginia (and now serving as the Chief
analysis is indeed necessary, it is not sufficient for Technology Officer of the White House Office of
effective service innovation: demographic information Science and Technology), described the challenge as
is no substitute for the contextual inquiry and one of “maintaining a balance between neutrality
emotional needs gathering performed during towards competing vendors and successfully meeting
ethnography – the latter directly informs service the needs of the State to acquire a functional yet
innovation whereas the former provides boundary flexible system.” While a highly structured and explicit
conditions. definition of requirements is common practice, this
unfortunately also serves to restrict potentially
Once both design thinking and strategic analyses creative responses. For example, if the VEC were to
have been integrated, the next stage uses convergent specify what technology should be used to achieve
thinking to synthesize the initial findings and move certain functionality, this could inhibit a vendor who
towards the design of a new service concept in the may have a better, alternative way of solving the
Development stage. This culling reigns in the problem. Another difficulty with the traditional
possibilities identified through design thinking and approach is that the user experience is opaque:
identifies a clear starting point for service design. The “unfortunately, in most government services, its hard
goal of the initial discovery process is to articulate to describe the user’s experience,” said Chopra.
what a better service would do and building many
Figure 2. A user journey map for an unemployed citizen seeking assistance from the VEC
3

5.
Design
Thinking
+
IT
Mediated
Services
=
IT
Excellence
__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
To gain more insight into the VEC user experience, reactions can be gauged. Storytelling, vignettes,
field observations were conducted to capture insights cartoons, and amateur videos are shown to potential
from both staff and users regarding their current users in order to tap into their emotional response,
interactions with the VEC system. The design thinking thus harnessing a unique quality of design thinking,
approach yielded journey maps of user’s experiences, which is turning complex systems into forms that are
noting aspects such as how often users needed to visible, tangible and accessible to users. When
interact with the system (and for what reasons), and creating these visual representations, it is important to
what roadblocks they encountered. The mapping step involve end users and front line staff in the
helped identify when information breakdowns took conceptualization process whenever possible, and
place, such as when users were unable to understand keep the stimulus user-centered.
what documentation was required to interact with the
system, usability issues in managing system access Design thinking is critical during these initial iterations
passwords, and frustration over what users identified of a prototype and a couple of traditional mindsets will
as “wasteful procedures.” need to be reversed in order for the process to be
most effective. First of all, rather than evaluating a
The VEC now recognized that understanding user service by its technical performance, it should be
needs was key to developing first a successful RFP evaluated by the reaction it elicits from end users and
and hopefully productivity reform, too. A key first step front line staff. Secondly, multiple prototypes should
was grouping users into four distinct scenarios or be generated and, while project managers may resist
“archetypes,” based on their needs, an exercise which this out of concern that the process will be inefficient,
had never been performed before. At this point, any incremental time investment is outweighed by the
development of the RFP was significantly enriched fact that prototypes reduce uncertainty and risk.
based on the methods of design thinking. According Through prototyping, designers can determine
to Sam Lapica, Director of Technology at VEC, “We whether users actually want the service, whether the
had never created specific scenarios before - that was team can deliver it, and whether cost objectives can
a new idea for us. It was more function specs, design be met before the initial pilot is launched. In
goals, and aspirations. Once we identified the four prototyping, the goal is not perfection but rather to
customer archetypes it became clear to us that we learn about the strengths and weaknesses of the
wanted to challenge the vendors to respond to that.” concept and to identify new directions that further
iterations might take.
The value here rested in having additional criteria by
which to evaluate vendor offerings, and assessing the With real user reactions in hand, the user experience
extent to which vendors’ proposals met the needs of can then be refined even further. This is also an
all four user archetypes. Lapica notes that “this is a opportune point to study the business case and IT
very specialized area of software development and specifications of the service and to document the
we didn’t want to foreclose possibilities by being too feasibility, costs and projected efficiency gains
specific in the RFP. We wanted the vendors to have associated with the service. It is important therefore to
some latitude.” Design thinking, in this case, was able deploy metrics and service standards to provide
to accommodate both specificity and latitude by quantitative measures (i.e., time to completion,
providing a wide range of archetypes to present percent completion, customer satisfaction) of the
diverse user needs. According to Lapica, “The productivity enhancements driven by an improved
process built on what we had already started and customer experience. The best programs seek to
gave us a different perspective and the addition of the improve some important aspect of the business case
scenarios was very creative.” such as productivity of the user or the system. And
without specified targets, it is difficult to prove that the
2. Development phase implementation of an ideal experience meets its
The Development phase begins once a vision for a objectives. Once the concept and the business case
better service is in place and initial prototypes can be have been developed, a period of iteration and
constructed. A key part of this is the ideation and refinement follows where, once again, it is important
visualization process, where quick, visual to involve end users and front line staff whenever
representations of services are depicted on paper so possible.
that participants can easily understand them and their
4

6.
Design
Thinking
+
IT
Mediated
Services
=
IT
Excellence
__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
Figure 3: Design thinking methods used in the Development phase including ideating (left);
visualization (center) and concept development (right)
At this point, the focus shifts from quantity to quality 3. Deployment phase
concerns. Contrary to traditional approaches which The strength of the final prototype and its business
lay out specifications for IT functionality early on in a case determine whether and how big of an investment
project, design thinking methods involve crafting the organization should make in the potential service.
informed technical requirements later in the process, Just as it would with a physical product such as a
once a clear vision for key requirements can be medical device or laptop computer, the design
articulated. thinking process ends with a final specification for
what should be built. In the product development
At the VEC, Sam Lapica described the visualization world, it is well known that organizations are far more
phase as “exercises with the project team to arrive at efficient at producing a product efficiently if both the
a unified vision for the project,” as these exercises developer and the users agree that the final prototype
were used to develop a service prototype for use in represents cost, margin, and timing expectations. This
the RFP. Part of the difficulty in developing the RFP is not necessarily common practice in the IT world,
lay in the complexity of the service, which was where projects are often funded lavishly before the
intended to satisfy a variety of user needs e.g., final outcome is known and are not necessarily
business owners researching incentives for opening a subject to user scrutiny during development.
new branch in Virginia or individuals navigating the
state’s unemployment registration procedures. The In fact, many of the disasters mentioned at the
services in question were entirely intangible, requiring beginning of this article occurred because there was
conceptual rather than physical prototypes. Using a no final prototype or business case prior to the
prototype allowed the Vendors to gain a much clearer beginning of the implementation phase of the work.
and more granular understanding of user needs. This area holds one of the strongest opportunities for
IT-mediated service design to learn from product
During the VEC project, the iteration and refinement development processes. The techniques now used in
process culminated in a two-day workshop involving product development in most industries include
consultants, the technology team at the VEC, and parallel development, rapid prototyping, and most
senior VEC leaders. Consultants presented the user recently, co-creation with users. Finally, incorporating
profile archetypes and guided discussion of their an element of storytelling helps sell the concept to
findings to determine whether user needs could leadership. All of these methods should be used in IT-
realistically be met through the system. This process mediated service innovation to reduce the risk of
shifted the focus of the RFP process from identifying failure.
desired information technology specifications, to
exploring how they would address the problems of a A common practice for many would-be innovators
wide range of users. According to Lapica: “It became faced with developing IT-mediated services has been
possible to identify not just information technology to go straight from concept generation to a pilot
barriers, but business process and policy restraints phase. Often these efforts require significant
that were obstructing the process.” Chopra stated that investment and have been known to fail because they
the workshop was, “The most impactful moment. We do not meet user needs or their service expectations.
listened to the customer experiences and allowed This is most likely due to several reasons, including
VEC leadership to listen to the outcomes and see if inadequate understanding of the problem to be
they found them realistic or unrealistic. This changed solved, a solution fraught with shortcomings, a system
the nature of the discussion away from ‘what IT that is too costly, or all of the above. The protocols
requirements do we want from the IT vendor?’ to ‘how outlined during the development phase, especially
will we address the needs of user A, B, and C?’” prototyping and iteration, help the development team
5

7.
Design
Thinking
+
IT
Mediated
Services
=
IT
Excellence
__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
get the technical specifications into the success zone There may also be an unexpected indirect benefit of
because of their heavy user focus. Because services deploying the process we describe: a subtle shift in
need to be experienced in order for judgments of culture of the organization applying the design
quality to be made, there is no better way to mitigate thinking process to IT-mediated service innovation is
the risk of possible failure than to deploy prototypes. It very likely, too. At the VEC, Chopra believes that
is therefore in the best interest of any organization to design thinking indirectly shifted the overall approach
build in the requisite protocols for continuous to business improvement. In discussing his
improvement upon launch whether the IT-mediated perspective on business improvement strategies
service is internal or external to the provider. using previous approaches, he indicates that: “I would
have emphasized Six Sigma, lean, or some other
performance improvement process that is a well-
Conclusion known manufacturing strategy used for process
No one argues that IT projects have a very high improvement. Now I would say design thinking is far
failure rate. The question is why, and what can be better suited for a services environment. We hope
done about it? We submit that there are two main design thinking might be the platform on which we
learning points for organizations as they seek to build a culture of continuous performance
develop IT-mediated services that delight users and improvement throughout our organization.”
customers. First, IT projects should be reframed as As organizations grapple with the twin challenges of
IT-mediated services so that the user experience is ever-demanding users and ever-increasing resource
front and center in all aspects of design and scarcity, new approaches will be required. Simply
execution. Second, service innovation methods based applying new technologies to new problems using the
on design thinking methods should be applied. As same methods is a prescription for mediocrity and
emphasized by Tim Brown, CEO of IDEO, in his 2008 preservation of the status quo. We urge organizations
HBR article, design thinking is a “discipline that uses to consider design thinking as an innovative new
the designer’s sensibility and methods to match approach to designing compelling IT-mediated
people’s needs with what is technologically feasible services.
and what a viable business strategy can convert into
customer value and market opportunity.”
In the VEC engagement and others with which we
have been involved, we observed that there are both
direct and indirect benefits of using a design thinking
approach to IT-mediated service innovation. The
primary direct benefit is a better service design in
terms of effectiveness, usability, and efficiency. The
key to achieving better service design is elevating the
user needs so they become central to all aspects of
the process. At the VEC, the project started off as an
exercise in IT specification setting, but after going
through the design thinking process, it became more
important to examine the IT barriers, process barriers,
and policy barriers that are obstructing the process. In
the words of Chopra, “What we’ve learned through
this process is a far clearer path from IT investment to
citizen improvement. In the past, IT investments were
largely back office and internal in their focus, citizen
benefit often indirect and secondary.”
6

8.
Design
Thinking
+
IT
Mediated
Services
=
IT
Excellence
__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
Top
Tips
from
the
Authors
for
Building
Innovative
IT
Services
1. Hold
on
to
the
notion
of
creating
a
service
for
an
end
user
rather
than
a
new
systems
deployment.
Forgetting
this
often
results
in
user
experiences
that
are
underwhelming
and
fail
to
capture
results.
2. Ground
all
development
decisions
in
the
perspectives
of
real
users,
by
gaining
their
insights
and
letting
them
co-­‐create
the
new
service.
3. Try
to
match
user
and
developer
expectations
and
remember
that
the
value
proposition
to
users
is
that
of
a
service
and
not
a
set
of
technical
specifications.
4. Market
analysis
is
necessary,
but
not
sufficient
for
innovation:
demographic
information
is
no
substitute
for
the
contextual
inquiry
and
emotional
needs
gathering
performed
during
ethnography.
5. Ensure
there
is
a
final
business
case
and
prototype
in
place
before
implementing
the
new
IT-­‐mediated
service.
This
practice
reduces
uncertainty
and
therefore,
risk.
Bibliography
Brown,
T.
Design
Thinking.
Harvard
Business
Review
(2008).
Hartmann,
D.
Interview:
Jim
Johnson
of
the
Standish
Group.
InfoQueue,
2006.
Kohli,
R.,
and
Melville,
N.
Learning
to
Build
an
IT
Innovation
Platform.
Communications
of
the
ACM,
52,
8
(2009),
122-­‐126.
Nelson,
R.R.
IT
Project
Management:
Infamous
Failures,
Classic
Mistakes,
and
Best
Practices.
MIS
Quarterly
Executive,
6,
2
(2007),
67-­‐78.
Further
Reading
“IT’s
Star
Turn”
by
Jeneanne
Rae
in
BusinessWeek
online
http://www.businessweek.com/innovate/content/jul2007/id20070718_340679.htm
“Seizing
the
White
Space:
Innovative
Service
Concepts
in
the
United
States.”
Prepared
by
Peer
Insight
for
Tekes,
the
Finnish
Funding
Agency
for
Tehnology
and
Innovation
http://www.peerinsight.com/docs/tekesreport.pdf
7

9.
Design
Thinking
+
IT
Mediated
Services
=
IT
Excellence
__________________________________________________________________________________________________________________________________________________________________________________________________________________________________________
Author
Biographies
Jeneanne Rae
Jeneanne is a nationally recognized thought leader on innovation management and design strategy. Rae was hailed
as one of Business Week's "Magnificent Seven Gurus of Innovation" in its cover story on the creative corporation.
After receiving an MBA from Harvard Business School, Jeneanne has now spent twenty years mastering the art and
science of innovation, including spending seven years on the senior management team of IDEO. A columnist for
Business Week online, Jeneanne writes on cutting-edge innovation topics. As an adjunct professor for nine years,
she taught new product development and service development at Georgetown University's McDonough School of
Business and currently teaches executive education through various top ranked programs. Jeneanne can be
contacted at: jrae@motivstrategies.com; 703-778-1051.
Carl Fudge
Carl is an Innovation Program Leader with Motiv, focused on design capability building and service innovation
projects within leading international corporations. With a background in organizational change, Carl is a firm thought
leader on subjects including organizational design, leadership and talent management. He holds a Masters degree
from Columbia University in Organizational Psychology and a B.S. in Psychology from University College London.
Prior to joining Motiv he was a Management Consultant with McKinsey & Co., in Houston, TX. While at McKinsey he
worked on topics such as growth strategy, operational efficiency and performance management in the beverage,
foodservice, media and energy industries. Carl can be contacted at: cfudge@motivstrategies.com; 703-778-5543.
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