One of the biggest challenges companies face is to stay competitive

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The Most Innovative Companies from 2016 are examples of organizations that are disruptive through creativity. However, there are still many others that are struggling, focusing on revenue, instead.

In this episode of the People & Business Podcast, we talk with Ingo Rauth, Innovation researcher and Design consultant.  He shared interesting insights from his research in Design and Innovation Management of how companies can solve some of the most common challenges by developing their capability to innovate.

References Shared in this Episode

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Ingo Rauth

Ingo Rauth

Innovation Researcher and Design Consultant.

For the past 10 years, Ingo has worked for corporations as Microsoft, Philips, Steelcase, and Google.  During this time, he has also worked on research in design and innovation management.

Ingo is also the co-host of the Design Thinking Exchange Conference. He also host his own interview podcast called Innovate by Design.

Interactive Transcript

Transcript Notes

[1:00] How would you bring innovation to a company? Where would you start?

I would probably first start by trying to understand what the company means by the word innovation? Like where do they want to go with this? What do they want to do? Do they want to do radical new things or do they just want to improve the things that they already have?

Based on that, I would try to understand what is the current role of the company to actually determine where they could go or where they really want to go.

Oftentimes we aren’t clear about what we mean by innovation. So in order for an organization to engage in that, I would first start with talking to them about where you want to go and where you want to take it.


[1:40] What are the challenges leaders face when trying to build innovation?

One challenge is certainly dependency on the past, not giving up on established mindset and the focus on efficiency

“Efficiency is not the same as innovation

Another one is the ambition to measure and try to control everything, especially when you focus on things like user centered innovation where you follow the user in order to understand his or her latent needs and based on that develop or conceptualize new products or services.

So when it comes to thinking about the barriers, often times if it’s really radically new, it’s better to establish a new organization that is neutered by the existing organization which can start from scratch and doesn’t have the same constraints, the same processes, the same values. And you really create this room for something new to emerge.

However if it’s an improvement of something that’s already on-going, so it could be seen as an innovation but it’s really based on existing technology or existing market understanding, then it might be brought to fruition within the existing organization.

So I think it is important to understand what exactly you want to do that is radically different from what you have done before.

So in order to get this new mindset into your organization and to get these new skills that can’t be controlled, that can’t be measured, it’s very important to setup an independent unit that is allowed to operate outside the norm of what has already been there.


[3:53] Are there different processes to start this innovative mindset within companies?

I think innovation can’t be prescribed as a process. The things that we have, these process models, they are nice or they are useful when you want to learn something like design thinking. But they aren’t sufficient when it comes to actually practicing it.

If you think about you wanting to climb a mount and that mountain is called innovation, the process that we have, they suggested there is one right way to climb that mountain. However if you have never been on that mountain top, you actually don’t know the way. And the problem there is if you follow a way you might realize that it brings you to a dead end and you can’t actually reach the target which is the top of the mountain.

So in order to do that, it’s more helpful to understand these approaches which are out there with design thinking being one of them, as a learning tool.
It helps you to climb a lot of small mountains before you actually know the tools and have the mindset that you need in order to be prepared to climb the big mountain.


[5:17] If you want to implement this method of design thinking in your company, you will need to spread a mindset first?

I hear a lot of organizations talking about mindset first. If you think about what a mindset is really, if something happens you automatically respond to it in a certain way. The problem is you can’t program people to think that way. The only way you can actually do that is if you help people to engage in a certain behavior that over time becomes this automatic way of acting and thinking.
So it is important to foster mindsets but you have to engage them somehow in practicing and utilizing design thinking or whatever you want to foster inside the organization.

“Engage people to change mindsets. Don’t change mindsets and then engage people because it won’t work”


[6:24] How can we motivate our employees to find their own ways to engage with Innovation?

The thing is that we aren’t trained to engage in things which are highly uncertain. And innovation is highly uncertain.
So in order to help employees to engage in these ways of working, they need something like psychological safety which is the safe environment in which they can practice and also fail with their ideas and their innovations. So in order to support a team in going through that development, it’s important to create a safety net, a feeling that they can actually do innovation and no matter what they do and no matter what they try, they will be safe to fail.
Failing is essential to learning and we know that we can’t predict the outcome of anything that we try on the market.

The faster we iterate, the faster we learn, the faster we fail, the faster we are going to succeed and come up with something that ultimately helps.

Through that process of constant iteration, through learning, through reflection based on this failing, we also will develop or the employees can develop a security so that they actually trust themselves to do this.
In the beginning it often takes a lot of practice, a lot of projects and external help but over time teams can develop the confidence to actually engage in design thinking or other innovation related activities and endure this uncertainty and develop and learn why they are on this uncertain journey.


[8:38] People is afraid to the word Innovation  

The thing is when you use words, especially those which have a lot of meaning especially nowadays as innovation is the cutting edge and this is where everybody wants to play. And it can create a lot of pressure and some people who may not feel actually equipped to do these kind of things.
So sometimes it’s better to engage them as you said a little bit more playful without making them think about it too much. And then later on actually help them understand what they have been doing and maybe showing them that they actually can do innovation and not saying up-front, ‘We are going to do innovation and this is really what every company should do and you must do that. It’s very important that you learn this skill.’
But being a little bit more low key and take away this value laden vocabulary that makes people maybe a little bit uncertain and nervous about what they are going to do in the next two hours of your workshop.


[10:00] Approach to Scaling   

What I have seen some organizations doing is that they charge an internal team with five or six people to bring design thinking to an organization of a couple of thousands or let’s say a hundred thousand people. So clearly by this difference in size, you can already picture that this is quite hard.
On top of that these teams also should develop products and support existing product development teams in doing design thinking. So that’s usually a little bit too much for a small team.
Also most of the time there was this idea where everybody should do design thinking and should do innovation. If you think about the core of any organization, the core is mostly about producing revenue and creating value for shareholders, customers or whoever.
So having everybody engaged in innovation will actually be not the best idea.
So an important thing to begin with is to think about who should really learn it and where can we have the most impact?
So with that in mind they started to engage in these really challenging issues and often times succeeded and that gave them an even bigger advantage in terms of promoting what they wanted to do inside the organization.
Another thing which I saw in many organizations was also this ambition to increase the initial team through educating other people inside the organization as design thinking facilitators. Or in some way as innovation leaders or spokesperson. So the team used other people part time that were motivated to engage in this as a way to extend their reach and extend the impact.


[12:24] You cannot force people to embrace a new process

That’s also something that we have found in the research team that I’m in which is basically if you bring design thinking to an organization or any new process for that matter, you try to innovate the organization.
There is no way that people will engage in your innovation if it forces on them top down”
So it’s very important to be actually employee centric, to get the people on board that you are working with and work with them to find ways to innovate.
It’s usually not such a good idea to think about a new innovation process and then force that on people because most of the time it doesn’t work and people will try to resist it and will probably try to find their own ways and paying attention to what you have to say to them.


[13:43] How you manage this challenging task of innovating by design in large companies? What do you do for them to engage with this kind of process?

I just help organizations to understand what they are going about and help them to ask the right questions. And maybe give them a couple of perspectives on what their actions might actually lead to.
To give you an example, let’s say you were a large organization, you want to scale design thinking inside your organization and you search for a way to do that. And what my colleagues and myself have seen in research are different ways on how you can scale it. Each one of these has advantages and disadvantages.
So for example you can say you want to do a voluntary network and everybody can learn design thinking. That’s great to get a very quick and rapid growth of people that have been exposed to design thinking. However it might not be so great if you want to have people that really have a deep understanding and know how to run high quality workshops.
So depending on what you want to achieve, we as researchers as a whole I think can offer, it’s basically the things that we have seen in many different organizations that might help to prevent future failure. And might give some deeper insight into how things work and how things could be explained.


[15:05] How to measure this subjective value called Innovation?

Most organizations that we have seen that try to measure, they do it because of two reasons. One reason is they want to really see if something improved. And the other one is to actually legitimize what they are doing with design thinking.
So for the second one, when you want to legitimize, then there are other ways of measuring because measuring is cumbersome.
For the first one you’ve got to understand what it is that you are actually interested in. So are you interested in for example the way interaction between team members changes. And we have a couple of measures there from psychology. Psychological safety could be one. Creative self confidence could be another one.
There are established measures and scales that people can use to actually tap into how these teams develop over time and how they perform before and after. However, this might not be guaranteed that this team even if they are excellent in any regard that you can measure, will perform innovation.

“In innovation there is no certainty”

One thing that we saw working from a researcher’s point of view is project based measures. So for example, if you do a project and you have a goal to improve a certain service experience, or to improve the way a certain product works, then you have product related measures and these are a little bit easier to actually evaluate.


[17:02] For corporations that are scaling and are not familiar with design thinking methods, What advice can you give to leaders that are trying to bring innovation to their companies?

The first step would be beyond what I told you before about being certain about what you want to achieve and what you mean about innovation, try it out. Do it at least once so that you get an understanding about what this is about and what can it help you with?

If you truly want innovation, give the people that you chartered to do it, enough freedom to explore and develop”

And don’t put too much measures or pressure on them.
Keep them accountable for what they do but let them explore, let them fail because the first iteration, the first project that you do, will not necessarily succeed. But it will give you a lot of insights into how you can foster and do organization inside your organization.
So think about applying designing thinking to design thinking. Think about embracing ambiguity and uncertainty and about failing.

Think about small bets and continuous experimentation to find the way that is right for your organization to innovate”

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