Roberto Verganti

At the heart of any innovation process lies a fundamental practice: the way people create ideas and solve problems. This “decision making” side of innovation is what scholars and practitioners refer to as “design.” Decisions in innovation processes have so far been taken by humans. What happens when they can be substituted by machines? Artificial Intelligence (AI) brings data and algorithms to the core of the innovation processes. What are the implications of this diffusion of AI for our understanding of design and innovation? Is AI just another digital technology that, akin to many others, will not significantly question what we know about design? Or will it create transformations in design that current theoretical frameworks cannot capture?

This paper proposes a framework for understanding the design and innovation in the age of AI. We discuss the implications for design and innovation theory. Specifically, we observe that, as creative problem‐solving is significantly conducted by algorithms, human design increasingly becomes an activity of sensemaking, that is, understanding which problems should or could be addressed. This shift in focus calls for the new theories and brings design closer to leadership, which is, inherently, an activity of sensemaking.

One of the most popular mantras for innovation is “avoid criticism.” The underlying assumption is that criticism kills the flow of creativity and the enthusiasm of a team. Aversion to criticism has significantly spread in the last 20 years, especially through the advocates of design thinking. In IDEO’s online teaching platform, the first rule of brainstorming is “defer judgment.” To make this rule even more practical and straightforward, others have reworded it to say: “When a person proposes an idea, don’t say, ‘Yes, but…’ to point out flaws in the idea; instead, say, ‘Yes, and…’” — which is intended to get people to add to the original idea.

We live in a world awash with ideas. Thanks to the web and to powerful ideation approaches such as open innovation, design thinking, or crowdsourcing, organizations have today easy access to an unprecedented amount of novel concepts. In this context, what organizations lack is not “one more idea”, but the capability to make sense of an overabundance of opportunities. They need a new meaningful vision, i.e. a new lens and a new map that indicates which direction to go. Without a meaningful vision, organizations tend to select those ideas that better address existing problems, and disregard solutions with higher potential, regardless to the number of ideas generated.

How to create a new meaningful vision that customers love, and that our organization is passionate for? Visions have long been considered as a result of an invisible process occurring in the mind of individuals, mainly top executives. However, Verganti’s research shows that visions can also spur from an organizational process that can be planned and executed. In particular, leveraging on examples from projects conducted by organizations such as Nest Labs, Apple, Yankee Candle, and Philips Healthcare, Verganti showS that this process is significantly different than classic ideation approaches. First, instead of moving from the outside-in, it moves from the inside out: it does not solicit early input form users and other outsiders, but it starts by engaging the internal organization. Second, instead of practicing the art of ideation, it requires to practice the art of criticism: the art that enables us to explicitly question existing assumptions and turn them into new bold interpretation. Taking a critical stance does not imply being negative, but going deeper, searching for contrasts between different perspectives, creating tensions, looking from a new vantage point, reshuffling things to find a new order. Verganti describes how to practice the art of criticism through cases and methods, such as working with a sparring partner, or clashing visions within radical circles and with new interpreters.

How to create innovations that customers do not expect, but that they eventually love? How to create products and services, that are so distinct from those that dominate the market and so inevitable that make people passionate?

In a context where everyone is using design, "Design-Driven Innovation" unveils a design strategy that makes a difference. A strategy and a process that leverage the rich and multifaceted network of a firm outsiders, looking beyond customers to those "interpreters" who deeply understand and shape the markets they work in.

The need has emerged for a better understanding of design research and design innovation and how they are linked. In our discussion, we consider design as the process of “making sense of things.” Hence, our questions turn more precisely into the following ones: What type of research is conducted on the meaning of things? And to what types of innovative output can this research lead? How are the two concepts, design research and design innovation, related? In answering these questions, our purpose is not to provide specific tools and steps, which are already well developed in other studies. Rather, we answer the questions posed by addressing the fundamental decision any innovation player has to make before moving into the use of specific tools: What general approach should be used to address an innovation challenge? What set of theories, processes, and tools should be considered? We provide a theoretical framework for distinguishing between the procedures of incremental and radical innovation and address the fundamental activities of innovation. For this purpose, we provide three different ways of treating innovation: as the attempt to find the maxima in a hilly terrain whose topology is unknown and novel, as movements in the product space defined by the two axes of “technology change” and “meaning change,” and as a design research quadrangle based on Stokes’s two dimensions of “advances in understanding” and “consideration of practicality.” We suggesting that radical product innovation is driven by either advances in technology or a deliberate change in the meaning of the product, rather than being driven by the human-centered design philosophy widely used in product design.

Firms, managers and scholars have often balanced between two approaches to innovation: user centered (where incremental innovation is pulled by the market) and technology push (where innovation comes from breakthrough development in technologies). However there is a third relevant path to innovation: Design driven innovation, i.e. the radical innovation of product meanings. This innovation doesn’t emerge from current user needs, but is a new vision, a proposal developed by a manufacturer that radically redefines what a product could mean for people. Corporations that succeed in creating these proposals, that go beyond what customers currently ask for but that in the future they will be excited to buy, are those corporations that lead the innovation game, build strong brands and have products with longer life cycle than competitors.

How a corporation may realize design driven innovations? Research of Roberto Verganti in this field has started ten years ago by investigating successful Italian manufacturers in design-intensive industries. His analysis has then extended to international corporations in different industries. His research shows that design driven innovation is based on interaction with communities of interpreters (manufacturers in other industries, designers, architects, schools, artists, craftsmen, magazines, technology suppliers, etc… ), i.e. with what we he calls a “design discourse” that surrounds every firm. Roberto has investigated and modelled this research process (that is significantly different, sometimes opposite, from the popular user-centered process) in order to provide guidelines, methods and examples on how to absorb knowledge from innovation interpreters, develop a novel vision, and diffuse it into the market.

Any organization, business or venture grounds its value on how “meaningful” are its products (functionally, symbolically and emotionally). Design Theory and Practice (DTP) empowers students to create products that are meaningful, to people who use them and to society at large. The course has three purposes:

1. To inspire students about the power of design in new business creation. We will address questions such as: Why is design relevant in tech ventures? How does it create value? And, most of all, why is it fundamental for a technology entrepreneur/leader?
2. To enable them to move into action, by learning the theories and practice (mindsets, processes, methods) of design: Where do ideas come from? How to frame (and especially re-frame) a problem? How to understand what is meaningful to users? How to make a product desirable (functionally, emotionally and symbolically)? How to design and build the user interface of a product? How to test it? How to narrate and visualize a novel idea?
3. To co-explore, with the class and the instructor, the use of design as a leadership practice: How does a leader who masters design can better contribute to creation of value? How can we forge a new manifesto for leadership, inspired by design?

The course is intensively project-based. Students will work in teams on a complex innovation challenge proposed by a real corporation. They will suggest a more effective framing of the problem, and create a novel meaningful solution, with a special focus on the user interface.