The Value of Concept Design Sprints for Financial Services
Why excellence in design thinking is the best starting point for your digitalisation journey.
Disrupt yourself or be disrupted is the new normal. Every month we see new technologies, regulations, competition and increasing customer expectations. The role of technology and data management is growing in importance. Regulatory demands increase the cost of doing business. A new generation of digital natives are redefining the nature of customer experience and new market entrants are increasing the competition.
IDC research shows that 80% of revenue growth in the next five years will come from digital business. Progressive organisations who push themselves outside the comfort zone and accelerate their digitalisation journey today, are the ones who will transform their competitive advantage, customer experience, employee productivity and ROE tomorrow.
It all starts with good design thinking. A practical and methodical application of design thinking, called design sprinting is helping financial service providers kickstart their digital journey, become truly innovative and unlock the opportunities inherent in digitalisation.
THE DESIGN SPRINT: A PRACTICAL APPLICATION OF DESIGN THINKING
A design sprint is design thinking put into practice. It is a tried and tested process originally developed by GV (formerly Google Ventures), that helps you explore, prototype, test and verify an idea or a concept within a short time period. Whereas design thinking is an overarching innovation philosophy or mindset, The design sprint is a method, a step-by-step approach for producing and testing ideas.
During a four-day process, the design sprint helps you gain insight into a current business, project or product challenge, and identify new ideas to be prototyped and user-tested on actual users.
DESIGN SPRINT OPPORTUNITIES FOR THE FINANCIAL SECTOR
In an age where digitalisation and technology are disrupting every industry and sector, design sprints help cut through the noise, clearly articulate pressing challenges and develop products and services that solve for the end user. In view of the accelerating pace of technological change and its impact on customer behaviour, design sprints enable financial service providers to focus their efforts more clearly and identify and embark on the most feasible and rewarding digital projects.
According to the Design Sprint Academy, design sprints can be applied in a multitude of cases, to:
- Assess the viability of new businesses
- Jumpstart a project, product or service
- Ideate on a specific area of a product
- Discover the right priorities and features for a product
- Create an MVP Roadmap
- Engage new audiences
- Define marketing and growth strategies
THREE KEY BENEFITS OF RUNNING DESIGN SPRINTS
Identifying the most valuable projects: Design sprints help focus the work and identify the projects that will prove to be of most value for the end user. Instead of spending hours on guessing what the customer wants and ending up launching a product or service that might flop in the marketplace, design sprints allows you to test and validate your ideas and concepts within a short time period.
Break down organisational silos: A common challenge working with digital projects is working across organisational silos. Various stakeholders rarely establish the necessary relationships, leading to misunderstandings and inefficiencies. In a design sprint the team is built across different departmental silos, with each member contributing actively in the process.
Leverage the speed and agility of a start-up innovation culture: Large incumbents often spend too much time analysing ideas and aligning stakeholders rather than turning an idea into a product or service that might fare well in the market. Design sprinting accelerate this process by focusing on building a workable prototype, a façade of a product, that can be tested on real users and has clear implementation requirements, and validating the market potential and strengthening the assumptions for the business case.
HOW DOES IT WORK IN PRACTICE?
Design sprints come with a well-structured process, tested and refined through hundreds of design processes. Although it comes in different variations, such as the Noria Financial services design sprint, BCG Digital Ventures model or AJ&Smart’s Design Sprint 2.0, both based out of Berlin, design sprints usually follow five fixed phases in an iterative process:
- Understand: During this phase, your objective is to gain a deep understanding of the challenge, your users’ needs and the technical landscape. You’ll pick a target, one that is ambitious but manageable enough to solve in one week.
- Diverge: When diverging, you explore, develop and iterate creative ways of solving the problem. This phase focuses on ideation and exploring solutions in response to your problem statement.
- Converge: Here the group identifies the best ideas that should be explored further through storyboarding and later progress into prototyping.
- Prototype: During this phase, your ideas come to life as you design and prepare prototypes that can be tested by users. The primary focus is to create a facade, the part of the product or service that faces the customer.
- Test: The testing phase involves one-on-one user testing with a group of people, normally around five to six people, from your primary target audience. This is where you will receive the most crucial data in the design sprint process. Depending on the outcomes of the user test you might move forward, or decide on a whole new direction for your project. Prototypes that are well received by users are also valuable tools in pitching a product to potential stakeholders.
DESIGN SPRINT USE CASES
Design sprints have helped businesses across industries and sectors improve their operations. United Nations, for instance, increased food donations with design sprints. McKinsey leveraged their own concept sprint variation to help a Fortune-50 consumer healthcare conglomerate launch several new digital products, driving a 30 percent improvement in productivity and a 25 percent decrease in IT costs. The British Museum experiments with design sprints in their product development group, helping them break down traditional organizational boundaries to tackle problems that impact the visitor experience.
Design thinking and design sprinting have gained a strong foothold within financial services, particularly with FinTechs and now InsurTechs. For instance, Noria Digital Lab are working together with an exciting new London based InsurTech called Loadsure, led by CEO Johnny McCord who said: "We literally went from concept to testing the prototype in the market in days". The product development team of the next generation payment platform app Payr, also uses design sprints to research new features to empower consumers pay their invoices in flexible and smart ways. As does the Swedish data-driven banking company Tink. With their feet firmly planted in the FinTech world they leverage design sprinting to create smart, precise and fast-thinking technology, transforming businesses, banks and countless customer experiences within the fields of account aggregation, payment initiation and personal finance management.
HOW TO MASTER DESIGN SPRINTS
Gathering the best team and making them work on the same task within a given timeframe, spawns alignment, momentum and productivity. This is what makes design sprints an appealing and effective method for innovation in any business area. However, for financial service providers to truly harvest the benefits of design sprints, external facilitators with extensive experience in design thinking, technology and finance are often a necessity. An external facilitator can provide you with the objectivity, fresh thinking and momentum you need to succeed in your digitalisation journey. If this is what you are looking for, we in Noria Digital are more than happy to do a design sprint with you.