Book Review: The Design of Business

Rarely have I ever had to add so many “tags” to a book review before.

Yet again, we are dealing with Roger Martin. It would stand-to-reason then his latest book, “The Design of Business: Why Design Thinking Is The Next Competitive Advantage” would explore a variety of inter- related business areas, such as strategy, customer experience, management and leadership. The most tangible in application, “The Design of Business” is Martin’s best book to date as it can be applied in the real world of mediocrity, ignorance and ego. And, if successful, actually change those very realities.

Click here for the publication of this book review (p. 26)

Martin’s central thesis surrounds what he calls the “knowledge funnel“, the process by which companies “proceduralise” and disseminate answers to problems, “wicked” and otherwise. As an organisation moves from (i) mystery, or unknown issues to, (ii) forming a heuristic, or rule of thumb, about some known elements of the mystery, to finally (iii) algorithms based on heuristics, a salient understanding of the original problem comes into being.

OK. Most organisations get that. Well the theory at least.

Where most organisations fail, according to Martin, is understanding the complexities of human ego in this journey. Most individuals worry an algorithm will negate their role, as everyone now understands the problem and resolution, and thus they may attempt to ‘keep’ a problem in one of the first two stages, preferably heuristic as they then control who does/ doesn’t understand. If a company does succeed in developing an algorithm, it’s now faced with the challenge of complacency that is inherit in them. Few will ever re-evaluate an algorithm, even when new salient variables come into play, thus nullifying it.

The answer, according to Martin? Design thinking (DT).

DT is the balance between BAU (Business As Usual) and innovation, or as Martin terms it: “reliability” and “validity”. In our pursuit of operational efficiency, cost reduction, revenue targets and general desire for predictability, organisations have become too focused on reliability, at the expense of validity. This is flawed, as outlined in “The Design of Business“, because reliability is based on historical analysis, not future hypothesis. Martin is quick to point out, however, that too much innovation is equally dangerous as BAU is always needed to pay the bills. Hence, DT suggests a balance between what is known to be true in the past, “reliability”, and what is known to be to be true now, “validity”. And what is valid, changes, and change is the antithesis to reliability.

“Design isn’t just about making things beautiful, it’s also about making things work beautifully.”

Martin ends “The Design of Business“, with a chapter tilted: “Getting Personal“. It is one of the better conclusions I’ve seen in business writing as it attempts to provide tangible ‘next steps’ for the reader. It challenges the reader to take on a new mantra:

“My [the reader’s] role is to balance reliability with validity.”

Martin further introduces a number of key activities each Design Thinker/ Strategist should incorporate into their responsibilities, in essence, giving some objective tasks to an ambiguous topic.

Via the strategies introduced, and the tools of observation, imagination and configuration, Design Thinkers will better balance the needs of a business to exploit (BAU) and explore (innovate), thereby promoting reliability, while ensuring validity, vis-a-vis issues, risks and opportunities. This enables organisations to step back from their greatest challenge, seeing what could be rather than only considering what is, and moving towards the former.

In an age of reward & recognition and training, eg. SIGMA, CIMA, CFA, of only reliability and efficiency of the status quo, organisations need DT to balance out their short-term and long-term priorities and strategies. One need only consider the economic situation to see we’ve been far to focused on the former which, although easier, has come at great cost. Maybe it’s time to change things. And do that, you need design thinking. Martin’s new book is a good start.


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