Understanding PESTLE and Design Thinking
Understanding PESTLE and Design Thinking
PESTLE model
Political: These factors determine the extent to which a government may
influence the economy or a certain industry. For example, a government may
impose a new tax or duty due to which entire revenue generating structures of
organizations might change. Political factors include tax policies, Fiscal policy,
trade tariffs, etc. that a government may levy around the fiscal year and it may
affect the business environment (economic environment) to a great extent.
Economics: These factors are determinants of an economy's performance that
directly impact a company and have resonating long term effects. For example, a
rise in the inflation rate of any economy would affect the way companies price
their products and services. Adding to that, it would affect the purchasing power
of a consumer and change demand/supply models for that economy. Economic
factors include inflation rates, interest rates, foreign exchange rates, economic
growth patterns, etc. It also accounts for the FDI (foreign direct investment)
depending on certain specific industries who're undergoing this analysis.
Social/Cultural: These factors relate to the social environment of the market, and
measure determinants like cultural trends, demographics, population analytics,
etc. An example of this can be buying trends for Western countries like the US
where there is high demand during the Holiday season.
Technological: These factors relate to innovations in technology that may affect
the operations of the industry and the market favorably or unfavorably. This
refers to automation, research and development, and the amount of
technological awareness that a market possesses.
Legal: These factors have both external and internal sides. There are certain laws
that affect the business environment in a certain country while there are certain
policies that companies maintain for themselves. Legal analysis takes into
account both of these angles and then charts out the strategies in light of these
legislations. For example, consumer laws, safety standards, labor laws, etc.
Environmental: These factors include all those that influence or are determined
by the surrounding environment. This aspect of the PESTLE is crucial for certain
industries particularly for example tourism, farming, agriculture, etc. Factors of a
business environmental analysis include but are not limited to climate, weather,
geographical location, global changes in climate, environmental offsets, etc.
Internal and External Stakeholders
Internal stakeholders are organizations or individuals that operate directly inside
an organization, such as managers, employees, and company owners. Managers
and workers have a strong interest in the company's financial well-being and
success because they want to earn good compensation and maintain their
employment. As recompense for the risks associated with owning and operating
a business, proprietors want to maximize the company's profit.
External stakeholders are those who do not directly work with a company but are
affected somehow by the actions and outcomes of the business. Suppliers,
creditors, and public groups are all considered external stakeholders. For
example, when a company goes over the allowable limit of carbon emissions, for
example, the town in which the company is located is considered an external
stakeholder because it is affected by the increased pollution. Conversely,
external stakeholders may also sometimes have a direct effect on a company
without a clear link to it. The government, for example, is an external
stakeholder. When the government initiates policy changes on carbon emissions,
the decision affects the business operations
of any entity with increased levels of
carbon.
Design Thinking
Design Thinking applies critical
thinking and approaches used by designers to solve problems and meet the
following criteria:
Human desirability: they meet a real human need
Technological feasibility: they can be developed into functional products or
processes
Business viability: the business can afford to implement them
On the other hand, Design Thinking can also be viewed as “the application of
design methods by multidisciplinary teams to a broad range of innovation
challenges” (Seidel and Fixson 2013).
Why Design Thinking?
Design Thinking is a process that helps us to integrate and apply creativity and
skill sets to solve problems and deliver value to a user or stakeholder.
This means that:
Design is a creative process that utilises skill sets to transform information
and ideas into a tangible outcome, i.e., a solution.
Design produces a solution that results in a new or improved product or
service
How to apply Design Thinking?
Design thinking is an iterative process in which you strive to understand your
consumers, question assumptions, reframe challenges, and build inventive,
prototype-able solutions. The ultimate objective is to uncover alternate solutions
and answers that are not immediately evident based on your current level of
comprehension.
Five steps comprise the DT process: empathizing, defining, ideating, prototyping,
and testing (Brown and Katz 2011). According to the definition, empathizing
involves direct engagement with users. The ideation phase entails thinking and
developing solutions, while the prototype phase entails producing many
prototypes fast. The last component of the testing step is the final
implementation.
Principle of Design Thinking
Solutions that are holistic examine the whole user experience and every
customer touchpoint. A comprehensive approach may be accomplished by
highlighting various user experiences and journeys using personas (Axelos
2021).
Phase 1: Empathizing
- Get an understanding of what the stakeholders do, say, think, and feel
- Collect sufficient data and input so that you can begin to relate with your
stakeholders (customers, suppliers, users, etc. ) and their opinions about
the problems the stakeholders are facing
- Considered one of the most crucial steps in DT as it provides important
inputs to all the latter steps
- Fail to empathize with stakeholders about their needs and wants, you
cannot define the real problems and their root causes to fulfill the real
needs of the stakeholders.
A, Customer Persona Profile
S1: Collect the information about
your users
- Do user research to
comprehend the attitudes,
motivations, and behaviors
of the target audience
- Derived from extensive user interviews and observational data of actual
users
S2: Identify behavioral patterns
from research data
- Analysis of the collected
customer profiles in the
previous step
- Identify patterns in user
research data that enable
the classification of
comparable individuals into
customer types
S3: Create personas and prioritize
them
- The descriptions of a persona should then be constructed around
behavioral patterns and different characteristics
- The researcher is tasked with describing each persona with sufficient
insight and empathy to comprehend the consumers
- However, for each persona, one or two pieces of typical
personality/behaviors may bring a persona to life, but too many details
can be distracting and reduce the persona's credibility as an analytical tool
S4: Tools to create customer personas
Free software (UXPressiaLinks, HubsportLinks) or visualization tools (MiroLinks,
Mind mapping tools like Mindmeister)
B, Customer Empathy Map
Helps firms to summarize what they've learned through their interactions with
customers in the area of design thinking
Gives an overview of a person's experience by highlighting four key areas
Consists of six distinct areas that should be included while constructing a
person's views:
(a) See – what the user sees in
his/her environment;
(b) Say and Do – what the user says
and how s/he behaves in public;
(c) Think and Feel – what happens in
the user's mind;
(d) Hear –how the environment
influences the user;
(e) Pain – the user's frustrations,
pitfalls, and risks;
(f) Gain – what the user really wants and what can be done to achieve his/her
goals.
C, Customer Journey Map
Visual representation of the
sequence of interactions a
consumer may have with
an organization across the
full purchasing process
CJM catalogs all
organizational touchpoints
that a client may meet
throughout the service
exchange process
The objective of these strategies is to improve customer service interactions and
understanding by enhancing the customer experience at each touchpoint.
Enables you to adopt the customer's viewpoint and utilize it as a chance to
identify answers to any issues they may have when dealing with your firm.
Research methods as discussed include:
Interview
Survey
Archival
Ethnography (learn about user behavior through observation)
Phase 2: Defining
- Delves further into the stakeholders' issue to pinpoint its root causes
- The problem may mean different things to different users or stakeholders.
- To identify the problem's root causes, we could frame it by asking "why
does it matter?"
- Multiple rounds of asking might be required for this step.
- Once the problem's root causes have been identified, the frame is
expressed as a "problem statement."
- However, when an iteration process fails to provide a clear answer to the
question "why does it matter," it may be because the stakeholders'
problem was not fully understood.
S1: Identify problems
Identifying a business problem means recognizing and defining a challenge or
issue that is affecting the operations, performance, or profitability of a company.
Once a business problem has been identified, it can be analyzed in the next step.
These problems could be defined based on the potential student journey map
with SSVN.
There are many techniques to identify business problems, including Gap
Analysis, Ishikawa Diagram, or Mind Mapping.
For example, a mind map can be used to generate and organize a wide range of
ideas and potential problems that may be affecting the business.
S2: Analyze problems
Analyzing a business problem means systematically examining the issue at hand
to gain a deeper understanding of its causes and impact. It involves breaking
down the problem into its individual components, examining the various factors
that contribute to the problem, and determining the impact of the problem on
the business's operations, finances, and overall objectives.
There are many techniques to analyze business problems, including 5 Whys,
Ishikawa diagram, Pareto chart, Root cause analysis, and Concept fan analysis.
The 5 Whys technique:
When an issue arises, you dig down to its root cause by repeatedly asking the
question "Why?" five times.
Then, when a solution becomes clear, you implement it to avoid a recurrence of
the problem.
The technique is most successful when the responses to the why questions come
from someone with direct expertise in the process or problems at hand.
Fishbone diagram
Start by identifying the problem or effect at the head of the fish
Draw a horizontal line to represent the spine of the fish and draw diagonal lines
branching off the spine to represent the major categories of causes
The sub-causes are then added to these categories as smaller bones branching
off from the main diagonal lines
The Ishikawa diagram is a useful tool for problem-solving and root cause analysis
in a variety of contexts, including business problem-solving
S3: Prioritize problems
Prioritizing business problems means ranking them in order of importance based
on their potential impact on the company's goals, objectives, and overall
performance. It involves determining which issues require immediate attention
and which ones can be addressed later. It is an essential step in developing a
strategic plan for problem-solving because it helps the business to allocate its
resources effectively and efficiently.
Priority Matrix
Technique to
identify the relative
importance of
various problems
Employs the
attributes 'Impact'
and 'Urgency'
Impact is the
measure of the
problem's effect on
the organization's
day-to-day
operations
Urgency refers to the perceived timing of when a problem may have an impact
on the company
Teamwork
The combined action of a group of people, especially when effective and
efficient.
The Tuckman Model
Designed to describe four stages that teams may progress through: forming,
storming, norming, and performing (a 5th stage was added later: adjourning)
Forming: This is the stage where team formation happens and activities leading
to team-building occur. It is the time when first impressions are being made and
expectations may be discussed leading to something like a Team Charter.
Building trust and discovering the individual strengths and weaknesses of the
team members begin to appear and boundaries are established for the group.
Storming: During this next stage, crises or other conflicts are most likely to occur
due to the team members not fully understanding each other yet due to hidden
motivations not discovered during the group's formation. At this stage, it is
advisable for the group to begin brainstorming its design process which may lead
to ideas that eventually become the focus of whatever the team is tasked to
work on. This is also the time for individuals to establish their roles in the team
and work out the conflicts and compromises that need to be resolved in order to
move to the next stage.
Norming: It is at this point when the team should have resolved any conflicts and
made clear the roles and responsibilities of each team member. This may also be
the time when it may be more productive for the team to begin working as
individuals again to focus on multiple areas of the project at once in order to
realize better efficiencies in time management and other resources. Don't forget
to stay in contact with the team for more timely updates. At this stage, it is vital
for everyone to fully understand their role to avoid wasting time and resources.
Performing: This is the stage where everything is actually going as planned.
Everyone is working well together and there is a sense of synergy among the
members of the team. If the same team is together for multiple projects, there is
either less time or no time at all spent on the first few stages of this model and
the team already know each other and what to do next. Everything runs
smoothly and efficiently. Strive for this stage with your own group!
Adjourning: This is the last stage of a group activity. Everything is said and
done... Time to say goodbye to your teammates. Wish everyone all the best on a
job well done!
The DISC Model
Focuses on conflict resolution in teamwork because it predicts the behaviors of
four different personality traits usually found in teams or groups working
together
The four are Dominance, Inducement, Submission, and Compliance...thus DISC.
The modern version of this has been modified as Dominance, Influence/Inspiring,
Steadiness/Supportive, and Compliance/Conscientiousness.
Industries often use DISC assessments in professional contexts.
Dominance
- Characteristics: direct, decisive, ego-driven, problem-solver, and risk-taker; like
new challenges and freedom from routine; driven to overcome obstacles
- Strengths: great organizer and time manager; challenges the status quo;
innovative
- Weaknesses: can be argumentative, disrespectful of authority, and overly
ambitious (taking on too much); can be blunt, stubborn, and aggressive.
Inspiring/Influential
- Characteristics: enthusiastic, persuasive, optimistic, trusting, impulsive,
charismatic, and emotional
- Strengths: creative problem solver; great cheer-leader, negotiator, and peace-
maker; a real “people person”
- Weaknesses: more concerned with popularity than tangible results; lacks
attention to detail
Steady/Supportive
- Characteristics: reliable, predictable, friendly, good listener, team player,
empathetic, easy-going, and altruistic.
- Strengths: dependable, loyal; respects authority; has patience and empathy;
good at conflict resolution; willing to compromise.
- Weaknesses: resistant to change; sensitive to criticism; difficulty prioritizing
Cautious/Conscientious/Compliant
- Characteristics: has high standards; values precision and accuracy; analytical
and systematic; even-tempered, realistic, and logical; methodical; respect for
authority
- Strengths: great information gatherer/researcher; able to define situations
precisely and accurately; offers a realistic perspective
- Weaknesses: can get bogged down in details; needs clear boundaries,
procedures, and methods; difficulty accepting criticism; may avoid conflict or just
“give in.” May be overly timid.
There are four basic personality types in DISC:
Drive. Drive relates to control, power and assertiveness. People who are high in
Drive like to get things done and are results-oriented. They tend to be ambitious,
competitive and persuasive. If you have a lot of Drive, you're likely to enjoy
taking on new challenges and being in charge.
Influence. Influence relates to people, interaction and communication. People
who are high in Influence are interested in relationships, networking and
persuasion. If you have a lot of Influence, you're likely to enjoy social situations
and working with people.
Support. Support relates to patience, thoughtfulness and harmony. People who
are high in Support are warm and accepting of others, and they like structure
and organization. If you have a lot of Support, you're likely to enjoy working hard
behind the scenes and being part of a team.
Clarity. Clarity relates to structure, organization and correctness. People who are
high in Clarity are detail-oriented, quality-conscious and cautious when making
decisions and taking action. If you have a lot of Clarity, you're likely to enjoy
working intentionally to solve challenging problems.
Leadership
The action of leading a group of people or an organization.
12 of the Most Common Leadership Styles
The Bureaucratic Leader uses the most formulaic of leadership models. They
follow these guidelines...you have a defined job title, a set of responsibilities, and
a pre-existing method for responding to urgent needs. Requiring such strict
adherence to established rules and protocols can create a rigid and tense
workplace for employees. Obviously, not very flexible!
The Charismatic leader has the charm and vision to grow a company and
develop their employees into their “disciples” to achieve the company goals
outlined by the leader. Conviction and a magnetic personality can certainly help
you climb the corporate ladder as a charismatic leader. Inspiring a team to share
the passion and vision of this leader takes skill, but it can bring rewards in the
form of higher employee engagement and a better bottom line.
The Pacesetting leadership style focuses on results. They set the bar high and
push their employees to achieve goal after goal. The Pacesetting leader can be
quite effective in getting things done, but their constant hard-driving pace will
wear down some employees. It’s a difficult style to sustain as a successful model
over an extended period.
The Ethical leader focuses on fairness. This model brings a balance of logic and a
sense of justice, with deep reverence for the rights of everyone involved. By
making ethics a top priority, this leadership style results in treating the staff with
respect and honesty that is mutually returned, benefiting everyone.
The Affiliative leadership style requires a “people first” mindset. It’s about
creating collaborative relationships and becoming an emotional support system
for the team. Connecting on a direct and personal level with the employees will
position the leader to quickly resolve conflicts among staff.
The Coaching leader is like a sports coach. This style of leadership works with
individual staff members to develop their strengths in an effort to improve the
overall success of the organization. The Coaching leader is goal-oriented rather
than focused on tasks. The Coaching leader sees the big picture and doesn’t get
lost in the details.
Have you heard of the Laissez-Faire leadership style before? The phrase “laissez-
faire” translates literally from the French as “allow to do.” This style of leadership
almost doesn't qualify as a "leadership" style as it represents a political,
economic, and leadership model that involves passivity. The Laissez-Faire leader
provides the needed tools for their employees and then steps back to allow the
staff to work everything else out without any guidance or consultation with the
boss. This hands-off approach represents a deep level of trust.
The Democratic leader is the opposite of the Autocratic leader. A Democratic
leader will seek out the input and perspectives of their employees, although the
final decision ultimately, belongs to the boss. The use of collaboration and
discussion can spark an increase in creativity and innovation. However, The
Democratic leader may feel challenged in situations where you must juggle
many diverse perspectives and ideas.
The Autocratic leader does not consult with or consider the opinions of others
when making decisions. They determine a course of action and relay their ideas
with the complete expectation that the employees will complete their assigned
actions without question. This method of leadership works well in situations
requiring quick decision-making.
The Servant leader will mix selflessness with a focus on the higher needs of
others as the employees work toward achieving the leader's vision. Through self-
reflection and awareness, the Servant leader gains insight into their own purpose
in life and work, the meaning of their leadership initiatives, and their personal
character. By mentoring their staff, they are able to lift up others to greater
success, improving morale and the business.
The Transactional leader is straightforward and works on a rewards-based model.
The concept is that an employee’s personal interests (as opposed to company
interests) are the principal factors motivating them to complete an assigned task
or reach a performance level. If you’re a transactional leader, you will set
performance goals for staff, promise a reward, and provide that reward upon
their successful completion of the goal—or impose a consequence if the staff
doesn’t meet their goals. This method of leadership can be very effective for
getting work done, but it fails to allow space for building relationships at work
and inspiring staff to contribute new ideas.
The Transformational leader achieves goals through their open lines of
communication with staff by demonstrating their integrity and respecting their
staff’s experience and knowledge. This mutual respect leads to improved staff
satisfaction and employee retention (no quitting the manager).
Reflective Learning
Involves looking back at something, a past experience or idea, and critically
analyzing the event. By looking at successful and unsuccessful aspects of an
experience, the reflection will help students learn from their past experiences
and turn surface learning into deep learning.
Gibbs’ Reflective Cycle
Action plan: At this step you plan for what you would do differently in a similar or
related situation in the future. It can also be extremely helpful to think about how
you will help yourself to act differently - such that you don't only plan what you
will do differently, but also how you will make sure it happens. Sometimes just
the realisation is enough, but other times reminders might be helpful.
Helpful questions:
· If I had to do the same thing again, what would I do differently?
. How will I develop the required skills I need?
. How can I make sure that I can act differently next time?
Description: Here you have a chance to describe the situation in detail. The main
points to include here concern what happened. Your feelings and conclusions will
come later.
Helpful questions:
. What happened?
. When and where did it happen?
. Who was present?
. What did you and the other people do?
. What was the outcome of the situation?
. Why were you there?
. What did you want to happen?
Feelings: Here you can explore any feelings or thoughts that you had during the
experience and how they may have impacted the experience.
Helpful questions:
. What were you feeling during the situation?
. What were you feeling before and after the situation?
· What do you think other people were feeling about the situation?
. What do you think other people feel about the situation now?
. What were you thinking during the situation?
. What do you think about the situation now?
Evaluation: Here you have a chance to evaluate what worked and what didn't
work in the situation. Try to be as objective and honest as possible. To get the
most out of your reflection focus on both the positive and the negative aspects of
the situation, even if it was primarily one or the other.
Helpful questions:
. What was good and bad about the experience?
. What went well?
. What didn't go so well?
. What did you and other people contribute to the situation (positively or
negatively)?
Analysis: The analysis step is where you have a chance to make sense of what
happened. Up until now you have focused on details around what happened in
the situation. Now you have a chance to extract meaning from it. You want to
target the different aspects that went well or poorly and ask yourself why. If you
are looking to include academic literature, this is the natural place to include it.
Helpful questions:
. Why did things go well?
. Why didn't it go well?
. What sense can I make of the situation?
· What knowledge - my own or others (for example academic literature) can help
me understand the situation?
Conclusion: In this section you can make conclusions about what happened. This
is where you summarise your learning and highlight what changes to your
actions could improve the outcome in the future. It should be a natural response
to the previous sections.
Helpful questions:
. What did I learn from this situation?
. How could this have been a more positive situation foreveryone involved?
· What skills do I need to develop for me to handle asituation like this better?
. What else could I have done?
Phase 3: Ideate
The question we need to ask is, “what are the solutions for the stakeholders’
problems?.” Ideate is the process to help us answer this question and find the
best ideas to start developing our solutions to help stakeholders.
Brainstorm to go from recognizing issues to developing solutions for your
stakeholders.
Use your creativity to produce solution ideas by combining your knowledge of
the issue area and the stakeholders you are dealing with.
Ideation is about generating as many ideas as possible from which to choose,
rather than merely choosing the best answer.
Ideation could help your team to:
- Step outside of the apparent answers to improve the innovation potential
of your solution.
- Bring together team members' viewpoints and talents.
- Discover new areas of innovation.
- Increase the quantity and diversity of your innovation alternatives.
S1: Idea Generation
Using techniques such as brainstorming, storyboarding, and sketching to
generate as many ideas as possible. In this step, quantity is more important than
quality of ideas.
Brainstorming: a strategy for generating ideas in which all participants may offer
their expertise. A brainstorming session may assist in generating a large number
of ideas for solving problem statements. A good brainstorming session stimulates
creativity and allows all participants to offer ideas, regardless of their hierarchical
ranks in an organization.
Storyboarding: planning a product launch, managing a project, developing a
marketing strategy, developing a new method, or developing solutions for a
problem (Mindtools n.d.) Your storyboard will then go through each phase of the
procedure. Instead of using words and making a to-do list, your storyboard lets
you see exactly what needs to happen and in what sequence. Your team provides
a clear overview of the actions that must be completed as a group. Then they try
to discover issues, identify complexities, and restructure duties as needed.
Sketching: the graphical depiction of developing ideas. The graphic facilitation
could be used through brainstorming sessions using visual symbols. In this
instance, the team leader used big sheets of paper, a whiteboard, or an
electronic drawing tool to record the team's thoughts using simple sketches. This
enables the team to think freely and allows the facilitator to record the team's
progress in a manner that might promote additional thought.
S2: Idea Evaluation
Putting all the generated ideas into the context of the defined problems and add
more constrain such as costs, time, efforts to provide more in-depth analyses
about the quality of the ideas.
Cost-benefit analysis: systematic method for determining the advantages and
disadvantages of a project, strategy, product, or idea. This study may be used to
produce a visual picture of the quality of an idea, compare two or more ideas, or
establish the viability of an idea. The purpose of a cost-benefit analysis is to
guarantee that the entire benefits exceed the whole costs of a course of action to
facilitate more informed decision-making.
Consensus mapping: a strategy designed to help team members develop a
shared understanding of an issue in order to establish a consensus on the
activities necessary to obtain a solution and their order (Hart et al. 1985).
Typically, brainstorming serves as the input for this practice. Following this, 20 to
30 ideas are ordered to create the core of an action plan to solve a problem. In
general, participants arrive to consensus via in-depth conversations.
Affinity diagram: a huge collection of data that has been sorted into groups or
themes based on their links. The affinity diagram approach is excellent for
organizing ideas developed during brainstorming sessions as well as for making
sense of insights obtained during research. The affinity diagram assists a group
in developing its own way of thinking about a difficult subject or problem. An
affinity diagram may be used by a group at any point when it has to produce and
manage a vast quantity of information. Members of a leadership team, for
example, may use the diagram to organize their thoughts and ideas during
strategic planning. An improvement team, on the other hand, might utilize the
diagram to investigate the frequent reasons of variance in its project. The
graphic has a wide range of applications and is simple to use.
S3: Idea Selection and Refinement
Based on ideas’ quality in the previous step, priority matrix and cost benefit
analysis, some of the best ideas could be chosen and refined as inputs for the
next step in design thinking process, the prototype step.
Action Priority Matrix places more emphasis on the effects to solve the problems
and how much effort needed rather than impacts and urgency. It helps in
determining which ideas are worth doing first.
Social innovation
Social innovation is the process of developing and deploying effective solutions
to challenging and often systemic social and environmental issues in support of
social progress.