The usage of Design Thinking to develop innovative services - A case study of the Swedish banking industry

Abstract

New entrants in an industry leads to changes and a more competitive landscape and for companies to stay competitive, there is a need for creating innovations which leads to new markets and revenue streams. The methodology Design Thinking can be used to create innovations since it focuses on creating high value for the end user. The Swedish banking industry's competitive landscape has changed due to the entrance of new digital actors. Within the industry it is a growing digitalisation trend and increased focus on creating high customer value. Therefore, this master thesis aims to answer the research question: How is Design Thinking used in the development of innovative services within the Swedish Banking industry? The theory Design Thinking focuses on the user’s needs, finding the underlying problem, experimentation, visualisation of ideas and diversity. The model can be divided into three phases: Customer discovery where customer research is conducted to empathize with the customer, understand underlying needs and define the real problem. Idea generation implies generating ideas within diverse teams. Testing involves experimentation of the ideas using prototypes and testing these prototypes. It can be challenging to implement Design Thinking in an organisation if there is a misfit between Design Thinking and current organisational structures and to succeed, support from the entire organisation is needed. The chosen research design is a qualitative single case study of a Swedish bank. The empirical result shows that the organisation has increased its focus on creating customer value and business developers observe digital behaviours, brainstorm together in diverse groups and conduct in-depth interviews in some projects. Many of the respondents seem to rely on the customer being able to verbally express their needs, limited ideation with the customer is conducted and the organisation is highly risk averse. Some characteristics of Design Thinking can be found within the bank organisation but there are some challenges such as the organisation prioritizing minimisation of risks higher than creating innovations which prevents a full implementation of Design Thinking. This master thesis contributes to a better understanding of the challenges to implement Design Thinking. Suggestions for future research is to observe how Design Thinking is used in practice and research of additional Swedish banks.