Design Thinking in China: How Siemens CT Copes with Cultural Issues

Many authors and practitioners see design thinking as an attempt to change a company's culture. But in every firm the initial situation that design thinking encounters is different. Siemens' approach “industrial Design Thinking in China” (i.DT) is an example of the crucial role of cultural challenges – and of how flexible design thinking needs to be.

Design thinking has oftentimes been described as a cultural change. Companies integrating design thinking typically aim at building a “design culture”. What does this actually mean? There are some normative claims. A culture of design thinking should focus on cross-disciplinary collaboration, and employees are able to challenge the status quo. Design thinking changes the “social structure” of a company. But even if we know how IDEO and other famous design agencies keep their creative culture alive, many questions still remain open about how a company with a genuinely different working culture can transform itself into a design thinking culture.

Siemens is a company that aims to be a trendsetter in all its business sectors, and to shape its technologies with a clear focus on delivering tangible and valuable benefits to customers and stakeholders for their sustainable growth. With diverse market needs and customers who are willing to try new things, China is an ideal place to develop world-class innovations. Siemens has been increasing investment to enhance R&D capabilities in China, which is one of the most important R&D bases for the company. Siemens looks back on a long history. Nearly 170 years of corporate development have naturally formed certain traditions and behaviours. Additionally, the question must be raised as to how a global player like Siemens can take into consideration the different mentalities of the staff in its global branches.

In order to find some answers, we talked to Dr. Bettina Maisch who works as a design thinking expert at Siemens Corporate Technology (CT) in Bejing. Bettina was hired in 2012 by Dr. Arding Hsu, former Senior Vice President and Head of Corporate Technology of Siemens in China, to set up a design thinking program within the company.

In order for Siemens to keep its competitive advantage in the unique environment of China, Dr. Hsu had the strategic goal to develop innovative technical solutions on the basis of the unique needs of the Chinese market and to speed up the innovation process through fast iterations of ideating, prototyping and testing. In order to generate a long-term impact for Siemens in China, an internal program has been initiated that trains R&D managers to become innovation catalysts for market-driven innovation through design thinking. From the beginning on, the teams were trained and coached along the execution of “real world” projects in pursuit of added business value. The launch started with four projects in parallel. Three of them were coached by IDEO and three by a team of the Center for Design Research at Stanford University. The idea was to test and compare different approaches from a design/innovation company and academia within the corporate environment of Siemens.

Three levels of cultural challenges

Applying design thinking from IDEO and Stanford at Siemens CT China revealed the particular challenges that arise from three cultural aspects: company culture, educational culture and national culture.

As already mentioned, Siemens is a multinational B2B and technology-driven company. The size of the company, the organizational structure, its well defined and established processes and responsibilities make it difficult to apply an innovation approach that is so different to its status quo. In order to deal with this issue, strong support by the upper management as well as identification of supporters in the middle management was crucial to build up the necessary framework to conduct project in a need-driven approach and to foster the cultural change.

The second cultural challenge is the educational background of the teams. All the project team members have been engineers specialized in a certain discipline, and they are trained to perform certain job functions. They are proficient in what they do and they are good at it – so why to change it?

Most of them were used to working individually on specific tasks given to them and concentrating on the technical demands of a product. This technical mindset was the first cultural hurdle to design thinking, which focuses in great part on what is called the “human factor.” The “human factor” means to have a deep empathy with the users, care about their emotions and their experiences. In short, the engineers saw the technology, but oftentimes not the social context. Bettina saw this as a challenge she needed to address. “We needed to make them see and feel,” she states.

How to achieve this? The i.DT coaches supported the team members during the needfinding phase through joint preparation of observation and interviews, they went onsite with the teams and remind them to broaden their attention and carefully record the context of technology applications. After the field study, the coaches helped to extract and synthesize the collected data from the field in order to identify insights and opportunity areas for new solutions. For example in a fashion shop lighting project, the experts were used to focusing on which technology and how a certain technology is installed. With the guidance of coaches, it still took the experts significant time and effort before they started discovering how people react and interact with the light and finding out the reasons behind user behaviours.

What can be learned from this? Not everybody goes to the field and automatically learns the “right” things about the user. It comes as no surprise that not every employee is able to see at first glance what is important in a certain user scenario: A long-standing tradition has shaped the company and affects the working style and mindsets of its employees.

The third cultural challenge arose from the national background of people working with and working for. In the case of the projects at Siemens CT China, almost all team members and their customers are Chinese. Born, raised and mostly educated in China (some of them got their PhD degrees in the U.S. or Europe) and deeply rooted with the cultural DNA of the country. This brings in some issues in regards to mentalities and customs. A deep understanding and respect for the Chinese culture was needed in order to create the special Siemens way of design thinking in China. Among other things, Bettina told us that “Chinese colleagues are oftentimes very timid, for example during the brainstorming phase. It’s extremely important that the supervisor is not in the brainstorming session, otherwise everything will have a totally different dynamics.”

The aspect of losing one’s face is much more problematic than in western cultures. Bettina and her colleagues had to react to this. Consequently, design thinking coaches at Siemens try to conduct discussions solely with the member of the team present and none of the supervisors and put a lot of effort to build up a trustful working atmosphere. This expresses the aim of “industrial Design Thinking in China”: It is innovation from Chinese employees for China. Sensitivity and attention to the specific characteristics of employees is needed by design thinking facilitators.

Not only a company culture: the need for flexibility in design thinking

What started in 2012 ago was actually not only a design thinking initiative. The program “industrial Design Thinking in China” – as the term already indicates – is a special adjustment of design thinking for the needs of a company like Siemens in a country like China. Not only do a company’s culture and its employees need to react and change, design thinking itself has to be introduced in a creative and flexible way, sensitive to the environment in which it is implemented.

Siemens China: Workshop Situation 03

Siemens China: Workshop Situation 02

Siemens China: Workshop Situation 01

Design Thinking at Siemens

Dr. Arding Hsu, Senior Vice President and Head of Corporate Technology of Siemens in China was the first to see the need of a change in favour of the “human factor”. Dr. Hsu had been responsible to set up the framework for the budget to create rooms, labs and staff to transport design thinking into the company as soon as possible. “That’s why we could act so fast”, Bettina remembers. Dr. Hsu coordinated the introduction of design thinking in three steps. First, he offered an introductory design thinking workshop together with IDEO Shanghai with CT internal decision makers in order to get feedback how the approach was perceived internally and to identify prospective future project owner. During this step, design thinking experts were hired to set up the program inside Siemens CT. In the second phase four projects started in parallel. One project was coached by IDEO Shanghai and three by the Engineering Design Thinking experts from the Center for Design Research at Stanford University. Along the execution of the projects the internal DT experts identified which elements of the two approaches were perceived as valuable and which elements were not accepted. Based on the takeaways, the framework for the industrial Design Thinking in China program has been able to set up. After this first wave the internal i.DT coaches taught and coached more project teams with further supervision of the DT experts from the Center for Design Research at Stanford University. Over time, the methods of i.DT and the program itself have had several iterations of changes based on lessons learnt from dealing with three levels of cultural challenges.. After two years of successful application, the management of Corporate Technology decided to leverage the approach and launch industrial Design Thinking activities in Germany, India and China.

Return of Investment by Design Thinking?

At Siemens Corporate Technology, design thinking had been applied in different projects from various business areas: building technology, healthcare, logistics, traffic management, just to name a few, and on various topics: hardware, software, service, and marketing, etc. But two years are still too short to talk about a monetary return of investment. All the executed projects were in the pre-development phase, and it takes several years before getting into products ready to market. The industrial Design Thinking team at Siemens CT China developed an impact measurement scheme where the outcomes of the projects have been evaluated. They used three criteria to determine the impact of such projects on Siemens business, and the assessment was done internally by the coaching team, team leaders, and research heads.

The first criterion is the technical value measured through generation of IP and/or meaningful technical publications, as well as through external collaboration that bolstered our internal innovation capability and skills. The second item is people development, measured by the continued involvement of trained teams in using the i.DT and other innovation tools in their continued projects and activities. The third item is of critical interest in an industrial setup i.e. business value. Innovation in an industrial setup is NOT an innovation unless it adds business value. The way how business value is determined in the projects is the extent of BU (business unit) involvement in the project, e.g., “High” is when BU actively followed up on project outcomes, “Medium” is when the BU supported continued activities by the project team for further targeted tasks, and “low” is when there was no follow-up. In terms of technical value and people development, almost all projects resulted in acceptable to excellent outcome. Unfortunately such great satisfaction has not been achieved in terms of business value. Many projects have not been successfully transmitted to BU due to several reasons. It became clear that identifying foremost hidden and critical needs and developing a solution that is desirable, feasible and viable at the project team level doesn’t necessarily leads to a new product in a multinational company.

Besides these results of the impact measurement, the i.DT coaching team conducted surveys to get to know the feedback from the team participants. Their feedbacks underlined the already known and communicated value of design thinking that engineers felt much more rooted to human needs after the training. Additionally, their onsite experiences and empathy skills enabled them to open up minds for different inspirations from the field. The i.DT coaching team also registered that the team colleagues communicated more across departments and had more fun and motivation during i.DT projects. “Sometimes they were really outgrowing themselves when they were presenting their ideas.” People find another access to their creativity and are actively making sense of their creativity. So even if after two years of design thinking, it is still too early to really see a return of investment, there exists the best experience: To see the change in people, Bettina told us.