I’ve been doing a lot of interviewing lately. Beyond meeting some really nice people, this means I have to explain what the idea of Business Design is a lot and how to start a business. To be honest, itâ€™s not always an easy thing to describe. The idea of using design sensibilities to solve business problemsâ€¦well itâ€™s easier done than explained. Much of the act of Business Design is dictated by the problem youâ€™re solving. This probably has more to do with design than business â€“business likes standardized processes, design likes appropriate approaches. When you design, you go about things is almost intentionally different every time. To top it all this off, the idea of Business Design is still very much emerging, so it’s changing all the time. Itâ€™s also a hip phrase people throw around a little too loosely. All this makes explaining what I do sort of a hot mess.
Yesterday I was interviewing with a colleague of mine, Joe. Without realizing it, I think he blurted out a pretty perfect description of the idea of business design. He simply said, “we hack business models.”
I really love that statement because of all the implications of the idea of “hacking”. For me hacking implies that you’re working with an existing system and pushing and pulling on its boundaries to see what will happen. Tools can be crude and fast, but there is an eye to understanding and evolve the larger system. Hacking implies that what you’re doing isn’t a science, but there’s probably a lot of underlying laws ad principles involved. Thereâ€™s no certification to be a hacker, but not everyone can do it. And to be a good hacker, you have to be pretty curious, confident, and inspired.
As I frame Business Design loosely as a hacking exercise, it also starts to draws some boundaries for what is and what isn’t business design to me. Businesses tweak their model all the time, and not every change is a design. If you increase the price for your goods, that’s not really design. If you change your entire pricing structure to communicate a new type of value, that’s probably business design. Netflix raising rates isnâ€™t business design. Netflix launching a streaming-only pricing option is definitely the result of a lot of hacking and some pretty smart business design.
All this hacking leads me back to the idea of a system. Businesses after all are systems that create/provide value. That’s very academic sounding, but thinking of a business as a system that must remain in balance is sort of the first step to being able to frame and solve problems differently. (And thereâ€™s a ton of companies who think of a business as a kit of parts.) These systems have many interrelated parts (and people). As you add or remove some element of the business, a different component will be affected. As you design the customer experience, you have to design the business model that supports it. As you design the business model, you have to think about what sort of experience you can provide.
It’s all about the system; it’s all about balance.