“Design thinking” is basically a methodology for innovation activities. It came out of Silicon Valley, nurtured in the Stanford Business School, and was designed for product manufacturing, not for services. So why has Infosys adopted it for services? Why is Infosys training over 40,000 of its employees in design thinking?
Vishal Sikka, CEO at Infosys, is trying to lead Infosys into a new and different future. Infosys recognizes that the talent arbitrage business is maturing and that it will increasingly face all the adverse aspects of a maturing industry – price competition, margin compression and slowing growth. In dealing with that, Vishal also sees an opportunity to shift Infosys into new, more fertile growing areas. But this shift requires a new business model.
This business model can take many forms. What these models have in common is that their pricing is different. They don’t charge by FTEs. They don’t charge on a resource basis. Instead, they link pricing to the value that comes in delivering an outcome or result for the client. These models are similar to a product business model rather than the talent factory services business model that Infy and other service providers have taken to such heights. Here is where design thinking gets applied.
Design thinking has been a mainstay of Silicon Valley’s rapid development of intuitive and outstanding products. Vishal understands this and understands that Infosys will need new tools to be able to interact with clients and understand them on an emotional basis as well as on a cost basis. Design thinking should help Infosys transition to this new business model.
Design thinking will help Infosys redefine its relationship with a client and the problems the client has, better understand the problems and engage on those problems in a profoundly different way than it has in the past.
Vishal recognizes that, at least in part, he’s taking Infosys on a journey to shift the business model, though it also may well have other implications in services. We look forward to seeing how that works out. We also look forward to seeing Infosys use design thinking at as technique and instrument to help on its very difficult journey to evolve its business model.