A Quick Glance at Rethinking and Refining Business Thinking by Lawrence Jones
In 2004, Roger Martin, dean of the Rotman School of Business at the University of Toronto published the ‘The Design of Business”. He proposes that competition is no longer “about creating dominance in scale-intensive industries, it’s about producing elegant, refined products and services in imagination-intensive industries” (p.7). Martin mentions that value creation in the 20th century was mainly defined by the conversion of heuristics to algorithms. Cherry (2016) explains that a heuristic is a mental shortcut that allows people to solve problems and make judgments quickly and efficiently. Generally speaking, it is a shortened decision-making time without constantly stopping to think about the next step.
An algorithm is a process or set of rules to be followed in calculations or other problem-solving operations. Martin (2004) posits that business people need to become more like designers that are masters of heuristics rather than managers of algorithms (p.7). This may not work well for biotechnology scientists conducting laboratory research. However, this may suggest that in the 21st century, design skills and business skills are converging. Heuristics play important roles in both problem-solving and decision-making.
This is the strategy to apply mental shortcuts when looking for a quick solution. A potential drawback to heuristics is that they can lead to cognitive biases. Martin (2004) elaborates and stresses that there are three major implications for the shift for today’s business people. The skill of design is the ability to apply the creativity, innovation and mastery necessary to convert the mystery to a heuristic (p.9). The second implication is that a new kind of business enterprise is needed to tackle mysteries and develop heuristics and that will require a substantial change in some of the fundamental ways we work (p. 9).
The third implication is that we must change the focus of our thinking about design and business. The traditional business world is trying to figure out what designers do, how they do it, and how best to manage them (p.10). Unfortunately, as companies continue to struggle to adapt to the global competition and the rapid expansion of the service based economies, the global landscape is forcing business firms to pause and reconsider their business models and radically transform their capabilities.
Algorithm. (2016). https://en.wikipedia.org/wiki/Algorithm
Cherry, K. (2016). What Is a Heuristic and How Does It Work? https://www.verywell.com/what-is-a-heuristic-2795235
Martin, R. (2004). The design of business. Rotman Management, 5(1), 6-10.