Got an idea for your business? Test your assumptions!

Don't try to solve problems before you've explored the reality of the user experience. Leverage the design-thinking model to test your assumptions and get back on track.

By Jeanne M. Liedtka

Ever charged ahead with a new idea, only to discover that it wasn't going to turn out as planned? Maybe you assumed your users wanted a new offering (they didn't). Or you thought that, despite the idea's shortcomings, your organization could still pull it off (it couldn't). You made assumptions that cost you time and money. If you were lucky, you were able to make a course correction. Or maybe outright business failure was the price you paid.

Testing the assumptions that underlie a business idea is crucial for any new venture. Design thinking — a collaborative, iterative process of arriving at a better, sharper idea — typically starts with awareness raising and needs finding, with assumption testing coming in the latter stages of the problem-solving and decision-making process. Unfortunately, businesses fall foul of skipping this order. The good news is, this doesn't have to spell disaster — provided companies learn to test their assumptions.

Using the example of a U.S. hospital's innovation effort, this article highlights three common challenges that arise when companies run before they have walked through the step of assumption testing. By analyzing what went wrong — and how the team rectified it — I show how design-thinking tools and principles can be employed to good effect, enabling companies to pivot away from disaster and push their assumptions to the fore — saving everyone time, money and headaches in the process.

In need of a checkup

Whiteriver Hospital on the Fort Apache Indian Reservation in Arizona detected a serious issue: around a quarter of its emergency room (ER) visitors were leaving before being seen. And this led to a bigger problem shared by hospitals across the United States, where 1 in 3 patients who left the ER without being seen ended up requiring emergency treatment within a few days.

The root cause of Whiteriver's problem was long wait times. The visitors who left without being seen were rarely in crisis, but their relatively minor complaints could escalate into major ones. In fact, it is not uncommon for initially treatable problems to spiral into emergency situations. In Whiteriver's case, this meant some needed to be helicoptered off the reservation, which greatly inflated the cost of care.

As is typical of patients in sparsely populated areas, the local community used the Whiteriver emergency room for the most mundane of treatments, such as prescription refills. Indeed, up to two-thirds of the ER visitors on any given day could be there for non-pressing issues.

With staff addressing acute emergencies as priority, non-emergency patients fell to the bottom of the list. Those who decided to wait it out could find themselves waiting as long as six hours before being seen. Though many hospitals report similar frustrations, at Whiteriver the rate of not being seen was many times the national average.

Enter Marliza. She accepted a job with Whiteriver where she was put in charge of performance improvements. One day, she received an invitation to submit ideas to Ignite Accelerator, an innovation program run by the U.S. Department of Health and Human Services that offers education, encouragement and some funding to help public servants improve the services they deliver to citizens. Marliza jumped at the opportunity, submitting several project ideas that she and her team had come up with.

Marliza's challenge may be instantly relatable to many executives, who often have an everyday organizational problem to solve that is not necessarily on the scale of the big, messy, so-called "wicked" problems that many people associate with design thinking. A key quality of design thinking is that it can be used by just about anyone to solve a problem like improving wait times or service delivery in support of the organizational mission. Not all changes have to be revolutionary.

Another aspect of this story that executives will undoubtedly relate to is what Marliza did in advance of the Ignite Accelerator workshop: she started with innovation ideas. In this case, the one ultimately selected for Ignite development was an electronic kiosk to improve the ER intake process and reduce wait times.

Why an electronic kiosk? Marliza got this idea after reading about one that had worked successfully at Johns Hopkins Hospital in Baltimore. Upon arrival, patients would use an electronic system to sign in, and other parts of the hospital — the pharmacy, specialist doctors, testing labs and the like — would be instantly informed of incoming needs. The system saved admin time, while speeding up the process of adequately allocating medical resources for each new patient.

With the backing of the hospital's leadership team, Marliza and Alysia, the ER supervisor, headed off to Washington, D.C., for a three-day Ignite Accelerator boot camp. They had their solution well defined: an electronic sign-in kiosk that would quickly triage patient needs, so people wouldn't leave the ER before getting treated. It seemed almost too easy. And it was.

The full article is published in IESE Insight 37 (Q2 2018).

This content is exclusively for personal use. If you wish to use any of this material for academic or teaching purposes, please go to IESE Publishing where you can purchase a special PDF version of “Got an idea for your business? Test your assumptions!” (ART-3170-E), as well as the full magazine in which it appears, in English or in Spanish.