In the historically resilient and change-resistant banking industry, the unprecedented era of Digital Transformation (DT) asks for a re-evaluation of traditional business models, processes, and customer interactions. This graduation project, conducted in collaboration with Innovation Boosters (IB), addressed these challenges by developing a strategic design tool to support traditional financial institutions in their DT.
The research, grounded in the Dynamic Capability (DC) theory for DT and the design thinking creative problem-solving method, investigates the interplay between DT, dynamic capabilities, and design thinking (Magistretti et al., 2021; Teece, 2007; Warner & Wäger, 2019). It posits that leveraging a design thinking approach can enhance the effectiveness of DT initiatives within an organization, as evidenced by relationships in the literature (Cankurtaran & Beverland, 2020). The research methodology employed included a literature review and semi-structured interviews with 14 participants. Seven IB consultants and seven DT professionals from the Dutch financial sector were involved, aiming to empirically investigate the effectiveness of design thinking in strengthening DT processes. Findings from the research highlighted the multidimensional nature of DT, emphasizing the alignment of strategy with organizational culture and operations. The importance of design thinking in executing DT strategies, managing uncertainties, and fostering user-centric innovation was also underscored.
Based on these insights, the subsequent design process aimed at defining the design problem, setting the design direction, design goals, and a list of ten design criteria. Afterwards, a co-creation workshop with students was organized to develop personas for the change manager role, the identified figure for DT's successful implementation. The ten design criteria were later categorized based on the two key dimensions derived from the research: innovation leadership and transformation management. The design output is a Change Management Process (CMP) tailored for managers dealing with DT in their organizations. It aims to bridge top-down strategies with bottom-up insights, guiding managers from minimal DT impact to advanced integration and sustained transformation. The three steps related to innovation leadership focus on fostering a collaborative environment, learning from failures to fuel growth, and cultivating a strong sense of ownership among team members. The three steps related to transformation management emphasize building capabilities, enhancing operational excellence, and empowering team autonomy to effectively implement DT. The CMP is supported by two canvases, each featuring four questions that encourage DT managers to critically reflect on their role, thereby enhancing their engagement with the CMP and improving their impact on DT initiatives.
This process was subsequently tested and evaluated by IB consultants, identifying four areas for further reflection, and an action checklist was developed to support the consultants in their work. IB also conducted an assessment confirming the feasibility, viability, and desirability of the developed CMP. The CMP serves as an actionable tool that IB can further test and implement with their clients, facilitating meaningful dialogues and identifying key areas for organizational transformation.
The project underscored the importance of investigating the intersection of strategic management, design, and DT, advocating for further cross-disciplinary research to explore how design thinking can support DT and enhance organizational innovation capability.