The current business landscape is a lot like being on a high-speed train.

We’re all sitting down, watching the scenery change before us. We might even be able to see where our destination is, or at least expect or predict it. But when we arrive, we’re wearing the same clothes and are carrying baggage. We’re not necessarily equipped to deal with whatever we find when we step off.

That revelation – along with a recent BusinessInsider article on corporate buzzwords – motivated me to write this piece. I want to define the difference between ‘Innovation’, ‘Design Thinking’ and ‘Agile’ development while avoiding that type of jargon.

Having worked on a daily basis using these three methods in a variety of industries such as corporates, the startup economy and not-for-profit sectors, each deserves its own explanation. If they were people in a bar, they’d each be a completely different personality… so what do they look like?


In the broadest of terms, this represents the ambition to create something in a new way – a fairly radical difference from the norm. It can refer to a process, culture or result. For example, an innovation process might be shortcutting the usual business case approach and being more open, rapid or engaging through collaboration. You can see innovation culture in leadership changes, communication, new metrics, idea and collaboration tools, new hires, rewards or physical spaces.

Innovation as a ‘result’ is fairly self-explanatory – it’s usually a new product or service to the market. The range of results may be from a new product, service or business approach, to the structure of a mortgage or the ergonomic design of a vacuum cleaner.

Our perspective is a range of culture, processes and results are required for lasting transformation toward a new way of doing business. It’s worth considering innovation being incremental, (e.g. a new feature or mobile banking app for something we already do), disruptive, (iTunes for the music industry), and breakthrough innovations, such as driverless cars, wearable devices or medical cures.

Design Thinking

“What gets us into trouble is not what we don’t know. It’s what we know for sure that just ain’t so.”
Mark Twain

“When the speed of change on the outside is greater than the speed of change on the inside, the end is near.”
Jack Walsh

The above quotes are both perfect introductions to Design Thinking.

Design Thinking is best used when a problem is ill-defined, or the environment is continually changing. It’s a practice which commenced in the 1980s and brought to the mainstream through the work of groups such as the Stanford design school and Ideo. And it involves four or five stages:

  • Explore the area and gain insights from techniques like ethnography
  • Define the problem worth solving
  • Generate as many and radical ideas as possible
  • Prototype, test, learn and iterate with hands-on learning
  • Finally, write up the kind of lean canvas proposition and business value

We strengthen Design Thinking for the areas it is not adequate in addressing. These include applying new developed digital innovation frameworks, which add foresight to the Design Thinking focus of gaining insight.

We also strengthen the commercial aspect of financial return, go to market, and start-up type framework delivery at the end of the process, since the purist Design Thinking approach doesn’t otherwise always hold a good fight when the result is competing with traditional projects for funding.

Agile development

Finally, Agile is both a subset of Innovation and Design Thinking. A well-documented and regularly practiced project delivery methodology, it refers to multifunctional teams coming together to work through a business request in a highly practical and responsive way. Hallmarks include replacing detailed specifications with scrums or stand-ups, epics, storyboards, wireframes, personals and building and testing with users.

Our perspective is that Agile is a strong, effective approach for projects of all sizes, (though a ‘scaled’ approach might be sought for the massive ones). In contrast to the other terms, Innovation will often use Agile at prototyping or delivery.

The relationship between Design Thinking and Agile is that the former uses the latter for its second half, namely through prototyping and testing.

It’s good to be mindful that an ‘Agile’ team usually get the brief when it’s fairly well defined, so this approach to development might deliver the best-designed, most useful washing machine. Just don’t expect the team to tell you not to be in white goods, or suggest a business instead to lift the agitator out of machines, make them solar powered and use them to sanitise drinking water for 1.2 billion people in developing countries.

So when we’re stepping off the bullet train, with our baggage and tools from a previous era, we should be prepared to cast them aside and start with a fresh perspective. If we aren’t using Design Thinking and Agile development to improve, our old ways of thinking won’t do us any good.

In 2016 we revisited this topic on corporate buzzwords. See how innovation, design thinking and agile development have evolved here.



Kate Bennett Eriksson

Kate is a former partner at PwC Australia and was its head of innovation and disruption.

More About Kate Bennett Eriksson