[Innovation #4] 'There's no place I'd rather work'

Design & Co-Innovation Center of SAP AppHaus Korea in Bundang, Gyeonggi Province / Korea Times photo by Yun Suh-young

This is fourth in a series of articles on companies with innovative work cultures. — ED.

Design thinking is the foundation of SAP's innovation culture

By Yun Suh-young

Is your workplace somewhere you'd rather work other than going anywhere else, out of pure joy and satisfaction _ not because it's your last resort?

For Christopher Han, vice president of the SAP AppHaus Design & Co-Innovation Center in Seoul, his company is.

The reason is because of the design thinking culture embedded in the company.

Design thinking is a concept that has become widely popular globally over the past few years, thanks to design consultancy IDEO which spread the term. The concept is still new to Koreans, but slowly penetrating into business sectors.

Design thinking is a cognitive methodology and activity that helps people to develop creative ways to solve problems. It's to "use the tool set or mindset of a designer and taking that same process and applying it to bigger issues," according to Tom Kelley, partner and co-founder of IDEO, in a past interview with The Korea Times.

But as difficult as it is to grasp the concept for a first-timer, it is challenging for businesses to apply it within their organizations. Hence, as much as design thinking can help change the organizational culture and consequently boost performance, it's easier said than done.

In the case of German software company SAP, however, it's different. Design thinking is embedded in its culture. The fact that the company founded a design thinking institution explains it.

Hasso Plattner, the founder of SAP, donated $35 million to Stanford University in 2005 and founded the Hasso Plattner Institute of Design which is better known as the "Stanford d.school" where the "d" stands for design. It's a non-degree boot-camp type program led by IDEO co-founder David Kelley training graduate students to practice design thinking.

Not surprisingly, SAP "systematically tried to incorporate (design thinking) within the company," said Han, the vice president of SAP's AppHaus in Seoul. AppHaus is SAP's co-innovation space in which customers, SAP staff, and end-users work collaboratively on projects. App in the name refers to apps on mobile phones as well as the application of knowledge in general. "We apply diverse domains to solve hard problems with customers," he said.

"The way of working has a direct influence on organizational culture and culture has direct influence on performance. I see design thinking as a way of working," said Han in an interview with The Korea Times in February.

He said the company has "transformed itself to be more empathetic and user centered" after applying design thinking.

"If you look at our products, the big change is, it has become easier to use. The user experience has gotten exponentially better," said Han.

"SAP has always been known for making robust software. It's always been good. The problem was that it was sometimes difficult to use. Now that's changed because of our emphasis on the social experience."

Design & Co-Innovation Center of SAP AppHaus Korea in Bundang, Gyeonggi Province / Korea Times photo by Yun Suh-young

Design-thinking culture

Transforming the user experience was possible because of the way the company works, or by transforming this.

"The vernacular has changed. How we talk about customers, how we talk with customers, how we interact with customers has changed. We invite customers to have a visioning session where we all visualize what success is and come to a consensus to what it is," said Han.

"All of this is intended for us to better understand our customers _ to empathize with them more concretely. On that foundation we can do whatever work that we're trying to do."

There are three important components in an innovation culture, he says: people, process, and place.

"You need great people with diverse backgrounds and the right mindset. Process speaks to the way of working _ design thinking has become a foundation of how we work. Place has to do with workplace design. This is unlike most offices. We made these investments as a company because of the importance space has, influencing the quality of interactions people have."

The AppHaus in Seoul opened in July last year. It is the company's first Asian branch out of the four AppHauses. The other three are located in Palo Alto, California, and Heidelberg and Berlin in Germany. The name AppHaus pays homage to the German Bauhaus movement_ the interdisciplinary approach to arts and science _ whereas haus is "house" in German.

"I really like our SAP work culture. I've dealt with executives/sessions/workshops with over 50 companies in Korea and government organizations, and at the moment, there's no place I'd rather work," said Han.

"It's not perfect but no organization can be perfect. It's not a destination, it's a journey."

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As if to testify to his statement, Lee Jin-hyun, senior UX design specialist at SAP, said what's special about the company is the prototyping culture.

"The culture here is to iterate, change, and make things better step by step. Whereas in previous companies I've worked with we had to submit a completed report, here we continue to iterate. Learning and applying is in the DNA of this company," she said.

"The organizational culture is flexible, iterative, and horizontal. Since the culture is based on design thinking, proactiveness is natural. It's a company where communication is flawless between top, bottom, and sideways.

"The system for feedback and evaluation is well established. Not only is evaluation done from top to bottom, but also from bottom to top. Surveys are well constructed with complexity and depth and through it, leaders can grow."

SAP has a corporate culture that continues to try to improve.

"It's more about the mindset that every member in the organization must have _ one of 'I am contributing to making this culture.' If we all have that mindset, then whether you're in a large or small company or a Korean or foreign one, you can seriously start to make changes," said Han.

"What I see in so many people entering conglomerates or those as mid managers or even high level executives is that there's a prevailing sense that 'it's just the way it is.' But it's absolutely not true. Culture is made by people and people can change culture."

Global SAP employees participate in a workshop inside the Design & Co-Innovation Center of SAP AppHaus Korea in Bundang, Gyeonggi Province. / Korea Times photo by Yun Suh-young

How to change the culture

"We use the term 'innovation culture' _ organizational culture that is helpful for innovation, not hindering innovation. People's mindset, behavior, how we interact _ these kinds of things can help or hinder an innovation process," he said.

Han said he's seen a lot of behavior in Korean companies that he'd like to weed out.

The first is authoritarianism.

"When you go to a typical setting in Korea _ say you're in a group _ there's a quick awareness of who's the top dog and that person does most of the talking. Respect to seniors or elders is good but in the work context it may not be. It also puts pressure on the top dog to have all the answers. There's no way for that one person to know the answer. It's too complex. Often the answer lies in other people and in combinations of other people."

The second is the perception of failure.

"I think fear of failure can cripple people's performance. So when I give people assignments, we create the first prototype and review that together. The language that we use is important. When I use the word prototype, they know it doesn't have to be perfect."

Third is the admission of fault.

"When we're going in the wrong direction, we need to admit it, do a U-turn and start over. In some organizations, that's hard to do. 'Let's just finish it because we worked on this so long'_ that's bullshit. You have to pull the plug."

From the moment Han created his team here, he told them, "We make our culture. We don't just settle for what we think is the prevailing culture."

Han says he wants to be able to observe behavior that helps innovation.

"We organize meetings in such a way that information is shared by everyone. Everyone can openly and freely participate in expressing their opinions. Often if you have a situation where only one person can voice their opinion at a time, it limits the amount that can be shared and people may defer to the higher level person," he said.

"But if you allow them to use mechanisms like post-its for example, or online tools where you can give your input and it can be immediately projected on screen, named or anonymous, these tools give people empowerment to share ideas in a time-effective way. Those are things that help innovation."

When Korean companies come to SAP for consultation on innovation, Han asks them, "Out of 10 projects, how many of them succeed?" The typical answer he gets is one or even less.

"They say it's simply bad luck. But 90 percent explained by bad luck? There's something systematically done poorly," said Han.

"My take on it is, it's the way you work, the processes that you have in place, the culture that you have in place, the mindset of the people _ those are the things that have to be addressed from a systems perspective."

Most of the time, the top leadership know they need to do things differently than they've done in the past. The question is "Do they really want to do this?"

"Ultimately what every executive wants are better outcomes. If I can snap my fingers and have better outcomes, that's what they want and pay for. The question is snapping my fingers doesn't help. The question is 'So what helps?' Changing the way you work helps," he said.

"There's no quick and simple surgical process. Changing people's mindset and behaviors _ that's what it takes.

"People are imperfect beings. It's hard to have a perfect organization. But we can always make it better than today. Just because we can't achieve perfection doesn't mean we can't make it better."