Survival of the fittest

The goal of a startup is to find the right thing to build as quickly as possible. However, the vast majority of startups fail, that’s a fact. As a new research by Harvard Business School shows 75% of all start-ups don’t succeed. According to the researcher Shikhar Ghosh, startups fail not because the product is bad but because the market it is not adequate, it does not exist or it is insufficient, customers don’t buy therefore less revenue than expenses. The Startup Genome Project has also analyzed data from 3.200 companies and came up with some answers summarized in the following infographic:

Why Startups Fail

Healthcare startups are among the ones that fail most. According to a study by University of Tennessee, 56% of startups in education and health still operate four years after launching.

The cost of startup failure in med tech is high: It throws away $10 to $200 million dollars, the time of 20 to 120 people, between 3 to 20 years of work and 3% to 25% of your life!

Recently, a couple of approaches have emerged that can make the process of starting a company less risky. The first one involves identifying unsolved problems because a well-characterized need is the DNA of a good innovation. This is what biodesign process is about, a needs-based invention process for medical device innovation aligned with an attractive market opportunity so that is sustainable. Developed by Stanford University in 2001, it has already launched 26 companies, raising over $200 million, creating over 500 new jobs and treating more than 150.000 patients.

The second approach that could reduce the failure rate of new ventures and help launch a new, more entrepreneurial economy, is a methodology called the “Lean Startup”. According to conventional wisdom, the first thing every founder must do is create a business plan, a static document that describes the size of an opportunity, the problem to be solved, and the solution that the new venture will provide. Typically it includes a five-year forecast for income, profits, and cash flow. Instead of executing business plans, operating in stealth mode, and releasing fully functional prototypes, young ventures based on the Lean Startup test hypotheses, gather early and frequent customer feedback, and show “minimum viable products” to prospects. This new methodology states that treating new ventures as established firms is a mistake.

d·HEALTH Barcelona has incorporated both approaches, biodesign and lean start-up, to its training process. Fellows will get immersed for eight weeks in a clinical setting, observe everything that happens and detect what does not happen, interact with professionals and with patients while working in a multidisciplinary team and learning about science, technology, business and design with internationally renowned experts and entrepreneurs. They will acquire the skills to select the best observed needs based on clinical impact, stakeholders, the treatment options and market’s characteristics to later build prototypes, present them in front of a panel of investors and get the funding to make them real.

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Design Thinking, the innovation’s engine

When Thomas Edison invented the electric light-bulb, he didn’t know he was creating, also, an entire industry around it. He just envisioned how people would want to use what he made and he engineered toward that insight.

Edison’s approach is an early example of what is now called “design thinking”, a methodology that has become business innovation process’ fuel and engine. As Tim Brown (@tceb62), CEO of the design consultancy IDEO wrote in an article at Harvard Business Review in 2008, “design thinking can be described as a discipline that uses the designer’s sensibility and methods to match people’s needs with what is technologically feasible and what a viable business strategy can convert into customer value and market opportunity.

Design sensibilities include empathy, creativity, a human-centered focus and deep curiosity about the world while design methods consist of observational techniques, visualization, prototyping, sketching, storytelling, brainstorming, and so on.

Historically, design has been treated as a downstream step in the innovation process. Designers just come to put a beautiful wrapper around the idea. Now, companies are asking them to create ideas that better meet consumers’ needs and desires. Any industry can benefit by employing design thinking and achieve better results, including healthcare.

Recently, the US federal government took the Department of Veterans Affairs’ current health record system, which looks and feels like a receipt, and challenged designers to reimagine a new electronic medical record output to describe a patient’s health history. The challenge received over 230 submissions. The winner, will hopefully, replace the actual format.

Design thinking process applied to innovation consists of four key stages.

Define the problem: Sounds simple but doing it right it is perhaps the most important of all. In design thinking observation takes center stage and requires cross-functional insight into each problem by varied perspectives.

Create and consider many options: Design thinking requires that no matter how obvious the solution may seem, many solutions be created for consideration. And created in a way that allows them to be judged equally as possible answers. Looking at a problem from more than one perspective always yields richer results.

Refine selected directions: Even the strongest of new ideas can be fragile in their infancy. Design thinking allows their potential to be realized by creating an environment conducive to growth and experimentation.

Pick the winner, execute: At this stage prototypes of solutions are created and testing becomes more critical and intense. At the end the problem is solved and the opportunity is fully uncovered.

“Design Thinking starts with a need and ends with an idea for a product or service” – Paul Yock (Founder of Stanford Biodesign Program).

 

At Design Health Barcelonawe will apply design thinking to deliver change within healthcare. To design clinical experiences that meet patients’ needs, different teams of fellows will immerse for eleven weeks at three clinical settings in Barcelona, Sant Joan de Deu Hospital, Clínic Hospital and Guttmann Institute. They will identify dozens, even hundreds, of unmet needs, understand them and select the most promising ones to, finally, get the winner idea. In the following months, and until the program finishes, they will mature and evolve them until they are ready for the patient.

If you want to know more about design thinking we recommend you to watch this video to learn how to think like an artist or Design & Thinking the movie (here is the trailer) and then share your comments with us! Do you think that design thinking has the potential to change our lives?

Lessons Learned:

  • Thinking like a designer can transform the way organizations develop products, services, processes, and strategy.
  • Design thinking is an approach to solve problems understanding consumers’ needs and developing insights to solve those needs.
  • Design thinking relies on our ability to be intuitive, to recognize patterns, to construct ideas that are emotionally meaningful as well as functional and to express ourselves through means beyond words or symbols.
  • Design thinking brings together what is desirable from a human point of view with what is technologically feasible and economically viable.
  • Design thinking is as much a mindset as a process.
  • Design thinking is a system of three overlapped spaces: inspiration, ideation, and implementation.
  • Only through contact, observation and empathy with end-users you can design solutions that fit into their environment.