The Current State of Service Design in Europe and America

Digitization of the Automotive Experience

In the keynote address, Holger Hampf, Head of User Experience at BMW, presented on the theme "Digital–Emotional," focusing on the digitalization of analog touchpoints that the automotive industry cannot ignore. The advancement of digitalization and external digital services significantly impact existing businesses, making digitalization imperative across all domains.

While his talk focused on digitalization in manufacturing, I believe it holds many common points for other industries also demanding business transformation. Mr. Hampf views the digitalization of the driving experience using new technologies as a major opportunity, seemingly envisioning a future-oriented, emotional new in-car customer experience.

At BMW, while the customer experience centered on the joy of driving for individuals still exists, it is seen as having already become commoditized and no longer a competitive advantage. He seems to be envisioning a paradigm shift: the digital device transformation of cars expected in the next era, the resulting provision of network services, and the possibility that decades from now, the in-car experience could resemble being in one's living room. Here, he emphasized that anticipating technological evolution presents a major opportunity for service design.

The next topic is external services and customer behavior. The influence of external digital services is immense, forcing every industry to confront market disruption and the need to reintegrate customer experiences. In the connected era, software services, IoT experiences, and in-vehicle experiences exist on the same continuum. Successfully integrating these external services, ensuring everything is networked, and designing a single, updatable customer experience is crucial for service design. This holds true for the automotive industry as well.

Creating Emotional Customer Experiences

Finally, Holger shared an image of his favorite connected city car concept, expressing his desire to continue exploring service design.

I sensed that Holger aims to create customer experiences driven by emotional services derived from iconic products, rather than merely functional services. Especially in industries like automotive, where the focus was once on competing with "things" – products individuals developed an attachment to – service design may need to particularly emphasize designing emotional experiences that move users at contact points.

A Renowned Design Firm Joins a Major Corporation

Next, we report on a presentation by Jamin Hegeman, Head of Design at major US bank Capital One, on how service design should be conducted within a large corporation. Jamin was the Design Director at Adaptive Path, a long-established design firm acquired by Capital One (this acquisition was a hot topic within the industry).

Implementing customer-centric approaches like service design within large organizations inevitably brings challenges like organizational structure issues and clashes of different cultures. Jamin directly faced these difficulties, reflecting on the experience and summarizing key challenges. This topic of service design and organizational structure was frequently discussed by other speakers too, indicating that building organizations capable of consistently delivering excellent customer experiences is a hot topic.

The position of the design function within the organization significantly impacts the precision of service design. When Adaptive Path was initially acquired, it seems they were only involved in a limited scope of design for Capital One. Being at the center of the organization makes the approach easier, but to truly unleash the power of service design, it requires engaging various business units and co-creating integrated services centered around the customer experience. This, he stated, simultaneously means delving into organizational issues.

Reaching this point involved numerous challenges: building connections with executive leadership, raising awareness of service design across business units, and bridging the gap between design and business thinking. Considering Adaptive Path had only 30 people compared to Capital One's 42,000 employees, the scale of this effort is considerable.

Integrating service design with business operations is no simple task. Jamin outlined an engagement model for service design—external, embedded, and hybrid—summarizing the advantages and disadvantages of each. Naturally, not all agency or in-house service designers can execute large-scale service design initiatives that fully engage the organization and leadership. His model effectively captures the key point of what type of service design to provide.

Designing Customer and Employee Experiences Simultaneously

In service design, it's crucial to understand how to foster a customer-centric mindset within an organization. To deliver exceptional customer experiences, one must delve into the company's structure, culture, and staff. However, this is not easy in large organizations. Jamin states, "You need to understand that implementing service design takes time and is difficult to execute."

This is unavoidable when delivering excellent service design. Many speakers in other sessions also introduced organizational aspects, such as initiating cultural change. It seemed service designers are experimenting with building organizations capable of implementing service design.

Whose job is service design?

Looking at the conference as a whole, many topics focused on how service design can transform business and organizational structures. This is a massive challenge, prompting reflection on which role within an organization should lead service design.

In Katie Koch's session from Spotify, she also discussed the service design process from the perspective of "Whose job is service design?" The ideal scenario is a mature organization where every department embraces customer-centric thinking through service design. Considering the complexity of tackling such corporate challenges, it seems decision-makers at the executive level should be the first to understand service design. This context also explains why design firms, not just consulting companies, are increasingly handling CEO agendas in recent years.