The Whole of Innovation

Why we aim to place sustainable innovation firmly at the heart of business

Co-authored by Verena Augustin

Old news?

If this were a press release, the headline would read “PwC launches Experience Consulting in DACH and a new Sustainable Innovation offering, enabled by the acquisition of design and innovation powerhouse IXDS.” Basically, PwC Germany has launched Experience Consulting in DACH, as part of a global group of design and strategy practitioners at PwC that catapults the capabilities of the world’s second-largest professional services firm into the realm of product and service innovation, and adds a critically important new perspective to PwC’s market-leading business and technology practices.

And you wouldn’t be blamed for thinking: OK, so what? PwC has acquired eight design and innovation firms in various markets over the past few years. Other large professional services firms have recognized the value of design and innovation, user experience, or however else you want to call the “secret sauce” that became the next big thing in 2009. So why should you care about PwC’s foray into this space in the German-speaking market?

From human-centric to system-centric

Sustainable innovation signals a massive shift in outlook: from the traditional orthodoxies of human-centered design and customer-centricity — which left untouched the fundamental assumption that efficiency was our highest calling — to a new paradigm centered on planetary wellbeing and human flourishing. Sustainable innovation delivers a differentiation we deem critical in times of declining trust in institutions worldwide: a lasting trust dividend that provides the fabric of prosperous societies.

The complexity of the problems our society faces can only be matched by sustainable and future-proof experiences and offerings. For sustainable change to take root, we have to think not only of individual humans (not “users”), or even humanity at large, but about the health of the planet as a whole. We need interdisciplinary experts who can help ensure that any solutions we design are viable not only for our businesses but for our societies.

Going beyond technical feasibility to products and services that are desirable not only from a human but from a planetary perspective requires re-balancing our systems and the roles of individual businesses within them.

Sound lofty? Perhaps. But here’s the thing: with PwC, we can make it real.

First of all, size matters. PwC is the world’s second largest professional services firm, with $43 billion in annual revenues and 276,000 employees worldwide. Our teams work across sectors with the world’s largest, most innovative, and most influential organizations. We reside and work at the heart of business. Embedding Experience Consulting capabilities within a network of 276,000 professionals with the unique combination of skills salient to success at PwC presents a powerful lever of change within the heart of the global economy.

Remember that old tagline of design and innovation firms — “we make more than just fancy concepts in PowerPoint”? We can truly deliver on it.

Second, we are building on phenomenal pre-existing assets. We have offered Experience Consulting for years, as part of our BXT (Business — Experience — Technology) collaboration framework, helping clients ensure that the technology “voices” in any innovation-planning don’t drown out the experience concerns or business realities. PwC has also established several Experience Centers in cities around the world. They offer an inspiring environment for project collaboration and foster new ways of working.

The IXDS factor

PWC’s existing practice of more than 800 design, strategy, and research practitioners will now be augmented by the January 2020 acquisition of IXDS, the renowned German boutique innovation consultancy. We combine 15 years of market experience of a pioneering innovation studio with broad methodological know-how in business, service, and tech design, and adding studios in Berlin and Munich to the existing PwC Experience Centers in Frankfurt and Dusseldorf.

IXDS is the X factor and will be a catalyst for innovation in client projects and within PwC. The IXDS acquisition extends PWC’s reach by adding industrial, service, and interface designers to our DACH staff, along with strategists, researchers, and writers. Our pioneering expertise and proven methodologies in New Work, systems thinking, hardware prototyping, and organizational design will sharpen our innovation offering.

Founded in 2006, IXDS has been widely viewed as Germany’s leading innovation agency with a particular focus on Connected Hardware. We explored New Work long before the term became a buzzword, experimenting with four-day work weeks and removing job titles and other orthodox hierarchy. IXDS built in-house rapid prototyping and 3D-printing capabilities when most companies were still just talking about it.

Furthermore, IXDS developed a proprietary skill management methodology that PwC will adopt: a fluid skills-based system that allows PwC to constantly adapt its teams towards a client’s specific critical question. The starting point and core of each Experience Consulting project is a process tool called Critical Question, which IXDS created and which serves as a continuous reference point.

Adding IXDS’s capability and methodologies will let the Experience Consulting group work more consistently across all PwC’s offerings, and deliver world-class innovation and design expertise to all sectors it serves, including the public sector, a site of significant potential for transformation and fertile ground for those offerings and capabilities.

Purpose-driven meets feasible

Trust in business has many ingredients, but two factors that are essential in every context are integrity and capability: You have to believe that the person or organization you’re dealing with has a vision for the greater good, and you have to believe that they are capable of delivering on their promises. One factor is rooted in clear communication of purpose and social impact, while the other comes down to execution. Skip the first, and you fail to attract the growing numbers of belief-driven buyers who choose, switch, avoid, and boycott brands based on their stand on societal issues; skip the second, and you undermine both impact and message.

PwC’s interdisciplinary approach is all about the essence of trust. Our dedication to interdisciplinary expertise lets us bring the right people, with the right experience, to the table to identify and deal with the full range of enterprise issues. Our global network of teams who can speak to both data analytics and people operations, product strategy and sustainability, is deeply invested in designing systems that work beautifully for all stakeholders.

Sustainable Innovation: a whole new view of value creation

We will introduce a new offering, Sustainable Innovation, that offers clients a path toward implementing tangible, measurable results in any transformation project. It will help bring to market new products and services grounded in in-depth user research and sustainable business models, and built for lasting positive impact. It will help clients create solutions that are viable for their business, feasible from a technological perspective, desirable for customers, and beneficial for society and the world at large.

With our new Sustainable Innovation offering, we can help clients specifically to:

Identify business opportunities based on unmet user needs
Define value-adding product and service ecosystems
Prototype, test, and iterate towards an MVP
Develop and launch new products, services, and organizational designs, then scale them
Improve touchpoints with customers and stakeholders

Sustainable Innovation represents our approach to pushing the brand, strategy, and products of our clients’ businesses towards long-term relevance.

Does your business fully understand how the behaviors, intentions, and needs of your customers connect to the desires of your partners, the demands for social impact, and the needs of the planet?

If no, or not entirely, you’re not alone.

Thinking holistically about innovation takes practice and coordination. In our Experience Consulting practice, we don’t work in industry silos, but bundle our industry knowledge and thinking across seven clusters: connected living, participatory health, seamless mobility, human industries, empowered citizens, responsible economy, and sustainable resources.

Sustainable innovation is difficult; if it were so easy, perhaps it would have been tried more broadly already. It requires that environmental, social, and financial considerations are integrated into the innovation process: from business model to materials, design, development, and distribution. Unlike the “move fast and break things” ethos that helped get us into this state of declining trust, sustainable innovation also considers the externalities of innovation, and takes into account the unintended consequences of purely technology-driven disruption. It makes regenerative economics and materials the foundation of new groundbreaking products and services.

Sustainable Innovation enables inclusive growth that can sometimes be exponential, but never at the expense of others, including other living things.

And sustainable businesses begin with sustainable innovation. This is why we are confident our Experience Consulting will be a true catalyst of change. You can meet user needs, and create convenient, efficient, even delightful product and service innovations for humans — and still wind up with products and services that are nonetheless too narrow, too short-term, too careless with resources, insufficiently mindful of a fracturing world and the places where one small change can produce big wins for all stakeholders.

We can help you launch products and services that are proactive and prosocial — intentionally and methodically designed to have a lasting positive impact on people’s lives, our societies, and our planet.

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