Three years ago, the Royal Bank of Scotland launched a mobile app allowing customers to access emergency cash if their bank card was lost or stolen. Simple, fast and reassuring for consumers, its enormous public success led to two awards for creativity and digital innovation. The bank’s goal had been to impress and look after existing customers – and, as a result, it also attracted new ones.

The company behind this project was Edinburgh-based service design and customer experience agency Nile, which worked closely with RBS on a four-week campaign to create the concept and bring the app to life. Little moments of wonder like this app offers – a simple way of making an everyday problem seem more manageable – are at the heart of service design.

The concept of service design is about taking the principles of good design and applying them to the structure of a business, identifying where a business can make improvements. The result is a positive, streamlined and sometimes pleasantly surprising experience for customers – leading to higher user satisfaction and customer retention, and from there to gains in terms of profit and market share.

In June, the Design Council published a report on the state of the service design industry. It found that Europe is home to half of all service design agencies, and that the UK has an especially strong presence in the sector. Given that the services sector is said to be responsible for rebalancing Britain’s economy, it’s not surprising that the emerging industry around designing the services customers seek is flourishing.



“Businesses are definitely waking up to the importance of service design, and realising more and more that what really needs the design attention is the service they’re offering,” says Matt Edgar, a committee member at Service Design Network UK, a business network for service designers. “Services benefit hugely from the designers’ way of looking at the world, synthesising lots of different inputs and making things visual. Those skills applied in a strategic way can really help businesses.”



The concept has been around for a long time, but it traditionally sat in the public and charity sectors, according to Sarah Ronald, founder of Nile. “It was never seen as a serious tool for business,” she says. However, a change in perception has led to an explosion of interest over the past few years, she says.



The scope of the service designer stretches across the boundaries between branding, business management and customer service, and for that reason, service designers are drawn from a variety of backgrounds. “Many who enter the industry come from a design background, or increasingly, from a hybrid background,” says Ronald. “Our approach is hybrid and collaborative; the point of service design is that you’re looking at whole systems.”

Virgin Media has a reputation for delivering exceptional service in the entertainment and communications industries, having picked up a number of customer satisfaction awards.

Working in collaboration with Virgin Media’s in-house experience design team, Engine Service Design has spearheaded a number of campaigns intended to move the business from simply gaining customers to beginning relationships, increasing satisfaction and ensuring retention for the company.

One of the campaigns was QuickStart, designed as an alternative to installation by an engineer for customers who are technically able and whose property is pre-wired. All the equipment required to get started with broadband, TV or phone is packaged in a QuickStart box with an instruction guide, including photos of the steps and an instruction video.

An emphasis on attention to detail and the introduction of special little touches are especially important, says Joe Heapy, founder of Engine. “Increasingly, we’re looking to design in an element of novelty or originality to a service. There’s something about finding an element of surprise for customers, to draw them in and charm them in a new way. Hassle-free and innovative service can really define a brand and ensure that customers stick with a company.”

Although service designers look at the structure and needs of each business individually, there are four basic steps involved with any campaign. “There’s an initial “discover” or “understand” step, where you go out and observe what’s happening. Then you imagine and define the possibilities of what a business can improve and achieve, says Alex Nisbett, a service designer at Livework. “After that, you develop those possibilities into real, tangible solutions, which typically includes an element of prototyping your ideas and concepts. The final stage is to integrate with the organisation to help them start to deliver those services.”



While the majority of Livework’s clients are larger businesses, the company has spearheaded projects for a number of smaller enterprises, many of them startups, including a campaign for London-based car-sharing company Streetcar.

Streetcar initially found it difficult to communicate to the public what a car club was and how it worked. So staff met new members at car locations, which meant there was a high cost attached to each new joiner. Livework, therefore, designed an effective self-service system so customers could sign up and start using Streetcar without needing a member of staff to help them.

By applying the principles of service design across the whole customer experience – from joining to booking to renting – Livework created the conditions that helped lead Streetcar to merge with the world’s largest car-sharing company, Zipcar.

Nisbett believes that a new generation of entrepreneurs are fast realising the importance of well-designed services in starting and maintaining a successful business. No matter what size the client, he emphasises that looking beyond the obvious as an important ingredient in effective service design.



Sign up to become a member of the Guardian Small Business Network here for more advice, insight and best practice direct to your inbox.