Working with a small company on a service design project has made me revisit how even an organisation with a handful of staff can be broken in terms of daily functioning (let alone any strategic capabilities) and how important it is that design work start internally.
There is sometimes an assumption in service design that the customer focus is sufficient a driving force for change that it can help an organisation reorganise internally to become better. And yes, an organisation-wide focus on purpose can be a powerful catalyst for change.
But many of the functions of good design (e.g, research) are based on even more fundamental principles (e.g. caring, listening) and so there needs to be a stage before, or at least in parallel with this customer alignment. And this internal focus provides one of the safest spaces available to an organisation.
A place that can get this right for itself can get it right for the other people they serve. A place where staff can listen to each other and care about what they hear has a better chance of listening to customers. A place that can try new things internally has a better chance of building new things externally. A place that can serve itself has a better chance of serving others.