What’s the best way to gain real-world experience when starting in service design?

In short: work in a consultancy, do volunteer work and build side projects.

These are the ways I've personally used to get more experience in Service Design and that I found worked well:

Work in a consultancy

Working in an agency is great because you'll get to work on a ton of different projects in a small amount of time. The agency culture isn't always the most healthy, but you'll get a lot of real-world experience, plus you get paid for it.

Volunteer to improve an existing non-profit service

You can help a local NGO to improve its service. For example, by doing a little research project for them or trying to improve things in the backstage to improve their efficiency. Here, you'll learn a lot about the political side of things and how to bring change in complex organisations.

Build your a service, startup idea or side project

Build something by yourself or with a few friends. Here, you'll learn to build something from scratch, and you can really use your full toolbox.

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