Design Thinking is more like a mindset for problem solving in general. It says that to innovate (to solve problems in a creative way), one needs to really start by understanding who their users really are, or as they say “to be in someone elses shoes and see things from their perspective” and really understand what is really the problem.
Untill we have a good understanding of who are users really are, not just in terms of demographics, but their pain points, behaviors and motivations, we will not be able to come up with a solution which really solves the core problem. This is the empathize phase, also why we empathize with users is so that we dont end up designing for ourselves. This is majorly to clear out our biases about the problem.
Now when the designer has empathized with the users and collected all the data, its time now to analyze the research and come up with insights which will help generate ideas that solve the pain points identified. Why we are analyzing is because what users says and what they do are different, so we cannot just take granted what users say, but we need to go deeper and analyze and sythesize what they really need.
Now is when the designer would start thinking of ideas considering no technical feasibility but really focusing at solving the problem in the best way. Then the designer would make a prototype to quickly test the design and get quick feedback.
Design Thinking is the creative problem solving process which a designer follows in the mind as well as in action in different phases to come up with a usable, elegant solution that really solves the problem. It can be applied to solving real world problems as you mentioned about certain wicked issues like huge lines in front of ATM, Climate Control etc or even as an approach to come with a digital product for a startup.
The word “User Centered Design Process” is generally used in the context of a company trying to make a product and following a product development lifecycle. Now the product should be desirable for the user (design team does this), viable for the business (business team takes care of this) as well technically feasible (Dev. team’ job) as per give time and resource constraints.
The aim here is also to make something useful and usable for the user and to make sure that all the design decisions are taken keeping in mind the end user, be it choosing which features would go in the application, which color will be used as a primary color in the mobile application etc.
Since there is always a time and resource constraints for companies building product that will do good business and will be usable for users as well, the UCD process and methods in each phase of it ensures that design thinking is not lost at any stages of the product development lifecycle.
Also it helps in defining certain common artefacts which can be used in discussions throughout the project, so that all teams have a common understanding about what they are trying to do at each stage of the process.
Hope, i was able to give you some more context around UCD process and Design Thinking. Do share your perspective here