The Power of Design
Tuesday, February 16, 2010 at 01:56AM No Design Thanks
Much of the discussion about the role of design in companies is clouded by jargon and designer up selling. Most designers will tell you with a straight face that design is the most important factor for any business, which is obviously just not true. There’s a more realistic battle for designers selling their services to corporations. That is to get design equal billing alongside the traditional C-level functions.
Design evangelists may be aghast at such a statement but it is possible that design is just not a real requirement for some companies. For example, a company may simply have much more pressing operational problems than design. For design to be effective, quality and cost must be under control, engineering, inventory and supply chain must be efficient and marketing and sales must be in working order. Design may also be considered fundamental to a company’s functioning but it may simply not be the priority yet.
A company could be functioning effectively but be working in a utterly commoditized area. Should the manufacturer of the yellow triangles that cleaning staff around the world use to warn of slippery floors be looking for a design edge? There’s no doubt that the most moribund industry (coffins anyone?) can be attacked with design. Indeed these are often the juiciest targets for an ambitious company daring to redefine an industry. The question is whether this is a sure-fire requirement for every dull, worthy market.
On the far end of the spectrum, highly sophisticated companies working in high technology areas could also see design as a less than strategic tool. Design thinker Steve Portigal noted the irony of Flextronics, the $18bn global ODM, being voted one of the Wired 40 based on it’s design ambitions. In fact Flextronics caused a little seismic event amongst designers a few years ago when then CEO, Michael Marks announced to the world that design had become a commodity and was no longer a strategic advantage. This was shortly after the acquisition of Frog, the celebrated boutique shop and was followed by the shedding of Frog together with some other non-core businesses. Only time will tell how prophetic Mark’s words turn out to be.
In the case of defensible intellectual property devoid of design, the candidates are rare who can build a company on that basis as opposed to a single product. Most end up like Polaroid. There are also cases where some other advantage; massive scale, superior reach, hyper vertical integration and so on, confers an advantage that design simply can’t match. However, these advantages boil down to cost.
And cost is where the discussion winds up. For without design the reliable tools of quality and efficiency strive to lower the price without any hope of raising it sustainably. So there may be exceptions but for most companies another tool is required; one that can break the zero-sum game of cost-driven competition.
Style
The most familiar image of design is as a creator of style. In fact despite the many other meaningful things that design can do, it could be argued that infusing products with designer style is the core competence of design. So we enter a discussion about beauty and the value of beauty.
The company that decides to use design to differentiate itself is betting that improving its style is a way of attracting customers. There’s an interesting difference in approach to design between different cultures. The yardstick that businesses use to measure good design in the USA is usually improved sales. This is pragmatic and measurable. In Europe, however weight is given to abstract elements of design (the kind art students would talk about; proportion, line, color and so on) which determine whether a particular design has been well executed or not. Ordinary Europeans, and therefore businesspeople more frequently recognize these elements intuitively and are able to form an opinion on a design. This is perhaps why European products have certain characteristic styles that are easy to identify.
It has been said that other countries like Japan blend the two approaches. This understanding of how design style is perceived is important when deciding when design can be exported across borders successfully.
In product design, improved style means making products look stylish and cool. However there are several layers to this ‘coolness’ as Diego Rodriguez so eloquently explains. To artists, designers and all aesthetes, creating beauty is in itself valuable. Businesses in America sometimes need to be convinced of that, usually when customers with the same sensibilities react to the beauty by buying it.
In the world of designers, few are able to marry the high art of original, iconic style with the depth of technical and commercial abilities needed to succeed with complex consumer products. As successful as Michael Graves has been working together with Target designing coat hooks and wall clocks, his range of consumer electronics was a failure. Even Yves Behar of Fuseproject, who has an apparently technically competent portfolio, commented in a revealing interview that the $100 laptop project is much more difficult for his studio than their regular work designing slick lifestyle products.
There is a downside to designer style. If style is the only reason for using design, the gain turns out to be short term. Style is easy to copy (just ask Alessi) and the style focus tends to be on one product at a time because the company is looking for quick easy successes by applying style. Since the reward is short lived, it’s prudent to allocate a minimum of resources to developing style as a differentiating factor. Hence the company employing design only for it’s style potential is always either playing catch up or jumping ahead only to fall quickly behind again.
In this situation, similar to the company which doesn’t yet use design for style, cost is the major weapon. Improved style cannot sufficiently differentiate products and services without highly competitive costs to attract customers. Attractive or distinctive style does offer a business a significant advantage over competitors whose style is less so. It places the company near the head of the pack and can sometimes stop commoditization and purely cost-driven competition.
Fortunately, style is closely followed in the minds of businesspeople by another attribute of design which adds benefits which make it harder for competitors to follow.
Function
If only designing successful new products was always as easy as making the new one work better than anything before it. Every product manager knows that it’s not - but try telling that to your designers! Their training is in making things look and work better. What your designers would call incremental functional improvement is one part of creating successful design, but it’s not enough to ensure success. That’s why adding blades to razors has been such a game of diminishing returns.
Clearly there are good reasons to compete by making something that works better than any competitor. This is the beginning of innovation. But that still doesn’t take us out of 5 blade razor territory. The improvement must be much bigger than that. It’s important to actually make something easier or more effective for the customer in a way that they can somehow measure. And when they measure it, it must be dramatically different. As Doug Hall and his peers point out, a big reason why many products fail is the ordinary person’s resistance to change. This means that a new design has to be an extraordinary improvement over previous designs before someone is persuaded to give it a try. The temptation to take a leading product and make the new one 10% better is a well-documented way to fail with new products.
The way that companies usually go about innovating is by studying other successful products (especially competing products) and trying to improve on them. This is both the strength and weakness of functional improvement. On the one hand, improved function can clearly give a new product an advantage, but because the new product is based on previous products, it’s also easy to copy.
This means that there is seldom a long term advantage to functional improvement and success is often hit and miss. This focus only on single products instead of the deeper thinking that can produce a whole system of innovative ideas, hampers longer term success.
Like adding style to products, adding extra benefits by innovating is not normally costly compared to the potential for success that it offers. It can be quite an efficient way of using existing resources to improve sales. You don’t have to be 3M, HP or Samsung to have innovation. It’s just a way of thinking that can be learnt. Innovation is simply a clever idea that has been successfully commercialized. Any company can do it by training its people to think like, well, designers.
But developing people’s creative abilities is still not an asset that can give a company a long term edge. It’s a great start because it creates the raw material for the reinvention which every company must have to succeed, but to win in the long term a culture of innovation is needed.
Solving Business Problems
Using design to improve the way things look and work may be an old fashioned notion but it served industry well for the whole of the last century and it remains one of the things that designers do best.
In this century, however, more is being asked of design. And faced with new threats, designers are happily obliging. It turns out that design thinking is well suited to solving all sorts of business problems. Organizations looking for a steadier advantage than the usual tit-for-tat style of competing have turned, amongst other things, to design.
The question has been whether products themselves could open up new markets, to actually create new opportunities instead of being created to fill opportunities. In order to do that, this type of organization has had to start to figure out how to think ahead of the field instead of reacting to the moves of competitors. It’s probably true that design’s main advantage over other types of business consulting is it’s ability to understand people’s needs and meet them in practical and desirable ways. To do this, designers use ethnographic research to observe real people in real situations. As humans, our actions betray needs that are simply too obvious to mention. Very often the way customers behave points out unexplored day-to-day problem areas. This is where an astute team could make life much richer for a customer .
This results in the ability to spot opportunities for the business before competitors do.
That’s not to say that design could supplant other types of business problem solving, just that design could be thought of as a permanent, legitimate business function. This has propelled design’s day-to-day role from thinking about individual products to thinking about product systems.
By this description, solving business problems using design starts to look like a whole lot of wrenching change. That impression isn’t diminished by the term “culture of innovation” which gets thrown around as a new aspirational goal. In reality though, innovation is not just for the guys in lab coats and creativity can be learnt. Businesses find that workers at the coal face are full of ideas of how to make better use of their time and effort as well as pleasing customers. Sometimes all that’s required is a good design team to guide the process.
That process starts by linking the tactical hits that are possible through ordinary form and function design. These small successes together with customer understanding and a growing ability to solve problems creatively allow the organization to move faster with new ideas.
All of which makes for a distinct advantage. However this does not yet add up to leadership in an industry. For that, design needs to be a strategic tool.
Leadership
Part of the fuzziness in defining what design actually is, is due to old definitions having outlived their usefulness. Some businesses have come to realize that design is much more than making things look pretty. In many cases a link can be found between how effectively design is used in an organization and the overall success of that organization.
A short list of companies who are undisputed industry leaders could include Nike, Apple, Proctor & Gamble, Nokia , Toyota and Samsung. In each case, success can be attributed to other factors but the influence of design has been integral.
These are companies who aim to be the absolute leaders in their industries; unique and far ahead of their competitors. They have discovered that the tactical ability of solving business problems with design creates successes that can now be knitted together with the emerging culture of innovation to create a strategic tool. For these leaders, design has become integrated into the business as a C-level function.
For companies like this, one finds a hierarchy of design thinking. Firstly a robust design process produces individual products which are carefully considered relative to their competitors. More than that, these products are designed in response to latent user needs and therefore ahead of current thinking. They form part of well-designed product systems which solve business problems. Finally, design thinking is applied in ten areas of business, transforming the organization.
It is this last layer of design thinking that contains the true advantage. Design is not an activity that is owned by designers. It is merely a profitable use of creativity. It can be learnt and applied by anyone in the organization. This is part of it’s power. Used correctly, design thinking can give any person in the organization a new ability to create dramatically increased value; just like efficiency, quality and customer focus have been able to.
Design has the ability to create products and experiences that have never existed before. When people all over the organization are thinking in this way, the true originality of their ideas cannot be predicted. Competitors can only follow because the organization is continuously disrupting the field.
Design is not the only way of disrupting the field. Methods like Six Sigma, the Toyota Way and the Theory of Constraints also make the same claim. The difference is that these are all process improvement methods whereas design applies innovation to products and experiences. In fact a good design consultancy will use these and other methods as tools in creating disruptive innovation through design.
Design has a great ability to be used in collaboration with other fields of expertise. That’s why it works so well with branding, advertising, engineering and architecture and other fields; to the point that it sometimes becomes indistinguishable from them.
Thanks to Jess McMullin for producing the original template on which this series is based and for giving his permission to use it.
The Power of Design is a series in 5 parts looking at the different ways in which design can be used within a company, cutting away hyperbole in the typical design sales pitch and investigating the real benefits of design to customers, the organization and its revenue. The 5 parts discuss incremental steps: no design, style, form & function, solving business problems and achieving leadership.
First published on 15 August 2006 at Core77.com
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