The Innovative Organisation: Learning From Design Firms
The
world’s top design firms have innovation down to almost a science. For
traditional incumbents looking to build innovative capabilities, design can be
the ideal catalyst.
In
1993, Samsung Electronics chairman Lee Kun Hee made a humbling discovery in a
Los Angeles electronics shop. He found his company’s televisions relegated to a
low, forgotten shelf in the back, while Sony and Panasonic models occupied the
front window. To Lee, this spoke very badly for Samsung’s global standing. Soon
afterwards, he began a radical overhaul of the company’s highly Confucian
culture, with the goal of making Samsung one of the world’s leading brands.
Lee
ordered top management to refocus their efforts from cost-saving to creating
unique, must-have products. In 1994, Samsung initiated collaboration with a few
design firms including IDEO. The following year, Samsung established an
in-house design school (in partnership with the Art Center College of Design,
the leading design school based in Pasadena, California) whose curriculum
included art and culture tours of New York, Paris, Delhi, and many other
creative hotspots. Perhaps most notably, Samsung was one of the few major
companies in consumer electronics to create a position for a chief design
officer. As times and technologies have changed, Samsung has gone from strength
to strength: In the first quarter of 2014, the company shipped 85 million
smartphones worldwide, more than its four leading rivals combined.
Design:
Catalyst of Change
Design
was pivotal to Samsung’s turnaround, in more ways than were readily apparent to
consumers. As its products acquired sleekness and elegance, Samsung was
retooling its organisational culture behind the scenes in line with Chairman
Lee’s edict: "An enterprise's most vital assets lie in its design and
other creative capabilities.” In short, the company was teaching itself to be
innovative, before that buzzword achieved techie ubiquity.
The
story at Apple, Samsung’s greatest competitor nowadays, shares certain
similarities with Samsung’s. In the late 80s, prior to establishing its
industrial group led by Bob Brunner (the design mastermind behind Beats
headphones), Apple used to have only a few designers who would do most of their
design work through design firms such as IDEO. Brunner eventually hired Jony
Ive, with whom Steve Jobs led the design revolution initiated with the first
iMac.
Samsung
and Apple traced out a path to 21st-century success admired and
followed by other brands. But too many companies still stash their design in a
silo, where it can have little to no overall organisational influence.
A
silo approach fails to capitalise on everything designers bring to the table in
addition to creativity. Top design firms such as IDEO, Continuum, and Eight,
Inc. have not only a well-tooled process for converting innovation
opportunities into real innovations, but also a set of organisational elements
perfectly aligned with that process. If companies require an innovation role
model, they need look no further than design firms.
The
Three “I”s in Design Firms
Designers’
most valuable capabilities have nothing to do with Photoshop, or any tool or
technique for “designing”. They are much more about setting a direction than
executing directives, more about shaping creativity to practical needs than
indulging flights of fancy. By observing how many design firms work, I have
identified three core organisational capabilities at which they particularly
excel, which also comprise the rudiments of any innovation journey:
user-centric insighting, deep and diverse ideating,
and rapid and cheap iterating.
User-centric
insighting:
In order to create value in novel ways (the goal of innovating), you must first
locate opportunities to do so. Where to start looking is easy to see—with the
end-user—but it’s far more difficult to detect and synthesise actionable
information within the complexity of the user experience. Customer surveys and
focus groups simplify the process, but are often removed from how people
authentically respond in the marketplace. Designers, by contrast, prefer
observation to interrogation, developing empathy to discern unarticulated, even
unconscious, user needs. As Tim Kobe, CEO of design firm Eight, Inc. put it, “We
represent the end-user in all the design decisions that take place in these
innovation projects.” And that’s why building empathy with the target user is
crucial, as Continuum did when working with Procter & Gamble to
reinvigorate the Pampers brand. Observing mums and their babies, designers
realised that the mothers’ ultimate concern was their infant’s development, not
the diaper itself. With that in mind, they devised a line of premium diapers
for different developmental stages (Swaddlers, Cruisers, etc.) rather than
segmenting by age.
Deep
and diverse ideating:
Designers generate heaps of new ideas based on user insights. This phase is
where they unleash their creativity, coming up with as many and as distinct
potential solutions as possible before putting much thought into
implementation. These preliminary solutions are the product of an
organisational process that deliberately cultivates a broad range of
perspectives. Far from avoiding eccentric and exceptional voices, design firms
seek them out and encourage their contributions within an atmosphere of freedom
of thought and playfulness. Playfulness is so important at IDEO that they have
created a Toy Lab where designers conceive and test out some of their creations
by playing with kids as young as 18 months.
Rapid
and cheap iterating:
Designers understand that the creative flurry of the ideation phase can take
them only so far. They are quick to make ideas concrete and not shy to declare
them failures when they don’t live up to expectations. For designers, failures
are not negative events but learning experiences. Producing fast and cheap
dummy versions to test out concepts means that even when the experiments flop,
it’s still a win-win. Singapore-based multidisciplinary design consultancy
Awaken Group makes “low-resolution prototypes” of spaces using stacked
cardboard boxes to represent walls. That way, alterations can be made to the
design in a matter of moments as the client walks through the demo space.
Many
firms developing new products or services carry out insighting, ideating, and
iterating, so what sets design firms apart? It’s the way they approach these
three distinct phases: Aligning their process and organisational elements to
encourage user-centricity when insighting, fostering the generation of many and
distinct ideas during ideating, and celebrating the creation of rapid and cheap
prototypes during iterating. The challenge for established organisations then
is to coordinate every aspect of their business so that they can produce their
own versions of insighting, ideating, and iterating in a way that does not
disrupt their capability to operate efficiently.
If
a second-tier Korean TV manufacturer could reinvent itself to become the
world’s biggest consumer electronics company, the transformative potential of
design is limitless.
Manuel Sosa
Read more at
http://knowledge.insead.edu/blog/insead-blog/the-innovative-organisation-learning-from-design-firms-3833#ddOSObyQjSE4IGZK.99
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