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6 Keys For Turning Your Company Into A Design Powerhouse

While design has always been f undamental to industries such as f ashion and consumer electronics, it has now spread to nontraditional settings such as airlines, consumer goods, and even governments, where it has become the driver f or dif f erentiated end-to-end customer experiences as well as innovation. T hats no longer news: Today, most executives recognize that design can be a source of competitive advantage. What most executives dont recognize is how to manage design strategically, how to use it to win in their industry, and how high-perf ormance design organizations are organized to deliver great results. Af ter years of leading assessment and change management ef f orts at global corporations, heres what Ive f igured out that leaders need to know to start to build design into the DNA of their organizations.

Align goals and strategy.

T he most ef f ective design organizations set goals that are aligned with their organizations corporate strategy. When HP went on a recent cost-cutting spree, its design team heroically delivered more than $50 million a year in savings by standardizing of the HP jewel logo across its vast array of equipment. Having a clear design vision and strategy like this allows a design organization to know what it is shooting f or and to put in place the appropriate talent and other resources to execute the plan. However, getting the vision and strategy to align with the talent and resources required to execute is most of ten where things go awry. "Creating an environment where design can thrive should be the greater f ocus, not just hiring superstars." In nascent situations, neither the design executives nor the executive leadership team understand the extent of the organizational development ef f ort required to support the corporate strategy. Consequently, progress is of ten slow and more painf ul than it needs to be. Simple tools like organizational road mapping and the resourcing to support the plan can set the right course f or transf ormation, yet Ive seen f ew companies treat design capability building seriously enough to merit this type of attention. Why?

Understand the dif f erence between design thinking and design.

Much has been made of using design methods (commonly ref erred to as design thinking) f or solving complex business challenges. In f act, the term has gotten so much coverage lately that I f ear that many people are starting to think about design and design thinking as interchangeable terms. T hey are not. Design thinking is methodology that is taught in certain types of design schools, notably industrial design and architecture; theref ore only a subset of all designers are bona f ide design thinkers through their academic training and practice. While better use of design thinking methods should be usef ul f or any corporation in solving its most wicked problems, design thinking will not in and of itself drive better design.

Hiring superstar designers is not the answer.

"Design thinking will not in and of itself drive better design." A common theme that weve observed over the last several years is that senior executives who are hot on pursuing design as a business strategy coerce a seasoned design star into their companies only to f ind themselves f rustrated 12 to 18 months out when they havent become the Apple of their industry. Worse is when corporations go through the time, expense, and trouble to hire multiple superstar designers only to have them leave within a short period af ter becoming f rustrated by the system and lack of results they are able to produce. Not only does this situation beget very low returns on substantial investments but also signif icant product disruptions and low morale f or the people lef t behind. While getting the best talent is an important goal, creating an environment where design can thrive should be the greater f ocus.

Measuring the return on investment f or design is a long-term pursuit.

Skeptics always want to know why they should make such signif icant investments in design. Unf ortunately, this is a dif f icult question to answer. Companies such as Nielsen that analyze marketing-mix investments do not account f or design. T he impact of design can span a variety of activities. And measuring emotional impact, or the delight f actor, of design is poorly understood in corporations that do not invest heavily in studying why people choose or dont choose their products. However, if stock price can be viewed as a proxy f or the impact of design in the marketplace, consider the perf ormance of this bucket of 10 f irms that have invested signif icantly in design over the last 10 years. Using an approach similar to how perf ormance of the S&P 500 is derived, our analysis shows that a $10,000 investment in our design index of diverse design-centric companies would have yielded a 64% return, whereas an investment in the S&P would have yielded a -22% return. T he outsized returns f or design-centric organizations represent a collective set of design investments on the part of each f irm, as no single investment could possibly drive the type of momentum realized. Note: To normalize data, we lef t Apple of f the list.

Great design leadership is important. But great change management is even more important.
It is true that most high-perf ormance corporate design f unctions have seasoned leaders who possess what it takes to make the magic happen f or a multibillion-dollar global enterprise. What is less known but also true is that a hallmark of design-centric companies is that design seamlessly integrates into the larger set of processes that constitute production in their organizations. Whether the process is budgeting, innovation, engineering development, branding, supply chain management, or something else, design has an uncontested role and decision rights. Mature organizations aspiring to use design strategically will f ind this state of nirvana elusive without signif icant intervention. Overhauling processes is painf ul; managers despise having their f ormer roles usurped; design culture and training leave managers unprepared f or such organizational wrestling. Further, such f ar-

reaching change cannot solely be designs job. Any company that wants more and better design must mandate that design be embraced. "Such f ar-reaching change cannot solely be designs job." But as Chuck Jones, a f ormer VP of design at Whirlpool and now chief design of f icer at Masco Corporation, says, that requires a long-term commitment: You have to be in it f or the long haul: Creating sustainable competitive advantage through design is not a quick or easy task. In my view, it will take seven to 10 years to get the capability to a point where it is consistently producing the kinds of results that are winning in the marketplace with the added benef it of shif ting the relevant brand image to that of design leader. From there, it is up to the entire organization to maintain this commitment and f ocus on design--f or decades. Herman Miller, as an example, comes to mind. T heir f ocus on design leadership spans over 60 years and continues unabated. Organizations that do this quicker than most employ a range of internal help, not the least of which is a senior leadership team whose unwavering support ensures the organization enacts the required change.

Companies that get the most f rom design rely on a culture of design.
Any organization that wants to leverage design f or strategic advantage needs to know that this cannot be achieved overnight; most likely, it will take many years. One way to shorten the journey is to concentrate some portion of the ef f ort on building a culture of design. Achieving a culture of design means that everyone in the organization understands what design is, how it is used f or strategic advantage in the organization, how and when design resources are used, what the work of design entails, and how design ef f orts should integrate with the companys production processes. "One way to shorten the journey is to concentrate some portion of the ef f ort."

Its been extremely important to share with the organization that design was beyond pretty products and cake decoration at the end of the innovation process, says Mauro Porcini, 3Ms head of global strategic design. We made clear in all possible ways that by def inition design was not just about designers: We wanted to have each 3M f unction, f rom marketing to the laboratories, f rom manuf acturing to sourcing, f rom HR to legal, aware of the value of design, engaged, eventually excited, and ready to drive the design strategy as a collective collaborative ef f ort. Along with championing the design process, the best corporate design leaders are ef f ective at conveying designs importance to the health of the enterprise, especially in the early days of their tenure. In an organization the size of Procter & Gamble, Coca-Cola, 3M, Masco, Johnson & Johnson, or Hewlett-Packard, where remarkable design transf ormations are presently under way, this can be a dif f icult task. Nevertheless, individual and collective ef f orts like those mentioned here are making a dif f erence every day in turning these admired companies into the design leaders of the f uture.

Checklist: Five Tips For Building Corporate Design Organizations

Consistently great corporate design is the product of the f ollowing elements: 1. A vision and strategy that is well-articulated and understood by its organization; 2. leadership that is capable and committed to driving its vision; 3. an organization that is structured and resourced f or success; 4. a talent pool that is diverse in design disciplines and deployed at key points of f unctional integration; 5. a culture that embraces the myriad dimensions of design. [Images: Sebastian Duda, Regissir, and Sebastian Duda via Shutterstock]