As president of the Design Management Institute, I am often asked: "How can we develop a great design organization," and "How do I convince our CEO about the value of design?"
Good questions, simple answers: Determine what matters to the decision makers and improve it with design. Then, either inspire the CEO, or become the CEO.
Do I hear you scoffing? "Thanks, Lockwood! 'Become the CEO.' No problem! Will tick that right off my to-do list."
I understand. But here's the problem: While there are many examples of great design, making them happen without executive support is a pretty tough challenge whether you're an in-house firm or not. In this post, and a subsequent one, I'll explain why.
Design follows money
It is really that simple: Design follows money. Get budget, get design. Design firms don't design without clients (which requires budgets), and in-house departments are not very effective without great people (which also requires budgets). Think of this as "Designomics."
I'm not talking about the fancy design that sometimes passes as fine art. I'm talking about hard-working commercial design. The kind created to drive business results—increasing sales and profits, improving customer experience and loyalty, enabling innovation, connecting emotionally, building brands. It is relatively rare to find really effective corporate design without strong executive support, or at least a history or culture involving design. I would like to say this is the result of good business practice—and it is—but it is also the result of funding for design services.
Money follows customers, and design influences customers
Companies fund projects for many reasons, not the least of which is to connect with their customers. Customers are the revenue stream for business, so the ability of design to influence customers is paramount. Here is a simple formula: Customers purchase based on perception, design influences perception, therefore, design influences purchase. But what lies behind all that is that design requires client approval—and that comes most often from business executives who are generally not designers. But they are the folks who make the major corporate decisions and approve the budgets.
Although design would like to operate at the fuzzy front-end of business decisionmaking, it often plays the role of follow the leader. For example, a few years ago I worked with the Swedish government on a project to determine how design firms in Sweden and in the U.S. establish their business strategy. We held a two-day workshop in New York City and discovered something very interesting: Most of the 25 design firms participating agreed that they generally did not set a business strategy, but instead just tried to respond effectively to client requests. A client would approach with a request for help, and the design firm would respond, "Sure thing! What is the brief, and what is the budget?" For creative and resourceful people this approach seems pretty uninspired, but the reality is that fulfilling customer requests is a great way to keep billings flowing and jobs retained. But it is hardly the way to get a seat at the table where game-changing decisions are being made.
Over the past decade, we have seen a sea change in design firm capabilities, which have moved upstream to provide research, strategy and integrated customer experiences. Is this due to demand? Only partially. Most clients have developed strong internal design organizations, so in order to compete and grow, external design firms must expand into new budget areas, by adding value that's based on market knowledge, not just on design skills. As one industrial designer recently tweeted to me, "We are critical thinkers."
That may be true, but in order to get the opportunity to apply those critical thinking skills, and not just fulfill client requests, designers need to prove that the value they provide can make a difference on a client’s bottom line.
In my next post, we'll explore how some great organizations made that happen, and how designers can manage to convince even recalcitrant executives to give design a chance.
Thomas Lockwood is the president of DMI, the Design Management Institute, a non-profit educational organization based in Boston, Massachusetts. He is one of the few people in the world with a PhD in design management, and is recognized as a thought leader in the area of integrating design and innovation into business, design leadership, and building great design organizations. He is the co-author of three books; Design Thinking, Building Design Strategy and Corporate Creativity. A frequent design award juror and keynote speaker, he has lectured and led brand and design workshops in over 20 countries. Prior to joining the public sector five years ago he directed design at StorageTek, Sun Microsystems, and ran his own design consulting firm for a number of years.