From a recent interview with GE CEO Jeff Immelt in Business Week.
Do you have to do more than that to make your managers truly creative?
Creativity is important. It’s an ingredient in innovation, but it’s not the only thing. We’re trying to stimulate new thinking by bringing people in from the outside, such as [design consultants] IDEO, to make sure we’re not too internally focused.
What do you feel the outsiders have brought to the company?
They try to approach growth in unique ways by looking at unmet needs of customers. We do creativity sessions with them and things like that. It gives us some new, nonlinear thinking, which is something I’ve picked up from A.G. Lafley at Procter & Gamble (PG ).
Is Lafley a particular inspiration to you?
We used [P&G] as a benchmark. He has that innovation gym [to train managers and test new ideas] and he has found new ways to blow some of the walls out and do a better job of integrating ideas from the outside.
Why do you think innovation is more important today for GE, or for business in general?
We’re leaving a period, particularly in the late '90s, where global economic growth of the developed world was pretty robust. It’s just choppier now. You need new ways to boost growth.
Do you think managers have to become more like designers, or masters of creativity?
What I tell people is that we have to develop new leaders for growth – people who are passionate about customers and innovation, [people] who really know markets and products. [Traditional] professional management isn’t going to give you the kind of growth you need in a slow-growth world.
Do you feel you’ve become more innovative in the past few years?
[It all] goes back to people – those who want to take swings. I tell people that you have to view these [new leadership] traits as critical to your long-term development. You have to change…or else you don’t have a great future at this company. END
I think what we are failing to recognize as a community is that big business is no longer looking for just good Design to build their businesses. They need Innovation to do that. Now before we start a war over the semantics of Innovation with a capital I, let’s just agree for now that we are talking about the ability of Designers and Engineers to bring new breakthrough products to market. These corporations rely on multisdisciplinary teams to create, evaluate, continue to fund, execute, produce, and launch. Only in the most enlightened companies have designers been elevated to positions that allow for command and control responsibilities.
What the good news and bad news? Well, let’s just say if you are a designer that doesn’t read the business pages on occasion, you are in for a rude awakening. The good news is that if you are capable of working with those multidisciplinary teams, your stock just went up. Designers can’t get good work if their Design Managers don’t get a place at the ‘big table’. Start redefining ID in your head as innovation services and you’ll start to see what corporate America is seeing. Look at what GE and P&G have done in the last 4 years.
The bad news? Design services are in danger of being largely commoditized. However, the design firms that are part of P&G’s Design Board have more to bring to the table. Rip DC all you want for all the Swiffer hype lately- but they have a seat at the ‘big table’.
Back to the larger question. I believe you can track very simply the companies that have leveraged design and innovation. Using the Swiffer as an example, how many of you can say you were an integral part of building a 500 million (going to a Billion with a B) dollar brand? I think that it is a damn fine example of the impact of design and innovation on a companies bottom line. It bodes well for the firms that can play at that level.
But here is the rub. Most companies do not share the information we as designers seek. Public corporations show some of their cards in their annual reports. Some more examples:
Client A hires us to tackle a new portable medical device to build on their first, single product line. New line is so successful company is sold to larger competitor for 23 million.
Client B hires us to design a new medical device. Design wins major award. Company sold for 45 million.
Client C hires us to design over 3 dozen products over the years. We design breakthrough product. Wins a number of design awards. Company is sold for 166 million.
See a pattern? See the value of good design? I’m sure the owners of these private companies did when the cashed those checks. What’s the larger problem? As I see it, it is the fact that too few designers are willing/asked to promote their business successes vs. their design awards. If you asked me whether or not I’d rather have a Gold IDEA award or have my client’s new product gain double digit market share, which one do you think is the right answer?
Looking forward to hearing more…