Design has an impact on business

Our View - September 2011

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Print this page by Bernie Niemeier

The power of design separates winners from losers in business. 

New technology gets a lot of attention, but the power of design is more subtle.  Take a look at Apple Inc.  Most people would categorize Apple as a hardware or a software company.  Apple is actually a design company.
Think about its sources of competitive advantage. Apple products cost more than their competitors, and its software isn’t necessarily compatible with other products, yet its stock price has appreciated more than 400 percent during the past five years.

People pay more for products that are well designed.  Not only has Apple created sought-after products such as the iPod, iPhone and iPad, it virtually redesigned the business of how music is commercially sold with the iTunes Store.

Great design isn’t just about products; it’s about the design of the business itself.  When you go into an Apple Store there are no visible cash registers.  Sales associates process all transactions on handheld devices (actually the iPod Touch).  Starting with the iPod and more recently with the iPhone and the iPad, Apple products have become signs of social significance for an entire generation.

On a more Virginia-specific level, think about the spectacularly renovated Virginia Museum of Fine Arts in Richmond or the Taubman Museum of Art in Roanoke.  The power of these spaces isn’t just about their art collections. These museums showcase innovation in their architectural design; they package art collections with restaurants and music, as well as community and corporate events to attract a greater audience.
The Virginia Beach Convention Center is another example of stunning design.  Its profile cuts through the sky like a ship’s prow, evoking the maritime focus of the Hampton Roads community.

Similarly, the National Museum of the Marine Corps in Quantico pierces the horizon as you drive by on I-95.  The focal point of the building is a 210-

foot tilted mast, a design that symbolizes the Marines’ role as the tip of our military spear while also recalling the iconic image of Marines raising the American flag on Iwo Jima.

At many companies, the executive suite now includes more than CEOs, CFOs and COOs.  Chief Marketing Officers (CMOs) and Chief Technology Officers (CTOs) are increasingly common.  What about Chief Design Officers (CDOs)?  Companies like Lockheed Martin, Hewlett-Packard, Marathon Oil, Ford, Intel, Procter & Gamble, Segway and Caterpillar all have CDOs, but design as a discipline like finance in the executive suite is still relatively unusual and can be a source of untapped potential.

Business design extends to more than just product design, architecture and organizational structure.  A commitment to sustainability is rapidly becoming a recruiting tool, especially for younger employees.  The growth in LEED (Leadership in Energy and Environmental Design) certified buildings provides both tangible and intangible benefits.  Flextime, wireless communications and telecommuting are other expressions of the power of business design in today’s workplace.

Another way of thinking about the design of business is through the lens of company values.  What values does your organization stand for in the eyes of employees, suppliers and customers?  How do these values differentiate you from competitors and in what ways do they make your company a more attractive place to work?

Branding is the result of emotional perceptions; business design operates on a similar level.  Brands are built from customer experiences.  Some experiences are intentional and others unintentional; some are positive and others negative.  Like having a high-quality brand, conscious leadership in business design can lead to extraordinary performance.

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