Nicholas Carr’s argument against peer-production of knowledge by “amateurs” has been getting a lot of attention, but I think it misses the point.

It’s not human-centered. I don’t mean that in a make the interface easy to use kind of way, but in a make it something people want kind of way. For example:

• We’re still learning that worse is better. In many cases simplicity is more important than correctness, consistency, and completeness. This is the reason Unix won out over Lisp (and then Linux over Unix), and more people read Wikipedia than Encyclopedia Brittanica. Most of the time a fast and free resource will suffice. It’s what people want.
• The algorithm that creates MP3s can make files smaller because it reproduces only the sound that humans hear and discards the rest, instead of trying to keep all the sound the microphone hears. MP3s won out over audiophile options because people like having 10,000 songs in their pocket. Most of the time a fast and free resource will suffice. It’s what people want.

Besides, these products don’t stay “worse” forever. They start simple, gain “market share” in a disruptive way, and then are improved over time. Linux has improved considerably. Wikipedia gets better every minute. AAC is an improvement over MP3. The new breed of wikis look swanky compared to the original wikis.

The ability to launch something simple and improve it over time is a huge competitive advantage for companies like Google. Can you imagine an established company having the discipline to launch something as simple as Craigslist?

The mantra is Do The Simplest Thing That Could Possibly Work.

A recent post from Jess inspired several interesting comments about who designers are really, and how to gauge the maturity of an organization’s design. Unless you really like thinking about this topic, it must seem like an awful lot of navel gazing, which is fine as that’s one thing that makes blogs useful to us: debating half-formed thoughts.

But for me — someone who wants to make an impact on my clients welfare — Jess gets to the heart of the matter when he says, “I don’t know that the term “design thinking” will actually make an impact in the boardroom…” Although I explicitly talk about design thinking on this blog, I don’t think this term will impact the boardroom, at least not directly and not in the short term. It’s esoteric, too easily confused with style/form/function, and suffers from navel gazing. It’s what we do using design thinking that will impact the boardroom. The benefits as a concept are already understood, and to activate that concept in executives’ minds — and for the community to make substantial progress — we must frame the idea of design thinking differently.

No one has framed it well yet, because we’re still discovering it. But perhaps we’re now ready to move forward.

My challenge to the community is to reframe design thinking / business design in a way that will impact the boardroom.

Here’s how I would start framing it…

1. The pace and complexity of 21st century society present formidable challenges that require us to compliment our judgement thinking with an additional way of thinking which is collaborative, abductive, experimental, personal, integrative, and interpretive (replace with your own definition)
2. This way of thinking leads us to do (fill in kinds of actions)
3. These actions benefit companies by (fill in kinds of benefits in a way that impacts profit)
4. The above can be summed up by saying, “(fill in summary in ten words or less)”

That summary is the frame.

(We could get very meta and apply design thinking to this problem, which I’ll leave as an exercise for the reader).

Organizations need to take design thinking seriously. We need to spend more time making people conscious of design thinking — not because design is wondrous or magical, but simply because by focusing on it, we’ll make it better. And that’s an imperative for any business, because design thinking is indisputably a catalyst for innovation productivity. That is, it can increase the rate at which you generate good ideas and bring them to market. Where you innovate, how you innovate, and what you innovate are design problems. When you bring design thinking into that strategic discussion, you join a powerful tool with the purpose of the entire endeavor, which is to grow.

More: Strategy by Design

Bruce Nussbaum (on his new blog, congratulations Bruce!) argues that JetBlue has pushed prices down through smart operations while avoiding outsourcing. While I agree, one could say CEO Neeleman has been outsourcing in an innovative way for years, by not housing a call center and instead “homesourcing” this function to individuals’ homes. The cost advantages come from relocating the employees geographically and lowering overhead, the same as if he sent the function to India (but without the political backlash).

I don’t know how Neeleman arrived at this idea, but this is just the kind of solution I think can come from good decision design, of creatively generating further ideas in the face of convention to arrive at new and better options.

My friend Jess and I have shared hotel rooms at two recent conferences, where he gently challenged and explored my thoughts on design and business. He’s smart, humble, and dedicated, so I’ve taken his skepticism seriously and use this space to address the criticism he offered. I’m happy to see he’s now doing the same on the bplusd blog, where I’m looking forward to hearing more from him.

Bob Lutz explains plans to centralize their design and engineering budget and what that means for building automobiles worldwide…

We expect a reduction in our architecture count over time of 50% as we introduce more converged architectures replacing the regional architectures we have today… For example, as we develop our new global mid-size architecture, which will replace such vehicles as the Opel Vectra, Chevy Malibu, Pontiac G6 and Saab 9-3, we’ll realize significant savings as a result of this new system. We’ll move from three closely related regional architectures to one global architecture serving nine different models in all four of our regions. We expect a 40% reduction in our prototype builds, a 20% reduction in material costs as a result of the common components, and 25% reductions in both engineering costs and overall investment. That one program alone could save us more than $1 billion over the course of its lifecycle.

Having just drove an Opel Meriva in Italy, a mini minivan not available here in the U.S., I can see the wisdom in leveraging great architectures worldwide. But we’ll have to see if a Saab is still a Saab when it has a Chevy chassis.

I added another quote — notably from a woman — to the Design Thinking and Business page, courtesy of Madelon Evers… “…To achieve superior design thinking in business, we need to facilitate learning from design across organisations.”

Malcolm Gladwell recently gave the keynote at the American Association of Advertising Agencies’ Account Planning conference in Chicago. It’s excerpted on Advertising Age ($). If you’ve worked in design or product development (or read “Blink”) you know the drawbacks of focus groups. But what Gladwell does here is describe the solutions as ones of management. Not surprisingly, I agree.

Here’s the ending…

Now think about the Aeron chair. [The focus group participants] say they don’t like the chair, of course they don’t. The chair is nothing they’ve ever seen before, but that was the whole plan in designing the chair. But that’s what’s wonderful about it, that’s why this chair will make billions of dollars for Herman Miller, but it’s also what dooms that chair in the focus group, because people don’t have the language.

Market research, when it is observational or when it is interpretative, is profoundly useful. But those are two critical things. They require the intervention of the person conducting the research. They require the findings that are gathered are considered, and thought about, and processed and interpreted. Back in the 1950s, most of the major advertising agencies on Madison Avenue employed Freudian psychoanalysts for this precise reason, and you don’t see that anymore. I think that’s a big mistake.

This understanding about what’s so terrible about focus groups ought to pave the way that we manage people. First and foremost, it’s very important for management to trust the creative talent.

The second thing is patience. The more breakthrough, the more revolutionary and the more innovative an idea is, the longer it will take for people to come to appreciate it.

The third thing is it requires people in management to tolerate uncertainty. The thing that’s driving all this focus-group and market-research data is the desire of people with the management power to make every decision as methodical and thought out and certain as possible.

Two recent thoughts on designing decisions, one good semantic point from my partner John in the RSA Journal…

John Zapolski, a San Francisco-based principal of the Management Innovation Group, believes there is “increasing importance in using design as a framework for organising decisions that people make”, citing, alongside the work of his own company, that of innovation consulting group IDEO. He is keen to differentiate designers from design, implying that the people who use these methods may not be called designers.

And another general observation in BusinessWeek from Roger Martin of the Rotman School of Management…

If decision production is such a big deal, corporations should be paying very close attention to design of decisions — as much or more attention than they pay to product or service design. In my experience, they aren’t. Corporate decision factories feature extremely low-quality decision design.

Max recently asked, “I’m wondering how to apply these insights in practice: How can I, as a designer, go about changing a culture that does not promote innovation…?” So I’ve been trying to isolate concrete examples to share from the times I’ve been successful.

Earlier this year I taught a workshop to a department that wanted to improve their level of collaboration. A big reason they couldn’t be innovative was the lack of people working together. We formed teams and all worked to design something small and familiar enough to finish in two days: a better stapler. The collaboration, iteration, prototype making etc. we used were all new to them. At the end someone suggested coining a trigger word that would jolt them into this new way of working when they felt themselves falling into old habits.

I met my client for a coffee recently to see how they were doing. She told me the team decided to use the word “stapler” as their trigger word, and use it to spontaneously convene collaborative work sessions. Now when someone uses the trigger word, they pull themselves away from deep document writing, remember the lessons from the experiential workshop, and work in more collaborative ways.

Recently I wrote about those times when a company’s strategic plans are almost inseparable from their tactical execution. I know I keep gushing about Neeleman and JetBlue, but I’m constantly impressed with how he integrates strategy and delivery. The DirecTV onboard satellite television is a good example. At the beginning his executive team was against it: it was expensive, and (beyond Air Force One) an unproven technology. But Neeleman saw the connection to his strategy and pursued it. At both the strategic and tactical levels he pushed for lean, progressive use of technology that would not only reduce costs but improve the customer experience. In this case, the medium-haul flights were too brief for movies but a perfect fit for TV. JetBlue developed a close relationship with the manufacturer to get it working right, and later bought them out. They now license it to other airlines, creating a whole new revenue source for the airline.

And as you can imagine, there are as many examples where a company doesn’t create a good fit between strategy and the points of delivery that bring the strategy to life. I summarized my thoughts on my company’s recent experiences in these cases in a new essay, Strategic Delivery Points, also available in printer-friendly PDF format.

LukeW compares what’s being said about traditional business approaches vs. a design approach. It’s a handy reduction of the current writing.

And while this is certainly useful, I hope we can reach a point where business/design becomes a false dichotomy. Both columns of appoaches can simply be tools in one big business design toolbox for solving all sorts of business problems.

Google vs. Yahoo: Clash of Cultures helpfully contrasts the cultures of both companies and how culture influences future performance….

As the two giants tussle for domination of online advertising dollars, it’s increasingly clear that this tug-of-war is really a test of what kind of corporate culture an Internet company needs: Is it a by-the-numbers and increasingly Hollywood-savvy environment like Yahoo’s? Or can an intellectual playground like Google continue to grow and thrive even as it approaches $4 billion in annual revenue?

It’s hard to agree more with the usefulness of examining the situation through this lens (and express pleasant surprise this sentiment comes from a techie site). An organization’s outward displays of innovation and operations are only symptoms of their health; culture is their heart. My business partner John gave a presentation recently making this point, illustrating the back-and-forth change ripple effect between product, process, and culture: Design [is not a] Strategy (.pdf).

Unfortunately, it’s not as simple as hiring a chief design officer and declaring design as your top corporate priority. To generate meaningful benefits from design, corporations will have to change in fundamental ways before they can operate like the design consultancies who advise them on how to sharpen their design focus. To get the benefit of design, companies have to embed design into — not append it onto — their business.

from Creativity That Goes Deep by Roger L. Martin, Dean of the Rotman School of Management. It’s exactly the kind of thing we like to do.

I’ve heard some skepticism towards business design, which is healthy and quite justified given that no one has shown concrete examples of it yet. One reason for this is that examples are difficult to describe; the application of design thinking to business situations is highly contextual and — as the name states — has much to do with how people think.

I recently encountered a situation where I thought design thinking could improve a problem-solving process. It’s small and simple, but often difficult to put into practice because it challenges the way organizations work.

Let’s say a mail order company’s Customer Service group reports that an usually high number of products are being returned. Someone in management might request some data and generate a hypothesis about what is happening. Then they might come up with an idea for fixing it and implement the idea. Or, maybe two good ideas are analyzed and the better one is implemented, thusly:

Another way to process this problem is to consciously inject elements of design thinking into it. Starting with the data, the manager could collaborate with a partner or a team and use creativity techniques to abductively generate several hypotheses for what is causing the unusually high number of product returns. They could then run an experiment and test the best hypotheses with customers to understand the unique and personal issues behind the problem. With both quantitative and qualitative information in hand, the team starts to integrate this information and interpret it while creatively generating a number of possible solutions. The solutions are analyzed for potential and tested with customers, and the best one is launched.

The second approach is unquestionably more work, but strives to find a better answer with less risk. Remaining agile is all in the execution.

This isn’t new or radical thinking, it’s just new and radical for organizations whose cultures are suffering and need to change.