Focus on design management
Irene Au interviewed by Bettina Schulz
Design as a strategic boost
Successful brands may differ in their thematic orientation, objectives, and appearance, but they share a foundation: integrating design processes into their respective long-term business strategies. Ideally, all planning, development, and ultimately implementation is based on sound design management that conciliates each design and communication tool with the company’s goals and, not least, the market’s requirements. From the overarching strategy to project management and quality assurance, the goal is to leverage the power of design and coordinate measures precisely.
Written by Jan-Erik Baar and published by bayern design, the Studienbericht zur Designfähigkeit (Study Report on Design Capabilities) shows how the value of design concretely impacts the development of companies and brands. Baar makes it clear that design by no means is a decorative add-on; it is a part of the company’s strategy that must be supported by each department.
The need for specialists of a hybrid nature
While full-blooded designers are less likely to feel comfortable with the spectrum of design management tasks, born managers are required to bring to the table an understanding of design and its impact. To foster innovation and achieve targeted added value, resorting to third parties for support with this special part of establishing design management may be advisable.
Irene Au is familiar with these processes from both perspectives. She organized experience and design teams in technology corporations including Google, Yahoo!, and Udacity User and managed them for many years. As a design partner at Khosla Ventures, Au currently helps CEOs of start-ups gain a better understanding of users’ needs. Her goal for every project is to increase the strategic significance of design in companies and establish better methods and processes to do so. In her book Design in Venture Capital, Au explains how design management processes are initiated externally and describes the role of strategic design management in capital procurement activities for start-ups. During the interview, the expert discussed global changes and the advantages of concentrated design management.
Irene Au interviewed by Bettina Schulz
Bettina Schulz: In your book ‘Design in Venture Capital’, you explain the role of design partners who advise CEOs but do not provide any practical design services. Is this a new development or an existing ‘model’ that is becoming more and more prevalent?
Irene Au: The role of design partners in venture capital represents an evolving model that has gained more prominence in recent years. The integration of design thinking in business strategy has been around for decades, with companies like IDEO popularizing the concept of design thinking in the 1990s. Traditionally, venture capital firms focused primarily on financial support, strategic guidance, and business development for their portfolio companies. Design was often considered an afterthought or a secondary concern.
As markets have become more competitive and user experience has become a critical differentiator, the role of design in product development and business strategy has gained importance. Recognizing the strategic value of design, VC firms have started to integrate design expertise more formally into their advisory services. This shift reflects a broader trend towards holistic support for startups, beyond just financial backing.
The formal role of design partners in VC firms has become more common over the past decade. These professionals bring expertise in UX, product design, and design thinking to help startups develop user-centric products and services. Design partners typically focus on advising and mentoring CEOs and leadership teams on how to incorporate design principles into their overall strategy, rather than providing hands-on design services. This aligns with the advisory nature of most VC support, which emphasizes strategic guidance over operational execution. Leading VC firms like Khosla Ventures, GV (formerly Google Ventures), Kleiner Perkins, and Sequoia Capital have embraced this model, employing design partners to enhance their portfolio companies’ success. The success stories of these firms have encouraged others to adopt similar roles.
What makes good design management so valuable and, above all, profitable for brands and companies today?
Good design management is valuable and profitable for brands and companies today for several reasons:
- Competitive Advantage: Effective design management helps create unique and innovative products or services that stand out in the market. This differentiation can lead to a stronger competitive position.
- Customer Satisfaction and Loyalty: A well-managed design process focuses on user-centered design, ensuring that products or services meet the needs and preferences of customers. Satisfied customers are more likely to become repeat buyers and advocates for the brand.
- Brand Consistency and Strength: Design management ensures that all design elements align with the brand’s identity and values, creating a cohesive and recognizable brand image. A strong brand can command higher prices and foster customer loyalty.
- Efficient Use of Resources: Good design management optimizes the use of resources, including time, money, and talent. By streamlining processes and reducing waste, companies can achieve better results with fewer resources.
- Innovation and Growth: By fostering a culture of creativity and innovation, design management can lead to the development of new products, services, and business models. This innovation drives growth and keeps the company relevant in a rapidly changing market.
- Market Responsiveness: Effective design management enables companies to respond to market trends and changes quickly. Being agile and adaptive can help seize new opportunities and mitigate risks.
- Enhanced Collaboration and Communication: Design management promotes cross-functional collaboration, ensuring that different departments work together seamlessly. This holistic approach leads to better decision-making and more integrated solutions.
- Improved Quality and Consistency: Consistent design quality across all touchpoints enhances the overall customer experience. High-quality design can reduce errors, improve functionality, and increase customer satisfaction.
- Financial Performance: Companies with strong design management often see improved financial performance. Good design can lead to higher sales, better profit margins, and increased market share.
- Sustainability and Responsibility: Incorporating sustainable design practices can enhance a company’s reputation and meet the growing demand for environmentally responsible products. This attracts customers and can also lead to cost savings and compliance with regulations.
BS: Does good design management extend beyond brand management?
IA: In summary, good design management is not just about aesthetics; it’s about creating value across the entire business. It aligns design efforts with business goals, driving profitability and long-term success.
BS: Is the first step always that companies simply have to redefine the term design?
IA: Redefining the term “design” within a company can be a crucial first step, but it’s not necessarily the first step for every organization. The necessity and timing of this step depend on the company’s current understanding of design and its integration into the business strategy. Broadly speaking, companies might start enhancing their design management by first evaluating perceptions. How is design currently perceived within the organization? Is it purely aesthetics, or is it recognized for its strategic value? If design is narrowly defined, design leaders must expand its definition to encompass strategic, user-centered, and business-aligned aspects. This broader definition should be clearly articulated and demonstrated to all stakeholders, from top management to individual team members.
Design goals need to align with overall business objectives to ensure that design efforts contribute directly to business success. Design thinking should be embedded early in product development and decision-making stages. Encourage a culture of design thinking across the organization to foster creativity, empathy, and innovation. Hiring and developing talented designers who can drive the design vision forward is crucial.
Once these changes have been established, the design team can develop and standardize design processes to ensure consistency, efficiency, and quality, with regular review and refinement of methods based on feedback and performance data.
It is important to regularly communicate the successes and impact of design initiatives to reinforce their value. Recognition and celebration of the contributions of design teams help build morale and encourage further innovation.
Design Thinking
Design thinking is not a singular creative method; it is deemed to be a systematic approach based on both human-centered solution orientation and productive multi-disciplinary cooperation. Originally devised as an innovative product development method, design thinking has expanded to cover all areas of creative challenges.
“In summary, good design management is not just about aesthetics; it’s about creating value across the entire business. It aligns design efforts with business goals, driving profitability and long-term success.”
BS: Can design management also function purely internally or is an external perspective indispensable?
IA: Design management can function both purely internally and with the inclusion of an external perspective. The chosen approach depends on the organization’s specific needs, goals, and context.
Purely internal design management has the advantage of having deep organizational knowledge, with the context around the company’s value, culture, and goals, which can lead to more cohesive and aligned design strategies. There is easier and more direct communication among team members and departments, fostering collaboration and quicker decision-making. Internal teams are more invested in the company’s long-term success, leading to more consistent and sustainable design strategies. They are also better positioned to handle sensitive information related to the company’s goals and strategies.
However, internal teams might become insular, leading to a lack of fresh perspectives and innovation. They may have limitations regarding expertise, skills, and resources compared to specialized external agencies.
External perspectives bring new ideas, trends, and best practices from other industries and markets, fostering innovation. External agencies or consultants often have specialized skills and experience that might not be available internally. An external perspective can provide an objective assessment of the company’s design strategies and identify blind spots or areas for improvement. Resources can be scaled up or down based on project needs, providing flexibility without a long-term commitment.
Working with external partners is not without its challenges. External partners may not understand and align with the company’s culture, values, and strategic goals. Differences in communication styles and processes can lead to misunderstandings or delays. Hiring external agencies or consultants can be costly, particularly for long-term projects.
While design management can function purely internally, incorporating an external perspective often enhances innovation, expertise, and objectivity. Many companies may employ a hybrid model that leverages the strengths of both internal teams and external partners, ensuring a balanced and comprehensive design strategy.
“The basic principles of positioning, image building, and brand development are fundamentally similar across the world, but their application can vary significantly depending on cultural, economic, and social factors.”
BS: What requirements do I need to fulfill to take on this advisory role? What background is recommended — is it more of a business or creative nature?
IA: Taking on an advisory role in design management requires a unique blend of skills and experience from both business and creative domains. Degrees in fields such as graphic design, industrial design, user experience (UX) design, or other design disciplines provide a solid foundation in design principles and processes. Practical experience in a design role, such as a designer, design leader, or creative director, is crucial. Understanding the design process, challenges, and nuances from a hands-on perspective is paramount to gaining credibility and offering practical advice. Experience in leading teams, managing projects, and making strategic decisions is also important. This could be in either a design or business context.
BS: You are based in the USA, but of course work for international clients: Are the basic principles of positioning, image building and brand development the same all over the world?
IA: The basic principles of positioning, image building, and brand development are fundamentally similar across the world, but their application can vary significantly depending on cultural, economic, and social factors.
Basic principles of positioning include identifying the target audience, understanding competitors, defining a unique selling proposition, and crafting a compelling value proposition. Basic principles of image building include creating a consistent messaging and visual identity, delivering on brand promises, building trust and credibility, and engaging with th audience through various touchpoints. Basic principles of brand development include establishing brand values and mission, creating brand guidelines and identity, developing brand communication strategies, and monitoring and evolving the brand over time.
While the core principles remain consistent, the application of these principles must be adapted to fit local contexts. Different cultures prioritize different values and beliefs, which can influence brand messaging and positioning. High-context cultures (e.g., Japan) may rely more on implicit communication, while low-context cultures (e.g., the United States) prefer explicit messages. The meanings of symbols and colors can vary significantly across cultures and can affect brand imagery and perception. Economic conditions affect how brands position themselves in terms of pricing and value propositions. In mature markets, brands might focus on differentiation and innovation, while in emerging markets, awareness and education might be the priority. Social trends and norms influence consumer behavior and preferences, requiring brands to adapt their image and messaging accordingly. Different regions have varying dominant media channels and consumption habits, affecting how and where brands communicate with their audience.
The basic principles of positioning, image building, and brand development are universal, but their successful application requires sensitivity to local contexts. Brands that understand and adapt to cultural, economic, social, and regulatory differences can effectively establish a strong global presence while maintaining relevance and resonance in local markets.
Further reading: Irene Au: Design in Venture Captial. Sebastopol, 2016
Recommended citation: Bettina Schulz (18.08.2024): Designmanagement im Fokus: Irene Au im Interview mit Bettina Schulz, https://bayern-design.de/beitrag/designmanagement-im-fokus