Recently, Thomas Lockwood published a thoughtful piece that hit close to home, detailing several hard realities design firms are facing today. As the CEO of gravitytank, an innovation consultancy, I can say that we are not exempt from these challenges.
However, I’m happy that he has created a public conversation around issues that we’ve been discussing with our clients for a while now.
DESIGN FIRMS HAVE ALWAYS ADAPTED TO SURVIVE
While these pressures are very real, gravitytank and our competitors are no strangers to category disruption. In my 25 years of experience, I’ve seen design firms forced to repeatedly reinvent themselves.
In the late 80s, traditional industrial design firms joined engineers to create development, an offering that fused the beauty and planning of art with the rigor and quality of engineering. In the 90s, customer research was popularized, paving the way for user-centered design. In the early 2000s, user-centered design was combined with acumen for business strategy, and innovation consulting was born.
Now, it’s time to reinvent again.
THE PRESSURE IS ON
We believe that Lockwood’s assessment is largely correct. First, design is being in-housed. Some of our clients’ own design spaces are starting to look cooler than our own. Even the most traditional manufacturing cultures are beginning to hire fresh and innovative minds.
Second, design as a skill is far more evenly distributed among different professions. Management consulting firms, advertising agencies and hungry young teams of freelancers with diverse skills compete for the same business.
Third, design firms and designers are no longer differentiated by limited supply or title alone. The great rise of the design economy has brought many more professionals into the field. Like all other mature industries: engineering, architecture, management consulting, healthcare, differentiating through words alone is impossible. Reputation, quality service to clients, growth over time, and yes, reinvention, is what will separate the long-term winners from those who fade away.
GOOD IDEAS ARE NO LONGER GOOD ENOUGH
The piece of the article that’s not totally right, however, lies in the claim that design firms are stagnating because corporations are integrating design thinking to make their strategies real.
Companies are doing that, but design thinking alone is not enough to bring new products and services to market. Many have tired of too much thinking and not enough doing. In fact, the article discusses factors that are challenging our category, but none of them are the root cause of why design firms need to reinvent themselves again.
The real reason design firms are stagnating is because on average we are not guiding ideas from inception all the way to reality.
15 years ago clients wanted walls full of concepts. 10 years ago they started testing them more rigorously. Now, startups are able to create a real product or service and enter the market with astonishing speed. As a result, our clients are asking to supercharge their abilities in getting good ideas to market. Furthermore, “ideas” are no longer neatly grouped in product, digital, or communications. Ideas need to be holistically considered, with every dimension coordinated as part of the solution.
Many firms are flailing because their best tools and methods are aimed at opportunity identification and generating great ideas, but ideas aren’t enough anymore.
Organizations need help constructing a path from design thinking to market entry. They need help shepherding new products and services into the world even when champions leave, stakeholders get embroiled in politics, and short-term P&Ls must be managed. They need help being lean, relentless, and resourceful.
IT IS TIME FOR A NEW KIND OF DESIGN FIRM
The future of design firms lies in the creation of new capabilities that help their clients behave with the boldness of startups to incubate visions that they’re most excited about — initiatives that combine creative DNA with the determination of execution.
To get there, design firms and clients need to:
1. Address innovation as a cultural challenge, not an operational one.
Help organizations adopt behaviors that support true collaboration, alignment, and a bias for action, as opposed to running through the motions of a “rigorous innovation process”
2. Find lightweight, fast ways to launch, shape, and validate ideas
Introduce scrappy, data informed experiments to validate new products and services, using real human behaviors as the key metric
3. Organize and manage innovation portfolios, not individual initiatives.
Manage the risk associated with innovation in ways proven by startup and investment theory. Align initiatives with corporate strategy, and diversify project risk through size, approach, and laddered investment.
Our industry, like every other, is in a time of change. Of course, change means opportunity for those who are thoughtful, bold, and entrepreneurial enough to grab it. It’s not time to panic or double down on what we already know how to do well — it’s time to help create the new age of innovation.
— — —
Originally posted on the gravitytank blog.
gravitytank is an innovation consultancy helping our clients grow their businesses, define new products and services, enter new markets and change their organizations. We’re out to make an impact on the world.