Design-Focused Business
A review of ‘The Design of Business’ by Roger Martin
Why do certain companies succeed while others fail? Why do companies that had *exactly* the right product at the right time ten years ago seem to continually fail at making good products today? Roger Martin’s answers these perplexing questions in ‘The Design of Business’. In this book Martin says that the companies that have a “design-focused business” are going to be able to evolve and stay on top of new customer needs and thus create the right product for the right time.
Martin puts design and design thinking as the critical element of business success. In the book he explains that successful companies start by solving a particularly difficult problem once, and then figure out how to solve it with a repeatable method. Then, the company is able to translate the repeatable method into code and scale the solution for mass consumption. This progression is shown in the diagram below as a company moves their solution from Mystery, to Heuristic, to Algorithm, and finally to Code. In Martin’s mind, this is the natural progress of a business as it solves problems and attempts to scale and become efficient.
Martin’s funneling method works for each “mystery” that a company attempts to solve and explains why some products meet the current needs: each product represents work that takes a large amount of time and money and if companies aren’t constantly evolving new solutions they are going to fall behind the times. Businesses need to be constantly solving new problems. And if they fail to evolve they will fail as a company.
When you look at the big companies that have failed in the past, you can see that they grew complacent. They sat on their laurels and thought that what they created was going to be the best solution forever. That made them vulnerable to the “disruptive” upstart innovations that ousted them from their thrones. (Think Blockbuster meets Netflix, or Taxis meet Uber.) In contrast, companies that have a design focus are constantly going back to their source of inspiration and creating new and better products that keep them current.
The second crux of Martin’s argument on is the balance between the stable reliability of iterating on successful designs with the validity of creating new solutions to additional mysteries. Companies look at the numbers to try and make shareholders happy; shareholders like reliable solutions. However, reliable solutions age. They age because they stop being valid to the current problems that customers are solving. However, to solve current problems takes time, money, and effort; all things that shareholders do *not* like. Overall, Martin argues that there has to be a balance between the two if a company is going to be successful. The examples of timely solutions Martin gives are P&G’s Magic Eraser (which came out of P&G rethinking their design strategies and moving away from reliable methods) and the business model of Southwest Airlines (which was a disrupter company showing that a new way of thinking can mess up reliable models of business).
Design Thinking is explained when Martin discusses how designers approach problems by constantly trying to solve new mysteries and create new solutions. (At this, I was like, ‘Hey! That is a stereotype’. But then I moved on to try and see the bigger picture.) Designers are always attempting to be more and more ‘valid’. That is why designers are the key to keeping businesses fresh and relevant when the natural inclination is to be reliable.
Design is a hot topic. I can’t throw a stone without hitting someone talking about design as a business model. For instance, Fast.Co came out with a recent article on the Yale School of Management & Design. And there was a recent podcast from TED on design thinking:
So what does this book add to the conversation? The Design of Business does a great job of highlighting the importance of design thinking. Design thinking belongs in more departments than R&D. It is a fundamental point of view that impacts how companies are going to invest and evolve. This argument was the first time I’d heard someone advocating for including design thinking so fully into a business, and it was refreshing. High-fives for designers!
What Martin does a great job of is explaining how design thinking has impacted large companies. Martin shows how companies that were stagnant were able to take a “design thinking” point of view and change how they operate to become successful. In the book he gives multiple case studies and covers the history of P&G in a good amount of detail. These stories were definitely the most enjoyable part of the book and provided some great insights into how design thinking can impact a company from big to small.
Martin also does a great job of explaining why design thinking is the atypical method that companies have adopted for success. He does this with a much better description than the summary I provided above and he does it by showing how companies use their R&D budget to invest in design thinking. I thought that this explanation was a great introduction to thinking about business modeling from a new perspective and helps explain why design thinking is an important part of success.
Unfortunately, Martin doesn’t do a great job of describing Design Thinking. But luckily for everyone there is a whole Wikipedia page dedicated to the subject and it does a much better job. (I personally like Simon’s Science of the Artificial, which is the first book reference in the article.)
Also, I wish the book discussed businesses that don’t have products but instead are a services oriented companies. For instance, I work as a government contractor where my company offers services to build usable and beautiful software. The products being created are not being driven by internal R&D groups. In a way, the products are the people themselves. How does Martin’s model change in that scenario? In general, I would have liked more discussion on different kinds of business models and how Design Thinking plays a role.
The other part of the book that I was not such a fan of was all of the talk about trying to get analytical people and designers to play well together. Maybe it is just because I work at a great organization where this isn’t a real problem, but I was a little annoyed at the tone these sections took. Telling people to learn how to speak each others language (which was the basis of Martin’s advice) may help, but I think that the advice was lacking if there were really problems between the two departments.
So, I don’t think that this is the book for people who already “get it”. But if you are looking for a book that is going to help you evangelize UX to your boss, than this is a great book for you to take a look at. I think it speaks really well to people who are in management. And, it does a really good job of introducing the topic to people who need convincing.
Book Club Questions
- Does your organization adopt “Design Thinking”? How?
- What does “Design Thinking” mean to you? Your organization? How do they differ?
- Does the analytical and design sides of your business get along? If not, what methods have you used to be successful?
- Have you had to sell “design thinking” in your organization? What happened?
