10/14/2011 03:54 pm ET | Updated Dec 14, 2011

When the CEO Pioneers Profitable Design

Co-written with Peter Phillips

Apple, Nike, Virgin, BMW, Herman Miller and John Deere -- all these successful firms leverage design at the CEO level and accomplish this through top-level strategic design implementation. So what is it that prevents non design-driven corporations from taking full advantage of design? Why is design relegated to the director level, turning their investment in design into an uncoordinated shotgun approach? The traditional perception seems to be that design is not a competitive advantage and too expensive to integrate in-house. This perception persists, despite examples such as Apple, which spends about 3 percent on R&D, or half of the average amount spent in the computer industry, while, at the same time, redefining the entire industry's design.

The reason top CEOs miss huge opportunities to spin gold from design are that design and its contributions are still not clearly understood by CEOs. Market oriented companies see design as a branding exercise in expressing the brand, while technology focused companies perceive design's job to be that of making their products beautiful. In the case of design as a marketing tool, design expresses unrealistic claims, formulated by branding, as storytelling and styling. In the case of engineering, it is simply too unimportant, little and too late. In either case, design's contribution becomes comparable to putting lipstick on a pig.

How is it that CEOs lack a clear understanding of design? Most likely it is due to poor communication from the design profession itself and a lack of metrics to back up the value of their contribution with hard facts. When designers explain their work as "tapping into the unconscious," or providing "predictable magic", they are doing themselves a disservice. To communicate and receive respect from business, they need to speak the language of business.

So, how will the CEO know that design actually delivers on its promises? Engineering and marketing can both measure their performance and back up their claims with data from calculations, simulations, tests and studies. So, when a new product fails in the market, they can clearly show that they did their job and then point their fingers at design, since designers are unskilled at defending themselves.

Since, currently, around thirty to forty-one percent of all new products fail, design is consistently shown at a clear disadvantage.

The answer is:

• Make design a part of the company culture
• Select the right design team if external have a competent internal design specialist