Looks like Innovation moves Markets, not Design

Image: Economy of Innovation by Smart Design. Click here for a larger size.
When I first saw this interesting illustration created by Smart Design, it did not resonate with me. Thus I only forwarded the image via my usual Twitter link love and spent the rest of the week thinking about it.
What threw me off was Bruce Nussbaum’s comment on the image which was, in his usual fashion, off the mark. Sorry Bruce. He wrote:

Design was born as Design Strategy to help guide CEOs in an unsettled and turbulent era. It morphed into decoration, then usefulness and now—back into Design Strategy once again in a period of uncertainty.

Being a designer, I would so love to embrace his comment as the truth. Unfortunately it is not. In my opinion, he should should have read the title of the graphic first: Economy of Innovation. If you look carefully at the Dow Jones stock chart, it looks like the key drivers of the first Bull Run are the TV and the automobile. In the next Bull Run, it was actually not the Mac, but the microchip that allowed for the desktop computing revolution. I did miss the internet at the top of the stock chart though. But if we did follow Bruce’s reasoning, it looks like Raymond Loewy and the iPhone are causes of the current economic crisis!
However if now we take a step back and look at the chart again, we can clearly see that Innovation not Design is key in driving the success of an economy. Let’s not discount Design totally though, I think Design did have an important role in delivering the innovation to the consumer in a meaningful way.
Now, I like to ask you this? To get out of this economic crisis, should we focus less on styling or the next iPhone, and instead look to create innovations like the microchip or automobile that can really change people’s lives?
Sadly most designers including myself are guilty of the former. Food for thought nevertheless?

  • DuyLam

    October 6, 2009 at 2:16 am Reply

    very true – your comment makes me think of the creator of preparation h or it maybe it was a ceo or somethin..
    anyways there was a journalist or blogger who was with the prep. h creator and they were skiing and the creator pulled out a tube of the stuff and used it as lip balm!
    what a great overt benefit for something that’s used for hemorrhages
    i love your blog btw. it makes me wish i went to a school that would let me major in business & design

  • DT

    October 5, 2009 at 5:42 pm Reply

    @Duy Thanks for your comments and nice to see a commercial view point.
    The reality is how you define innovation and the relationship of both. An innovation could also be defined as a known product used in a different environment or context.
    The objective of this post was to remind designers that we sometimes get a bit too caught up in our work to really see in perspective of what the game changers are.

  • Duy Lam

    October 5, 2009 at 12:59 am Reply

    hey DT
    coming from a business student with a savvy for design i can see what you mean. it’s as if design is now form without function and as some of the commentators have said innovation and design go hand in hand at least from what I’ve seen.
    but i noticed with objects with the iphone and other smart phones there is just a huge collision of objects and functions in one device. now some may call this innovation, but i think this, for lack of a better word, well thought out anomaly has mutated far from innovation and is now the norm, just like designing small devices.
    so what i think you said is right. majority of designers have committed the former, but i think to even ignite the latter idea of innovation, the designer must be in conjunction with the others who make innovation happen e.i. businesspeople and engineers. think of Toyoda’s “T” metaphor
    but again this is from someone who does not know the inner workings of design

  • DT

    September 29, 2009 at 11:23 pm Reply

    Hi all, great discussion going on, thanks for sharing.
    Jason and Shahar, something went wrong with some of your comments, it went garbled so I had to delete them. Please feel free to update them again? Sorry for this.

  • Arun Raj

    August 23, 2009 at 11:08 pm Reply

    Hi guys, I am not a designer, but I am quite interested in design, creative and innovation.
    The first three comments were quite thought provoking, and it made me think for a moment. But I later realized there seems to be a confusion in the way design and innovation is understood here. Here’s my view:
    Invention is ‘creation of something (usually a technology) that doesn’t already exist’
    Innovation is ‘creation of a new way/use of an invention usually making it more useful to meet the need and demand.’ Simply said, this might be a modification of an existing product, or idea to meet a need or a future need. Like we say, “let’s innovate on this product” or “let’s innovate in our action” … what is actually meant would be to have a new way of doing/using something.
    Design. Well, for this, lets go left on the timeline. Initially, when we said, the team should design a product, it meant the team should be looking into:
    1. who is going to use the product?
    2. what are the features of the product?
    3. what could be the features of the product?
    4. what kind of technology is going to be used?
    5. how the product is going to look?
    6. how can we integrate all this so that the efficiency of the product is maximized.
    well, later design drifted into art, and graphics. And as Johnathan mentioned, more of the look, rather than the attention paid to the details. Design as reached a point, where people look into it as just the way it looks. But this is only from the point of view of the general crowd. I am sure in a Design Graduate would be thought, of the different elements are involved. When a website is designed, others might just remark on the visual appearance and rate the design. But, it would involve more details, like the placement of the elements. Its more about WHERE and HOW an ELEMENT is placed in the space provided, that gives it the necessary PRIORITY. Its about how the designer gives importance to studying the priorities and directing the viewers eyes the way he wants.
    Speaking about Apple, Robb was saying about perfect marketting rather than Design, while Jonathan was referring on how beautiful Apple paid attention to details.
    Considering Apple, they are known for their design and simple approach. In all their products, its about reducing the buttons on a device, placing the ‘play’ button/ hold button, just under our finger tips, at exactly the place where our mind would go for it. And its NOT that this was accidentally placed. IT IS WHERE IT IS, BECAZ IT WAS DESIGNED TO BE WHERE IT IS.
    Apple was and is always effective in knowing what the market needs, and effective in Designing their Product with lesser complications and with exactly what the consumer needs.
    hence, they are NOT Inventing! But they are Innovating, in bringing out the complex technologies, in a simpler way to the common man. While adding to the style, the also make it USEABLE!
    A I guess a more better example would be FACEBOOK. Compare it to Orkut. Facebook did NOT Invent Social Networking concept. But they Innovated in it, by paying attention to the details of a user using it. They innovated by Engineering in it! Everything seems to be placed at the place where we need it. And this is a result of Innovation (to engineer every aspect) and the Design ( to place the content )…
    I guess, you guys to comment on the topic of the blog::::: Innovation does NOT move the market. Neither does Design… What moves the market would be:::
    Innovating in Invention, and then Designing the Innovation
    Arun Raj

  • Ricardo Freitas

    July 25, 2009 at 9:23 pm Reply

    Seems to me some people are mistaking cientific breakthroughs with innovation…

  • shahar Klein

    July 25, 2009 at 2:35 pm Reply

    Agree with most Tenirol’s post.
    Industrial Design is not a leader but collaborator…
    Last time I was led/leading so called innovation we (as in the client and me) came with a (really!) wonderfull product they couldn’t sell…

  • Tenirol

    July 25, 2009 at 1:05 am Reply

    … design was led to styling by taking the place offered by marketing. Wahoo!
    What about the idea to bring a new business model with the Apple Store ? This is strategic marketing ! What about the way Steve communicates ? This is communication marketing ! What about the strategic alliance with leading cell phone companies ? Strategic marketing again. For the “sexy GUI” and the innovative functionalities, it’s surely R&D, design, industrialization and product marketing alliance which made the product. But without innovation in marketing (strat

  • Tenirol

    July 24, 2009 at 10:25 pm Reply

    In my view, this graph is misleading us as designers. Although very interesting, I think your question about what sort of innovation we should favour needs to be seen from a different angle.
    Because we are technicaly minded, the title “An economy of innovation” is misreaded. In the curve, the innovation which is demonstrated is the “financial innovation”. It was initiated in the mid 1980’s. Before, there was a clear distinction between short and long term company financing. As a result, companies started to raise more and more funds in order to give huge multiplier to the investors, who were keen on having more and more innovative financial tools to “sale the risk” they were taking (everybody knows the result) …
    Hence to me, this graph shows us something which has little to do with the real wealth created by technical innovation. If you wantt to be convinced, just look at the sharp raise the daily volume of the transaction DJ has since 1985, and compare it to the GDP growth… which IMHO translates much more the added value of technical innovation than the DJ does.
    But you need to raise capital to invest in “deep innovation”, while “design” innovation may be affordable to any company…
    Going back to the graph, what is interesting to see is what happened for 20 years (65 till 85), before financial innovation initiated a new technological investment capability area. During that period, design, not deep technological innovation was funded by companies. Who said technology, design, economy and politics are separate issues when creating value is at stake ?
    Just think about the G20 summit (beginning of 2009). Who was saying that traders should no longer be allowed to get commission above 1M

  • designnatin

    July 24, 2009 at 9:36 am Reply

    I beleive innovation and design comes hand in hand. You can have the best computing technology but if the experience is worst, then it will still defeat the purpose of giving people lives easy.

  • Robb

    July 24, 2009 at 5:16 am Reply

    I agree with the post that there’s a core difference between innovation and design. There’s also a crossover zone, where innovation meets design. But what drives what, and who does what, is what drives me nuts about designers. They simply think they drive everything.
    In the early 90s I saw a design gallery in which leading designers each picked their favorite “design innovation.” Harmut Esslinger chose a Coke can. Through design engineering, Coca-Cola had downsized the top of the container, and included 3 ridges for structural stability at the rim, allowing a thinner wall thickness and thereby a much more efficient use of materials. While everyone else chose objects of beauty, Esslinger chose an object of utility with a far greater impact on world consumption of resources than all of the other designers’ choices put together. He chose an object of “design innovation” born out of a need to conserve dollars and resources. It wasn’t pure innovation (if you define “pure” as “disruptive”), but unlike his peers, Esslinger got what “design innovation” is. Even if his example was likely from the mind of a packaging engineer, not a designer.
    As per the last blog reply, the designer’s aim to create value and improve people’s lives doesn’t change, or shouldn’t change, but the fact of the matter is that socioeconomic drivers affect us all. In a bubble economy, we want to spend our extra money on superfluous “objects of desire,” and in a depressed economy, we trend toward “objects of utility” with an occasional attempt to escape our economic reality through minor superfluous objects. My guess is that name-brand designers like Rashid aren’t doing the kind of business today that they would in years past, because of their market association with “objects of desire.”
    I disagree with Jason on one point. How has the iPhone really changed people’s lives? It hasn’t. Networked computing has. Now networked computing comes in a small handheld package that people can understand how to use. Engineering enabled that, not design. Design helped with the understanding part. Marketing is what really made the difference: to create ubiquity of the object in the marketplace.
    The iPhone is also a relative anomaly which fits nicely into that psychological drive to escape our current economic reality: a high-end “object of desire” within a cloak of simplicity, originally introduced in a relatively stable economy. It is not a $70,000+ car, yet like that car it provides a feeling of luxury relative to its competitors, while enabling the end-user to justify the $300 purchase with its utility. It’s real brilliance is in the $30/mo. internet fee. Otherwise, no one would buy it for $1100-$1500, even though that’s what we’re really paying for it over a plain old mobile phone. It simply doesn’t provide that kind of financial utility. It’s not even innovative. It’s just brilliant marketing, great engineering, great design engineering and pretty simple design.
    People look at Apple as the best Design company, when they’re really the best Marketing company which emphasizes Design more than others. They’re not even an Innovation company. That would be Xerox PARC (the innovations for the mouse, GUI, etc. during the flat 70s economy which Jobs later “borrowed”); General Magic (the PDA innovators in the early 90s recession whose ideas Scully later “borrowed” for the Apple Newton, which Palm “borrowed” and then later partnered with Qualcomm to make the first Smartphone, which Apple later “borrowed” and combined with an iPod to make the iPhone); and ARPANET (the Defense / R&D network which grew up in the Nuclear age and became the Internet).
    Innovation happens most when people go “Oh, shit, now what do we do.” And even more often when people go “We’ve got all this stuff and all these resources and all these people, but nothing’s happening. Oh, shit, now what do we do?” Nearly all large companies that managed to save for a rainy day are reciting that latter phrase, now that we’re in a depressed economy, just like Xerox PARC did in the 70s. And they also recite that phrase when their stocks are in the toilet, regardless of the broader economy. Apple introduced the iMac in the context of their tanked post-Scully stock: “innovate or die.” P&G introduced the Swiffer, Glad ClingWrap, and other inventions when they realized they were up against a zero-growth scenario. Nothing was happening. Oh, shit…
    …”now what do we do” goes back a few years. A recent McKinsey report about the Depression era reveals that most of the innovation that fueled the post-WWII 50s and 60s growth was done during the 30s, when a record number of patent filings occurred. TVs and computers grew out of the need for military and government resources, not because P&G wanted to create the soap opera. Indeed, necessity IS the mother of Invention, not the mother of Design.
    Yet necessity itself shifts relative to social context. In Post-WWII, necessity looked a lot different than it does now. People were into appliances for homemakers. It wasn’t until the vacuum cleaner was invented that we stopped having to haul area rugs out and beat them with a stick. So once we had the vacuum cleaner, the wall-to-wall carpet was born. Which was the invention, which was the innovation? Neither was a “design innovation.” Dyson wasn’t yet obsessed with suction.
    Or maybe he was, but was simply too young. He grew up with the vacuum and probably was inspired more by it than the airplanes which inspired Loewy, who then made those first vacuums look like airplanes. And I guess Dyson thought vacuums shouldn’t look like airplanes, they should look like alien robots and should suck. Streamlined airplanes were so yesterday to him.
    And that iPhone? If you asked someone in 1975 whether they wanted to be in touch with other people 24/7 via a mobile telephone and text messaging, they wouldn’t. In fact, they’d probably be slightly horrified by the notion of being tethered to others and without privacy. But ask someone who grew up with networked computers–well that’s a different story.
    And so that’s where we get confused. Social context drives needs & desires. Needs & desires drive innovation. Innovation drives design. And there are a lot more Innovators than there are Designers. They just don’t do renderings.
    Oh, shit.

  • Jonathan

    July 24, 2009 at 5:03 am Reply

    Unlike Jason I do get the point you’re making – mainly because I’ve been making it myself for some time.
    Trouble is, and why I think people like Jason don’t see the distinction, is that “design” means different things to different people. To some it’s styling (decoration, as Bruce puts it) and to others it’s innovation. The two wings don’t tend to see eye to eye and probably don’t even know the other exists! Or if they do it’s a little like reading a Windows/Mac thread in the comments of some blog or other…
    To me, design at university should always be about innovation – I started off teaching graphic design but am now of the view that the subject doesn’t really belong in a university as most degrees are no different from what you’d get on a one or two year vocational course. But I think there is room for a version of graphic design which is innovation-led, that looks at new models of communication etc… I think that’s where we’re heading, slowly but surely. (Too slowly, and not surely enough I fear).
    I think there are two types of people who don’t “get it” – the types like Jason who don’t get it because it’s just so damed obvious (they’re the good types!) and the types who don’t get it because they think design is all about having wet dreams over the angle of the curve on the new whatever, or the daring typography on… well you get the idea. Design as innovation, design as Art – what it changes/solves versus what it looks like.
    But to go back to Jason’s main complaint – yes it’s a generalisation. That’s the point. It’s making an argument using a few examples. It’s open to debate, it’s open to further thought. And from a graphic design point of view (harking back to my earlier point about innovation) that’s what good graphic design should do – inform, provoke, illustrate, suggest. It’s the job of words – in this case a whole PhD thesis I suspect – to explore the intricacies of the argument.
    Non-innovative graphic designers would just go ga-ga over the iconic Time magazine cover, mising the point entirely. Innovative graphic designers will try to improve the way the graphic tells the story.
    Jason’s complaint, to me, falls in to the latter category. But the iPhone is a good example – yes it changes people’s lives/experiences, in many different ways from the trivial to the major. But the way it’s used in this post is really criticising those who just go on about it as a form, what it looks like, the icons, the interface, rather than the deep understanding it demonstrates on the part of Apple of the way people use devices in their lives.
    Remember Palm saying, when the iPhone was introduced, that Apple would never achieve what it took them years to achieve? And Apple blew them away because Apple realised a phone wasn’t a device, and the interface wasn’t at the service of the programmers. They realised it was a tool that people use for various things – and that, all that understanding and observation and planning is where design begins. What the phone looks like is late in the process (if you look around on the web you’ll find a video of a prototype iPhone interface which looks awful but works – showing once and for all that without the underlying fnctionality and engineering, the GUI would still look pretty but would be useless).
    So where I come from, I don’t see design and innovation as different because I move design “upstream” in the process. But I acknowledge that most (the vast majority of) people still see “design” as what happens when the innovation has happened, the engineering has been done and now it needs to be made pretty. So long as that’s true (and designers are often the worst) then there will always be a strong division between design and everything else.

  • Jason

    July 24, 2009 at 1:30 am Reply

    Where does design stop and innovation begin?
    I am quite confused with the image and this blog post. The image puts forward a very weak argument due to the fact that it is a huge generilisation. How is design and innovation measured against something as analytical as the Dow Jones stock chart? This all seems to be some what of a Black Swan imho.
    As for your question, shouldn’t this always be the designers aim, crisis or no-crisis, to create value and improve peoples lives. I also disagree with your choice of example, the way I see it the iPhone has and will continue to change peoples lives.
    Nice post, v.thought provoking.

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