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How IBM Is Embracing the Future Through Design

February 6, 2017

Shifting trends are forcing technology companies to reimagine their value proposition. IBM has chosen to create disruption through design. In embracing the future, the company is essentially invoking its past. Back in 1956, IBM was the first large company to establish a corporate-wide design program. But this time, the company’s goals are more ambitious.

Recently, we interviewed Karel Vredenburg, Director of IBM Design’s worldwide client program and head of IBM Studios in Canada, who told us, “We’ve put everything into this transformation.” The company is investing more than $100 million in becoming design centered.

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The Turning Point

Vredenburg cited three major market shifts that have triggered IBM’s design renaissance:

  • technology—Recent changes in technology—specifically, the cloud, analytics, and mobile—demand a different focus, and design is becoming an incredibly important differentiator in all three areas.
  • demographics—There’s a growing realization that Millennials are digital natives who expect a much higher level of user experience. Vredenburg recognizes that this group is distinctly different from older demographics—both as clients and employees—and acknowledged, “We have to make sure we design products and services to appeal to our millennial clients, and design internal systems to be appropriate for our millennial employees.”
  • digitization—Every industry—from academia to finance, healthcare to security—has now gone digital. The focus is on designing new products, processes, and services with the best attributes of digital in mind.

The Big Leap

IBM’s full-throttle commitment to implementing a culture shift toward design began about four years ago. In 2012, the company decided to hire more than a 1000 designers and train its entire workforce to approach problems like design thinkers—everyone from executives to interns.

The level of IBM’s commitment was also apparent in one of its acquisitions: Lombardi Software, a Texas-based enterprise software company. In terms of technology, IBM already offered all of the same capabilities as Lombardi. “But their products were better designed, and they had a really good design process,” Vredenburg acknowledged. Lombardi had already achieved what IBM was after—albeit on a smaller scale. Phil Gilbert, formerly President of Lombardi, now heads IBM Design. Gilbert has played a significant role in helping IBM break with the past, usher in new processes and practices, and most importantly, embrace a startup mentality. He thinks of IBM as a 105-year-old startup.

The most astute part of IBM’s change-management strategy has been its systematic effort to bring everyone on board IBM’s transformation into a design-centered company. They began by moving many Design frontrunners into senior executive positions, and top leadership has empowered these new executives to instill a design culture throughout the company and effect systemic changes.

Three Pillars of Change

Four years ago, when IBM started on this journey of reinvention, Vredenburg considered how they could transform a company with such a deep-rooted, technology-first culture. He told us, “We determined there were three major pillars we needed to work on: people; places and practices. If we did right by each, we’d be able to yield appropriate outcomes.” Let’s look at each of these pillars in depth.

People

Considering what needed to change from a people point of view, IBM decided to review how many designers it had versus developers. Vredenburg said, “We tried to determine the right kind of ratio. We figured our target should be one designer to eight developers. In mobile projects, even lower: 1 to 3.”

Considering that, in 2012, IBM—like many of its competitors—had just one designer to every 72 coders, this would be a huge gap to fill. So, the company went into action—not only recruiting and training top design talent, but also hiring a large number of front-end developers to help realize the designers’ vision.

In a clear departure from the past, IBM also put a strong career path in place for its designers. Previously, IBM had career paths only for technology, business, and consulting. Vredenburg admitted, “When it came to performance reviews and promotions, technologists and business executives evaluated designers. That wasn’t so fair on the designers. We now have a Design Board to conduct these reviews. And the career path for Design leads right up to the highest echelons of the company.”

To ensure that design informs the corporate culture, IBM now mandates every new hire—whether designer, developer, manager, engineer, or business executive—must go through a Design Boot Camp and get initiated into this design mindset at the very beginning. Everyone must embrace a T-shaped skills model, in which design thinking represents the horizontal stroke that all teams must practice.

Places

Where people work and how they work together is critical for fruitful collaboration. Therefore, IBM has built 36 Studios around the world. According to Vredenburg, the core characteristics of these studios are collocation and collaboration.

The walls of the studios display journey maps, wireframes, personas, and prototypes—in plain sight where everyone can see and critique them. Rather than holding information in their head, people now share information willingly and often. Vredenburg’s intent is to foster workspaces in which innovation, creativity, and collaboration can thrive.

Introducing IBM Studios to the world, Vredenburg said, “We need spaces where we argue, spaces where we play, spaces where we rest, spaces where we think. Welcome to our space: the IBM Studios.”

Practice

One of the main benefits of IBM’s acquisition of Lombardi Software was their user-focused approach to problem solving, innovation, and design. “We adopted their design transformation model—which had at its foundation an enhanced version of design thinking—and applied it to our company. Our version of the foundational framework is called IBM Design Thinking,” said Vredenburg.

At the core of IBM’s design-thinking framework is an unceasing cycle consisting of three stages, as shown in Figure 1:

  • Observe—Empathetically understand the world that customers and users inhabit.
  • Reflect—Process information and identify needs and opportunities.
  • Make—Transform ideas into products and services that provide positive experience outcomes for users.
Figure 1—IBM’s design-thinking framework
IBM's design-thinking framework

Source: IBM Design

Within this framework, a troika comprising hills, playbacks, and sponsors keeps everyone on the IBM team focused and aligned. IBM defines the three elements of this troika as follows:

  • Hills—These define business goals in terms of user-experience outcomes.
  • Playbacks—This is a collaborative practice in which teammates regularly exchange feedback.
  • Sponsor Users—The norm is to involve real users in the design process.

Of course, a design-thinking approach to problem solving isn’t revolutionary. Many designers have been touting this approach for a long time. However, at IBM, this mindset is seeping into the recesses of nondesigners’ psyches—including those who focus primarily on business and technology—and is becoming an essential part of IBM’s corporate culture. As Steve Lohr, technology writer for The New York Times, states so succinctly, “Design thinking flips traditional technology-product development on its head. The old way is, you come up with a new product idea, and then try to sell it to the customers. In the design thinking way, the idea is to identify users’ needs as a starting point.”

No Magic Bullet

Such a bold transformation is no small feat for a large company like IBM, which has traditionally focused on back-end software and hardware engineering. And IBM has never been hailed for its user experience. When we consider IBM’s size—377,000 employees across 175 countries—and the number of legacy products the company will need to redesign—this makes IBM’s commitment to change all the more commendable.

In initiating this transformation, IBM’s hope is to liberate Design from the narrow confines of prettifying user interfaces and cleaning up messy presentations. IBM is expanding the role of Design through a design-thinking framework that will enable the company to humanize solutions for real-world problems. But is this sustainable?

“There really is no magic bullet,” Vredenburg admitted. Changing mindsets at an organizational scale requires constant effort. He thinks of this as: “A muscle you need to keep exercising.” It’s not about getting one thing or another right. It’s about achieving and sustaining a fine balance. Having the right people, the right workspaces, and the right processes. The success of this transformation rests, above all, on the shoulders of a committed and undeterred leadership. “Besides, this kind of transformation takes time. You can’t gear up to measure results the very next quarter,” Vredenburg acknowledged.

But, speaking of results, Vredenburg believes the payoffs of this effort are already beginning to materialize—especially the intangible benefits. IBM’s design-led, software-development efforts in the cloud, analytics, and cognitive products have all recorded higher-than-before user acceptance. IBM’s Design Thinking workshops alone—which have numbered in the thousands over the last few years—have fortified customer loyalty and brought in new business opportunities worth billions of dollars. The company hopes their overall revenues will soon reflect the value of their design-thinking approach and validate their bold investment in design.

Vredenburg has already seen growing interest among IBM’s clients—the larger ones in particular—in effecting a similar transformation in their own companies. And IBM has started working with a few clients to help them do just that.

Can This Approach Work for Others Too?

When we asked Vredenburg this question, he answered, “Absolutely! Design thinking, in fact, is so scalable, you could apply it to how you coach a little league team or manage a personal relationship. … You don’t need millions of dollars, thousands of designers, or extravagant Design Studios to succeed. To get started, you need an ethos of empathy toward your users, a spirit of collaboration, and a vision to tackle business problems as design problems.”

As IBM has demonstrated, the company is committed to this approach and strongly believes their design-thinking framework can translate well to other businesses. This model is scalable and applicable to companies both large and small. Vredenburg told us, “IBM is now spending a fair bit of time … running design-thinking programs for start-up incubators. We’ve realized and learned this model is as relevant to them [as to larger clients].”

However, you have to start with the right goals and expectations. Some companies are tempted to crunch numbers and work out returns on investment (ROI) before they even start implementing a design-thinking approach. “It doesn’t work that way,” asserted Vredenburg. “Some occasions warrant analytical thinking. And sure enough, numbers can help improve a lot of stuff—cost, speed, quality. But you’ll never get innovation. For that you have to use design thinking.”

Vredenburg advises IBM’s clients—who are eager to embrace design and design thinking—to choose their first project carefully. He tells them, “You don’t want to choose something that’s so straightforward and easy that it isn’t representative of what you really do for your company. You also don’t want to choose something too complex, which is already running late. … Start with two or three projects that are representative and have a shorter timeline to deliver. That way, select teams can start to see the results. They can then mentor other teams.”

What Next?

IBM now calls itself a cognitive company. Like many of the company’s partners and competitors—such as Apple, Google, Amazon, and Microsoft—IBM is making big strides in domains that inject a human quality into machines. The company believes that Watson, which is synonymous with artificial intelligence for business, healthcare, and data analytics, is IBM’s ticket to future success. So, it makes perfect sense that IBM is adopting a more human view of technology—a designer’s view, so to speak—to create products that effectively enhance what humans do today.

But the world of technology is discovering countless other opportunities for disruptive innovation—moving beyond traditional software user interfaces to augmented-reality, tangible, speech, gesture, brain-computer, and IOT user interfaces. Any business success that hinges on such new technologies must draw inspiration from the human viewpoint. And that need for a human perspective is forcing businesses to see these opportunities for disruption through the prism of user experience design.

IBM has hitched its wagon to design to secure its future success—and for good reason. According to the Design Management Institute, when companies apply design principles to strategy, innovation dramatically improves. So much so that, over the past ten years, design-led companies such as Apple, Coca-Cola, IBM, Nike, Procter & Gamble, and Whirlpool have outperformed the S&P 500 by 211% or more. Given these hefty returns, design sure seems like a sound bet. 

Design Operations Manager at IBM

Toronto, Ontario, Canada

Atul HandaAtul is a seasoned UX leader with 16 years of industry experience. He has a Master’s in Information Technology and is also a certified user experience designer and researcher. His greatest strengths are in product strategy and UX best practices and methods within an agile world. He helps implement design thinking in tune with the latest standards and industry benchmarks. He also lends his expertise to bridging business goals and user aspirations, translating complex business ideas into actionable blueprints that he’s based on exhaustive user research. He has successfully led the design and development of Web and mobile products in a variety of domains. Beyond the digital world, Atul enjoys spending time with his frisky, two-year-old son. When time allows, he likes to get creative with his woodworking skills in his garage.  Read More

Co-Founder and Senior Content Strategist at Conceptell Inc.

Milton, Ontario, Canada

Kanupriya VashishtA seasoned content strategist, editor, and writer with more than 15 years of experience, Kanupriya provides communications-strategy leadership that, supporting a user-centric approach, to a diverse array of clients. She oversees projects throughout their entire lifecycle—from research, analysis, content strategy, and design to content creation and testing. She also regularly writes and edits features and columns for leading magazines, newspapers, and Web sites. Kanupriya has a Master’s in Journalism and Mass Communications from Arizona State University.  Read More

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