Sunday, October 3, 2010

Using Leadership to Drive Innovation with Design Continuum's Dan Buchner

Dan Buchner, VP of Design and Innovation at Boston-based Design Continuum, will be the first to tell you that there is no silver bullet to transform a company from cost-cutter to innovator. It’s much more nuanced than that, with enlightened leadership being perhaps the one necessity.

I first met Dan when he came to Cornell to run a design thinking workshop for the second meeting of “Creative Design for Affordability” in March of 2009. Dan grew up and spent his early career in Canada, and I was immediately drawn to his cool, laid-back approach to driving innovation and creativity in business.

Aside from his role at Continuum, Dan is also “Innovator in Residence” at the Center for Creative Leadership (CCL) in Greensboro, NC. With the CCL, Dan has unleashed Continuum’s innovation process to try and help leaders understand that process first hand, and then assess what concrete actions they must take to drive behavior change throughout their organizations.

All of this is much easier said than done, as Dan will readily admit.  Edited excerpts of our recent conversation follow:

ThinkingDesign: So how did you make the leap from product design to organizational design and leadership?

Dan Buchner: Within two years of graduating from design school, I got put in charge of the design team of a small Canadian manufacturer in Ontario. It was pretty na├»ve on their part, and for me it was a baptism by fire. I’d never managed anyone in my life, and suddenly there were people that had been with the company for 30 years who were reporting to me.

I got really interested in why really good designs never made it to market. When you look at it, you realize that much of it is because of organizational dynamics. Lots of decisions get made for good reasons but they water the idea down.  What makes it to market in most cases pales in comparison to the original idea.

ThinkingDesign: So what are the key pieces to leading/managing design effectively?

DB: I got a job with Moen and helped set up the new product development process. At the time, they were essentially a manufacturing firm, and about ¾ of the revenue was from products designed 25 years earlier. They were essentially cost reducing, making the same thing over and over again, which was fine in that industry at that time. But with the advent of Home Depot, and the consumer coming in and starting to make decisions about what kinds of faucets they wanted to put in their homes, the owners of the company decided we needed to become a consumer products company.

The first thing was becoming concerned about what the consumer might want. At that time in the early 90’s, if you wanted a faucet, you phoned the plumber, and they put in what they wanted.  But when the consumer gets involved, we had no capability to understand what they wanted. So that was the first step – a consumer research capability.

 The second was the ability to actually design and prototype and put into production new products. We had a system at that time that was in place, and everyone was spending time trying to take a few cents out of here or there.  So I set up the new product development process, the design department, and the market research department. I also helped set up an innovation incubator there.

ThinkingDesign: How does the leadership part play in?

DB: Leadership is huge. The company had been a private company and had been quite happy to be #2 in the marketplace and they made lots of money. Then the company was sold to a public company – the precursor to an organization called Fortune Brands. And they came in and said, “You’re not going to be a sleepy little manufacturing firm. You’re going to be a consumer products company, and you’re going to be #1 in the market. You’re going to grow at 10% a year in an industry that grows at 1 or 2 % a year.” We got a new CEO, a phenomenal leader, and that was his charge.

ThinkingDesign: What behaviors did you see in him that drove your later work?

DB: Intense focus on the customer. He spent huge amounts of time talking to plumbers, retailers, and homeowners. He was out there in the field. He also had an amazing ability to communicate to all different kinds of people. He could talk to truck drivers one day and then come back in and talk to Wall Street analysts the next. And he’d be compelling to both audiences.

The other thing he did was set the strategy for the company. He came in and said, “We can’t be world-class at everything.” All the ownership and everyone thought we could do everything, but he focused the organization and said we’d be the product innovators in our category, and that we'd have to say no to investments in other areas.

ThinkingDesign: Isn't “Innovation Lab” just another way of saying R&D?

DB: Most of the time, when you say R&D, people think about basic science. The innovation lab I set up and ran was about exploring consumer context in a much broader way. It was about exploring trends that may affect consumers or the industry well into the future, exploring emerging technologies that may be applied in some way to create whole new categories. We looked at the future of piping in the home and the effects it might have on faucets and shower experiences going forward. It wasn’t about basic science, though we had a technologist involved in it. It was about scanning for technology and looking to see if there were interesting ways to apply it.

ThinkingDesign: You know what’s funny? The first time I ran across you and Continuum was in a clip from the Today Show segment when you were in the shower.

DB: I was actually the client on that shower research. We brought Continuum in for it. I was their biggest client for six years. I brought them in to design a new line of products, and part of the deal was that they had to help us learn the product design process ourselves.

ThinkingDesign: As we know, you eventually did make the jump over to Continuum. Were you successful in helping Moen master the product development process themselves?

DB: Absolutely. They grew from $240 million to $1.1 billion in eight years, and only some of it was acquisition. A lot of it was the new products – about 20-25% of the growth came from new products. It was a pretty phenomenal experience. It was really fun and exciting to be part of the transformation, and once all those capabilities were in those place, it got kind of boring for me.

I’d always wanted to try consulting, and one day Continuum called me and asked me to come over.

ThinkingDesign: What’s the value in your relationship with the CCL, and partnerships like that in general?

DB: I got involved with the Center For Creative Leadership and ultimately became their “Innovator in Residence,” so I became an advisor to the EVP of research and innovation to try to find ways to make the center more innovative. I eventually worked on a really interesting project to bring their really expensive leadership training to rural India in low-cost ways. That was a really fun project that we did with them.

At one point, they were getting lots of requests for some programming in innovation and leadership, and they asked if I would be interested in developing something with them. One of the big hurdles to innovation is that a lot of leaders kind of get the idea that they need it and they like to talk about how innovative they want their organization to be. But they don’t behave or make the necessary changes for that to happen.

Leadership can be either a barrier or catalyst for innovation in organizations. So we co-developed a two day program that mashed up Continuum’s approach to innovation and the CCL’s approach to leadership, and it’s aimed at upper middle managers inside organizations. What we do is have them experience parts of the innovation process, then have the reflect on what they as a leader are going to have to do to foster a climate where it can happen.

ThinkingDesign: Is there a silver bullet there? And if a company goes from 0-60 in the innovation space, how long might that take?

DB: It all depends on the size of the organization, how committed the leadership is, the availability of the necessary resources to do it. Some of the companies I work with in developing countries just don’t have access to basic prototyping stuff. So there’s just basic infrastructure that needs to be in place. Generally, what happens is that some smaller group within the organization decides that, as a group or department, that they need to become more innovative, and they’ll undertake it themselves. For me, that’s one of the most successful models, because when they show success – drive growth, increase profits, whatever – the rest of the organization pays attention and starts to put some of that in their group, or the leadership says, "That’s really cool. We need to have some of that in the rest of the organization."

But it can take years. I think it takes longer in successful organizations, actually, because you don’t want to mess with success. When people are under particularly high levels of stress, they can be more willing to change.

We’re seeing a lot right now in organizations who have gone through the downturn and downsized and realize they can’t go back to the way they used to do things. So our business is booming right now, and I think that’s a large part of it -- people aren’t going back to the way things were before the downturn. They’re actively out getting new ways to do things.

ThinkingDesign: Any examples you can point to of that?

DB: Well, most of it is proprietary, but if you look at Indra Nooyi [of Pepsico] talk about "performance with purpose":

There’s a very enlightened leader that’s going to take Pepsi from a snack food company to a nutrition company, so that means you have to change a lot about the way you do things.

The Pepsi Innovation Fellowship Program is a component of a project we’re doing with them. To help Pepsi change the fellowship program is used to bring in young innovative thinkers. It’s a very enlightened program.

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