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December 08, 2005

Creativity in business

Design policy is itself a globalising industry. I arrived back from Korea to be greeted by my copy of the Cox Review of Creativity in Business. This startling document has been eagerly awaited by the design industry. Many creatives in the UK (as in other industrialised countries) fondly believe that while manufacturing and call centres may emigate to cheaper countries, their brand of 'creativity’ is immune. They expected the Cox Review (it's written by Sir George Cox) to confirm this warm and cosy feeling. Instead, it will feel more like bucket of cold water. “The model of the UK becoming an all-service economy, the world’s leading repository of professional skills, is enormously appealing - and totally unrealistic” writes Cox. “The now rapidly advancing developing economies have no desire to remain as suppliers of cheap, low-skilled labour to the world. And indeed, why should they?”

As my own visit last week to South Korea confirmed, what’s impressive about emerging economies is not where they stand today, but the scale of their commitment to knowledge-intensive industries, including design, in the near future. The Cox Review is admirably global in its scope, but even he underestimates the speed with which things are changing. The report refers to “a window of opportunity – perhaps five or ten years – while the new economies develop the kinds of creative skills necessary to compete across the board”. I don’t think those years exist. Pretty much the same words greeted me when I joined the Hong Kong Design Task Force in 2001: we had "ten years to move the Hong Kong design industry up the value chain", we were told. A single visit to the Pearl River Delta, and an encounter with a room full of PhDs developing acoustic software for Bose, persuaded us that the gap in capability between Hong Kong and the mainland was was nearer two years, than ten.

The story in India today is similar. Cox states that GE has 1,000 scientists doing top level research in India. But my own understanding is that the number is already nearer 3,000. The site, which is always shrouded in construction equipment, has a capacity for many more again. I have a feeling that that GE would happily base all its 7,000 researchers in India were it not for fear of the political backlash in the US. As Cox rightly emphasizes, it’s not just about cost. Yes, an Indian PhD can be hired for 10 percent of the cost of an American or British one. But GE’s Indian PhDs, I was told, have also reduced innovation processes that took 24 steps in the US to seven steps in Bangalore. They are cheaper, and better.

But back to Britain. I was an early critic of the implication that only ‘creatives’ are creative, and the Cox Review wisely eschews that approach. Its subject is creativity and innovation among thousands of small and medium sized companies (SMEs) in all sectors of the economy, including public services. It’s also refreshing that Cox does not limit creativity to the production of new (and, for me, often pointless) novelty. On the contrary: He insists, on page one, that creativity includes new ways of looking at existing problems.

Having set out to discover what stops SMEs making greater use of the country’s creative talents, and what might be done about it, Cox arrives at a series of recommendations for action. These, for the most part, strike me as well-reasoned, innovative and relatively inexpensive. (I should declare an interest at this point: the Design Council, of which Sir George is Chairman, is a client of mine). Having evaluated no fewer than 70 existing initiatives which, one way or another, have the aim of linking creativity, design and business, he recommends that one of these, a Design Council programme called Design for Business, should be developed natonally. Around 6,500 SMEs could be reached over a three year period if the right resources were mobilised and focused. Based on early testing of the programmme, Design for Business would transform the performance and prospects of around 1,800 of these firms.

The Cox Review also emphasizes public sector procurement. British public services spend around £125 billion each year (getting on for 200 billion euros) on goods and services. For Cox, "all of the major problems facing society today – such as healthcare, education, security, transport infrastructure, or sustainability – require a high degree of innovation if they are to be addressed effectively". The public sector should be an intelligent and demanding buyer of goods and services, not simply looking for long-proven products and yesterday’s solutions at the lowest prices.

These are wise words, marred by the fact that this is one of the few places in the report where the word sustainability appears. This is a missed opportunity. Sustainability is the most important driver of innovation of all. SMEs represent over 99 percent of companies, and permeate supply chains: The fact that most SMEs are far less advanced than most multinationals in their environmental policies and practices is a fantastic opportuniuty for design-led innovation.

Cox also recommends that universities should develop multidisciplinary masters programmes that would bring together different elements of creativity, technology and business. He reminds Britain’s design schools that they face new competiton from programmes such as IDBM in Finland, or Stanford’s new D-School in the US. (The latter has been funded by a reported $25 million grant from SAP, the European software firm). Cox recommends that at least one of the new UK centres of excellence should embrace service design within its curriculum.

It looks as if most of Cox's recommendations will be implemented. According to the Design Council's website the UK's chancellor, Gordon Brown, has backed its key recommendations from the Cox Review, including a design support programme for businesses, a review of the tax credit system, and a network of design centres.

The Cox Review has one weakness, which is easily remedied. This is a proposal for no fewer than six showcase buildings in different parts of the UK that would “create greater visibility for the UK’s creative capabilities” and be a hub for creative industry gatherings.These shiny edifices would enable networking between them and regional SMEs, the report argues. Running costs for a London centre alone would be “around £4.6 million”, but the centres “should become largely self-sustaining” with income from letting, retail activities, grant, and sponsorship.

I don’t buy the value proposition, and am suspicious of the business model supplied to Cox by consultants. Cox is right that networking among SME’s, and with designers, can foster innovation – but you don’t need shiny and expensive buildings do it in. On the contrary: the most intense and creative encounters I experience usually occur in edgy, derelict, un-shiny old industrial buildings, or in tents, or in Starbucks. New institutions to foster networking are a good idea – but what’s needed are support and connecting organisations – and small ones at that - not great big edifices.

If if the prominence given to glossy photographs of the project is any guide, Cox's team was unduly impressed by Singapore’s £158 million Fusionopolis creative centre. Fusionopolis, which is due to open in June 2007, is a massive development - dedicated, says its brochure, to “fostering knowledge transfer and providing a vibrant work-live-work-play environment”. For me, at the end of the day, Fusionopolis is a government-subsidised real-estate project. Fusionopolis is the latest in a series of grandiose Singapore projects (others include Biopolis (biotech) and a Technopolis) that have been backed by billions of dollars of government money. They look futuristic, but these projects are based on an old-fashioned, technology-focused, and therefore unsustainable, understanding of innovation. Singapore bureaucrats are now promoting “Global Entrepolis”, the concept of Singapore as an entire city-state dedicated to, and filled with, high-tech entrepreneurs. This last brainwave, said one local critic, “confirms Singapore’s position as a ‘Polis State’ “.

Innovation needs to be situated in reality - not segregated from it. Projects like Fusionopolis (and New Songdo that I learned about in Korea last week) are gated communities for subsidised scientists. So much development money is sloshing around in them that their inmates are fated to become inward looking and self-referential. And that's when the innovation stops. Look what happened at Interval Research in the US: it burned through $100 million of Paul Allen’s money but, being isolated behind smoky mirrors up a Palo Alto hill, it so lacked interaction with the real world that it produced no innovations that the world wanted.

A simple win-win solution is available: Redirect the money earmarked in the Cox Review for showcase design buildings, to the greening of SMEs.

Posted by John Thackara at December 8, 2005 04:58 AM


Every time I read about the design industries growing in developing nations and the threat they pose to established western design industries, I can't help but remember some point Lawrence Lessig makes:

  1. creativity and innovation always build on the past
  2. the past always tries to control the creativity built on it
  3. free societies enable the future by limiting the power of the past

So generally speaking, politically and socially freer and more open societies should be capable of enabling futures that less free and open societies cannot even conceive of.

To me the question isn't one of developing vs. developed, but rather of more free and open vs. less free and open. My guess is that those societies that are more free and open (whether in developing or developed states) should outperform less free and open societies in terms of innovation.

So in terms of innovation, perhaps financial investments and number of PhDs are irrelevant in comparison to a society’s creative and intellectual climate. Does the society punish dissent? How hierarchical is it? How much social mobility does it allow? Does the culture encourage acquiescence to authority? How much does the culture value obedience? How fixed are their gender roles? Do they discourage exploration versus execution? Do they embrace orthodox thinking? How strong do they adhere to the past?

While many developing nations may have talent and drive, they (at least the one I am familiar with) appear to be politically, socially, and sometimes economically, less free and open than we tend to be in more developed nations. (Please take this as the generalization it is meant to be; obviously there will be some cases that do not agree).

So as long as there are large cleavages between developing and developed nations in terms of freedom and openness, I suspect there will be equally large cleavages in the nature and quality of their respective innovations—despite financial investment and technical education. So then the biggest question is (and it’s a similar question on a corporate level too) not do these people want to be innovative, but rather will their societies allow them to be innovative.

Posted by: niblettes at December 8, 2005 10:23 PM

One comment, one question. First, the comment:

If there's anything I've learned from the whole IDII debacle (Interaction Design Institute Ivrea) , it's that the people are what matter most. The building is just a container for the people...but it makes a convenient poster-child.

The allure of buildings probably rests somewhere in the notion of a mad-scientist's lab. Lots of cool stuff happens inside, and occasionally something interesting lurches out from within (which is usually when you have to replace the dead scientist). The problem, however, is that those laboratories are never where the party's at. Parties, for some reason, always seem to end up in the kitchen.

And if we're talking about buildings to spur design creativity, the last thing we should want is a lab high up on a mountain that the villagers point to in fear whenever livestock starts disappearing. Rather, if the goal is to inspire and provoke collaboration and dialogue, then maybe we need to aim for a model that's more like the kitchen (vulnerable though it may be to bad puns about "cooking up" new ideas).

Now, the question (completely unrelated to the above):

We are used to viewing the world through the competitive lens of business. If we're not winning (whoever "we" constitutes), then "they" are. And thus we understand business on a country vs country, economy vs economy basis.

Yet the point you make above, that "Sustainability is the most important driver of innovation of all", a view that I share and wholeheartedly embrace, has the potential to fundamentally alter the world's perception of this dynamic.

Rather than competition, do the issues and influences surrounding sustainability (peak oil, limited water supplies, global warming, and so forth) instead suggest a future of cooperation? What does it really mean if England achieves a completely economically, socially, and environmentally sustainable society if the rest of the world isn't on the same level? This is precisely the problem facing the world today as the United States refuses to acknowledge its contribution to global warming: as much as other countries around the world can mitigate or eliminate their emissions, in the end the atmosphere has no respect for man-made lines drawn on a man-made map.

What is the value, in the long term, of fostering schools and centers, design or otherwise, which prepare students and professionals to enter a world of market-based competition pitting country against country, economy against economy, when the real issue suggested by sustainability is one of a common plight: air, water food, land.

This is the problem I struggle with, because as much as Paul Hawken et al can suggest a new economic model, from where (and just as importantly, when) does such a model arise? Is such a model to be found in isolated design centers around the world, segregated by economies and lines drawn on maps? Where can we find the means to address the problems which no one country has the capability of solving?

As a brainstorming idea: Perhaps design centers around the world could be merged with the idea of a traveling circus, that the mixing of people and flow of ideas spreads beyond the borders of individual countries and is instead world-wide. Although this might sound naive, signs currently point to countries slowly recognizing that circumstances in far-off lands can hold direct and indirect consequences for them. Might such a trend point towards an openness to a different notion of collaboration?

Posted by: Dave Chiu at December 13, 2005 03:46 AM

I have been following with keen interest the Cox Review, DOTT07, the media coverage of
Design v Innovation and all the arguments breaking out regards who has the
right to call themselves a designer. Designers have been accused of being arrogant and territorial. I don't blame them. I believe it is true that many individuals from all walks of life have the ability to 'think-creatively' - whether that's as small as improving a work
process. But how many of them can bring that new idea or service to market without the skills of a designer? The work and research of scientists and technologists of all type spark new innovations but rarely do they have the proximity to the consumer or the design skills to turn their results into commercially viable propositions. The financiers, manufacturers, distributors, retailers, marketers all have a role to play in bringing new propositions to market - but again rarely, if ever without several professional design disciplines being involved. Creative
or innovative thinking is within most people's grasp but 'design thinking'
brings the many disparate aspects of innovation together and visually
translates, often complex issues, into a tangible proposition that everyone can
understand. That is the skill of a professional designer. Personally
I do not believe that design is innovation, I believe design plays a
fundamental and critical role in the innovation process. It makes sense of it
in a way everyone else can buy into. The Design
Council and many others consistently promote design as adding value to
business. I personally feel that the reason designers are feeling so
uncomfortable with the 'everyone can be a designer' claim is that it
fundamentally de-values their role, their years of professional training and
experience. They have to sit back and listen to government bodies, politicians and others hail design as the big saviour to UK plc whilst often taking away the credit from the
designers themselves. Over
recent years designers have seen the public profile of 'design' itself grow and
grow - and yet their own profession has become a commodity. Who is
protecting the interests of the design profession? BDI is trying as best it can
for a small, non-funded, body representing design & innovation. But all the
time 'design' continues to be territorially fought over it is little wonder
that designers feel like pawns in a political game. The Cox
Review and the proposal for design & innovation centres are likely to house
everyone but designers - leaving them on the outside looking in. I agree with
John Thackara's comment about diverting some of those
funds into sustainability - that at least would mark out a role for the design

Posted by: Maxine J Horn at December 17, 2005 01:49 PM

I posted a 'review' of the Cox report at City of Sound recently.

[John, I've been trying to email you recently on john@thackara.com, but it keeps bouncing back. Is it me or is if you?!]

Posted by: Dan at January 4, 2006 08:38 PM

Good article. Worth noting Christopher May's arguments on the information economy, that informational work is actually more suited to "task migration" and offshoring than non-informational work. And that place-specific service tasks (health, education) should be given increased focus (this could also relate to design - i.e. less focus on export / tech innovation, more on sustainable processes).

It's good to see some acknowledgement of what is essentially racial prejudice underlying the assumption that developing nations will always be the destinations for outsourcing. I think the creative industries in "developed nations" would be well advised to consider what services they may be able to provide to companies based in China or India.

Posted by: Danny at January 15, 2006 02:16 AM

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