On innovation, with Tom Kelley of IDEO

Tom Kelley, co-founder of design firm IDEO and author of The Art of Innovation (2001) and The Ten Faces of Innovation (2005), spoke in Syracuse January 12 as part of the Famous Entrepreneurs Series. Here are some take-aways.

About IDEO

IDEO began as David Kelley Design (after Tom’s brother), and was a group of engineers when David asked Tom to join the team. IDEO was formed in 1991, and has designed products that are both physical and conceptual for a lot of companies you’ve heard of. They’re responsible for the fact that kids’ toothbrushes have fat handles, which they designed for Oral B, and Bank of America’s checking account that rounds up to the nearest dollar on purchases and sends the change into your savings account was their idea as well.

Using IDEO’s design, Oral B became the top-selling kids’ toothbrush in the world for the next 18 months (when everybody started selling the wide-handled ones), and in the first year of the Keep the Change campaign, Bank of America opened 2.1 million new accounts, 700,000 of them for people who had never banked with the company before.

IDEO also designed the Apple mouse and the Palm V.

On innovation

Kelley focused on innovation. Everybody’s for it, he said, but in your day-to-day worklife, it can usually wait until tomorrow, because you’ve got other things on your mind (like deadlines and sales quotas). Here is an example of why that’s not OK.

In the 1960s, 100% of the passenger car tires in the U.S. were manufactured in the Akron, Ohio, area by a handful of companies. Minor innovations would appear every few years (new tread patterns, etc.), but nothing major. Then some upstart French company developed something called the radial tire. People in Akron laughed. Now, everyone has radial tires on their cars and roughly 0% of the passenger car tires in the U.S. are manufactured in Akron.

That’s right, 100% to 0% in fewer than 50 years.

Interbrand’s Top 20 brands in 2009 featured five brands that weren’t in the Top 20 in 2001 – that’s 25% turnover in 8 years – Google, BMW, Louis Vuitton, Samsung and Apple. (See source PDF, page 12.)

So the answer is yes, you have to innovate. And in a flat world – that is, a world where you compete globally and have to deal with factors like big differences in labor and materials cost – you have to do it quickly if you want to stay ahead in the game.

In 2001, you would never have even thought to look at a Samsung TV unless the price point against a Sony was the most important thing to you. Now, Samsung outsells Sony in consumer electronics. Who missed the innovation boat?

The Ten Faces of Innovation

Kelley didn’t learn until after he wrote The Ten Faces of Innovation that we’re good at remembering 7 items, plus or minus 2. So he doesn’t talk about all ten, since everyone will forget all of them. He breaks the ten roles people play in innovation into three categories: learning personas, organizing personas and building personas.

Learning personas: These are anthropologists, experimenters and cross-polinators. They’re the people who observe and learn what people need, the people who try stuff and learn from mistakes, and the people who combine ideas that are already out there with new ideas.

: These are hurdlers, collaborators and directors. They’re people who may not be the fastest, but they’re the most efficient (most Olympic hurdlers don’t run significantly faster without the hurdles), people who work with others, and people who position other people to be the stars (think about movie directors – they rarely appear on screen, rather they help actors to be great at their jobs).

Building personas: These are experience architects, set designers, caregivers and storytellers. They’re the people who put all the pieces together, put the people who propel innovation in a good space, anticipate and help fill customer needs, and evangelize how the whole process comes together.

Kelley focused on two of these personas: anthropologists and experience architects.

Anthropologists

Kelley is the first to admit that when anthropology PhDs started showing up on the payroll, he didn’t get it. There were a lot of them, and he didn’t get it for a couple of years. “We have engineers who are developing laptops that don’t break when you drop them four feet onto concrete, and these people go out and watch kids fish and take pictures?” he asked.

He’s come around 180 degrees, he says. It’s when you go out and watch people that you figure out what they need.

The kids’ toothbrush I mentioned in the first section? Anthropologists went out and saw that kids’ toothbrushes were really just smaller versions of adults’ toothbrushes. But adults brush their teeth with their fingertips – they have the manual dexterity – while kids hold toothbrushes in their fists. That’s why they needed fatter handles.

Bank of America’s Keep the Change account came about because IDEO anthropologists went into the field and discovered that people were writing checks to round numbers – for example, if your electric bill came to $56.24, you wrote a check for $57 so you could do easier math. Lots of people were doing this, and lots of people thought they were the only ones doing it. So they devised this system where if you paid that $56.24 on your debit card, $57 came out and you wound up with an extra 76 cents in your savings account.

The key is this: you have to go out and observe to figure out what people need.

Experience Designers

These are the people who create an overall experience. Kelley uses a sushi restaurant as an example. Your food is only part of the experience. There’s the presentation – especially important in sushi – and then there’s not only your table/counter service for beverages and the like, but you actually get to interact with the chef, whose preparation becomes a performance.

In terms of a website, visitors create some of their own experience: we can’t influence their physical surroundings, the noise level in their room, the size of the screen, the weather, etc. But we can set up a website experience in such a way that they can get our content (the primary reason they come) in as pleasant a way as possible. [Kelley didn’t mention Steve Krug’s book Don’t Make Me Think, but I’d highly recommend it.]

Your Customers

Your current customers can help you innovate in baby steps, but they’re never going to tell you the next giant leap – you have to figure that out for yourself. For example, let’s say you make VCRs, and you ask your customers what they want. They say, “we want it to rewind much faster so we can just bring the tape right back to Bliockbuster.”

So you go back to your development team and they say, “Sure, we can do that,” and next year at the Consumer Electronics Show you arrive with a table showing off the fastest rewinding VCR in the history of the world.

And then you look over at the next table and see a DVD player – no rewinding at all, and the discs even take up less space than videotapes.

Your customers can tell you how to improve your existing product a bit at a time, sure, but if you really want to innovate, you need to get out there and see what people need.

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