MEREDITH Strategy + Design

We design the places and spaces where people come together to do great work

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No organization design without building design, no building design without organization design

Buildings and transformation

For more than a decade, we and our peers have contended to ourselves and to our clients that the workplace is a strategic asset, a critical component in the array of tools that an organization deploys to achieve its aims. I have to admit that, at times, I had felt a bit self-serving using this language, and a bit embarrassed by the groupthink characterizing our profession. 

But we had, in background, felt enormous change emerging in the world in which we practice. This significance of the essential relationship between buildings and getting things done was affirmed not just by our senses but also by clients whose projects were driven by the need to change their organization, operations and culture to achieve or sustain leadership in their industries. 

We began to realize that almost every organizational design initiative was accompanied by a facilities project, and every building project arose from an organizational redesign initiative. 

The first wave of this change was in the dot-com boom. The growth of the technology sector, the youth at its core, and coding as one of the new ways of working generated a more casual-looking yet productively interactive workspace. This was not style but substance at work. 

As other organizations began to confront a need for more integrated solutions in an increasingly complex world, multidisciplinary collaboration as a work mode became a driver of workplace form. Support for serendipitous conversation and for intense team focus generated a workplace with a significantly varied granularity of space and form. 

And now, as industrial companies begin to uncover the exploding potential in the hybrid of analog and digital, the mechanical and the electronic, and product and services, a new wave of workspace change is emerging. We are seeing the rise of an entirely new kind of organization. We are seeing what some now call the most significant change in the manufacturing organization since the Second Industrial Revolution more than 100 years ago. 

Does this latest wave of organizational change look like these others? Are industrial companies using facilities as a core asset in the change they seek? Are these new buildings arising from simple expansion needs, or is there something else at work here?

Why is it that organizational transformation projects evoke building projects? Here are three examples.

Evolving from moving air to storing power

Dyson is well known for its air-moving technology. The company’s “cyclone” powered vacuums are iconic, soon to be made autonomous, and have changed the entire market for home products. You may also have experienced its hand-dryers in airports and commercial buildings, ending the paradigm of having to wipe your hands on your pants after using other driers. Its ventilation fans are now also air cleaners, and the company will soon roll out a new technology in hair dryers. 

In the background, the company is also moving into other emerging technologies, and not all about air movement. Lighting is one of those areas, and battery power another.

But product line expansion is not the reason for its investment in a new research and development center. Yes, scale is part of it. Dyson recognizes that a breakthrough product may only arise out of thousands of failures (“For engineering, it’s a good thing because you’re forced to make mistakes and learn from them. You gain this visceral, tactile understanding.”). The company now needs to hire thousands more people to participate in that exploration. 

But there are other, more significant drivers for its new building. 

First, there is the DNA of the company. Like Apple, Dyson is fiercely committed to the design excellence and the entire product experience.  Anthony Bamford, chairman of the UK construction equipment company JCB, was recently quoted in the Financial Times saying, “Dyson is a brilliant engineer and an exceptional designer. His love of product sets him apart — he cares about how a product looks, how it performs, how it can be different. As an iconoclast, he’ll develop many concepts . . . Those that [work] are wonderful examples of British creativity.” That quest for design excellence meant the development of 5,127 prototypes for the bagless vacuum cleaner, 1,000-plus prototypes for the 360 Eye robot, and 600 prototypes for the Supersonic hair dryer. 

Then, there is the product development model refined in previous Dyson buildings. There is an essential openness through every part of the product development process. From its visit, the Financial Times says, “We tour through the prototyping area, with 3D printing machines that use 30 tonnes of nylon powder a year to create models. Next comes product testing, with robots pushing vacuum cleaners over patches of dust. Finally, we stand on the edge of a space that was once a production line for washing machines, and is now packed with desks bearing computer screens. Some 1,000 young engineers cram into the space.”

Then, there is the presence of everybody, even Dyson in the workspace. Dyson spends a lot of time in the laboratory, with significant effect. Dyson’s chairman and chief engineer talks of his monthly “James reviews.” He says “It can be nerve-wracking because he’s so inquisitive. He’ll always ask you a question you don’t have an answer to. We’ll sit for hours brainstorming and we’ll filter it down to what we think works best and build a prototype. James will say, ‘Have you thought about this?’ and we’ll say, ‘Well no, we haven’t.’”

Finally, there is competition. We know from our other research that there is a significant shortage of engineers in almost every developed economy. Britain is no exception, with more than 60,000 open job opportunities seeking talent. Every product design and development company in every industry is in competition with each other. The distribution of product development around the globe is part of the effort to find and engage top talent wherever they may live. The leading companies also realize that multidisciplinary collocation is a principal underlying condition for generating new product ideas and speeding their development. 

Dyson now has plans to double the number of products it has on the market by 2020. To lead in that competition for talent and for new product, Dyson has designed and built Building D9 – a top-secret $2000 million building intended as a “gleaming cornerstone” in the company’s efforts to draw top talent right out of college to try, fail and then win with innovation and product design and performance excellence. 

Moving from hardware to software, from machines to outcomes, from big iron to smart applications

Among the great by-products of all of the electronic controls and sensors built into modern operating industrial products is the huge amount to data generated by them. That data is a large part of the “big data” that is now the focus of almost every company’s strategy. 

GE, the celebrated manufacturer and funder of most of the big operating things in machines and infrastructure is now transforming itself to achieve a new generation of industrial leadership based on that data. The collection, analysis and application of that information can help the company and its products perform better and, more importantly, could help shape a lifetime of GE-provided services associated with that equipment. That transformation is what Jeff Immelt, GE’s CEO, has called “probably the most important thing in my career…it’s this or bust.” 

Now, GE is in the start-up space, literally and figuratively. The company is investing a billion dollars in a software development operation, a “center of excellence,” in San Ramon for an initial team of 1400 people. They are trying on the Silicon Valley way of doing things, all of them carrying copies of The Lean Startup. Immelt has been quoted saying, “If you went to bed last night as an industrial company, you're going to wake up this morning as a software and analytics company.” Everything about the company is in play from its customer value proposition, to its organizational structure, to its culture, and to its methods of recognizing revenue. 

The company’s new division brings together the its information technology, industrial security operations and software center under one roof in San Ramon. Although acknowledging that technology would allow for a dispersed virtual operation, the innovation and speed necessary to achieve and sustain leadership required a place where everybody could locate together. A new kind of space was also an essential tool in visualizing and affirming the company’s commitment to change and an attractor to the kind of talent the company needed for its transformation. 

The interior of the operation is unlike any associated with the GE of Big Iron. The look and feel is, however, familiar to Silicon Valley with its concrete floors, open workspaces, bench seating, whiteboards, couches, balconies and kitchens. There is also a design studio to foster collaboration in product and services development. That space, in itself, breaks new ground of the industrial company and is a model for the company’s transformation. Working directly with customers and suppliers, the highly adaptable and customizable space space will help design teams reduce the product development cycle and increase the speed and success rate of its customers’ adoption. 

The building is also a model for transformation of other parts of the company. Employees from other locations are sent to San Ramon for technology briefings and immersion into the new culture. The goal is to infuse the work styles, culture and productivity of Silicon Valley into GE’s industrial manufacturing soul. The design of the workspace, in other words, is the visual catalyst for radical transformation of the company. 

Moving from cars to mobility, from products to services

Ford is another great example of an industrial company using building design to drive organizational design and cultural transformation. With an intention to evolve from a car company to a mobility company, Ford is now investing more than a billion dollars to rapidly remake its Dearborn, Michigan Research and Engineering Center and, ultimately, its corporate headquarters. 

After more than a year of on-site research and gathering insights from other places, Ford came to the clear realization that its campus was both out of date for the design and development of vehicles and totally out of step with the kind of work environment it would need to sustain its leadership position as Uber, Google, electrification and autonomy redefined the auto industry and defined the new world of mobility. 

Ford found, as others do, that the shape of the workplace significantly influences the culture of the organization and the performance of its people. While describing itself as a “family” company, Ford reinforced a hierarchical organization of power and privilege in its workspaces. Any attempt to move to a more agile, entrepreneurial, risk-taking culture could not be achieved in its thin buildings which were designed in an era when secretaries in anterooms controlled access to executives and where the conference room and who was invited in to it defined status. 

Much of the campus was also designed to incrementally develop technology and products that now increasingly look irrelevant. Gasoline engines and individual car ownership are becoming overtaken by electrical propulsion, shared transportation and vehicle autonomy. Bill Ford has looked into the future of the world’s rapid urbanization to recognize that congestion, especially in the rapidly growing emerging economies where his future market is, means a whole new way of thinking about transportation, transit and mobility. 

So now a design process is underway in which much of the existing campus will be erased and a new set of buildings put in place. The new buildings will be designed with an eye on the emerging generation of designers and engineers, and the essential new hybrid culture where hardware and software engineers work together on the tough problems rapid urbanization, mega-cities, and broader concepts of mobility. Ford’s master plan and its building prototypes are seen as the principal strategic tool to attract, engage and develop the talent that will reshape and redefine the next generations of the company. 

Why do they do this? 
Some speculations

Why is this relationship between organizational redesign initiatives and new building projects so consistent? We might speculate on a few reasons from these three stories. 

These are systemic flips, moves from one state to another. Natural forms (caterpillar/butterfly) may be an appropriate conceptual model illuminating that change in function means a change in form. 

Everything about work is changing. The digital transformation in industry is evoking entirely new business models. Those new or hybrid models require new kinds of talent in the organization and the new ways of working that they bring. Things move faster, so the more formal and hierarchical forms of organization and operation present too many barriers. New workmodes and the rapid generation of new businesses demand new environments. 

Most business messaging seems to be regarded skeptically. The CEO's declaration of an intention to change won't be considered authentic without clear visual evidence of the move. Neither Immelt's declaration that GE should become a digital business, nor Dyson's move out of air, nor Ford's move to mobility could hardly be received as serious if there were no other visible evidence of the company's commitment to change. 

Each culture, it seems, has its own footprint. Family and village and city and tribe are descriptors both of the way that people come together but also specific forms that support their activities. Business models are cultural descriptors as well, and the culture of the organization is authentic when the form of the company and the form of the space are aligned.  





The things you'll miss

In a couple of recent discussions on LinkedIn about the evolution of the workplace, I could sense the signals of an anxiety or fear in justifications for resistance to a more open and agile workplace. Much of the concern seem to come from paradigms around the term "mobile" as implying a necessity to give up the company workplace. Other resistance is more superficial having to do with the old conventions of why someone just has to have an "office." I find in these discussions the fault of a tendency to go to assumptions about the form rather than to comprehend the personal benefits of these emerging workplace concepts.

A day later some rather interesting citations showed up in a couple of posts by Diego Rodriguez of IDEO on his excellent Metacool blog. He wrote about the considerations of both Joichi Ito (CEO of Creative Commons) and John Lilly (CEO of Mozilla) reflecting on the power and opportunity in chance encounters.

Joi Ito referring to some of the things he's learning from Hagel and Brown's book, The Power of Pull, says "…you should set a general trajectory of where you want to go, but then you must embrace serendipity and allow your network to provide the resources necessary to turn any random event into a highly valuable one and developing that network comes from sharing and connecting by helping others solve their problems and build things."

He then is reminded of Edwin Hall's descriptions of monochronic and polychronic characteristics of space and time as organizing frames for activities saying, "In M-time, we delineate time and space into meetings and cubicles allowing organizations and institutions to scale massively. P-time is like a Arab majlis where everyone is invited at the same time and they all mill around in the waiting room of the sheikh while the sheikh has a series of meetings in the open inviting people into the meeting like a long flow of consciousness. P-time lacks scalability and order, but it is rich in context and serendipity. At some level, if you plan everything, you are very unlikely to be able to embrace serendipity or be as 'lucky.'"

And he concludes, "I feel like I am floating in a rich network of highly charged people and serendipitous events, not a single day going by where I don't feel like 'Yay! I just did something really good!'"

He does also reflect on a matter of context. "I find that this P-time method allows me to have a much richer high context thought process involving more people. The problem is, it's hard to then get anything structured done."

John Lilly John first reflects on his youth when, falling asleep in a lecture, he misses perhaps the very first demonstration of the World Wide Web. He is talking about turning points in life and the things that influence them and says, "a bunch of decisions that I thought were really important turned out to be not important at all, and some things I decided to do just for fun changed everything."

He reflects on this, offering that "you never know when a decision you make is going to have a profound effect in your life. At least, I’ve never been able to tell. So my coping strategy — what I do to make everything work for me — is try to put myself into situations where there are tons of great choices, tons of great people, tons of great outcomes possible — so that it makes the odds that I make some really important & good choices that much better."

These are great illustrations (even more illustrations!) of the benefits and achievements that come from more open approaches to the contexts in which work is done. Yes, Ito will need to find a way to shut out some stuff when he wants to concentrate and focus, but I assume that neither he nor Lilly would be proponents of conventional office space.

As Hagel and Brown point out in their book, this time we are in is no longer about stacks of information, but about flows, and to be successful, you have to get into the stream.

Roger Martin on Design Thinking

There is a lot of skepticism around "design thinking" brought, I think, by process rigorists constraining movement forward and missing the significant benefits of even casual application of its principles and practices.

In any case, Roger Martin's voice is always excellent in connecting the shared purposes of business and design.

The link between talent and success

We often think that the two go hand-in-hand, but perhaps they are less linked than we'd want to believe.  

It’s not talent that’s brought to the fore most often these days, but success. Whether it’s Joshua Bell playing masterfully to a swirl of indifferent commuters, or a brilliant film that gets a bad review and barely makes a dent in anyone’s consciousness, talent in its pure, beautiful form can be overlooked or misunderstood. Meanwhile, success – which by nature is bottomless, fathomless, and therefore keeps even successful people constantly on the hunt for it – keeps getting the attention. The two continue to be spoken of interchangeably, when in truth the first is the real deal, and the latter is simply the fairy dust that sometimes gets sprinkled on the real deal, and other times gets puzzlingly sprinkled on the mediocre, or the fraudulent, or the happened-to-be-there-at-the-right-time.

In Search of the Real Thing in

Will people choose the cities that technology controls?

I feel generally optimistic about the emerging potential of the Internet of Things and the concept of a sensors-embedded, continuously communicating environment. For the moment, the creative thinking around the potential and the paranoid anxiety around the abuses obscure and distract us from more meaningful and useful conversation around what could become a much more free, open, agile and flexible world.

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Has workplace design become a proxy for salary suppression?

Has workplace design become a proxy for salary suppression? We sit in meetings almost every week in which our clients – large product development, manufacturing and marketing companies – lament their ability to find, hire, and retain the educated, innovative, and engaged engineers, designers and others who will make their businesses competitively successful. A "skills gap" in other words.

We are engaged in these conversations because our clients ask us to design a workplace that will be an effective tool in the attraction and engagement of the people they are trying to hire. If this article in the New York Times is correct, our clients are using workplace transformation programs as a device to cover for other strategies in hiring. Could this be true?

"What employers describe as talent shortages are often failures to agree on salary."

The article continues to say –

If a business really needed workers, it would pay up. That is not happening, which calls into question the existence of a skills gap as well as the urgency on the part of employers to fill their openings. Research from the National Bureau of Economic Research found that “recruiting intensity” — that is, business efforts to fill job openings — has been low in this recovery. Employers may be posting openings, but they are not trying all that hard to fill them, say, by increasing job ads or offering better pay packages.

Corporate executives have valuable perspectives on the economy, but they also have an interest in promoting the notion of a skills gap. They want schools and, by extension, the government to take on more of the costs of training workers that used to be covered by companies as part of on-the-job employee development. They also want more immigration, both low and high skilled, because immigrants may be willing to work for less than their American counterparts.

There are many reasons to improve education, to welcome immigrants and to advance other policies aimed at transforming the work force and society. But a skills gap is not among them. Meeting today’s job challenges requires action to improve both the economy and pay, including government measures to create jobs, strengthen health and retirement systems, and raise the minimum wage. Fretting about a skills gap that does not exist will not help.

I deeply appreciate the delight...

We looked at different professions or industries and recognized that there is an emerging new landscape of work that is shaped by considerations of product, proximity, presence and process, and where the "monuments" of equipment shape the arrangement of people dependent on those devices. When the scale of product (automotive, for example) implies stability or durability of place, how do we accommodate teams (design teams, for example) who move between product programs?

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