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IDEO, Inc. provides design, engineering, social science, and business strategy services.
It offers strategic services, including exploration, service design, and transformation;
and design services, such as environments, digital experiences, and product development.
The company guides in the creation of products, services, environments, and digital
interactions that support and extend the brand experience. It serves clients in
healthcare, consumer goods, business, government, education, entertainment, technology,
and services industries.IDEO,Inc. was founded in 1991 as IDEO Product Development, Inc.
and changed its name to IDEO,Inc.in 1998. The company is based in Palo Alto,California.
IDEO,Inc.operates as a subsidiary of Steelcase Inc.
HISTORY OF IDEO
□ABOUT David Kelly
Kelly is one of the most powerful people in Silicon Valley. In 1975, Kelly joined the
Stanford University program in product design. But he gave up writing his Ph.D thesis.
□Starting
Kelly went on to fom and run David Kelly Design for the next dcade.IDEO started in 1991
when David Kelly Design merged with two companies: ID Two,led by renowned designer Bill
Moggridge, and Matrix, started by Mike Nuttall.
□Naming
The name came to life when Bill Moggridge scanned his dictionary for suitable name and
liked “ideo-”( a Greek word which meant”idea”) as it formed the foundation of many
important combined words such as ideology and ideogram.
□Concurrent Engineering
IDEO thus pioneered the design version of “Concurrent Engineering”
a fusion of art engineeringto produce aesthetically pleasing products that were also
technially competent.
□Major clients
Major IDEO clients included Apple Computer, AT&T, Samsung,Philips, Amtrak, Steelcase,
Baxter International, NEC Corp.In 1990s, IDEO won more industry awards than any other
design firmworldwide.
□Locations
In the late 1990s, IDEO employed over 300 staff and maintaintained desgn centers in
Boston, Chicago,SanFrancisco,London,Palo Alto, Grand Rapids, New York,Milan, Tel Aviv
and Tokyo.The sites were chosen for their stimulating locations.Although, all centers
operated independently, seeking business locally, they exchanged a high volume of
e-mail and often share talent as needed.
□Revenue
IDEO’s fees generally ran from as little as $40,000 to $1 million ? It’s depending
on the scope of the project.
THE WEBSITE IS FOR OUR PROJECT RESEARCH OF METHODCARDS. DATE/2006.10-2007.02. JAPAN
http://uni.gestaltung.com/WASEDA/methodcards_3532.html METHOD CARDS
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The Power Of Design
IDEO redefined good design by creating experiences, not just products.
Now it's changing the way companies innovate.
Kaiser Permanente, the largest health maintenance organization in the U.S.,
was developing a long-range growth plan in 2003 that would attract more patients and
cut costs. Kaiser has hundreds of medical offices and hospitals and thought it might
have to replace many of them with expensive next-generation buildings. It hired IDEO,
the Palo Alto (Calif.) design firm, for help. Kaiser execs didn't know it then, but
they were about to go on a fascinating journey of self-discovery. That's because of
IDEO's novel approach. For starters, Kaiser nurses, doctors, and facilities managers
teamed up with IDEO's social scientists, designers, architects, and engineers and
observed patients as they made their way through their medical facilities. At times,
they played the role of patient themselves.
Together they came up with some surprising insights. IDEO's architects revealed that
patients and family often became annoyed well before seeing a doctor because checking
in was a nightmare and waiting rooms were uncomfortable.They also showed that Kaiser's
doctors and medical assistants sat too far apart. IDEO's cognitive psychologists
pointed out that people, especially the young, the old, and immigrants, visit doctors
with a parent or friend, but that second person is often not allowed to stay with the
patient, leaving the afflicted alienated and anxious. IDEO's sociologists explained
that patients hated Kaiser's examination rooms because they often had to wait alone
for up to 20 minutes half-naked, with nothing to do, surrounded by threatening
needles. IDEO and Kaiser concluded that the patient experience can be awful even when
people leave treated and cured.
What to do? After just seven weeks with IDEO, Kaiser realized its long-range growth
plan didn't require building lots of expensive new facilities. What it needed was to
overhaul the patient experience. Kaiser learned from IDEO that seeking medical care
is much like shopping -- it is a social experience shared with others. So it needed
to offer more comfortable waiting rooms and a lobby with clear instructions on where
to go; larger exam rooms, with space for three or more people and curtains for
privacy, to make patients comfortable; and special corridors for medical staffers to
meet and increase their efficiency. "IDEO showed us that we are designing human
experiences, not buildings," says Adam D. Nemer, medical operations services manager
at Kaiser. "Its recommendations do not require big capital expenditures."
With corporations increasingly desperate to get in touch with their customers, IDEO's
services are in growing demand. As the economy shifts from the economics of scale to
the economics of choice and as mass markets fragment and brand loyalty disappears,
it's more important than ever for corporations to improve the "consumer experience."
Yet after decades of market research and focus groups, corporations realize that they
still don't really know their consumers -- or how best to connect with them.
Cool and Fast
Enter IDEO. The 350-person design firm has offices not just in Palo Alto but also in
San Francisco, Chicago, Boston, London, and Munich. Office-furniture maker Steelcase
Inc. (SCS ) owns a majority stake in the firm, which operates as an independent unit.
By design industry standards, IDEO is huge, though its $62 million in revenues in
2003 are puny by most corporate measures. But IDEO's impact on the corporate world is
far greater than the sum of its sales. It has a client list that spans the globe,
including Hewlett-Packard (HPQ ), AT&T Wireless Services (AWE ), Nestlé (NSRGY ),
Vodaphone (VOD ), Samsung, NASA, and the BBC. More than half of the firm's revenue
comes from European and Asian clients or work done overseas by U.S. corporations.
IDEO began in 1991 as a merger between David Kelley Design, which created Apple
Computer Inc.'s (AAPL ) first mouse in 1982, and ID Two, which designed the first
laptop computer in the same year. The Grid laptop is in the Museum of Modern Art in
New York. Kelley went to Stanford University School of Engineering in the mid-'70s
and met Steven P. Jobs. Jobs later introduced Kelley to the woman he married,
Kc Branscomb, former senior vice-president at Lotus Development Corp. (IBM ) and
CEO of IntelliCorp Inc. ID Two was run by Bill Moggridge, a well-known British
interaction designer. Both founders still manage IDEO, along with CEO Tim Brown.
From its inception, IDEO has been a force in the world of design. It has designed
hundreds of products and won more design awards over the past decade than any other
firm. In the roaring '90s, IDEO was best known for designing user-friendly computers,
PDAs, and other high-tech products such as the Palm V, Polaroid's I-Zone cameras,
the Steelcase Leap Chair, and Zinio interactive magazine software. It also designed
the first no-squeeze, stand-up toothpaste tube for Proctor & Gamble Co.'s (PG ) Crest
and the Oral-B toothbrushes for kids. Now, IDEO is transferring its ability to create
consumer products into designing consumer experiences in services, from shopping and
banking to health care and wireless communication.
Yet by showing global corporations how to change their organizations to focus on the
consumer, IDEO is becoming much more than a design company. Indeed, it is now a rival
to the traditional purveyors of corporate advice: the management consulting companies
such as McKinsey, Boston Consulting, and Bain. Management consultants tend to look at
the corporate world through a business-school prism. By contrast, IDEO advises clients
by teaching them about the consumer world through the eyes of anthropologists, graphic
designers, engineers, and psychologists. "I haven't seen anything like them before,"
says Tom Wyatt, president of Warnaco's Intimate Apparel Group, who is turning to IDEO
to help battle rival Victoria's Secret Ltd. "They're creative and strategic, eclectic
and passionate. They're cool but without attitude."
And IDEO works fast. That's because the company requires its clients to participate in
virtually all the consumer research, analysis, and decisions that go into developing
solutions. When the process is complete, there's no need for a buy-in: Clients already
know what to do -- and how to do it quickly. Unlike traditional consultants,
IDEO shares its innovative process with its customers through projects, workshops, and
IDEO U,its customized teaching program.In IDEO-speak, this is "open-source innovation."
"Consulting firms usually come in, go away, and return with heavy binders that sit on
the desk," says Kaiser's Nemer. "With IDEO, we partner up and work side-by-side.
We are internalizing their methodology to build our own culture of innovation."
Eye Openers
IDEO doesn't have the field to itself. Witnessing IDEO's success, management consulting
firms are expanding their offerings to corporate clients to include a greater focus on
consumers. And other design firms are piling into IDEO's space. Design Continuum in
West Newton, Mass., Ziba Design in Portland, Ore., and Insight Product Development in
Chicago are all experienced in understanding the consumer experience. Design Continuum,
for example, observed consumer cleaning habits in research that helped P&G launch its
$1 billion Swiffer mop business. "IDEO has captured the imagination of the business
world," says Craig M.Vogel,director of graduate studies at Carnegie Mellon University's
School of Design, "but there are other firms doing similar work, translating user
research into products and services."
Even so, IDEO is far ahead of the competition. There is even something of a cult
following in the sometimes staid world of business. IDEO's clients don't just like the
firm, they love it. "I think the world of them," says P&G CEO Alan G. Lafley, who has
teamed up with IDEO to create a more innovative culture at the consumer-goods giant.
"They are a world-class strategic partner." Adds Sam Hall, vice-president for mMode at
AT&T Wireless Services Inc. (AWE ), who turned to IDEO to redesign its mMode service:
"Those guys really get it. They opened our eyes." Since the mMode relaunch in November,
2003, subscriber membership has doubled. "I would work with them again in a heartbeat,"
he says. "They are a fun bunch."
Fun? Since when is changing corporate culture fun? But that's how most corporate execs
describe their experiences with IDEO. Contrast that to the fear and loathing that
management consultants sometimes generate when they walk into a corporation's offices.
How does IDEO do it? Perhaps it is the unusual techniques it uses to energize corporate
clients -- "bodystorming," "behavioral mapping," "quick and dirty prototyping,"
"deep dives," "unfocus groups," "shadowing," and "be your customer."
Or perhaps it is working with interesting polymaths --people with two or three advanced
degrees who climb mountains, go birding in the Amazon, and bike through the Alps --
instead of the typical B-school grad management consultant. The head of the IDEO group
that teaches companies how to innovate, Ilya Prokopoff, is a graduate of the U.S.
Naval Academy with a BA in history and a master's degree in architecture. He designs
furniture and tinkers with old cars, such as his 1979 Alfa Romeo Giulia Super.
Corporate execs probably have the most fun simply participating in the IDEO Way, the
design firm's disciplined yet wild-and-woolly five-step process that emphasizes empathy
with the consumer, anything-is-possible brainstorming, visualizing solutions by creating
actual prototypes, using technology to find creative solutions, and doing it all with
incredible speed.
Here's how it works: A company goes to IDEO with a problem. It wants a better product,
service, or space -- no matter. IDEO puts together an eclectic team composed of members
from the client company and its own experts who go out to observe and document the
consumer experience. Often, IDEO will have top executives play the roles of their own
customers. Execs from food and clothing companies shop for their own stuff in different
retail stores and on the Web. Health-care managers get care in different hospitals.
Wireless providers use their own -- and competing -- services.
The next stage is brainstorming. IDEO mixes designers, engineers, and social scientists
with its clients in a room where they intensely scrutinize a given problem and suggest
possible solutions. It is managed chaos: a dozen or so very smart people examining data,
throwing out ideas, writing potential solutions on big Post-its that are ripped off and
attached to the wall.
IDEO designers then mock up working models of the best concepts that emerge. Rapid
prototyping has always been a hallmark of the company. Seeing ideas in working, tangible
form is a far more powerful mode of explanation than simply reading about them off a
page. IDEO uses inexpensive prototyping tools -- Apple-based iMovies to portray consumer
experiences and cheap cardboard to mock up examination rooms or fitting rooms. "IDEO's
passion is about making stuff work, not being artists," says design guru Tucker
Viemeister, CEO of Dutch-based designer Springtime USA. "Their corporate customers
really buy into it."
That pragmatic attitude is why no-nonsense CEOs are often more comfortable with IDEO
than with product designers primarily interested in style. Kelley, born in Barberton,
Ohio, says IDEO shares "Midwestern kind of values" with many of his clients. Kelley,
who studied engineering at Stanford, now teaches there, holding the Donald W. Whittier
Professor of Mechanical Engineering endowed chair. He travels between IDEO's Palo Alto
offices and the nearby Stanford campus in a 1954 Chevy pickup truck. "It's all about
authenticity, about solutions, not style."
Some corporations send their top people to IDEO just to open their minds. P&G CEO Lafley
took all the people who report directly to him -- his entire Global Leadership Council
of 40 business-unit heads -- to San Francisco for a one-day immersion. IDEO promptly
sent them all out shopping. The goal was to have the execs understand consumer
experiences so they could come up with innovations. Lafley's own team went to buy music,
first at a small, funky music store, then at a large retail music store, and finally
online. IDEO team members shopped alongside them to analyze each experience as it
unfolded. Other P&G executives went shopping with poor people so they might better
understand what it means for Third World consumers to buy the company's products.
IDEO's strategic relationship with P&G runs deep. In weekly workshops and monthly stays
in Palo Alto, P&G managers are taught the techniques that go into observation,
brainstorming, prototyping, and fast implementation. CEO Brown sits on P&G's own design
board, along with General Motors Corp.'s (GM ) Robert A. Lutz and other design-minded
executives. IDEO has even built an innovation center for P&G called "the Gym," where P&G
staffers are inculcated in the IDEO innovation process. "They opened our eyes to new
ways of working," says Claudia Kotchka, vice-president for design innovation and
strategy at P&G. "They solved problems in ways we would never have thought."
Like a law firm, IDEO specializes in different practices.
The "TEX" -- or technology-enabled experiences -- aims to take new high-tech products
that first appeal only to early adopters and remake them for a mass consumer audience.
IDEO's success with the Palm V led AT&T Wireless to call for help on its mMode consumer
wireless platform. The company launched mMode in 2002 to allow AT&T Wireless mobile-phone
customers to access e-mail and instant messaging, play games, find local restaurants, and
connect to sites for news, stocks, weather, and other information. Techies liked mMode,
but average consumers were not signing up. "We asked [IDEO] to redesign the interface so
someone like my mother who isn't Web savvy can use the phone to navigate how to get the
weather or where to shop," says mMode's Hall.
Too Many Clicks
IDEO's game plan: It immediately sent AT&T Wireless managers on an actual scavenger hunt
in San Francisco to see the world from their customers' perspective. They were told to
find a CD by a certain Latin singer that was available at only one small music store,
find a Walgreen's (WAG ) that sold its own brand of ibuprofen, and get a Pottery Barn
catalog. They discovered that it was simply too difficult to find these kinds of things
with their mMode service and wound up using the newspaper or the phone directory instead.
IDEO and AT&T Wireless teams also went to AT&T Wireless stores and videotaped people using
mMode. They saw that consumers couldn't find the sites they wanted. It took too many
steps and clicks. "Even teenagers didn't get it," says Duane Bray, leader of the TEX
practice at IDEO.
After dozens of brainstorming sessions and many prototypes, IDEO and AT&T Wireless came
up with a new mMode wireless service platform. The opening page starts with "My mMode"
which is organized like a Web browser's favorites list and can be managed on a Web site.
A consumer can make up an individualized selection of sites, such as ESPN or Sony
Pictures Entertainment (SNE ), and ring tones. Nothing is more than two clicks away.
An mMode Guide on the page allows people to list five places -- a restaurant, coffee shop,
bank, bar, and retail store -- that GPS location finders can identify in various cities
around the U.S. Another feature spotlights the five nearest movie theaters that still
have seats available within the next hour. Yet another, My Locker, lets users store a
large number of photos and ring tones with AT&T Wireless. The whole design process took
only 17 weeks. "We are thrilled with the results," says Hall. "We talked to frog design,
Razorfish, and other design firms, and they thought this was a Web project that needed
flashy graphics. IDEO knew it was about making the cell phone experience better."
IDEO's largest practice is health care, accounting for 20% of its revenues. In addition
to Kaiser Permanente, doctors, nurses, and managers at the Mayo Clinic in Rochester,
Minn., SSM DePaul Health Center in Bridgeton, Miss., and Memorial Hospital & Health
System in South Bend, Ind., among others, have teamed up with IDEO. They discovered that
health providers tend to focus on technology and medicines. Patients, on the other hand,
are concerned with service and information.
Fred Dust, head of IDEO's Smart Spaces practice, spent hours in DePaul's emergency rooms.
He saw that patients were anxious not just because of their injuries but also because
they simply didn't know when they were going to be treated. Dust suggested a cheap monitor
in emergency rooms that lets patients know when they will be called.
"Shop-a-longs"
Surprisingly, many of the lessons learned in the health practice work in retail. Just as
getting medical care is a shared experience, so is shopping. Warnaco's Wyatt went to IDEO
when faced with severe competition from Victoria's Secret. Warnaco was at a disadvantage
because its lingerie is sold in department stores rather than in its own private shops.
"Consumers were not having a good experience shopping for our products, and we needed to
make the department stores more inviting," says Wyatt. "We turned to IDEO because it had
done unique things with hospitals and Gap Inc. (GPS ) and Prada that enhanced the
shopping experience."
Warnaco and IDEO teams did "shop-a-longs" with eight women. They also visited department
stores in three cities to understand something as personal as the lingerie shopping
experience. The upshot: Women didn't especially enjoy shopping for Warnaco's products.
When they entered a department store, they couldn't find the lingerie section. Once they
did, they couldn't find their sizes. The fitting rooms were too small to accommodate a
female friend -- and there was no place nearby for anyone to sit. The experience was
eerily like that of the dissatisfied patient in Kaiser's hospitals: bad.
In 18 weeks, IDEO and Warnaco came up with a solution. They created a new kind of retail
space within department stores with big fitting rooms, a sitting area for couples and
friends to talk privately, concierges to guide shoppers, and displays offering fashion
options. Now, Warnaco is working with department stores to implement the design.
During the '90s boom, some 35% of IDEO's revenues came from designing products and Web
services for Internet and other startups. At its peak in 2002, IDEO generated some $72
million in revenues. The tech bust destroyed that business model. Brown, then the head
of IDEO Europe and its London office, was made CEO in 2000 by Kelley. In 2004, Brown
reorganized IDEO into a professional consultancy around practices, or fields of
expertise. "With practices, you can talk to clients with a voice they can connect to,"
says Brown. "It allows us to focus on their broader needs and serve them more
effectively."
IDEO may yet stumble. Its penchant for zany terminology verging on new-age jargon could
potentially turn off no-nonsense CEOs. And companies used to button-down management
types may not be attracted to IDEO's fast-paced, open-ended methods. "The first P&G
team that worked with IDEO called back in horror," says P&G's Kotchka. "They said,
'These people have no process.' We later saw that they do have a process. It just
doesn't look like ours."
Despite -- or because of -- its iconoclastic ways, IDEO's ideology is gaining traction.
Stanford, for one, has bought in. It has committed to raising $35 million so that Kelley
can create a "D-school," a new design school that may one day match Stanford's famed
B-school. Stanford professors in business, engineering, social sciences, and art will
teach there. Sounds a lot like IDEO. If the D-school students are lucky, they might
even have as much fun as IDEO's corporate clients.
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