Bob Lutz, vice-chairman of global product development at GM, announced his retirement at the end of this year (Losing Lutz).  His stated reasons give some insight into the mindset at the top of the big three American car companies about the role of design, and public relations, in developing and selling cars (and themselves) to the American public:

…a bigger tipping point for Lutz was the government’s increasingly hands-on role in how cars will be made. Lutz said he was looking ahead at engineering and designing new cars to meet tougher government-mandated fuel economy rules rather than strictly to spark passion among car buyers—and thought it would be a good time to start moving out. “What I have proven to be best at is the psychological and emotional end of the business, designing what people want,” Lutz said in an interview. “We’re seeing an increase in regulation. This is one reason I think it will be a good time to retire. I won’t have to worry about that stuff.”

To hear the head of global product development complain about new design constraints is a bit surprising. Or not. But it is a lesson in how the mighty have fallen.  Here are five reasons why this response reveals a lot about just how broken this industry is.

1. Design is art practiced under commercial constraints. Henry Ford’s offer of “any color, so long as it’s black” was an admission that black was, at the time, the only color for fast-drying lacquer, and thus a constraint in designing for mass-production. Good design embraces constraints because doing so creates new market opportunities.  Bad design avoids constraints and, by doing so, limits opportunities.

2. The automobile industry, like any old and established industry, has been dealing with government-mandated constraints since before today’s executives were born. Unleaded gas, seat belts, and air bags were all sure to bring the auto industry to its knees, and yet miraculously did not.  Imagine what would have happened if the big three, instead of lobbying against fuel efficiency for the past 30 years, embraced it.

3. One of the strongest arguments GM and others put forward in the past few years for why they would not design in more fuel-efficiency was that their customers did not want it and would not pay for it. Six months after the bottom of the SUV market fell out, it is hubris I hear when Bob Lutz says his strength is “designing what people want.” That works when people are buying what you’re building, but doesn’t when they’re not. 

4. While Lutz is complaining about being unable to design fuel-efficient cars, Ford’s PR guys are touting their “dusting off” of fuel-efficiency technologies shelved decades ago (Ford see the future). And US cars currently average 21mpg, far below European and Japanese cars averages of 36 mpg and 31 mpg respectively. Efficient design solutions are already widely known and widely used–just not here. 

5. Finally and most critically, when it comes to designing new cars, Lutz has lost the distinction between design and public relations. Faced with new design challenges, it seems Lutz would rather reach for a microphone than a drawing board. The head of GMs product development has blamed more than the government for the challenge of designing better cars–also competitors, environmentalists, democrats, and even the Union of Concerned Scientists (saying “I’m not sure if they are concerned,” he said. “But they are certainly not scientists.” BW 11/2007).

When Alfred Sloan tapped Harley Earl in 1927 to design the new Cadillac, and later found the Art & Colour Department, GM led the world in design.  Times have changed. 

A very nice story on Greenbox graced the cover of February’s Entrepreneur magazine.  Greenbox is a San Bruno startup pulling together and repackaging information about residential energy consumption.

There are only a few places where Energy Efficiency has a chance to make real gains in the traditional model of Si Vallety entrepreneurship: low capital investment, high proprietary technology, and scalability. Greenbox is aiming directly at one of these places–the intersection between households, home area networks, smart meters, and utility databases, where a few smart programmers and marketing guys can create a set of tools and relationships that can find rapid growth and, hopefully, impact.

The idea is similar to the flies engraved in urinals (see Nudges)–given something to aim for, it’s amazing how consumers can be nudged to change their behavior despite a lack of clear incentives for doing so. Given the costs of improving existing energy infrastructure, and the relatively low returns to individual homeowners (even if they are better than investing in solar), changing behavior through non-economic means may be the most economical strategy.

Greenbox is one of a number of similar efforts in this area, but also one of the leading companies and thus one to follow.

[author’s note: a special shout-out to Matt Smitt, who participated in the Green Technology Entrepreneurship Academy 07]

Gizmodo's review of Amazon's new Kindle2 ran a nice design test–Dieter Rams' Ten Design Principles. It's been a while since I'd seen them and so, in the spirit of acknowledging what has already been said (while everyone tries to say it again better), I am doing my part to help re-circulate these good words of advice:

01. Good design is innovative.
02. Good design makes a product useful.

03. Good design is aesthetic.

04. Good design helps us to understand a product.

05. Good design is unobtrusive.

06. Good design is honest.

07. Good design is durable.

08. Good design is consequent to the last detail.

09. Good design is concerned with the environment.

10. Good design is as little design as possible.

Back to purity, back to simplicity.

Because at heart, and in our work, all of us engage in designing in some form or other, we should always be asking ourselves how well our work (products or services) measure up to these timeless principles. 

For those wondering who Dieter Rams is, the Design Museum has a nice page with examples of his work.

The Center for Entrepreneurship at UC Davis will be hosting the Food & Health Entrepreneurship Academy (FHEA), on February 23-27, 2009 at the University of California, Davis campus. This new program, run in conjunction with the UC Davis Foods for Health Institute and sponsored by Unilever, Pepsico, is focused on the fields of nutrition, viticulture & enology, plant science, biochemistry, nutritional genomics and fields relevant to food and health.

These Entrepreneurship Academies are designed to train university and industry researchers on how to identify, evaluate, develop, and advance the commercial opportunities created by their scientific research. It’s a one-week “bootcamp” where participants learn the basics of the business side of innovation and evaluation by working on the potential of their own research. We’ve developed an effective curriculum focused on the migrating technology from laboratory science to broader application which is then taught by a faculty comprised of academics, entrepreneurs, angel and venture capitalists, and IP lawyers. In this way, participants gain both a solid educational experience as well as a valuable networking experience.

FHEA follows on the success of our Green Technology Entrepreneurship Academy (GTEA), which brings researchers from across the world to UC Davis’s Tahoe facilities, where they learn and advance their technologies under the guidance of leading early-stage “green technology” entrepreneurs, angel investors, venture capitalists and related professionals. And, like GTEA, the Food & Health Entrepreneurship Academy builds on one of the campus’s core research strengths.

For researchers, it’s an opportunity to (1) analyze, enhance, and communicate the value of your research, (2)
explore the business opportunities their research creates, (3) build the skill sets for a career in industry research, and (4)design future research programs that address and align with practical applications.

A relatively recent but great leap forward in prototyping received some deserved attention in a NYT article today, “If No One See It, Is It an Invention.” The article, by Leslie Berlin, describes Johnny Lee Chung (a Carnegie Mellon graduate student) and self-produced short youtube videos of his inventions.  A great example is his low-cost Wii-hacked interactive white board.  And these videos have been a big hit–viewed by millions, used by school kids, and landing him a nice job at Microsoft. 

Low-Cost Multi-touch Whiteboard using the Wiimote

While not addressing it directly, this article captures a slowly emerging but immensely powerful tool in the innovation toolkit: the short video as prototype. Prototyping usually involves designing, building, and testing aspects of the technology or product features in order to learn what works and what needs improvement. The mantra: express, test, cycle.

Perhaps not surprisingly, effective technology development teams embrace prototyping to design products and services.  Yet those same engineers and scientists turn around and try to describe and sell their ideas without designing the communication process.

The short video, done well, not only communicates more information in 3 minutes than a powerpoint presentation can get across in 15 minutes, but allows for prototyping.  Express, test, cycle.

I have seen short videos, developed and shared, that were the deciding factor in internally selling new product platforms. And as a result, we now require our students to present their ideas for new businesses or compelling markets in this format. This turns the usual (and painful) 15 minute presentation that inevitably goes long and off-script into 3 minutes, leaving 12 for questions and answers. Further, it forces the students to triage: focus on the most important information and get rid of the chatter.

Johnny Chung Lee’s videos are nicely humble and low-tech–and had held camera and headshot of him describing the technology.  But we’ve found slideshows that combine images, text, and brief clips of user testimonials to be a far better means of describing customer problems, compelling solutions, and potential business models. 

Few compare in quality and emotional impact to the Girl Effect, so right now this serves as the best to strive for.

The Girl Effect

As a fan of good product design, I have to quickly recommend Jason Amendolara’s site. It’s a great example of fun design, creative ideas, and wonderful execution. One of my favorites: the self-shaking salt shakers…

A bias for action is contagious. I wrote an earlier post about one of the student teams in the Center for Entrepreneurship‘s Business Development Program, who in the course of the program designed and built a new business around bringing traditional, tasty, and nutritious drinks from indigenous cultures to the American market. They were one of a half dozen teams this year who made significant progress in turning their ideas into reality.

Indeed, this year seems to have proved out one of the basic tenets of the Center for Entrepreneurship’s programs: that innovation depends as much on the value of your actions as of your ideas. The teams drove hard to prove (or disprove) the value of their ideas by taking concrete actions.

One team took an idea coming out of our newly-created Western Cooling Efficiency Center, and that retrofits commercial rooftop air-conditioning units to save 5-10% on energy costs. Working with its inventors, the team oversaw the engineering, built a prototype, secured the intellectual property, began discussions with several major utilities to explore adoption incentives and, before the term was even out, reached agreements with Wal-Mart and Target to run initial pilot tests on their stores.

With a payback of less than a year (without incentives), this technology–as an idea–has considerable promise for reducing energy demand. With prototypes, letters of intent, and pilot-tests underway, the business of installing these retrofits is equally promising. It’s one thing to read about building a supply chain and initiating negotiations with customers, it’s another thing to learn by doing it.

Another team had developed a new great-tasting set of salad dressings (don’t mention that they are also low-calorie) and, in the course of the Spring began selling this dressing, with vegetables, in the student lounge; built a strong advisory board; worked with a copacker to identify which combination of market niche, ingredients, and process would work best; and with a designer created their labels, branding, and point-of-purchase displays. They also taught the class a valuable lesson on the role that good design can play.

As I said, a bias for action is contagious. These teams, like others in the program, witnessed first-hand each other’s actions and accomplishments and set their own expectations higher as a result.

The more experience they had getting out of the classroom and engaging with suppliers, customers, and others the market, the more they learned about what it took to act on their ideas. These lessons are among the most valuable they will take away from their education.

Edison may have said innovation was 1% inspiration, 99% perspiration but he didn’t explain just what the perspiring was all about.

Anything can be hard work if you let it: running in circles can take just as much time and energy as moving forward. And in this way, most perspiration in innovation is misplaced–spent perfecting what inventors and entrepreneurs are already comfortable working on. If they’re engineers, that means perfecting the mousetrap; if they’re managers, it means more planning. Hard work, but not necessarily the right work for turning a new idea into a new business.

One of the core principles in the Business Development Programs at the Center for Entrepreneurship is to instill in our science, engineering, and business students a bias for action. That means, first and foremost, identifying the right actions: the activities that will move a new venture forward rather than run it in circles.
Put in the right context, our PhD and postdoctoral fellows embrace this bias.  It is, after all, built on the scientific method.

That’s because the most valuable actions an entrepreneur can take in the first year are essentially experiments, activities that test hypotheses about the idea and the business around it.  For example:

Hypothesis 1: It will work outside the laboratory

Hypothesis 2: Customers will understand and value the solution

Hypothesis 3: We are the right people to build this solution

Whatever the outcome, the results of each experiment move you forward by reducing the uncertainties surrounding your venture.

And so it’s always exciting to see some of most educated people around get out of their labs, roll up their sleeves, and take action. This time, it was one PhD in computer science and two postdoctoral fellows in the life sciences manufacturing and test marketing a line of traditional, nutritious, and very tasty drinks from Africa.

Why? Because they had developed this idea for a business and needed to know how the market would respond.
In two days spent at the local farmer’s market, they sold over $600 worth of the drinks.  And in getting there, they had to find a co-packer willing to front them the bottles and another who would work with them on the formulation; forge an agreement with a Ugandan women’s coperative to supply the ginger, hibiscus, and other ingredients; and spend hours in a commercial kitchen actually cooking up the first batches.

Sure, they could have worked on their science-based ideas about network security, alzheimers, or nutrition; or they could have spent the time re-running the numbers on their business plan from here through 2012, revising their marketing plans, or allocating equity amongst themselves. But they chose to work on this business because it was hands-on. In one quarter, they might not have learned so much about their potential business, or how to build new businesses, as they did making real juice and talking to real customers.

If and when
they go into industry R&D when they graduate, that business experience will provide them with an invaluable understanding of what it really takes to drive innovation.

Amory Lovins to Present Keynote Address at Second Annual UC Davis Green Technology Entrepreneurship Academy

Program Agenda and Key Faculty Also Announced

DAVIS, CA–(Marketwire – April 22, 2008) – The University of California at Davis (UC Davis)
Center for Entrepreneurship announced today that Amory Lovins, co-founder,
chairman, and chief scientist, Rocky Mountain Institute, will be the
keynote speaker at the second annual Green Technology Entrepreneurship
Academy, to be held July 7-11, 2008, at the Tahoe Center for Environmental
Sciences in Incline Village, Nev. The Center also announced that the
Academy’s faculty will include experts from the nation’s top venture
capital firms, law firms, and research institutions. The Academy’s agenda
will include sessions covering the first critical steps of
entrepreneurship, such as intellectual property, incorporation, building a
team, and market validation, teaching students how to move their research
on sustainable technologies out of the laboratory and into the marketplace.

Lovins, who will speak on the evening of July 9, is a world-renowned energy
consultant and physicist, as well as an author, speaker, and MacArthur
Fellow. In 1979, he co-founded Rocky Mountain Institute, an independent,
market-oriented, entrepreneurial, nonprofit, nonpartisan “think-and-do
tank” that focuses its research on advanced resource productivity and
innovative business strategies that lead to “abundance by design.” Lovins
is also a member of the Board of Advisors for UC Davis’ Energy Efficiency
Center.

The Green Technology Entrepreneurship Academy is in its second year. It
provides doctoral students, post-docs, and research faculty in science and
engineering with the knowledge and skills that will enable them to move
their ideas out of the laboratory and into the marketplace. Applications
for participation in the Academy are currently available at
http://entrepreneurship.ucdavis.edu/green/apply.html. The deadline for
applications has been extended to May 16. All admitted students will
receive scholarships from the Kauffman Foundation to cover the program’s
room, board, and tuition. PG&E has agreed to sponsor two fellowships to
provide both room, board, and tuition and travel for doctoral candidates,
post-docs or research faculty working on research in sustainable
technologies.

The five-day program will cover the basics of entrepreneurship, with
sessions focusing on networking, intellectual property, market validation,
elevator pitches, development strategies, business plan presentations, and
the logistics of building a team and establishing an organization. Time
will also be set aside for networking and mentoring sessions with faculty,
lectures from entrepreneurs about their own experiences, group
presentations, and social hours. Further details about the program can be
found at http://entrepreneurship.ucdavis.edu/green/schedule.html.

The Academy’s faculty will be drawn from the venture capital community,
including venture capitalists from American River Ventures, CalCEF Clean
Energy Angel Fund, DFJ Frontier, MDV-Mohr Davidow Ventures, Nth Power,
Physic Ventures, and Sierra Angels; the legal community, including
attorneys from Morrison|Foerster; and the research community, including
representatives from National Instruments, San Diego Gas & Electric, and
the UC Davis Energy Efficiency Center.

“I expect Amory Lovins to be a top draw for students and faculty alike,”
said Associate Professor Andy Hargadon, director, UC Davis Center for
Entrepreneurship. “We’re lucky to have outstanding faculty and partners
dedicated to this summer’s Academy, and I hope the students’ plans will
reflect the valuable input they receive from their mentors.”

About the UC Davis Center for Entrepreneurship

The UC Davis Center for Entrepreneurship serves as a nexus for
entrepreneurship education and research — and as a springboard for
entrepreneurial initiatives on the UC Davis campus.

To accomplish this, the Center brings science, engineering and business
students and faculty together with experienced entrepreneurs, investors and
corporate leaders in a highly collaborative environment that blends
effective theory with hands-on participation and solution-driven
innovation. The Center is a Center of Excellence within the Graduate School
of Management.

Under the direction of Associate Professor Andrew Hargadon, the Center
provides researchers and MBA students with the necessary skills, resources
and network support to turn their ideas into action. Whether for profit or
for social benefit — or both — the Center’s programs enable students to
envision a better world and make it a reality.

For more information, please contact Nicole Starsinic, assistant director,
at nstarsinic@ucdavis.edu or visit http://entrepreneurship.ucdavis.edu/.