DESIGN IN ASIA

John HeskettChair Professor of Design School of DesignHong Kong Polytechnic University

Questions

- How are Governments in Asia responding to competitiveness and productivity challenges through developing design support policies? What resources are being committed, on what activities and, where measured, what the impacts such policies have had on business management and performance and/or educational effectiveness?

- How do businesses use design and are they becoming more sophisticated in their design thinking?

- Against the competitive threat from Asia, is it possible to build and maintain a competitive edge through use of design?

Design Timeline

1950 1960 1970 1980 1990 2000

Japan

Taiwan

Korea

China

Hong Kong

Taiwan

- Government Initiatives and Organizations

- Role of Design in Business

- Capabilities of Designers

- Design Education

Major Government Initiatives in Taiwan

1989-93 First 5-year plan promoting ID by Industrial Development Bureau (IDB), Ministry of Economic Affairs, emphasizing ID education and introduction of basic techniques and knowledge from abroad, particularly Japan and US.

1994-99 Second 5-year plan promoting ID by IDB, focusing on enhancement of ID role/status in enterprises particularly by emphasizing new product development for SMEs manufacturing consumer products with conventional technologies.

2000-4 Third 5-year plan concentrating on modernization of ID companies, providing assistance to build an e-business environment.

Taiwan - China Productivity Center

1955 Ministry of Economic Affairs established the China Productivity Center (CPC), with contributions from 50 public and private industrial and commercial enterprises. Its main task was to assist industries enhance productivity.

1980 Quality became main focus.

1990 Overall competitiveness of companies emphasized.

2000 CPC's mission now to help enterprises to be innovative, creating value and building knowledge capabilities.

China External Trade Development Council (CETRA)

1959 CPC established Trade Promotion Department.

1968 Trade Promotion Department spun off and restructured as China External Trade Development Council (CETRA).

1979 CETRA) established the Design Promotion Center (DPC) to raise levels of design and upgrade the quality, image, and competitiveness of Taiwan-made products on world markets.

Taiwan - China External Trade Development Council (CETRA) 2

CETRA has five sections:

1. Design Planning;2. Design Development; 3. Design Information;4-5 Image Enhancement Plan Promotion 1 & 2, which

ncluding Commercial Design, Packaging Design, and International Design Coordination.

Taiwan - Design Promotion Center

DPC's services include :

- programmes to promote product and packaging design;

- aiding corporate identity systems (CIS) and corporate image building;

- package testing services;

- design competitions and exhibitions

- design seminars and workshops;

- publishing design periodicals and literature,

- sponsoring international design exchange activities;

- collecting and disseminating design-related information.

Taiwan - Design Promotion Center

DPC's services include :

- programmes to promote product and packaging design;

- aiding corporate identity systems (CIS) and corporate image building;

- package testing services;

- design competitions and exhibitions

- design seminars and workshops;

- publishing design periodicals and literature,

- sponsoring international design exchange activities;

- collecting and disseminating design-related information.

Taiwan Creative Design Center 1

In 1998, DPC and CETRA proposed a national design centre with an investment of NT$46 million to help small and medium-sized companies enhance product design and marketing. It commenced operations in 2004.

The organizational structure remains that of DPC, with two new units added, design management and design research. Its role is now a design integrator rather than promotion, helping SME’s move from OEM to ODM and eventually to OBM with a range of services including product innovation, development, design, marketing strategies and talent training.

Two-thirds funded by the government, with the remainder coming from eight private companies.

Taiwan Creative Design Center 2

With Mainland China becoming an important market to Taiwan companies, the center is establishing lifestyle data banks of Chinese consumer markets from the perspective of product design, brand building, and lifestyle shaping.

There are plans to establish design center branches in major cities to help Taiwan-based companies enhance their business competitiveness in the China market.  The design center is also intended to play a major role in helping the central government promote Creative Culture Industries.

Taiwan - Design Capabilities.

- Designers are at best well educated in technological competency and business understanding.

- They have become integral to larger companies’ operations.

- The number of industrial designers is between 6-7000 in total, increasing by 400 p.a.

- There are some competent consultancies. The largest, NOVA, has three overseas branches in Shanghai, Singapore and Los Angeles, with more than one hundred designers and strategists.

- Many Taiwanese designers are finding high-level employment overseas and in Mainland companies.

Taiwan – Educational Development

Number of institutes offering ID degrees in Taiwan since 1964: Diploma Bachelor Master

PhD

1964-70 7 - - -1971-74 4 2 - -1975-84 5 2 - -

1985-89 8 3 2 -1990-94 9 10 5 -1995-99 9 11 7 - 2000-05 0 22 15

4

Taiwan – Achievements

- An excellent design education system has evolved with high standards and a growing academic research capability.

- Taiwan has some large companies such as Acer, a computer company, which use design extensively and pay well for design services. In-house groups where they exist, however, are small and rarely have any role above the middle level of management.

- Many small design consultancies are now facing problems with the loss of manufacturing investment to Mainland China, where there is competition from lower paid local designers. The more adventurous are seeking both a wider geographical area for their talents and a move into higher level strategic and planning roles.

Taiwan – Achievements 2

- Design has undoubtedly played a role in some of the more outstanding successes of Taiwanese companies in international markets. Officially, design is one of the crucial factors in Taiwan’s competitiveness, but there are still reservations about how deeply design consciousness has penetrated the Taiwanese business community.

Taiwan – Problems

- The universities are probing many advances in design thinking but a gap has opened up with the SMEs that dominate the economy and which usually expect drawing skills, not conceptual thinking. Whether the new Creative Design Center can fundamentally change this situation remains to be seen.

- There is a feeling that Government officers running design organizations do not really understand design.

- China Industrial Designers Association (CIDA), founded in 1967 had in the mid-1990s over 800 individual members and 60 group members. Effective memberships has collapsed by 70% of individual members and half the group members by 2002. The cause is unexplained.

Taiwan – Problems 2

- Design promotion has not been enough to break resistance to change among business managers.

- Subsidies for design services further depress fees and confirm unwillingness of businesses to pay adequate levels.

Korea

- Government Initiatives and Organizations

- Role of Design in Business

- Capabilities of Designers

- Design Education

Major Government Initiatives in Korea 1

Ministry of Commerce, Industry and Energy (MOCIE) by mid-1990s had Department of Industrial Design Promotion, which grew rapidly and by 2003 became part of new section on Standards and Design. It controls policy and funding.

Korean Institute of Design Promotion (KIDP) functions as an operating arm of MOCIE, which determines funding annually. Other sources of funding are rental income from companies located in new building and special events.

The new building in which KIDP is housed has lost something of its initial attraction. It is a long drive from Seoul (a bit like locating it somewhere out in Essex) and KIDP apparently has problems in fully using it, renting out part to a local government and part to 40-50 companies.

Major Government Initiatives in Korea 2

Government procurement is in theory seen as a way to project the design image of the country, but there does not seem to be any real idea of how to implement this, other than a stated intent that the government should buy products that have received the Good Design award.

KIDP seeks to increase public consciousness of design through exhibitions, seminars, TV programmes and regional design policies.

Major Government Initiatives in Korea 3

Government’s Third Five-Year Plan for Industrial Design Promotion, 2003-2007.

1. To broaden the base of the design industry;

1. To take various measures for the education of “star” designers;

1. To establish local design innovation system;

1. To strengthen design R&D capabilities;

2. To innovate the national image of Korea;

1. To expand international design exchange and to strengthen cooperation in Northeast Asia.

Korea Institute of Design Promotion

Current Strategy of KIDP

1. Promotion of Design Industry/Utilization of Talented Human Resources by Creating Jobs

2. Reinforcement of the Design Innovation Capability of the Industry

3. Globalization of the Design Industry and Laying the Foundation for Cooperation in Northeast Asia

4. Reinforcement of the Design Innovation Capability of Local Industries

Major Government Initiatives in Korea 4

Structure of Korean industry and domination of chaebols has meant the main thrust of industrial design has been the evolution of in-house groups oriented to needs of big companies. This means there is now a more devolved trend in Korea, with large businesses, business organizations and regional design centres all embarking on their own initiatives independently of government.

The industrial pattern of Taiwan is in contrast more dominated by SMEs, which has resulted in continuing high degree of centralization in design policy.

Design in Large Business Organizations in Korea

All major industrial companies in the fields of electrical and electronic products and automobiles, such as Samsung, LG, Hyundai and Kia have substantial in-house design groups. The need for these has been stimulated more by the need to emulate competitors in international markets than by any government promotion or intervention.

At Samsung, the jewel in Korea’s design crown, a question about the influence of government policy was answered: “The strong will of top management and company-wide mind-set for design innovation enables design-driven management in Samsung.”

Samsung

550 designers – 470 in Korea and 80 overseas. Working on Product, User Interface and Graphic Design and also Research, IT and Planning.

Balance changing more to UI and Research.

3 main divisions:- Corporate Design Center;- Divisional Design Groups;- Global Design Centers in London, Milan, San

Francisco, Tokyo, Shanghai and Los Angeles.

Samsung 2

Purpose to attract new users by transcending the value users want and earning their trust and loyalty.

Concept of “Total Design Solution” that enhances overall brand value by taking part in every process from early product concept to final sales point.

Investing in people is the way to boost competitiveness.

Clear process is necessary to cope with complexities of production. Need, however, to vary process to meet different product and market needs rather than single regimented process.

Samsung 3

For mobile phones with very fast life cycle, a Design Bank System compiles advanced design concepts so that they are always ready to rapidly meet shifts in markets.

To exploit possibilities of digital convergence, a Cluster System is used, exploring archetypes of clusters or potential user applications for later rapid application.

User Centered Design Lab explores latent needs of people. Ideas provide scenarios for future life-styles and new concept products along with new business process.

Educating outstanding designers is major emphasis with Samsung Design Membership programme for promising design students.

Samsung 4

“Due to the characteristics of design activities, it is barely possible to give ROI data offhand … “. Executive Vice-President Chung, Director of Design.

Mr. Chung uses case-studies instead to point to success of design contribution.

The E700 “Benz Phone” launched in 2003, sold 10 million units in 14 months, generated profit margins of 47% and accounted for 15% of total net profit of Samsung Electronics and 35% of Telecommunication Network business.

It earned its nickname when a Norwegian newspaper compared it to the Mercedes Benz as a symbol of wealth.

Samsung 5

Samsung 6

New fast-selling slim-line SP50 TV was a concept developed by a design team. The positioning of electronic components behind the screen is responsible for the large bulge in the back of TV sets. In the SP 50 the major components were repositioned in the cylindrical support pillar.

Samsung 7

When negotiations are held with institutional investors regarding large-scale financial projects, design teams are always an integral and high profile element of the Samsung presentations.

Korea – Capabilities of Designers

Current Status of the Design Industry in Korea

The current value of the design industry in Korea was estimated at around 7 trillion won in 2002. It is expected to grow to 36 trillion won, equivalent to 3% of GDP in Korea by 2010. How these figures are calculated is not made clear.

The number of people graduating from design related universities and colleges increased from 28,583 in 1998 to 36,397 in 2002, up around 27% over the past five years.

The total number of design studios in Korea is 1,215, with over half in the visual communication sector. The average number of employees per company is 6.9 - most studios are quite small.

Korea – Capabilities of Designers 2

SMEs in Korea like those of Taiwan similarly have little design capability and a main thrust of government policy has been to support them by a system of government subsidy.

From 1995, for new products or redesigns, they could get up to US$20,000. KIDP played matchmaker function.

Pay-back 30% royalty on profits over 5-7 years. Design consultants benefited with substantial growth of design firms up to about 25 employees but level of fees remained low and so could not rely on government funded work.

Local university professors also became consultants for SMEs and with basic security, low overheads and students as cheap labour they were happier with low fee structure.

Korea – Capabilities of Designers 3

212 Consultancy

212 was founded in 1989 – the first ID specialist – about ten years behind the curve of graphics and packaging experts. As a consultancy it grew over ten years from simple, superficial products to more complex designs.

Coway

In 1990 had 20 employees and tried to redesign water purifier. It was a failure and they turned to 212 as consultancy. Great success and expanded into other water system products for kitchen, bathroom, etc. Coway now employs over 1000 people.

Korean Federation of Industry

Has instituted its own Special Committees on Industrial Design and is actively developing its own design promotion policy in an effort to have other voices than government projecting the message.

Currently promoting design clusters. Selected design firms are being supported to enhance their capabilities.

Korean Design Education

Both Korea and Taiwan have been characterized from their early phase of design development by large investment in human capital, with the educational system producing a flow of graduates in applied subjects that were highly tuned to the needs of industry. - Some 36,000 graduates per year.- Almost all universities have master’s programmes;- Ph.D in design at over 30 universities.

KAIST is an elite institution intended to act as a role model for education with a very strong research base.

Korea – Achievements

- Design education emphasizes ability to function in a wide variety of design contexts, with a strong academic research component enlarging discussion of role and methodologies.

- Large companies set the standard with substantial in-house design groups strongly export oriented.

- Greater diversity of design initiatives than in Taiwan.

- Government initiatives are top-down and directed at SMEs. Subsidies have generated some success.

- Regional design centres are already showing substantial iniatives in the localities.

- Reputation of Korean design in international markets is growing and Korea is now a design leader in Asia.

Korea – Problems

- Top-down emphasis can be heavy handed.

- Subsidies of design fees by government have lowered the cost base of consultant services.

- SMEs are a source of potential growth but hampered by a sense of hierarchy in industry and society. “It seems the bosses want to borrow the use of the hand, not the head.”

- Koreans emphasize what is tangible and are unwilling to pay for intangibles.

- Korean design firms lack self-confidence, too often following what is in the market, playing safe, rather than developing new ideas.

China- Government Initiatives and Organizations

- Role of Design in Business

- Capabilities of Designers

- Design Education

Government Initiatives and Organizations

As yet, China has no design policy although the State Development and Reform Commission of the State Council is said to be considering one.

The only recent government initiative has been the establishment of the Beijing Industrial Design Centre, founded in 1995, which has two major functions:- To promote industrial design- To provide design services to industries for which

few designers were available at that time.

Government Initiatives and Organizations 2

Other design organizations have been established by regional governments.

- Shanghai Industrial Design Promotion Organization

- Guangzhou Industrial Design Promotion Organization

- Shenzen Design Forum

Shanghai is vigorously promoting creative city concept.

GIDPO has subvention of around RMB200,000 per year for special events.

SDF is chaired by the local party official in charge of propaganda – under which design is subsumed.

The Role of Design in Business

In general, in large Chinese manufacturing companies, design functions at best at a middle level, buried in large marketing or engineering departments. Its role is to give an aesthetic veneer and not to be involved in conceptual work.

Even in companies considered leaders in China, such as Lenovo, there has in practice been very limited success. The core of corporate strategy is supposed to be innovation and design but not this has not been implemented and products are not of a very high standard. The IBM merger raises many questions.

The Role of Design in Business

Huawei Technologies Co.

1993 - started to use designers1997 - 4 designers in total2005 - 16 designers for server terminals, modem

equipments - 25 designers for mobile terminals, cordless

phone and Fixed Wireless Terminals - 13 designers working for user interface

(graphics & interactions)

Design is moving slowly away from concept of cosmetic design but has no role in proposing product concepts.

Huawei was recently reported to be bidding for Marconi.

Professional Organizations

China Industrial Designers Association (CIDA)A privately-founded professional body dominated by academics. Government provides funds only for special events.

In general, CIDA makes great claims for its role, (e.g. that it is similar to the UK Design Council) but even its members state that it is generally ineffective.

Professional Organizations 2

CIDA is preparing a document on design policy for the central government, covering the following areas:

- Policy on Technologies- Management of Design Industry- Design Organization- Intellectual Property- Human Resource, Education and Training- Promotion to Society- International collaboration and exchange- Fund raising and taxation

Estimated number of industrial design consultancies:

Beijing 19Guangzhou 80Dong Guang 30Foshan 40

The scale of establishment ranges from 5-6 staff, very few have over 10 people.

Design Consultancies

Capabilities of Designers

- Basic skills of visualization that meet the demands of companies are well taught and competency at this level is high.

- There is a lack of initiative, however, with a pattern of looking to the rule book for guidance.

- Problems in product design systems, where skills of superficial design are inadequate for more complex problems.

- Some consultants have built relationship of trust with owners of companies over long periods and this is a key element in changing managers’ understanding and attitudes.

Design Education in China

With the command economy, manufacturing facilities and quantities of commodities were all controlled by the State. Consequently, design of products at that time was basically ignored.

With the opening up of China in the early 1989s it became rapidly clear that the arts and crafts emphasis needed to be changed. An important shift in the nature of industrial design education was the re-definition of the subject as science-and-technology-based. Growth of design courses in general has mushroomed.

The most authoritative source available on the number of industrial design courses at present gives a figure of 126.

Design Education in China 2

Standards vary and there are some courses in industrial design in major universities with good standards of professional training in basic skills.

However, there are many problems:- Teachers are drawn from many backgrounds, are often

incompetent and are badly paid. Teaching is often a cover for personal consultancy activities.- No industrial design course in China has a workshop.

- Students learn to use computers, but visualization is not the same as designing.- There is a heavy emphasis on fashionable forms for IT

products and following the market, but no training in how to design for more fundamental problems across a wide spectrum of products.

Advantages

- Design is becoming a recognized discipline in Chinese manufacturing.

- There are designers capable of more complex work but needing more effective management.

- Many designers, particularly consultants, are pushing to educate themselves.

- Fast learning curve – copying seen as quick way to learn.

- Consumers are becoming very sophisticated.

- Younger, more sophisticated managers and entrepreneurs are showing greater innovative spirit.

R & D Design Commun-

ication

Market User

Brand

Culture Law

Financial Institutions

Potential

Techno-logy

Security

Profitability

Product/Service

Patent Protection Constraints

Acceptable norms

Compatibility

QualityImage

Structures Fashion

Taste

Advert-ising

Integrity

Recognition

The Context of Design

Purchase

Interface

The End