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Rise of the DEO: Leadership by Design

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This chapter is from the book
The authors of Rise of the DEO explain that leaders who understand the transformative role of design and embrace its traits and tenets can command in times of change. They call these leaders DEOs—Design Executive Officers—and they are the new heroes.

The crowd at SXSW stretches to the horizon. The two-week-long conference showcasing music, film, and interactive talent attracts a young crowd. Mostly under 40, the attendees come from around the globe for a hit of their favorite drug: change.

Change used to be much less popular. In business, it was an outcome: the result of deliberate, often measured efforts to reach a new goal or solve a significant problem. Considered inherently risky, it was administered in small doses. We welcomed a refreshed logo or name. A minor feature could be advertised as “new and improved,” but large-scale change signaled distress. Big change meant something was wrong. Big change meant someone had erred. Today, while change retains its prescriptive quality in some circumstances, for most businesses, and certainly for the 60,000 paid attendees at SXSW, it’s in the bloodstream.

No organization is static right now. Even the most staid and conservative company changes simply by staying the same while everything around it evolves. Traditional companies become dated companies through no effort of their own. They become the 1950s suburban ranch home surrounded on all sides by updated remodels—their safe, traditional stance slowly but surely lowering their value.

In the United States alone, over six million startups are launched annually.1 Google, Comcast, Amazon, Cisco, and Oracle are well-established Fortune 100 companies, yet none of them were on that list ten years ago. Twitter, Facebook, YouTube, and Pinterest connect billions of people around the globe. All were founded within the last decade.

This turbulence naturally impacts employment and careers. The conventional map of success—get a degree, start at the bottom, network aggressively, follow the rules, climb the ladder, retire comfortably—is now a no-man’s-land.

The average adult worker in the United States holds more than 10 jobs in a lifetime.2 It’s become increasingly common to hold more than one job at a time, to reeducate yourself continuously and to reinvent your career three to four times. The simple inquiry “what do you do?” has become a complex question unanswerable with a simple title or function.

This chaotic landscape of constant and continual change is at odds with the established view of business and business leaders, particularly CEOs. Good CEOs once ruled from a position of stability. They commanded forces of people, money, distribution networks, and brand imagery, bolting them together into a profit-making, market-share-gaining machine. An industry might be cutthroat, but it was understandable and advanced relatively slowly. Innovations required years of development. Aspiring CEOs wrote five-year business plans, built brand equity, assembled their associations, and climbed up a well-defined hierarchy.

As attractive and permanent as that world may sound, it simply doesn’t exist anymore and it isn’t coming back.

We live in a time where little is predictable. No career path is predetermined. No one can play it safe. The majority of companies, their employees, and their leaders navigate a space where competitors appear overnight, customers demand innovations monthly, business plans rarely last a full year, and career ladders have been replaced by trampolines. This environment of incessant, nonlinear change will only accelerate in the future. Traditional CEOs are ill-equipped to survive.

Design

We’re not the only ones to see this leadership gap.

In 2010, the IBM Global CEO Study announced, “More than rigor, management discipline, integrity or even vision—successfully navigating an increasingly complex world will require creativity.” Two years later, it added three more essential traits: “empowering employees through values, engaging customers as individuals, and amplifying innovation through partnerships.”3

Daniel Pink takes a holistic perspective and relabels our era the “conceptual age.” As a result, CEOs need to be storytellers, big-picture thinkers, and empathetic humorists capable of giving meaning to our lives through their products, services, and management styles—not to mention their honest, revealing, re-tweetable posts.

Thomas Friedman warns that we’re living in a hot, flat world where a successful CEO must upload, outsource, and offshore. Tom Kelley and David Kelley invite us to reclaim our creative confidence, while Sheryl Sandberg instructs us to “lean in.”

Some authors and advisors focus attention on the problems, noting that today’s challenges are “wicked” and defy conventional solutions. CEOs, we’re told, need to change their character and develop peripheral vision, pattern recognition, an experimental mindset, and a high panic threshold.

A logical response to these avalanches of advice is to surrender. We throw up our hands and hope our inherent traits or some measure of luck will suffice. Perhaps we’ll work for the right startup, or get the attention of the right boss, or happen upon the right industry in its earliest stages. Maybe we’ll stumble across a mentor who can help us make sense of conflicting paths and tortuous routes.

Another response—the one advocated in this book—is to identify the business function best suited to these tumultuous times and use it to guide your actions. The business world has done this before. When companies needed to develop procedural discipline, it turned to Operations as a guide. When companies needed to attract and retain customers, Marketing led the way. When companies needed to learn how to scale, Finance provided the tools and perspective.

Now that companies need agility and imagination, in addition to analytics, we believe it’s time to turn to Design as a model of leadership.

If you want to start a contentious, circular debate among a group of sophisticated, otherwise mature adults, ask them to define “design” as a business function. Google lists over four billion entries. Wikipedia adopts a particularly lame dictionary definition: “Design is the creation of a plan or convention for the construction of an object or a system (as in architectural blueprints, engineering drawings, business processes, circuit diagrams and sewing patterns),” then makes it worse by adding that no real definition exists.

The International Council of Societies of Industrial Design gives it credit for creativity, but then complicates it with grandiosity: “Design is a creative activity whose aim is to establish the multi-faceted qualities of objects, processes, services and their systems in whole life cycles. Therefore, design is the central factor of innovative humanisation of technologies and the crucial factor of cultural and economic exchange.” Phew. Good to know.

A more recent definition from proponents of design thinking emphasizes design as problem solving that creates new, useful products, places, communications, or experiences. We have no argument with this description as long as problem solving is understood to be a process and not the literal definition of design (surely we can build on successes or enhance desires as well as solve problems). We would add—with emphasis—to design is to encourage collective change.

When we think design, our first association is change: change that responds to need, embodies desire, pursues a stated direction, and reflects a shared vision. Those who are designers—either through training or by nature—actively encourage and support collective change.

Historically, design changed “things.” More recently it’s changed services and interactions. Looking ahead it will change companies, industries, and countries. Perhaps it will eventually change the climate and our genetic code.

Leaders who understand this transformative role of design and embrace its traits and tenets can command in times of change. We call these leaders DEOs—Design Executive Officers—and they are our new heroes.

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