Design To Grow uses Coca-Cola as an example of how keeping a company stable and flexible at the same time over decades is not only possible, but a must to grow and scale your business across the globe.
David Butler has helped startups scale and companies grow for over 25 years. The last 12 of those he has spent at no other company than Coca-Cola, most recently as vice president of innovation and entrepreneurship.
He says that there’s never been a scarier time in history to be an established company than now, because in the past decade, more giants than ever before have stumbled: Kodak, BlackBerry, Nokia, Blockbuster, Dell, Motorola, Yahoo, the list gets longer by the day.
So how does an almost prehistoric giant like Coca-Cola not only stay in business, but thrive in a world where any teenager can come up with an app that solves yesterday’s problem better tomorrow?
David thinks it’s because from the start, Coca-Cola was designed to grow. To stay stable, but at the same time remain flexible enough to handle a very uncertain environment. Let’s look at how other companies (like yours) can do the same.
Here are 3 lessons from Design To Grow:
There are two parts of a business’s design: the visible and the invisible.
All startups must switch from being flexible to stable as soon as they find their product-to-market fit.
Use an open innovation system to keep your company’s R&D lean and efficient.
Ready for a behind-the-scenes look at one of the top 10 most valuable brands in the world? Let’s go!
Lesson 1: Your business is designed in two ways: the invisible and the visible.
When we talk about business design, most often we think of nothing more than a company’s corporate identity – their logo, colors, fonts they use and maybe what the product looks like. David makes two interesting remarks, which both hint at the fact that business design is much more than just that:
The visible design extends beyond your products and branding to everything customers can see and connect with, such as customer service, your office building, your website, etc.
There’s also an invisible design, which includes everything your customers can’t see, but that’s part of how you deliver your product: your internal processes, company culture, partnerships in the industry, etc.
David says the only way to make great overall design is to always combine the two.
For example, Coca-Cola re-designed the water bottles for their brand Minaqua in Japan. First, they started with doing something invisible to the customer: researching what Japanese people desire in a water bottle. After finding out that they care about recycling and live in small houses, they could then design the visible part (the bottle itself) in a way that aligned with that.
What they came up with was a small, lightweight plastic bottle, that could easily be twisted, stacked, stored and recycled. Thanks to a combination of both visible and invisible design, they created a great product, which significantly increased sales.
Lesson 2: Once a startup finds its product-to-market fit, it must switch from being flexible to being stable.
Everything in the startup-world is fast-paced. You have to grow fast, adapt all the time and stay lean. David says all of that true, if a new startup isn’t flexible, it’ll die quickly, BUT he makes one condition: as soon as a startup finds its ideal target market and has a great product-to-market fit, it must switch from flexible to stable and focus on providing the same, high quality standard, in order to scale.
For example, Coca-Cola was founded in 1886, which means it’s 130 years old. What’s astonishing is that for the past 93 of those, the bottle design, font, color and franchise model have remained the same.
The first two franchisees came on board in 1899, purchasing their rights to bottle Coca-Cola for a single dollar, the contour bottle design was the result of a 1915 bottle design contest and the curly font was standardized in 1923.
Because the product was popular, giving it an iconic, simple and recognizable design is what made it spread like wildfire across the world.
Yes, flexibility is good, but once you have a winner, know when it’s time to switch to stability.
Lesson 3: You can use an open innovation system to let customers take care of research & development for you.
Want an easy way to save $100 million on research and development? Let your customers do it for you. There will always be customers who come up to you with ideas on how you can make your product better. Instead of filing these away under annoying complaints, why not embrace them and make the most of it?
Using what Coca-Cola calls an open innovation system, you can give people a set of fixed tools, within which they can experiment as much as they like and come up with their own ideas for products, advertisements and services you can offer to them, to make them happy and sell more – a win-win!
Coca-Cola does this with the Design Machine, which lets users design bottles and advertisements for various Coke products. The templates, font and colors are standardized, but the rest is up for grabs.
The result? Through this and other open innovation systems, Coca-Cola has saved $100 million in R&D over the years.
My personal take-aways
Nowadays it happens often that a company hits the market, goes through the roof, you read about it everywhere and “experts” try to explain its success and how to replicate it and then…it’s gone. Bust after 2-3 years. How about we make a rule to only learn from companies that have truly stood the test of time? Companies like this one. Great read!