Evolving Design Firms (AIGA/DC Growth Lecture Services)

Vivid Phase 1:

• Partnership (3 partners) with diverse backgrounds.
• Our goal was simply to do interesting work.
• No real strategy (thought we'd do this for the rest of our lives and built the partnership around how we wanted to live).
• A partnership is truly a marriage. If possible, always have an odd number of partners (3, 5, 7.etc.).
• Never issue non-dilutable stock.
• Reward performance and not tradition.

Vivid Phase 2:

• Added a new partner and regrouped as an S-Corp.
• Grew from 4 to 40 people.
• Still building the company we wanted to work in for the rest of out lives.
• Still had no strategy except to work.
• In the right place at the right time.

Vivid Phase 3:

• Spun-out a sister company too early with no safety net.
• Hard times.
• Took investment which drove some of our decision-making (for better and worse).
• Grew to over 100 people.
• Sold the company (for stock). This company was then acquired by another company (for cash).
• Bought it back (barely).

Vivid Phase 4:

• Reinvented the company, again as our idea, but now with a lot more experience and insight.
• Created some business innovations:
  • Flat, 5-tiered stock option plan (no tier more than twice the tire under it).
  • Everyone owned the company and had a vested interest in its success 9to a larger degree than most companies).
  • Investors worked in the company.
  • Daily stock vesting (rather than quarterly or yearly). This gave no incentive to stick-around if people weren't happy. The accounting was easier as well.
• Sold the company again (for stock) because the investment terms were coming due. We were about 120 people.
• It was a disaster despite the deep cultural courting (there's a difference between culture as discussed or idealized and as practiced).

Deluxe:

• Born to sell (either the product, company, or technology) within a 12-24 month time frame.
• 3 (4) partners/founders who hold "real" stock.
• All boot-strapped investment with costs kept minimal.
• S-Corp.
• Virtual stock option plan (still legally binding but without the paper work and legal fees).

Sustaining Growth:

• Be selective about clients (turn away the wrong business).
• Discuss with entire company what kind of work you want to be doing. Create criteria that can be used by business development people to land the right work.
• Be honest about finances and problems and solicit your employees' help. Simply involving and informing them can lead to more loyalty and confidence.
• Set standards of excellence (this is an ongoing dialog).

Management:

• Create detailed job descriptions for everybody (including administrative staff and executives).
• 360° Reviews (reviews by managers and peers as well as of managers).
• Split outward and inward focus responsibilities (or make it easy to do so at times).
• Split management of people from design direction (CCO vs. Group Director).
• Everyone in the company is creative--or better be. "Creative" isn't a word owned by the design department. For that matter, neither is "design."
• Make multi-disciplinary teams.
• Project-oriented teams can focus and do better work than department-oriented teams.
• Split job titles (with the structure of the company) from project titles (responsibilities someone may have on a particular project). This helps people use and grow their skills and not get pigeon-holed into narrow work.
• Always hire better than yourself (or everyone and everything is weaker than you by default).
• Pay according to market, not hierarchy--even if it's more than you get paid yourself.
• Support your managers but encourage open dialog.
• The team should write the proposal and budget--and specify the hours required.

Marketing:

• Differentiate on real issues, not phony ones. Clients will see through your bull-shit.
• Don't make up silly or redundant words, terms, or processes.
• If you can, sell research! Design is very hard to sell right now. Any mystification of the design process only makes clients less confident in hiring design services.
• Compete on insight, skills, and experience.
• Understand and communicate the market climate.
• Partner with other quality partners.

Your Space:

• Space for meetings is more important than space for offices.
• Create lots of meeting areas (more informal than formal).
• Democratize the office plan (share the windows in common areas and don't give them all to "management").
• Cover the walls with white boards.
• Show your work in the office, not another artists'.
• Invest in chairs, not desks.
• Allow people to work on the equipment they feel most comfortable with (Mac, Windows, UNIX, etc.).

Remaining Creative:

• Vivid School (ways of sharing knowledge among employees--such as lunchtime presentations on any interesting topic).
• Experience School (self-generated projects on more exploratory problems that involve peer critique). These projects might find their way into your portfolio and help you transition the work you're known for.
• Training courses or conferences only for ideas and processes. People can learn new tools through experimentation and tutorials provided with the tools. Tool courses are often a waste of time and money since people can't learn as fast as they are able.
• Two-tiered management structure (people management split from creative direction). This allows a creative director to focus on the work.
• Keep portfolio rights in your client contracts and give portfolio rights to your employees. This is how you get more work.

Education:

• You will always have to educate your clients.
• Use you website wisely to cut-down on your conversation overhead. Create product planners, insight pieces, white papers, present you process, etc.
• Develop, codify, and present your methodology (this will help train new employees, increase quality and productivity, and win clients).

Culture:

• Are you a first name or last name kind of company?
• What's your culture? Does your personality show through in your marketing materials?
• Create and evolve a mission statement with the participation of everyone in the company.
• Solicit input from your employees on the work they desire to do.
• Involve the company in issues of culture and important decisions (though make it clear that this is input and not decision-making).
• Everyone's input is valued on projects but responsibilities must be clear.
• Lead! Employees desire and seek leadership.

The Entitlement Generation:

• Show little tolerance for outlandish behavior or demands.
• Always be positive and dispassionate in dealing with these demands.
• Demanding employees require a LOT of education and attention. Be sure they're worth it.
• Fire trouble-makers ASAP

Resources:

• www.nathan.com
• www.vividstudios.org (This is the last website vivid used. In it are examples of job descriptions, project planners, white papers, etc. that may give you ideas to implement for yourself. vivid's previous two websites are also buried within the "Origins" section of the "Culture" section.

 

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