British Design Innovation and Harbottle & Lewis LLP have worked in partnership for the past two years to support strategic designers and their clients to operate best practice procedures through appointment processes and contract negotiations. Harbottle & Lewis also provide an IPR helpline for all BDI members.
Taking this work a step further, they have launched a Shared Risk and Reward Guide, with a focus on collaborative innovation, produced in recognition of the changing design and innovation business & remuneration models. It provides guidance to strategic designers and to those seeking to engage with them to bring new propositions, services and products to market.
Over the last decade, BDI has witnessed the fortunes of the design sector rise significantly up to and including 2000 and then begin to fall and fall, reaching an all time low in 2003/4.
The strategically led design practices are seeing an upturn (fee income up by 28% in 2005) but, whilst design as an activity is valued by business, it continues in the majority of cases to be purchased on price rather than on most appropriately qualified practice.
This presents the design industry and those who seek to engage designers with a series of (surmountable) problems.
• The first is the engagement of designers too far down the design and innovation supply chain, which results in compromised and/or higher risk propositions if early decisions are irrevocable.
• The second is buying on price rather than on appropriate expertise, which often leads to the appointment of a less qualified design consultant or a reduced level of design thinking and design process applied, leaving the proposition compromised or unfinished.
• The third is the risk averse nature of SME’s or lack of funds available to purchase the right level of strategic design thinking that can often reduce risk and heighten or discover new market opportunities.
• The fourth is the ‘add-on’ perception of design input rather than the collaborative partner approach that delivers greater results – particularly in a shared risk scenario.
• The fifth is business language and cultural barriers between designers and non-designers.
• The sixth is R & D tax credits, which include a provision for design only where it directly contributes to overcoming scientific or technological uncertainty in pursuit of an advance in science or technology.
• The seventh is the complexity and expense surrounding IP issues.
Most of these issues are surmountable, some more easily than others. Many can be resolved through an improved climate of collaboration between all parties playing a critical role in the design and innovation space.
In an attempt to assist this process, BDI has developed a simple framework, support structure and design and innovation network called Propositions into Profit (PIP) backed by the Harbottle & Lewis legal framework and term sheet to support shared risk negotiations.
The Shared Risk Guide provides the tools to enable designers, universities, entrepreneurs and broader industry to:
a) understand the role strategic designers play in the innovation process
b) enable that role to be appropriately valued
c) enable strategic designers to communication that role & value
d) enable all parties to negotiate appropriate remuneration terms
e) *establish the value of the funds provided by design firms in lieu of full economic fees
f) be supported and protected by a term sheet and legal framework for shared risk deals
* Uniquely BDI and Harbottle & Lewis have produced an analogous lending model that places the design agency in the position of money lender (their time and fees) compared against other types of business development money lenders e.g. from friends and family through to venture capital. This model enables the design industry to set a precedent for an accepted return on investment ratio in reduced fee plus royalty, licence or equity deals.
In a shared risk shared reward model it is reasonable to expect that strategic design firms will seek to agree a structure which enables them to participate fairly, and potentially to reap considerable financial rewards – in the same manner as other business organisations do.
Comments Andy Millmore, IP lawyer, Harbottle and Lewis
“There are two challenges to overcome in order to turn this expectation into the reality – the first is to achieve acceptance of this as an approach which we believe that BDI’s PIP initiative will help considerably in this regard.
The second in then suggesting or agreeing a structure which is both fair and workable which is where Harbottle & Lewis can help through its’ experience and expertise in licensing deals of all sorts, start-ups, angel investments, Joint Ventures, development agreements and beyond”
Maxine J Horn, CEO BDI concurs “the strategic design industry is being presented with an opportunity to get into the driving seat and positively direct the future remuneration model. But to achieve that the established design firms need to put in place a business structure and agree remuneration standards before they can take an equal place at the negotiation table”
Designers and industry collaboration
The benefits of sharing risk with strategic designers are self evident.
• They are the only group of people uniquely qualified to view need and product interaction from a consumer/user view point and have the skills to visually translate that knowledge into a tangible proposition, product or service concept that all stakeholders can understand.
• Core design thinking and visualisation techniques can be utilised to translate and package business thinking into a format that all stakeholders – internal and external - can understand and engage with
• Design thinking can unearth undiscovered IP and/or *add value to existing IP (*IP arising)
• Designers early input can reduce risks, components, materials and thereby cost.
• Designers can assist with legislative compliance including sustainability issues, and reduce compliance costs.
• Designers work across many industry sectors on an international basis and are therefore ideally positioned to identify additional market applications or at times to forewarn of market risks that may affect the market success of the proposition, product or service in development.
EDITORS NOTES
About Harbottle & Lewis LLP
Harbottle & Lewis LLP is a London based commercial law firm of over 80 lawyers providing specialist advice primarily to the media, entertainment and communications industries.
The firm’s work encompasses all areas of media and entertainment, including film, television, broadcasting, sport, music, theatre, publishing, fashion, design, marketing and communications and we remain unique in having expertise right across these sectors.
We provide a complete range of commercial legal advice to our clients, including intellectual property, legal issues relating to media, including defamation, advertising, sponsorship, brand protection, data protection and privacy as well as buying and selling businesses and companies, joint ventures, finance, capital markets, commercial disputes, property, employment, immigration and tax. Much of our work involves the technology, new media and telecoms industries and we have done ground-breaking work in connection with the digital exploitation of content and e-commerce generally.
Contact Information
Harbottle & Lewis LLP
Andy Millmore
Hanover House,
14 Hanover Square,
London W1S 1HP
Tel: +44 (0)20 7667 5000 Fax: +44 (0)20 7667 5100 Dx: 44617 Mayfair Web: www.harbottle.com
About British Design Innovation (BDI)
On 1st August 2005 the British Design Initiative, established in 1993, licensed its assets and brand to a newly formed company British Design Innovation, a not for profit membership organisation with a range of services reflecting the increasing focus on collaborative innovation by designers & industry.
The membership of strategically-led product, proposition creation, brand, new media, packaging, commercial interior and service/experience design consultants are joined by PhD's, university innovation departments, in-house design and innovation teams, innovation agencies, entrepreneurs, dealmakers and art & design faculties and their graduates
This unique membership mix is designed to encourage collaboration between the membership groups to foster a creative environment for collaborative innovation whilst demonstrating the role that strategic design plays in its success.
Importantly, British Design Innovation has been launched to communicate that design is a core discipline in the innovation process. The success that strategic-led design can bring will be measured by an organisations ability to engage 'design thinking' (creative knowledge transfer) early enough to make a difference.
We believe that it is more beneficial to promote proposition creation & design-thinking (creative knowledge transfer) than it is to promote design as an activity to be purchased only at the point when visual translation is required.
Engaging designers to input into user-focused strategy and proposition creation at the outset of the process provides companies with the opportunity to benefit from creative knowledge transfer and use it to discover market opportunities they might never have known existed.
Earlier involvement might also reduce risks, costs and time to market.
General (non strategic) design services can be bought further down the value chain but consigning the 'strategic design process' to a commodity purchase overlooks the critical value a designer can bring to a business.
Contact
BDI HQ
Maxine J Horn, CEO
BDI
9 Pavilion Parade
Brighton
BN2 1RA
01273 621378
maxine@britishdesigninnovation.org
www.britishdesigninnovation.org
Other information and links
On June 15th 2006 BDI cloned its national site www.britishdesigninnovation.org and launched 10 regional British Design and Innovation portals. They can be viewed at:
• www.london.britishdesigninnovation.org
• www.scotland.britishdesigninnovation.org
• www.northeast.britishdesigninnovation.org
• www.eastmidlands.britishdesigninnovation.org
• www.eastofengland.britishdesigninnovation.org
• www.yorkshire.britishdesigninnovation.org
• www.northwest.britishdesigninnovation.org
• www.southwest.britishdesigninnovation.org
• www.southeast.britishdesigninnovation.org
• www.westmidlands.britishdesigninnovation.org
• www.wales.britishdesigninnovation.org
• www.northernireland.britishdesigninnovation.org
This launch provides BDI with a virtual presence in each of the nine English regions plus Scotland and as such enables the regional design and innovation players to more easily identify with and engage with each other. It also provides the Regional Development Agencies (RDA's) and other focal point organisations with an opportunity to network the regional design, innovation, and knowledge transfer and business networks.
MEMBERSHIP GROUPS
Commercial Design Agencies - Design Agency Directory
Membership continues to exist for all type and size of design agency to service the needs of nearly 700,000 site visitors per annum. All design agencies are represented in the Design Agency Directory. All members are denoted by the BDI marque. All other agencies are registered with BDI on a non-membership level and form part of our inclusive policy. Over 4,500 commercial design agencies are registered with BDI representing 95% of the commercial design market.
Strategically-led design and innovation consultancies - Design and Innovation Directory
Commercial design & innovation consultancies who seek to engage with other players involved in the innovation process are represented within the Design Agency Directory and/or the Innovation Directory. These consultancies and/or individuals are the 'design thinkers' with more than 10 years experience in product development and service design propositions across many business sectors.
University Innovation departments, research, scientific and technology led faculties
The design thinkers are joined in the Innovation Directory by scientists, technologists, biologists, economists - in fact every type of 'ist' with PhD's in all sorts of 'ologies' employed by some of the UK's leading Universities.
PhD's are encouraged to engage with Design Thinkers to turn research results into market-led ideas and subsequently ideas into market ready propositions.
In-House Design & Innovation teams
Individuals and teams from all type and size of manufacturing, retail, service or technology companies that have a design & innovation focus are eligible for BDI membership. They have access to the Innovation Directory to commission consultancy projects and/or to form partnerships with the 'thinkers'.
Entrepreneurs and start-up companies
A high percentage of new product, service and business ideas come from individuals from all walks of life. Most do not have the ability or means to exploit those ideas without the assistance of designers and dealmakers. Individual membership to BDI provides this group with access to Propositions into Profit a framework, network and process designed to enable those with the ideas to engage or collaborate with others whose design, business and deal making skills assist them to develop their idea into a market ready proposition.
Dealmakers
This group of members include Intellectual Property experts, venture capitalists, business angels, knowledge transfer officers and all other type of facilitator, intermediary or funding source. No design and innovation process would be complete without the dealmakers.
Art & Design Faculties & their Graduates - Graduate Directory
BDI provides membership to individual graduates who elect to join and benefit from the employment opportunities afforded to them through the Graduate Directory and other services.
 Download the attached PDF
Submitted: 04 Oct 2006
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