Online Extra: P&G's Quest for "Wow" Design

CEO Lafley is pouring resources into making consumer products a hothouse for innovation and probing deeper into customers' psyche

In the fortress of Procter & Gamble (PG ) of just five years ago, a meeting never would have occurred like this. On shelves and tables sit mock-ups of consumer products P&G has under development, from known brands in redesigned packaging to truly new products, never seen by the outside world.

Even more surprising: Half of the 12 people in the room aren't P&G employees, and more surprising still, they aren't the type P&G would have involved at this early stage just several years ago. All six are professional designers on P&G's Design Board. Their role, in three all-day meetings a year, is to provide an outside designer's perspective on everything from upstream products to how goods are marketed.


  The formation of the design board in 2003 is just one example of the importance A.G. Lafley has placed on design since becoming CEO of P&G in 2000. In 2001, he created the new executive post of vice-president for design, innovation, and strategy, naming Claudia B. Kotchka, 53, to fill the position.

The Cincinnati-based company has also hired scores of designers. It declines to give numbers for competitive reasons, but Kotchka admits that P&G has quadrupled its design staff and can't find enough to hire.

One reason why, she says, is that the packaged-goods industry has never been perceived as a hotbed of design thinking, so designers aren't particularly encouraged to work for such companies. To bring in experienced designers, P&G's human-resources department has been relaxing its hiring practices. P&G traditionally hired only people just out of college or business school and promoted from within, but it's making an exception with designers. And P&G is also relying more on outside firms, such as leading shop IDEO.


  What's behind the shift in thinking? Competition, for one. The consumer-products industry is overcrowded and mature. On top of that, the consolidation in retail among big players like Wal-Mart (WMT ) means that prime shelf space is reserved for strong-selling items. And retailers are taking more of that space themselves with private-label products.

At the time Lafley took control, P&G's volume growth was stagnant. He realized that P&G needed its products to resonate more strongly with consumers. He has boiled this mantra down to three phrases, which employees now frequently use:

1) The consumer is boss.

2) The first moment of truth (how the consumer reacts to the product on the shelf).

3) The second moment of truth (how the consumer reacts when actually using the product).

Relying more on human-centered design with a focus on the consumer fits naturally with Lafley's philosophy, Kotchka says. Before P&G started paying more attention to design, it concerned itself primarily with how functional a product was, she says. Now, she adds, "Functionality is not enough. We want to identify consumer desires, rather than needs. What gives you the 'wow.'"


  Indeed, using designers is part of P&G's commitment to identifying unarticulated wants that it can transform into products. Kotchka cites the example of when heated car seats first came out. "Would I have ever asked for heated seats? Never." Similarly, she adds: "What does the consumer want? You can't ask them, because they are not going to tell you."

Getting P&Gers to better attune their thinking to design hasn't been easy, Kotchka says. In an interview, she demonstrates a method she uses with employees to convey the emotional importance of design. She pulls out a tin of Altoids and then asks employees what P&G would do if it owned the brand?

They invariably say three things: Get rid of the tin container, because it's too expensive. Get rid of the white paper that covers the mints, because it serves no purpose. And, pack the mints systematically to better utilize space. Then Kotchka asks them if they would spend the same amount of money for the product if those changes were made. They invariably say no.

To drive her point home, Kotchka had containers made up to demonstrate what Altoids would look like if P&G owned the brand. Instead of a tin, they come in plastic. Inside, the mints are perfectly stacked in sterile rows, with no paper. Instead of "Altoids," the outside of the container says "Proctoids." She then gives the Proctoids to employees, so they don't forget the lesson.


  P&G is also using its expanded ranks of designers in a fundamentally different way. Before Lafley took charge, P&G more or less brought in designers at the end of the development process to improve a product or upgrade its packaging cosmetically. Now designers work with P&G's research and development staff from the beginning, helping to conceive products.

P&G's divisional heads have received letters from Kotchka asking them to list things they are worried about to see how designers would address the issues. The head of home care was concerned about bathroom cleaning, so Kotchka had P&G's home-care designers work with IDEO.

The result: the versatile Mr. Clean MagicReach introduced in April. The invention uses disposable cloths and, for easy-to-reach places, can be held like an iron. It comes with a 4-foot detachable pole for harder-to-reach spots.


  Kotchka uses the design board to get designers' takes on P&G's product developments and marketing strategies. The board includes Nancye Green, founding partner of New York City design firm Donovan/Green; Wayne Cherry, a retired design head at General Motors (GM ); Shayne Hart, managing director of Fred Segal Studios, the spa division of upscale Los Angeles retailer Fred Segal; Tim Brown, CEO and President of IDEO; Judith Smith Koroscik, dean of the College of Design, Architecture, Art & Planning at the University of Cincinnati; and Ivy Ross, executive vice-president for product design at the Old Navy division of Gap (GPS ).

On this day in late May, the group listens as divisional managers make presentations on a wide range of products including a feminine hygiene item for European consumers and a new line of Swiffer cleaning products. They also discuss package designs that will boost drug compliance. Kotchka leads the meeting, attended by several other P&G executives, including Lafley, who joins for part of the day.

In one presentation, Rich Harper, the chief designer on the Swiffer product line, sets up a display of new Swiffer offerings, including a cleaning device that works on carpets. Each is on a separate museum-type stand with a sheet draped over it. "For the theater in us all," Harper says as he unveils the new products to the design board. "I want to get your reactions.

"Delightful," Green says, as others in the room react the same way.


  Many of the products come in bright translucent colors similar to those of Apple computers (AAPL ). "It's elegant for display, not hiding away," Harper says. He notes that he has used the image of a "surf rider" for the products' "design language."

Harper shows how the handles on the Swiffer products have an ergonomic shape to better fit hands and round hooks at the end for easy hanging on a wall. The hooks, too, are rubberized so that when a Swiffer is hung on the wall, it won't slide down.

The message is clear: Swiffer won't be falling down on the job, and neither are P&G's designers.

By Robert Berner

Edited by Patricia O'Connell

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