The following report will analyse and evaluate the current status of design management in the cosmetics industry, looking at the three main areas that fall within design management and what activities are implemented by companies, in regard to the elements of design management.
2. Design management areas
While companies are divided into sections where various activities are taken in place, they fall under three levels of where design management is active, in order to sustain and generate an outcome of customer service and productivity through consciously confronting and resolving issues; operational, tactical and strategic. All levels of design management interlink with each other and each level must be completed in order to continue to the next one, in order for a company to generate a productive outcome.
The operational level mainly consists on how a company operates. The most significant entity that lies within the operational level of design management, is the entire structure of a company or organisation, which varies across different businesses. All companies, organisations and even smaller businesses have structures in which they rely upon; these structures are normally departments, each with a differentiated set of activities, that also interlink, obtain information and follow instructions from the board of directors who are placed at the top of the structure.
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According to Bruce and Bessant (2002), design management at the operational level is firstly identifying customer issues such as how to translate customer requirements into clear instructions, how to distribute responsibility and accountability and how to maintain responsiveness in relation to the timing of supply and of demand. Once issues such as these have been put forward and analysed, then management will face various challenges in order to resolve them; the structure of the company or organisation will be observed and assessed as to how information is being disseminated into different departments, the evaluation of how well the structure works and identification of any areas that are in need of improvement.
This could possibly be one of the most important levels where design management is present as it is where new strategies are considered, the development of new products or services are studied, and the reassessment of the holistic approach of a product or service in a current or new customer market is thought of.
The operational level analyzes current customer issues, generates solutions and disseminates information and instructions to the tactical and strategic levels to carry out.
Design management within the tactical level comprises on structuring and managing design and design activities that fall within a company or an organisation. According to Mozota (2003) the management of design within a company is of high importance, it operates independently from other departments and is responsible in providing a fair share to a company's success.
"In order to develop design internally, the most important issues are supporting design at the top-management level and being involved in the development of a brand strategy" (Brigitte Borja De Mozota, 2003 p. 214). The management of how design should be implemented within a company is very crucial as the consumer ultimately purchases firstly the appearance of products or services and then evaluates personal beneficiary elements.
However, design is integrated in different departments of a company or organisation which tend to prefer the design attribute that fits most with their specializations, either that is research and development where in most cases is technology, or corporate communications where visual identity is managed; design can be viewed and applied differently depending on the department that integrates it therefore, design management has the important role of managing these different forms that design takes no matter where it sits in the organisational structure of a company or organisation.
Nevertheless, in order for a company or an organisation to apply design to its highest level possible, there is a need of employing successful management within the department which as mozota (2003) suggests could be considered to have a structure of its own; efficient design which is generated through the careful construction of a well managed design team.
This area of design management relates to the corporate strategy and management of a company or organisation and its long-term activities. A company's long-term activities can be considered as long term relationships with other organisations which will ultimately benefit from and the strategic decisions they make for the future which are likely to be concerned with the overall scope of a company's activities; these decisions have a significant role as they are about achieving competitive advantage.
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Design management is responsible in analysing and identifying any areas within the company that are in need of assistance while bringing forward strategic decisions that will help gain advantage over competitors. However, management within the strategic area can also be seen as creating opportunities, by building on a company's resources and competences.
"Strategy is the direction and scope of an organisation over the long term, which achieves advantage in a changing environment through its configuration of resources and competences with the aim of fulfilling stakeholder expectations" (Johnson et al, 2005 p. 9).
Strategies and the strategic decisions companies or organisations analyse, reassess and introduce, are present in a number of levels, as Johnson et al. (2005) identify, there are three different levels; corporate-level, business-level and operational strategies.
2.3.1 Corporate-level strategy
Any strategies and decisions that fall under the corporate level, are implicated with the overall scope of a company or organisation and how value will be added to the different departments.
2.3.2 Business-level strategy
Strategies that are concerned with what types of products or services should be developed in which customer markets and how competitive advantage can be gained in order to achieve the objectives of an organisation or company, belong to this level.
2.3.3 Operational strategy
The implementation of operational strategies and decisions are of great importance as Johnson et al (2005) explain, they are concerned with how well the corporate- and business-level strategies operate and in particular how well each department of a company or organisation delivers in both levels, in respect of people, resources and processes.
As Mozota (2003) explains, strategic design management is the relationship between design, strategy and the identity and culture of a company and its environment; the ways a manager generates strategies is with always having in mind the importance of controlling design and to employ it into strategic conceptualisation processes.
3. Design management tools
According to Mozota (2003), the role of design management within companies or organisations alters and adapts to the vast differentiation of departments. The author explains the importance of the use of successful management throughout and its responsibility to observe and identify changes or trends in the customer market that could possibly influence the environment and the goals of the company or organisation.
Design management has the responsibility of detecting and observing innovative areas from which opportunities can emerge, such as useful information that can be manipulated in order to clearly state and execute the company's vision.
However, in order for design management as a holistic activity, to be able to generate productive results for a company or organisation it provides various tools for the design manager, that can be implemented in the design management areas; operational, tactical and strategic. Mozota (2003) suggests that there are eight design management tools, as explained in appendix 1, that can be used in all the areas and adapted to their specifications; they ultimately contribute to the decision-making system of the company or organisation;
The design manager's toolbox, as it is referred to by Mozota (2003), contains the same tools for companies or organisations to use, even so, the implementation process varies not just in the three different areas of design management but also in diverse companies where requirements and specifications are different.
4. The Body Shop International Plc
The Body Shop was founded by the late Dame Anita Rodick in 1976 in Brighton. It is now a global manufacturer and retailer of ethically sourced and traded toiletries and cosmetics with over 2500 stores in over 60 countries, with a range of 1200 products (The Body Shop International Plc, Values report 2009).
It is a UK based company that now belongs to L'Oreal as it became the parent company for the Body Shop in March 2006, however, in order to prevent any commotion or confusion from the general public towards the actions of this movement, L'Oreal decided to keep the same values and activities operated by the design management team that run throughout the company, and so the Body Shop operates as a distinct entity (CEO, L'Oreal, Body Shop Values report, 2007).
The Body shop is a responsible corporate organisation which focuses and emphasizes on corporate social responsibility, having in mind ethics and redefining the role of a business in society, with their personal actions which have an impact on legislation, community development and how they are able to raise consumer awareness in regard to social, ecological and human rights issues (Nicola M. Pless, Journal of business ethics 2007).
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4.1 Design management at the operational area
While The Body Shop is a part of the L'Oreal group, it operates as a distinct entity, as Jean Paul Agon CEO of L'Oreal mentions in the Body Shop Values report 2007.
The company's organisational structure begins with the board of directors which is situated at the top, where the CEO who is also a part of the board, has the responsibility to clearly communicate and disseminate information to the seven departments of the company that are controlled by their directors and who later report to the CEO who carries the information back to the board; there is no immediate contact with the department directors and the board, therefore the CEO becomes the sender and the receiver.
With head offices in London and Littlehampton, West Sussex, the company can maintain good internal communication due to geographical facilitation. The design management tools used in the organisational structure for successful distribution of data are information, communication, planning, research and development of future products, considering the implementation of new strategies or how to improve on existing ones and human resources where a lot of training of their staff is being considered in order to pass on the values of the company which are also reflected from the employee to the consumer.
4.2 Design management at the tactical area
The Body Shop International Plc which is a global retail chain, has expanded into four different regions; the UK and Republic of Ireland, Americas, the EMEA ( Europe, Middle East and South Africa) and Asia (Body Shop Values report 2009).
While brand identity should be consistent throughout, it also acquires the need of adapting. The way it is implemented and introduced slightly changes due to cultural differences and societies, for this very important reason Body Shop uses R&D in order to know the customer market and what it requires, from then on information gathered from the market research are communicated to their personnel who undergo the necessary training.
An aspect of Human resources within the tactical area of design management at the body shop is providing sixteen of its senior managers the opportunity to take part in the global leadership program to develop skills in global managers and their teams as cultural diversity is a regular feature within the company. The global chosen leaders have the responsibility of travelling to various parts of the world to engage with staff, customers and the environment in order to learn and experience what matters in different cultures and how things operate (Human resource management international digest, 2005). This is a strategy implemented through the use of training, where the company and the employee would benefit from.
Design is also critical; as the Body Shop uses point-of-sale activities and window displays rather than the use of any form of media to promote its brand, the company uses store design that relates to its brand and its values.
The store design, which was firstly introduced in 2004 at the Covent Garden store, has a clear and interesting style; light coloured wood is used throughout to maintain an environmental theme, glass shelving are used for the ease of visibility of products and free-standing floor units are used to create a more spacious effect(Strategic Direction, 2007). The Body Shop uses store design as a strategy to promote its brand and products and to remind consumers what their values are.
4.3 Design management at the strategic area
The Body Shop encompasses five core values; it defends human rights, Activates self-esteem, supports community trade, is against animal testing and protects the planet. The company uses cause related marketing (CRM) by obtaining long-term relationships with charities and causes by campaigning for human rights, in order to subliminally gain brand awareness and for the automatic association of the consumer between the charity and the company.
It activates self esteem by providing its personnel with training courses in order to better themselves and raise their confidence; it is a strategy cleverly implemented through human resources as training for the benefit of their employees, when in fact the ultimate beneficiary is the company.
While the Body Shop owns 100% of Soapworks, which produces soap and is situated in Glasgow, Scotland, the rest of its products are outsourced. For this reason it needs to maintain external communication to the highest level possible, it supports marginalised communities who would not have had the opportunity to work with such markets, by sourcing responsibly; farmers and workers in such communities have to comply to the code of conduct which includes fair working conditions, and the company audits their suppliers every 12 months and regularly inspects their working facilities and sites so that they carry out their corporate values (Body Shop Values report, 2009).
L'Oreal who is Body Shop's parent company started a partnership with the Epic skin scientists who developed artificial skin so that the company's products could be tested on. As they are strongly against animal testing these actions maintain the certification of the Body Shop to the Human Cosmetic Standard. Each of the company's manufacturers has to comply to the HCS declarations and offers a web-based database which contains the raw materials that are approved by it; the website becomes the communications tool. (Body Shop Values report, 2009).
As one of the upcoming trends in today's society is being environmentally aware, Body Shop uses corporate social responsibility and it consciously reduces their carbon emissions by reducing store energy; installing LED lighting and providing their staff with energy efficiency training and using hybrid vehicles in their product transportation. The company also reduces and reuses packaging, reduces waste, and increases the content or recycled material.
5. Boots UK Ltd
Boots began as a herbalist store in 1849 in Nottingham by John Boot who sold remedies for people who could not, at that time, afford doctors. Now Boots is an international pharmacy-led, health and beauty retailer that has over 3250 retail outlets throughout 10 countries with around 115.000 employees (Boots.com 2010).
Boots UK Ltd is a subsidiary of Alliance Boots Ltd which was created through the merger of Alliance Unichem Plc and the Boots Group Plc in 2006 (KeyNote 2010). When Alliance Boots Ltd was formed it gave the holistic Boots brand a greater profile as it added value to the company's products and services (bized.co.uk 2010).
5.1 Design management at the operational area
Boots was bought by the US private equity firm Kohlberg Kravis Roberts (KKR) in 2007 where later in 2008 a new restructured marketing approach was introduced to the company which encompassed a more customer-focused approach; customer loyalty, communications and relationship management and in-store marketing strategies (bized.co.uk 2010).
These new customer-focused activities which are currently carried out require internal communications which are successful through the use of face to face team briefings, which are also achieved through the use of intranet sites in order to clearly communicate with staff, and individual and group award schemes for the company's employees to help personnel gain self esteem confidence and motivation.
Boots UK Ltd also encourages their staff to become ambassadors of the brand in order to strategically gain awareness and recognition through the traditional and most effective medium of communication and promotion with their customers; word of mouth. The company focuses on human resources to maintain and raise internal communication from which successful external communication can be obtain to ultimately produce beneficial outcomes.
5.2 Design management at the tactical level
Boots UK Ltd strategically implements design in the architectural morphology of its stores in regard to the geographic location and to meet consumer demands and expectations (boots.co.uk 2010); their flagship format health and beauty stores consist on size that offer destination shopping with a wide spectrum of premium toiletries and cosmetics.
Their airport format stores are built having in mind the last minute necessities of consumers and include compact and smaller designs of an amount of products considering the available and required space the consumer has when on board. There are also convenience high street stores that do not have a particular format which are normally found in busy pedestrian roads, these formats are similar to the flagship formats, they are however scaled down to size.
The company's internal store design entails the complete division of the health (pharmacy) and beauty department in order to clearly distinguish the segmentation of markets. Boots also assist their consumers with their drive-through strategy where the customer can hand in their prescriptions and collect medication driving through the collection points.
The company demonstrates how well it knows its target customer market through the diversity of its store formats and the use of design within them; R&D, market research, information and communication are being implemented in order to successfully employ design.
5.3 Design management at the strategic level
The strategies Boots uses are mainly focused on obtaining relationships with other organisation in order to expand from health and beauty to other areas, cause related marketing, corporate social responsibility and looks into building its workforce with its graduate program.
The company strategically establishes partnerships with Waitrose, to operate Boots in-store pharmacies and with an attempt to sell selective product lines in both Waitrose and Boots, and Mothercare, for the supply of children's clothing which will strategically stimulate their development (Boots Annual Review, 2010). Boots UK Ltd also uses cause related marketing by establishing long-term relationships/strategies to gain brand awareness and an automatic association with charities such as children in need, breast cancer care, the eve appeal; and the Macmillan cancer support organisation, where as a charity partner Boots uses volunteering, fundraising giving advice and information to obtain brand exposure (Macmillan cancer support, 2010).
Since the majority of Boots customers are women, their priorities are concerned on the impact of what they purchase has on the environment; factors such as these are much more powerful than celebrity endorsements (MIntel, 2007). Corporate social responsibility is important at Boots, as it reflects on customers' needs and society's trends. The company responsibly reduces their holistic impact on the environment by reducing energy in their stores and buildings, reducing packaging waste and recycling using sustainable materials and using their backload policy where trucks never make a journey being empty.
Boots offers a 12 month brand, buying and marketing graduate program for people who are interested in learning about branding and managing and could ultimately obtain a permanent place in the Boots family by having their own stores to manage and their own teams to lead. Boots builds its workforce by purposely training and forming their ideal future staff with the ideal skills and knowledge around boots.
Both companies have a strong brand image and maintain unique designs both in their stores and in their product ranges, there is also strong internal communication with the face to face sessions run at Boots and the large amount of human resources through training and courses provided to employees by the Body Shop. CSR is a priority at both companies, which is reflected upon their actions according to the environment and the marketplace, however Boots UK Ltd should also maintain these environmental issues within their stores and increase advertisement of it and add daily team briefings to their timetable to increase and maintain internal communication by educating their personnel in their performance and targets of the day. The Body Shop should increase their site visits in order to maintain awareness and control of the production line, in addition Body Shop should increase advertisement not just within its stores but also externally by also exploring various types of mediums.
All in all, both companies are very successful in their business and field in regard to the good use and function of design management within the industry. Whilst operating differently, the Body Shop and Boots have been able to attract various audiences from different background with their application of design. Finally communication with staff has been a strong element, which in turn enables successful external communication that improves brand image and builds brand loyalty.
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