Design in Business Awards

Luxury shower and tapware manufacturer, Methven, is the major winner of the Design in Business Award 2008, organised by the Designers Institute of New Zealand in association with Better by Design.

The Design in Business Awards, which were presented in Auckland on Thursday, September 18, recognise and celebrate New Zealand companies who have strategically used design to achieve commercial success and business growth.

Highly Commended Awards were made to AuCom, of Christchurch who manufacture and export soft starters for electric motors, and phil&teds, Wellington based designers and manufacturers of inline buggies and innovative nursery equipment.

Methven’s recent rapid growth and international success is an inspiring turnaround story. Until ten years ago, the company, which began in Dunedin in 1886, was a traditional tap and bathroom valving products company. However, in 1998 the company decided to change its strategy to concentrate on research and development with the aim of setting up a world class business with New Zealand as its design and engineering hub.  

The company, still with headquarters in New Zealand but also bases in Australia and the UK, is now a world leading designer of luxurious proprietary water and energy efficient showerware, tapware, and valving products. 

Design strategist and award judge David Walker, said he and fellow judges (Derek Lockwood, Worldwide Director of Design, Saatchi & Saatchi and Nevil Gibson, Editor in Chief, National Business Review) were looking for a company where design was built into the structure of the business and “infused in every outcome, act and operation.”

The judges said that as well as a track record of growth and exports, Methven was impressive in its communication skills, its brand story and the quality and sophistication of its products.  So were many other entrants, but there were extra dimensions which set Methven apart.

Said Walker: “Firstly, Methven has a commitment to research and development as the platform for good design and success. Many companies do have good design, coherent stories and respectable business success. Fewer have a strong commitment to research and development.

“Secondly, Methven has a commitment to sustainable targets. This is especially crucial in products that rely on water supply. True, there are some gestures by NZ companies towards sustainability, but they are superficial and led by compliance or window dressing sometimes called ’greenwashing’. Here (with Methven) we have the real thing”.

While Methven had already developed core strategies in 1998 for long-term growth, the turning point came in 2005, after the company underwent a Better by Design audit, now called the Design 360 programme.

The design audit recommended that if Methven was to grow its business and product offerings it needed a global design head to lead the way; a stronger brand; and more marketing expertise to launch the company’s products into the highly competitive global marketplace. Methven soon appointed a Design Director, Kent Sneddon – the company now has a design team of 25, compared with two in 1992.

The Methven team then worked to identify gaps so they could develop products for specific markets and set up a “wet lab” so that all products could be tested from a human perspective.

This research led to the development of Satinjet shower technology in 2004, with its water saving capabilities (it uses less than half the water of a conventional showerhead) which made it ideal for the Australian market, where it is now the leading shower brand. Since 2006, the company has developed Maia, the world’s first beauty shower; the Kiri showerhead, an ultra low flow shower aimed at the hotel market; Kiri tapware, an upmarket range to compete with Italian and German manufacturers; the Tahi, a high end Satinjet shower system; and infusions, therapeutic and aromatic formulae delivered through the shower system.

These proprietary technologies have led to Methven winning a number of design awards (including a 2005 GOOD DESIGN award from the Chicago’s Athenaeum Museum).

Forty per cent of the company’s sales are now offshore and last year the company completed acquisition of UK tapware firm, Deva. In its financial year until March 2008, Methven reported an after tax profit of $9.8 million, up 37 per cent from 2007. Since it listed on the NZX in 2004 the company has had an unbroken record of profit growth.

Highly commended company AuCom is also a true Kiwi technology turnaround story. Founded in 1978, AuCom makes soft starters which reduce the maintenance for heavy machinery, particularly in the irrigation, marine and forestry areas.

AuCom manufactures the soft starters in Christchurch, which are sold through distributors in more than 70 countries. Sales have always been solid, as 50 per cent of the world’s electricity is used by electron motors, which require soft starters.

However, by 2005 the company was at a crossroads. Their technology was sharp, but their product design, service delivery and marketing collateral were anything but. As international companies began to develop copy cat products the company realised style and design were important, particularly if it was to continue to compete with international giants such as Siemens & Schneider, ABB and Rockwell.

Even though the company engineers were highly sceptical, the management team decided to invest in attending a Better by Design conference. They were so impressed that afterwards they decided to “give this thing called design a go” by undergoing a Better by Design 360 programme.

Since then the company hasn’t looked back. It has appointed a Director of Design, Craig Tuffnell, and design has been introduced at every level of the company.

Since 2005, sales have increased nearly 60 per cent. The company has had an international partnership with Danish Company, Danfoss, since 2001, but brand partners now include Toshiba (Japan) and Electronica Santerno (Italy). At the end of 2008, AuCom will start manufacturing a new product range for Danfoss, as well as product ranges for a new partner.

Also highly commended were phil&teds, another graduate of the Better by Design Design 360 programme. While phil&teds already had an innovative product - the market leading inline buggy – and a successful company, they had ambitions of expanding their business.

The Design 360 assessment challenged the company’s thinking and showed if they wanted to achieve global success, they needed to place more emphasis on using design throughout their business.

So phil&teds initiated a two part strategy: the first involving a complete rebranding, and the second, a major expansion of its industrial design capabilities.

Since adopting their new positioning based around the premise that nursery products should eb aimed at helping parents manage their day, live their chosen lifestyle and retain their sense of self – even with kids in tow – the company’s overseas sales have increased tenfold.

The next step, which came a year later in 2006, involved expanding its design team to eight, led by Phil Brace, industrial design veteran and co-designer of the legendary Fisher & Paykel dishdrawer.

phil&teds has experienced massive growth since embracing design. They now do business in over 45 countries with a presence in more than 2,000 retail outlets. Exports make up 95 per cent of their business and full time employees have grown from 12 to 47 in just three years.

Eighty per cent of sales come from products they have created within the past three years. In 2007 phil&teds launched ten new products, and they intend to launch the same amount this year.

The company is making international ripples, with UK’s top nursery brand, Mothercare International, naming phil&teds as their first ‘brand of choice’, reporting that of the key brands introduced last year, phil&teds outperformed all of them in terms of sales and profits.

Other finalists in this year’s award were Amie Design Group, the makers of merino sleepwear for infants; Xero, an online accounting programme for small businesses; Sonar6, an online graphic based HR management tool; and Winegrowers of Ara, a Marlborough winery designed from a blank canvas of 1600 vacant hectares to (one day) become a global wine business.

This year, for the first time, a Design in Business Outstanding Individual Award was presented to Rick Wells, chairman of Formway Furniture, for his vision, leadership contribution and achievement in the field of design in business in New Zealand. He and a partner bought Formway Furniture as a small, locally focussed company in 1981 and turned it into a global exporting business with more than 200 staff by making design central to their business approach.

Previous winners of the Design in Business Award include Formway Furniture; Icebreaker; Furnware and  OBO, and 2006 winners, Mokum Textiles, a family based company that designs and exports its own fabrics.

They say that when you are selling or purchasing a home, the two rooms that can truly sway a buyer’s decision are the bathroom and the kitchen.

Methven is a New Zealand based company, publicly listed in 2004, that knows this well, with their tap and showerware products adorning these two very important spaces not only in homes throughout the country, but increasingly, around the world.

Established in Dunedin way back in 1886, Methven is an iconic Kiwi company that has always placed a significant amount of emphasis on and invested heavily in product design, development and research, which has seen the company being awarded numerous national and international design awards for their unique proprietary products.

While Methven is the undisputed darling of the tapware market in New Zealand, with an estimated market share of 50 per cent, when the company decided they wanted to make a splash globally and be seen as an international design leader in the industry, they knew they needed an extra edge, especially if they were to successfully compete against the large established German, Italian and American brands.

While they had already developed core strategies in 1998 for long-term sustainable growth, the turning point for Methven came in 2005, after the company underwent a Better by Design audit.

The design audit illuminated that if Methven was to grow their business and product offerings they needed a global design head to lead the way; a stronger brand; and marketing expertise capable of successfully launching the company’s products into the highly competitive international marketplace.

With a vision to creating desirable product ranges for the international market that encapsulated Methven’s brand values and design philosophies, and with the information garnered from the design audit, Methven hired a new head of design, created a new position of global marketing manager, hired a team of new designers and adopted new design based strategies for product development, brand development and marketing.

The Methven team then worked to identify gaps and openings in various markets, while also undertaking studies on showering practices, so that they could develop products to suit each unique market.

This inevitably led to the development of the Satinjet shower technology. For quite some time Methven had been exploring ways to improve their end users shower experience, as well as ensuring the future growth of the company, and with Satinjet, they had found it.

Since 2006, the company has developed Maia, the world’s first beauty shower; the Kiri showerhead, an ultra low flow shower aimed at the hotel market; Kiri tapware, an upmarket range of tapware to compete with Italian and German manufacturers; the Tahi shower system, a high-end Satinjet shower system; and infusions, therapeutic and aromatic formulas delivered through the shower system.

The company has also embarked on an extensive brand development project led by the company’s chief marketing officer.

By utilising design throughout its business – from the consumer and its perception of the Methven product and brand, through to the design of its products and international retail take-up and acquisitions – Methven has opened up a number of opportunities that a few years ago, the company never would have dreamed of.

They have won numerous design awards, have been able to reach customers they never thought they could reach, have opened up new markets internationally, increased revenue and have grown a strong internal design-led culture.

While design has played a huge role in the iconic kiwi company’s success and has laid a foundation for their future growth, Methven says none of what they have achieved would have been possible without the support and foresight of its board, who not only believed in the power of design, but have fully embraced it.

Design is something that has “empowered” Christchurch based AuCom Electronics, a successful high technology exporter of soft starters, which control and protect 3 phase electric motors.

Core to the company’s success has been the identification and leveraging of the world’s best technologies and production methods, which have enabled the company to win a series of strategic supply agreements with multinational brand lines.

Established in 1981, AuCom Electronics attributes much of its past success to engineering talent. However, rather than resting on their laurels, the company began looking for something that would fuel its future growth plans and propel the business forward.

The answer – design.

While the company has now fully embraced design in their business, this wasn’t always the case. Prior to 2005, the company saw design as ‘window dressing’ and found their previous experience with designers ‘unsatisfying’.

Fast forward to 2008 and AuCom Electronics describe their company as “design empowered”. The business has an active lexicon of design language, a skill development programme in place, and design has been embedded into every aspect of the company.

Spearheaded by CEO Brent Archer, AuCom Electronics is making a substantial investment in design as part of its future growth strategy. The company sees design as complimenting the technology, production and engineering skills that are the traditional bedrock of the company.

They say that while it’s still early days, the results of their investment are now starting to show through.

Sceptical at first regarding the value that design could add to their business, the company first embarked on a major rebranding project as an initial test of how design could add value.

Happy with the results and sold on what design could do for their businesses bottom line, the company soon realised that if they wanted to continue improving their business through design that they needed to bring design awareness to all aspects of the business and create a culture of design-led innovation. They formed a dedicated team of people to focus on this, and appointed a director of design, cementing their commitment at the highest level.

After going through the Better by Design programme, the company read widely, networked and sought conversations and mentoring with others in the design space. Key staff attended formal design education programmes and sessions, and external consultants have been used for mentoring on specific projects to ensure that the company not only gains knowledge but also solutions.

With assistance from Better by Design, a significant investment has been made in various formal design projects across AuCom Electronics which has resulted in the company undertaking a brand revitalisation, improving usability, enhancing their website, developing a process for innovation and improving their product development programme and processes.

As a result of their efforts, sales have increased significantly and the company has secured a significant global distributor.

AuCom Electronics also report that as a result of embracing design their products are now better designed, and they are better able to provide their customers with what they really need.

You’d have to have been living under a rock not to realise that worldwide, the baby business is booming.

If you’ve visited a nursery store lately, chances are you were either shocked or amazed at the multitude of products on offer. While for some this is great news (as lack of choice is likely never going to a problem again), for those on the other side of the fence - the producers of the products – ensuring that their goods stand out amongst the crowd has become a key issue.

The nursery market become increasingly cluttered and saturated, which poses a challenge for manufacturers in the sector as now more than ever they need to find ways to differentiate themselves from their competitors if they are to successfully grab a slice of the booming baby goods pie.

This is something that leading Wellington based baby buggy manufacturer, phil&teds, is all too aware of.

While they realised that they had an innovative product – the inline buggy – and had already built up a successful company, phil&teds had ambitions of growing their business even further and knew differentiation would be the key to achieving that goal.

A Better by Design audit (now called the Design 360 programme) of phil&teds in 2005 challenged the company’s thinking, and showed that if they wanted to achieve real greatness, they needed to place more emphasis on using design throughout their business.

So phil&teds initiated a two part strategy: the first involving a complete re-branding of the business that encapsulated their uniqueness, and the second, a massive expansion of its industrial design capabilities.

With the help of consultants, phil&teds first went to work on developing a strong compelling brand – one that would set them apart from their competitors. They identified their uniqueness as being the focus on parents as the key customers, and, most importantly, their quirky, irreverent culture - both of which were to become the cornerstone of their new brand and marketing strategies.

Since adopting their new positioning - which is based around the idea that nursery products should be aimed at helping parents manage their day, live their chosen lifestyle and retain their sense of self, even with their kids in tow - the company’s overseas sales increase tenfold.

The quirkiness of the phil&ted brand is blatantly evident and touches every aspect of the business, extending from everything from the company’s point of sale systems, marketing strategies, right through to the its phone answering system and the ironic job descriptions of its staff - which include “chief cook and bottle washer” and “show and tell”.

The next step, which was to come a year later in 2006, involved enhancing the company’s design capabilities. phil&teds recognised that innovation was vital to their success so accordingly, they expanded their design team from two to eight, led by Phil Brace, a 22 year industrial design veteran, who co-designed the legendary Fisher & Paykel dish drawer.

The company says adaptability is something they will be building on in the coming years. Differentiated roducts, such as their market leading inline buggies which ‘adapt’ to take two kids and are globally unique, are key to their success.

They have taken ownership of the inline buggy category, and have grown their range significantly, expanding their offerings to include products in six categories – push, sleep, feed, carry, drive and adapt - that interconnect and compliment each other.

phil&teds has experienced massive growth since embracing design. They now do business in over 45 countries worldwide with a presence in more than 2,000 retail outlets. Exports make up 95 per cent of their business, and full time employees have grown from 12 to 47 in just three years.

Continually developing new and innovative products also remains vitally important to phil&teds success, with 80 per cent of their sales coming from products they’ve created within the past three years. In 2007, phil&teds launched 10 new products, and they intend to launch the same amount this year.

The company is causing a stir worldwide, with the world’s leading nursery chain, Mothercare International naming phil&teds as the first “brand of choice”, reporting that of the five key brands they introduced last year, phil&teds outperformed them all in terms of sales and profits.

While the company’s kiwi spirit, efforts and commitment to design, innovation and creating products that fit in with a parents lifestyle have seen phil&teds win numerous awards including the NZ Creative Exporter of the Year Award in 2006 and 2007, perhaps the truest testament of the company’s success is the fact that parents and celebrities throughout New Zealand and around the globe choose phil&teds products for their precious young ones.