A front page article in last week’s Wall Street Journal documented the demise of Liz Claiborne, one of women’s fashions most successful product lines for 34 years. The company that pioneered working women’s apparel after its introduction in 1976, Liz Claiborne has been removed from virtually every tony retailer and is now available exclusively through JC Penney.

It was a precipitous and entirely avoidable fall.

Liz Claiborne broke the first commandment of branding: Be true to your clients and yourselves.

Claiborne made its name by designing stylish career wear for the millions of women, particularly younger women, entering the workforce. Their pieces were consistently styled and well made, delivering a specific brand promise to the women who stocked their closets with Claiborne ensembles that could be mixed and matched to create multiple outfits from a handful of separates.

Claiborne developed a loyal and trusting following of women who appreciated her collections. But with her retirement from the company in 1989, the brand began to suffer. There was no designer who shared Liz Claiborne’s design aesthetic and without a design leader, the company regressed to a financial leader whose focus was the bottom line, not the hemline.

Design by committee emerged, diluting the Claiborne brand promise in a fruitless pursuit of the youth culture. Their working women loyalists took notice and turned their backs on uninspired and confusing Claiborne collections that were considered fashion forward but not geared toward working women, the brand’s core constituency.

The dispiriting Claiborne story was in sharp contrast to the story that Jay Greene recounts in his book Design is How it Works. Porsche has remained remarkably successful in an industry that has few perpetually thriving automakers. Porsche attributes their success to an unyielding devotion to the design principles encompassed in the very first 911 that debuted in 1963.

Since their very first car, Porsche has remained true to its design DNA by incorporating specific design cues – intakes instead of a radiator grill, a car that always tapers to the rear, open wheel rims to display the strong brake calipers, front fenders always higher than the hood, ignition always on the left of the steering wheel and vertically oriented dashboards – that support their vision of a car that is all about driving performance and authenticity.

Porsche has never varied from a design approach that produces cars that their own designers crave. They never cut corners. They never adopt trends that risk the company’s credibility. And they never try to appeal to everybody.

Porsche designers intuitively understand the desires of their most passionate drivers and develop new cars with them in mind. Liz Claiborne took a different tack and abandoned their brand promise and with it their most loyal clients in pursuit of a younger, more active customer. They alienated their most loyal customers without generating any traction with the fickle and trend conscious youth market who want nothing to do with the company who makes clothes for their mothers.

Porsche has had an endless string of hits, including their Boxster, Cayman, Cayenne and Panamera and reported record profits in 2009. Liz Claiborne has virtually ceased to exist. Breaking your brand promise appears to have severe repercussions. If only the Claiborne executives drove Porsches, they’d understand.

How many other successful brands have hastened their corporate demise by abandoning their core principles and their most loyal customers? Sadly, I’ll bet it’s long. Real long.

A terrific article in today’s New York Times by Edward Niedermeyer prompted me to document my own belief, from the day I heard of GM’s announcement of their eco-friendly Volt hybrid that it would be a massive and historic commercial failure.

There may be no single automobile ever made that has garnered as much positive press and unfettered support from the press, the green lobby and the government. They desperately want the Volt not only to succeed but to be a game changer, a tipping point in the auto industry.

And I’m here to tell you it won’t be a game changer. It will tip no points, and it will end up losing massive sums of money.

It would be hard for any product to live up to the anticipation and hype that’s surrounded the Volt. The Volt’s  been assigned messianic status in the auto industry, preordained to be the savior of GM, the transformer of all transportation and the harbinger of an entirely new way of thinking in the auto industry.

But the Volt has been destined to fail from day one. Rather than asking their designers to make an already developed idea more attractive to consumers, GM should have asked them to create ideas that better meet consumers’ needs and desires. The former role is tactical, and results in limited value creation; the latter is strategic, and leads to dramatic new forms of value.

Their objective from the start shouldn’t have been limited to the objective of building a new hybrid car, but to create new interactions, entertainments, immersive, emotional activities that are embodied in an entirely new way to travel.

But GM is not a strategic, design-centered company. They’re a tactical company that has never demonstrated a capacity for design brilliance or its commensurate risk taking.

Want proof? Take a look at the actual Volt that they’ll be attempting to sell this fall for $41,000. It’s nothing more than a Toyota Prius with a $15,000 Chevy bowtie on its grille.

Contrast this bland design with the original concept car. It was bold, it was edgy, it stood out and made a statement. So, of course, GM had to assign some internal committee to tone it down a little. After all, they want it to appeal to the largest audience possible.

Their design killing efforts proved Mark Twains adage that “I cannot give you a formula for success, but I can give you a formula for failure, which is: Try to please everybody.”

I believe that brands are the promise of an experience. Great brands can project our hopes and dreams and aspirations. They broadcast who we are and what we believe.

So what is it that GM wants to convey with this rolling testament to corporate mediocrity that hasn’t already been captured and owned by the Prius?

Beyond the branding and design failures, GM has to overcome enormous financial, technical and practical hurdles that all conspire to doom the volt.

It’s expensive at $41,000 – which doesn’t include the price of the $2000 charger you’ll need in your garage.

Its electric motor range of 40 miles is virtually guaranteed never to be met in real world conditions. Subtract mileage when it’s cold or when you’re operating the AC or the radio.

And, when its battery needs to be replaced, get ready for the $8000 sticker shock.

The Volt is a corporate response to political pressures. It validates the contention that great design and revolutionary concepts don’t emerge from corporate boardrooms and government bureaucracies. The Volt is exactly what we would expect from Government Motors, and that’s the tragedy.

Imagine what could have been produced if Apple were to design a car from scratch. Or if Google teamed with Ideo to create a new commuter vehicle. I don’t know what they would conceive, but I do know one thing for certain: it wouldn’t be the Volt. And it wouldn’t require hundreds of millions in subsidies to attract buyers, and it wouldn’t be conceived without considering alternative green technologies that could be integrated into its design.

If the Volt symbolizes the new GM and the new Michigan, as Michigan Governor Jennifer Granholm claims, pray for GM and Michigan.

Sony has transformed itself into one of the most disappointing brands of the 21st century. The company that dominated consumer electronics for most of my life hasn’t had a bona fide consumer electronics hit outside of their gaming systems in years, and their product releases, with business partner Ericsson, of multimedia playing phones and smartphones have been huge disappointments.

Sony Ericsson’s response to their negligible impact on the smartphone market? The introduction of an $800 smartphone to compete against the iPhone and Blackberry lineups. It’s almost as if they’re trying to fail.

Sony Ericsson is not renowned as a mobile phone provider, as evidenced by their 5% market share. Their forays into Walkman phones – phones capable of downloading and playing music – produced little consumer interest

Sony has always had a sharp eye for design, and they’ve certainly brought their design sensibility to their joint venture. Sony has designed and manufactured some of the most stylish and technically advanced electronics in the world. But their grasp of design apparently doesn’t extend to the full concept of design thinking, which also takes into account the entire user experience surrounding one’s product.

Play to Your Strengths
Anyone who has used a Sony product in the past 10 years knows how miserable the Sony user experience can be. I’ve owned Sony cameras, videocameras, ebooks and laptops and can attest that their devices don’t play well together, much less play well with others. Sony continually provides beautifully designed hardware with thoughtlessly designed software – a combination that guarantees a lousy experience. And yet they continue.

There is still a huge opening for Sony Ericsson in the smartphone market that can exploit one of Sony’s only remaining strengths: gaming.

Sony has sold over 50 million of their portable PSP gaming systems worldwide. They have experience in that sector that no other manufacturer has. They’ve watched the iPhone develop into a serious gaming platform, validating the market for combination phone/gaming systems.

So what does Sony Ericsson do? They release an $800 smartphone with a great camera and no gaming. Wow.

Maybe I’m the one who’s out of touch. It’s certainly possible. But I have serious doubt that a 12 megapixel camera will drive sales of an $800 smartphone when virtually every other smartphone offers at least a passable 3 MP picture. I just don’t believe that photos drive phone sales nearly as much as entertainment options drive phone sales.

Oh, by the way, Sony Ericsson isn’t even releasing their new phone for another 6 months. That just gives them more time to fall behind the new iPhone, Palm Pre and new Blackberry introductions before they launch an inexplicably expensive phone in a midst of a global recession.. Good luck guys. You’re going to need it.

Living in Cleveland, as I do, I have frequent conversations with executives who run prototypical rust-belt businesses. Heavy manufacturing, industrial distribution and professional services that support these core businesses that are decidedly unsexy and unremarkable.

What’s surprising about these discussions is how many of these executives view their own companies as unexceptional and nondescript. Which begs the question: If you don’t think your company is remarkable and unique, why would anyone else?

As the former owner of a manufacturing company that produced labeling machines (it doesn’t get less sexy than labeling) I can attest to the dysfunctional industrial mindset that dominates entire industry sectors. Manufacturers are obsessed with their physical equipment, not what it is capable of providing. Distributors are the sum of their products, not the value they add in knowledge, responsiveness and expertise. And service companies have absolutely no idea how to separate themselves from nearly identical competitors.

When I hear these executives describe their own company in these terms, I see boundless opportunity. In most cases, their competitors behave in exactly the same way, enabling a savvy, thoughtful  and creative marketer to create a distinctive and memorable presence in their industry sector. And with the proliferation of penetrating social media tools, the ability to create an impression and reach your targets with precision and frequency has never been greater.

So if I can see the opportunity, why can’t they? I hear the same excuses over and over, including:

1. My customers aren’t on the internet. I was wondering who it was that wasn’t on the internet at all. Turns out it’s always the clients and prospects of every industrial executive I speak with. Theirs are the ones who don’t use e-mail, never watch anything on YouTube, get their news exclusively from newspapers, still use film cameras, listen only to CD’s and still deliver presentations from a stack of transparencies. I don’t believe it. What’s more believable is that these companies have never provided any reason for any of their clients to use the internet to gather information, gain knowledge or, heaven forbid, entertain.
2. My customers buy on price, so what’s the point? The point is that you’ve never given your clients any reason to base their buying decision on anything other than price. That’s the fundamental problem. You need to become more valuable, and a thoughtful social media program can communicate your distinctive abilities, and reinforce the true value you deliver.
3. What would I say? At first, it’s not about what you say, but how you contribute. How can you help? What do you know that you can share? It’s about them, not about you. Link to articles that you think they would find helpful and interesting. Link to videos that are instructive and entertaining. Link to research that will help their strategic business decisions. And write about the successes that you’ve contributed to and the problems that you’ve helped overcome. Nobody’s expecting brilliance. Insight will do.
4. I don’t have the time. What priorities do you have that are greater than developing your business? Building close relationships with your prospects and clients is not something you can outsource to a marketing firm. Your web developer cannot substitute Flash for real conversations. Want to demonstrate your commitment? Spend some time each day participating. If you don’t commit and engage, neither will your staff.
5. I would lose control. For many old school executives, the concept of social media participation is downright scary. What do you mean people can leave comments? What if they say bad things about us? How can I control what my employees say online? For the command and control executive, the openness of the social media channels strikes fear in their heart. For these executives, I can only commiserate and offer the limited consolation that the new world of social media marketing won’t be that bad if you’re authentic, open, truthful and helpful. Now is that too hard?

The blogosphere and Twittersphere have been buzzing this past week over a series of blog posts by Oliver Blanchard on his blog, The BrandBuilder, discussing how to communicate social media ROI to skeptical executives.

The posts sparked dozens of comments and hundreds of Tweets from social media aficionados that split between those who castigated Olivier for daring to introduce crass mercantile interests into the pristine world of social media and those who recognize the business realities involved with securing investment and executive support and need practical guidance to pitch their social media plans.

Olivier was precisely correct when he wrote that executives need to hear how any social media plan will generate a tangible and measurable return on their investment. These executives are responsible for dispensing a finite amount of corporate resources among departments. It is practical, desirable and reasonable that they dispense investment dollars to those projects that will advance the company’s financial position the farthest. That’s reality. Now how do you deal with it?

Once you understand their agenda – maximizing the return on their finite investment dollars – you can frame your social media plans effectively, in language that is compelling and convincing.

Rule #1: do not talk about Twitter followers, the number of retweets last month or the number of times a Fan Page was shared on Facebook. They don’t understand and they don’t care. Zip it until next month’s local SMC meeting.

Rule #2: Speak in language that they understand: Process, Plan, Cost and Return. CEO’s will want to understand the SM process and know that you have a precise plan to execute. By the way, it must be written, or it’s not really a plan.

Rule #3: Do not tell the CEO that the cost of your social media plan is zero or you’ll lose all credibility. Although Twitter, Facebook, LinkedIn and WordPress do not charge their users, their cost is not zero. Their actual cost must include the human costs of participation, engagement, content development and management. How many employees will be involved? At what level? How many hours per day? Per week? Although the company doesn’t write a separate check for social media costs, they are paying for participation, and the total cost may be significant.

Rule #4: Focus on Quantitative, not Qualitative returns. Qualitative returns include the impact of your participation on your company’s reputation and the value of extended online conversations in relationship building. The CEO doesn’t care. I know you do, and I know your CEO should, but that’s not how he measures success. He wants Quantitative metrics. How many new customers did your efforts generate? How many new sales? How much did the average sale increase? What impact did your efforts have on gross margin?

Rule #5: Understand how the F.R.Y. metrics explain and support your social media goals. As Olivier described in his blog post, a compelling social media strategy should improve:

Frequency Increasing sales revenue by shortening the interval between transactions.

Reach (breadth) Increasing sales revenue by increasing net new customer count.

Reach (Depth) Increasing sales revenue by helping customers buy deeper into the product line.

Yield Increasing sales revenue by driving customers to want to increase their average per transaction spending.

Rule #6: Be prepared to detail how you intend to track sales that emerge from the social media channels. You must be able to track results to prove that your SM participation justified the company’s investment.

There. That wasn’t so hard. Now head up to the CEO’s office and tell him how you’re going to improve the company’s bottom line. And you can blog about it later.

The only thing worse than being exposed to bad design is being forced to work with bad designers.

During each of the past two years, I guest lectured at the Kent State design school, discussing with students how to integrate their design aesthetics with business exigencies. I told them that design had to support a specific business purpose, reinforce the corporate brand and communicate specific qualities. If their design failed to support these business imperatives, then it was bad design, no matter how pretty it was.

Over the course of a semester-long design project, the students learned how to apply their design skills to create a memorable impression, generate interest, communicate product information effectively and generate revenue. Just what they’ll need in the real world.

If college students can understand the purpose of design, why can’t professional designers?

I stopped working today with a designer who simply doesn’t understand how to design effectively for business. Despite detailed feedback, this designer could not grasp the five essential rules of business design:

1. Reinforce my corporate brand. My company has a brand. Specific colors, images, fonts, styles and visual elements that are repeated across multiple media to convey specific qualities and attributes of my company. Your job is to incorporate those design elements to reinforce my brand, not to create a new look that ignores established visual cues and design rules that define my brand.
2. Understand my strategic goals. What is my market? Who are my clients? What are my sales goals? How does this project fit into my corporate mission? If you don’t understand where I’m going, and why, how can you design components to support my efforts?
3. Look at your work from the end-user’s perspective. What does the user want from the product or service? Does your design communicate the core purpose effectively? Is it compelling, distinctive and memorable? The end-user is the one who determines the effectiveness of your design, not your design committee or the marketing director.
4. Design with a purpose. Know what you want to accomplish and what specific message you want to convey. Then design with that purpose in mind. Focus, focus, focus.
5. Pretty ≠ Effective. I’ve yet to meet a designer incapable of creating pretty output. Virtually all are able to generate gorgeous brochures, beautiful ads and splendid identity programs. But just because your work is pretty, doesn’t mean that it’s effective. Great design communicates function, pleasure and meaning to the customer, and supports the specific business purpose of your client.

Remember, you’re a businessperson, too. Pretty isn’t enough. Design with purpose.

I carry a newspaper in my pocket at virtually all times. Actually I carry hundreds of them. All resident as flowing electrons on the screen of my iPhone. This scares the hell out of the major newspaper companies. And it should.

News stories abound detailing the assorted turmoils afflicting the newspaper industry. Major city papers have already ceased operations, and even the most revered journalistic icons, the New York Times and the Boston Globe, are hemorrhaging cash and are trying desperately to execute a corporate strategy that reverses their current death spiral.

Redefining The News
The major newspapers are in serious trouble because they are not really in the news business, they are in the printed news delivery business. Everything they do, every corporate strategy they envision, revolves around newsprint and its physical distribution.

They have hundreds of millions of dollars invested in huge physical plants, enormous high-speed printing presses, fleets of delivery trucks and an enormous, largely unionized, labor force all devoted to delivering a mass of newsprint to an audience whose demand for printed news has declined precipitously.

News As Advertising Vehicle
It’s not just the demand for printed news that has diminished. It’s the demand for printed advertising, the source of all the newspaper’s revenue.

Craigslist, the free online ad service, single handedly destroyed the newspaper’s classified advertising, which provided about 40% of their total revenue. In the Bay Area alone, area newspapers lost more than $50-65 million a year in help wanted advertising and untold millions more in merchandise and real estate advertising.

Local businesses have discovered that most consumers now rely primarily on the web when searching for a new product or service. These businesses are shifting their marketing expenditures to search engine optimization, pay per click advertising and website development and away from traditional newspaper advertising. And these dollars will never return.

Lack of Design Thinking
The newspaper’s response to this critical strategic shift in demand for their product reflects an absence of design thinking. The typical management response has been to reduce staff, demand concessions from their remaining employees, reduce the size of their paper and threaten online bloggers and news aggregators who dare link to the newspaper’s articles.

Design thinking is about creating a better, different alternative to newsprint for news (and advertising) delivery. The current news executives are focused on analytic choices between producing newsprint for a large audience or a smaller audience, not on envisioning a different news delivery vehicle altogether.

These executives appear to lack the essential components for creative design thinking. Rather than empathize with our desire to receive the news on our terms and on our schedule, they continue to focus on printing and delivering the news on their terms. They need to take a “people first” approach and design a solution that revolves around our desires, not theirs. And I have no desire for a stack of newsprint in my driveway each morning.

They should also read Roger Martin’s brilliant book, The Opposable Mind: How Successful leaders Win Through Integrative Thinking. Martin, the dean of Toronto’s Rotman School of Management, details through case studies how managers can synthesize opposing ideas and create bold and dynamic solutions to seemingly insoluble problems.

Experiment and Collaborate
One thing is clear: the newspaper industry won’t solve its problems by doing more of the same, but at a smaller scale. They need to accept that their industry has changed and will never revert to their former glory days. They will need to experiment with new solutions and collaborate with creative geniuses in online disciplines to create a news experience that people will clamor for.

Collaborate with Google, Twitter, Facebook and other social media leaders. Partner with Amazon to deliver your news to reader’s Kindles. Provide subsidized netbooks that receive your news and advertising feeds directly.

I’m not sure what strategy will work or what the future of news delivery will look like precisely. Only one thing is certain: it won’t look like their current model. And they need to start now.

A small article in the Wall Street Journal caught my eye last week and validated my increasing certainty that Sony continues to rely upon a sclerotic design approach that patently ignores their users’ experience with Sony products.

Although Sony is capable of producing aesthetically beautiful hardware, their design sensibility doesn’t incorporate the broader themes of design thinking, including the imagination and creation of new processes, approaches and insights to complement and extend the impact of their hardware.

In response to Amazon’s launch of their 2nd generation Kindle e-book Reader, Sony announced a partnership with Google that would provide owners of Sony’s own e-book reader with access to over 500,000 public domain books that Google has digitized.

Problems That Even the All -Powerful Google Can’t Fix
As the owner of the Sony Reader, I can personally attest to the short-sighted implementation of Sony’s e-book effort and their near complete lack of design thinking.

I bought the Sony Reader because its physical design was so much better than the cheap, plastic, 1980′s styled Kindle 1. However, I soon learned that the seduction of beautiful design lured me into purchasing a terribly flawed device.

History of Disappointment
It’s apparent that Sony focuses almost exclusively on their own mercenary benefits when considering design options. Their self-interested approach to product design has led to the failure of entire Sony product lines.

Their Walkman line dominated the mobile music market in the 1980′s. Today, they are a footnote to Apple and their ubiquitous iPod. Sony was the first to market with personal videotape players, but their insistence on adhering to their crippled Betamax format ensured their failure. Their forays into digital cameras have produced feature rich cameras, but their insistence on using a proprietary storage medium has limited their market penetration. Their early camcorders were technically excellent, but their imposition of proprietary Sony software to view, edit and transfer files limited their effectiveness and appeal. And their Sony VAIO laptops, although physically appealing, integrated assorted Sony proprietary components that increased their cost and limited their allure. Today Sony has only 4% of the laptop market despite their stunning design aesthetic.

Self-interest = Failure
Each of these product laggards and failures shared a common element: Sony’s focus on their own self-interest, not the interests of the users.

Sony’s design and execution of their e-book Reader reveals that no Sony executives were ever influenced by George Santayana’s perception that “Those who do not remember the past are condemned to repeat it.”

Design Irrationality
Let’s count the ways that Sony failed to integrate design thinking into their Reader:

1. the user must use proprietary Sony software to transfer books the device
2. the Sony proprietary software runs only under Windows, not on the Mac
3. the number of commercial titles is significantly lower than Amazon offers for their Kindle because the titles must be converted to the Sony digital format
4. the Sony Reader is the only device capable of downloading books from the Sony e-book library
5. there is no integration with web-based booksellers, severely limiting the available titles for the Reader

Sony’s partnership with Google delivers little value to most Reader owners. The books available for download are public domain books, not bestsellers and contemporary releases. The value to me? Near zero. The value of a partnership with Barnes & Noble to access content? Priceless.

Although the Sony Reader delivers an excellent reading experience, it’s apparent that Sony focused their efforts only on the experience that users have after they’ve downloaded content. The process up to that point – especially for Mac users – is poorly envisioned and executed.

Design Thinking Done Right
The Kindle 2, although better designed that its predecessor, still does not awe or amaze. It’s physical design is competent and certainly improved, but it’s not the Kindle’s physical design that has generated its enormous appeal.

In contrast to the Sony Reader, it’s apparent that Amazon envisioned its Kindle as a platform to extend sales of it enormous library of books. Amazon is in the book business, not the e-book reader business, and their decisions reflect their focus.

The Kindle 2 is an excellent product, but it’s not the only platform that can access Amazon’s extensive e-book library. Just a week after launching the Kindle 2, Amazon announced the availability of Kindle software for the iPhone and their 17 million users. Although Sony claims sales of nearly 400,000 Readers, their sales pale in comparison to the enormous population of potential Kindle users.

Does Amazon care if I buy my e-book for my iPhone or their Kindle. Nope. They get paid either way. And to help me out, they offer wireless syncing between the iPhone and Kindle 2 so I can use both and have both devices will remember what I was reading and what page I was on. That’s design thinking at its best. It’s user-centric, not Amazon-centric. And by focusing on my experience, they’ll likely gain a Kindle 2 user when my frustration with the Sony Reader experience results in a spontaneous, and ultimately tragic, Reader hurling incident.

Design Lessons You Can Apply
What can you learn and apply to your small business from these two corporate behemoths?

1. design great looking and great performing products, but never forget that physical beauty does not define design brilliance
2. carefully observe your clients’ behavior to generate breakthrough insights
3. partner with companies that can deliver products or experiences that you cannot – the perception of your value will increase, not diminish
4. deliver an extraordinary user experience
5. do not compel your clients to adopt proprietary technologies solely for your benefit
6. extend the definition of your product to include packaging, delivery, supplies, service and every user touchpoint
7. find new ways to amaze your clients and stand apart from your competitor