Industrial design as a producer service: A framework for analysis in regional science

PAPERS IN REGIONAL SCIENCE: The Journal of the RSAI 75, 3:237-252 �9 1996 by Regional Science Association International

I N D U S T R I A L D E S I G N AS A P R O D U C E R SERVICE:A FRAMEWORK FOR ANALYSIS IN REGIONAL SCIENCE

Kevin O'Connor Department of Geography and Environmental Science and Associate, Graduate School of Government Monash University Clayton Australia 3168

ABSTRACT: Industrial design can be used to explore some ideas in producer services research. Its geographical location and position in a corporate structure can indicate much about the character of regions and corporations because it represents a way that knowledge is incorporated into production. Hence the size, location and organisation of industrial design can be an important indicator of the vitality of regions. This paper illustrates how these perspectives can be derived, and provides two frameworks that could be used to structure detailed empirical research on firms, industries and regions.

1. INTRODUCTION For some time research has acknowledged that the old sectoral boundar ies

between agriculture, manufactur ing and services are not of great help in understanding m o d e m economic change. Most modern product ion systems draw upon "services" and "manufactur ing" at different stages in their production. In this situation, the vitality of manufactur ing is closely linked to the availability of certain services, and service deve lopment has accelerated as the needs of manufactur ing have changed. As an example, few manufacturers now exist wi thout having contact with marketing services, environmental control engineers, as well as human resource consultants; those serving the global market will be in close contact with freight forwarders and shippers. These linkages mean that unders tanding the development of services needs to rec- ognize networks of producers within a system of product ion, and ul t imately the growth of services emerges from changes in the organization of production.

The present paper takes that general insight a little further by a close analysis of industrial design, a "service" that in some situations is a part of "manufacturing". The paper shows h o w .the character and growth of industrial design, and its impact on cities and regions, is shaped by its place within the system of production. The approach recognizes that the growth of industrial design depends on changes within manufacturing, while at the same time the structural change in manufactur ing can depend upon the availability of industrial design services. The paper develops a f ramework to tease out these interdependencies and illustrate how the development of p roducer services can play a role in changes in the structure and organization of product ion within regions.

238 PAPERS IN REGIONAL SCIENCE, VOL. 75, NO. 3, 1996

2. WHAT IS INDUSTRIAL DESIGN? Industrial design is a very general term, and in historical situations as

well as in current times it has included a variety of activities (Miller 1989). At one level it is close to architecture and building and shares a concern with aesthetics and function; examples include the design of domestic furniture and equipment, and a broad range of consumer goods. In that heritage, design draws upon a long history of urban based creative activity, examples of which can be found from the Renaissance onwards, as Tornquist has reviewed (Torn- quist 1983). That background was strengthened by the role that design played in the progress of the industrial revolution in England, which created the great industrial cities of that era (Tilson 1989, Knight 1986). Sparke (1983) has reviewed this history, and shown how the two elements underpinned the development of the discipline in educational institutions, and the creation of professional institutions (MacCarthy 1979; and Lucie-Smith 1983).

The emphasis on aesthetics and function is still a big part of design work in the auto industry and in the clothing industry, while the narrower industrial process perspective plays a major role in modern industrial system management. The latter can be seen in the approach taken by Dixon and Duffey (1990) in their analysis of engineering design--to them "the development of a product from its technical conception through detail design of the related manufac~ring process and tooling ... we distinguish engineering design from what is often called "industrial design"; the latter is centrally concerned with important issues of styling. Industrial design is a part of, or runs parallel to engineering design" (Dixon and Duffey 1990: 10-11). Hence industrial design is understood to be part of product development, and so is an activity that exerts control over the subsequent production process by way of instructions about materials or specifications about size and technical tolerances.

The expansion of the design component in production engineering is in response to, and follows the steady evolution of, manufacturing technology, involving what have come to be called advanced manufacturing technologies (Dixon and Duffey 1990). The new role is also related to the importance attached to flexible production systems, which Jelinek and Goldar (1984) dis- cuss in terms of the "factory of the future", where electronic control of production and management will flow from sophisticated design skills. The incorporation of information technology into computer aided design and computer aided manufacturing systems has also changed design work, shifting both its scale, its type of employees and the strength of its linkages with the production process (Langdon and Maller 1984). Very recently, environmental pressures and efforts to minimize raw materials in production have provided yet another stimulus for design activity to be integrated into the production process.

Hence industrial design is an activity that is involved not only with the creation and design of new products, but also the control and specification of production processes. It is the latter where the links to manufacturing are the most direct, and these activities are the central interest of the present paper. In its focus it differs from the pioneering work on manufacturing-service links done by Marshall (1985), who looked at finance and related services. The link to manufacturing relates to ideas expressed by Coffey and Bailly (1991), who

O'CONNOR: INDUSTRIAL DESIGN AS A PRODUCER SERVICE 239

showed how a shift to flexible specialization within manufacturing was associated with changes in the scale and location of the service sector. Industrial design is likely to play a propulsive role in flexible manufacturing, and so will probably have an important role in future service growth in some regions.

3. INDUSTRIAL DESIGN AND INDUSTRY: A GENERAL PERSPECTIVE A general insight into the employment of industrial designers can be

gained by looking at the data displayed in Table 1, showing output from a cross tabulation of the Occupation group "Designers and Illustrators" by Industry within the Australian census of 1991. The statistician's definition of the occupation group is broad reflecting the general interpretation given to design as discussed earlier. It includes subcategories of designers (Fashion, Graphic, Industrial, and Interior) as well as Illustrators. Of this group, only two relate directly to industrial production processes (fashion and industrial design), but the category is the most refined for which data is published. The table provides a general perspective on the design industry within Australia, illustrating the breadth of activities that involve design in one form or another. The employment in the finance, property and business services group, and parts of wholesale and retail trade includes illustrators who work in advertising, while the large number employed in printing within manufacturing are probably illustrator and layout artists. In addition the recreation, personal services and other services industrial category also includes artists.

Closer study of the table shows where industrial designers are employed within manufacturing. For example, there are five groups apart from printing that employ more than 300 people in this occupation group. Clothing, Textiles and Footwear are prominent, and have traditionally been an important area of design activity, and Furniture is also an important employer. The last two categories, "other machinery and equipment" and "miscellaneous manufacturing" which incorporate the production of industrial, electronic, scientific and medical equipment are also important employers of designers. These sectors are the home of the small firms, and are prominent in recent export success in Australian manufacturing (Garnsworthy and O'Connor 1996). Within Finance, Property, and Business Services there are likely to be people employed in industrial design consulting firms which provide engineering based services to manufacturers. (This group will be addressed in the discussion on out-sourcing below). The data shows the design sector within Australia is small, an observation supported by a recent review of the activity (Badham 1991). It has only 17,369 employees in design related activities, which represents only 0.25 per cent of the total work force of the nation in 1991. Australian manufacturing has for a long time relied upon imported design. Only now has a small local sector based on design skills begun to have success in global markets; Government policy is currently encouraging the expansion of design activity and its greater integration into the production process within Aus-


TABLE 1. Employment of Designers and Illustrators: Australia a

Industrial Category

A. Agriculture, Forestry, Fishing, Hunting

B. Mining

C. Manufacturing

20. Manufacturing Undefined

21. Food, beverages and tobacco

23. Textiles

24. Clothing and footwear

25. Wood, wood products, and furniture

26. Paper, paper products and printing

27. Chemicals, petroleum and coal

28. Non-metallic mineral products

29. Basic metal products

31. Fabricated metal products

32. Transport and equipment

33. Other machinery and equipment

34. Miscellaneous manufacturing

D. Electricity, Gas and Water

E. Construction

F. Wholesale, Retail Trade

G. Transport and Storage

H. Communication

I. Finance, Property and Business Services

J. Public Administration and Defence

K. Community Service

L. Recreation, Personal and Other Services

M. Not Classified and not Stated

TOTAL

1991

27

28

5238

146

51

396

1141

358

1978

51

87

34

113

171

332

38O

81

347

1743

80

87

5613

439

783

2502

401

17369

Source: Australian Bureau of Statistics Cross Tabulated Data Census 1991

tralia, reflecting the growing awareness of the potential of design activity in many countries (Bryant and Holt 1987). For the present paper, however, the table is also relevant to illustrate the breadth of industries that draw upon design skills. Given that diversity, research into industrial design as a service will need to be carefully focussed, and statements about its activity will need to be linked to detailed understanding of particular industries.


4. INDUSTRIAL DESIGN, REGIONAL SCIENCE AND PRODUCER SERVICES RESEARCH The role and vitality of industrial design is important in regional science

as both dimensions recur in some of the critical dimensions in producer services research. First, the size and scope of industrial design activity is a prominent dimension in regional restructuring, as it offers the possibility of higher standard products and higher standard jobs. In essence it is a way to incorporate higher levels of knowledge and skill into the production process, and so can have an impact on local innovative activity. Industrial design can there- fore be an important service both in new and mature industrial regions, and will figure in policy in these locations. A second dimension of producer service research involves the size and direction of out-sourcing. This is a critical element in the success of industrial design, so research into the activity can be closely integrated into current service research agendas. A third context is the role of producer services in metropolitan development. Daniels (1991) has shown that producer services stimulate expansion in selected metropolitan areas. The location of industrial design services may reflect the location of other creative arts, research and allied skills in design generally, and so be found mainly in the very big cities. Places like Paris and Milan provide good examples. Alternatively, it may be anchored in industrial regions, both old and new, and may not necessarily have the big city concentration often associated with producer services; Stuttgart and Pittsburg could be examples of these locations. Understanding this outcome could add to the understanding of the link between producer service growth and the role of large cities. In all three issues, understanding the place of industrial design within the production system of firms provides insight on producer services generally, as well as the spatial distribution of economic activity generally. These three aspects will be reviewed in more detail below.

Industrial Design, National and Regional Restructuring The restructuring of national and regional economies means the shift in

their employment, industrial and occupational structures from one type of activity to another. For many the change can mean a loss of vitality as old industries close down (the "mature industrial economies") while for others the process provides new opportunities for growth and development (the "newly industrialized countries" or "sunbelt regions"). Numerous reviews of this process have illustrated its selective impact, and have begun to debate public policy responses (see Rodwin and Sazanami 1989). The early inter- pretations of this process were associated with the geography of the product cycle. The winning regions and nations were those with activities in the early stages of the product cycle. With the international division of labor those patterns began to change, as newly industrialized regions were integrated into global production systems at different stages in the product cycle (Dicken 1992). Industrial design plays a critical part in this process as it is through successful design that the product cycle begins to unfold; nations and regions involved in the generation and refinement of products and processes through a substantial commitment to industrial design may benefit in terms of good quality jobs, even though production may be located in newly industrialized


areas. For public policy, industrial design offered the opportunity to "bet on the basics" (Markusen and Carlson 1989) and replace older industries with new services that draw on the established skill but applied it to new problems, as Hennings and Kunzmann (1990) have discussed for the development of the Ruhr.

More recent analysis of national and regional restructuring has emphasized accessibility to and utilization of knowledge as a determinant of industrial performance and economic growth. At the national level Romer (1990) has demonstrated that knowledge is an important factor of production, and nations that have more investment in knowledge than others can expect faster rates of development. Drucker (1994) has provided a comprehensive overview of these changes at the national scale, showing how knowledge intensive activity will be central to long term vitality for nations. Feldman and Florida (1994) illustrate this effect at the regional scale, showing that access to knowledge in the form of research and development expenditure and other areas of knowledge creation are critical to the generation of innovative firms and industries and so the structural change of a regional economy. Industrial design has several attributes that mean it can be an important activity in this context. It is a specialized, knowledge-rich function, especially when enhanced by information technology links to electronically controlled production processes. In many industries this function means it is a core competence, so its overall size and influence can shape the industrial structure of a region. As an occupation, the skill and training involved means that industrial designers fit the Robert Reich (1992) category of "symbolic analysts". The clustering he describes for these occupations suggests that the impact of industrial design on jobs and industries may be limited to some parts of nations, and some nations across the globe. Hence the industrial design function of a region or nation will be a major influence on the restructuring process.

Given the product cycle and knowledge base role of industrial design as outlined above, it is possible to classify regional or national economies in terms of their industrial design function. This has been carried out in the construction of Table 2.

The table presents three possible scenarios for the location of design and manufacturing. In the first case, the nation or region has both design and manufacture; good examples of this are machine tool production in Baden- Wurtemburg and specialized engineering in parts of Italy and Switzerland (Gertler 1994). These countries and regions are high-income high-growth locations as they draw benefits from jobs in services as well as manufacture; they also benefit as their design functions make it possible for their manufacturers

TABLE 2. The Location of Design and manufacturing

Design Manufacturing

Case I Yes Yes

Case 2 Yes No

Case 3 No Yes


to remain internationally competitive. Public policy concerns centre on the production efficiency of the manufacturers, as well as the skills of the designers. A second group (Case 2) describes national and regional economies where design is well developed, but manufacturing is not significant. Parts of the car industry in the UK seem to fit that position; firms in that nation are the acknowledged leaders in the sophisticated technology of Formula One racing, but its car producers do not share the same rank. The development of car design in Los Angeles, which no longer has a local car industry as a base, also illustrates this category, while the restructuring of Silicon Valley from a design and manufacturing centre to largely a design (and research) centre illustrates a shift into category 2 (Saxenian 1994). Japan's consumer electronics and camera industry now fit this category, as they have moved manufacturing out to other parts of Asia (The Economist 1992). Public policy for nations and regions in category 2 involve improving the link between design and manufacture; Morales and Storper's (1994) research on the solar car industry in Los Angeles is an example of an activity in a region attempting to make better use of local design skills. As will be discussed below, Cohen and Zysman (1987) have suggested that US manufacturing has moved from case 1 to case 2, and the disassociation between design and production has hampered development of US manufacturing.

The third case captures those locations that only produce, relying on design to be supplied from elsewhere. Many parts of the newly industrialized countries of Asia fit this category; a very good example is Nike's shoe production studied by Donaghu and Barff (1990), where major production activity is located in Asia, but design occurs at the Beaverton, Oregon head office. Some older industrial regions are in this category. They continue to manufacture old style products, lacking the local design skills to boost their pro- ductivity and innovation. It is also possible that the Japanese car factories in the US and UK could fit this category, so long as design skills remain at home base in Japan. Berggren's (1992) comments that most major auto producers are centralizing design; his analysis certainly suggests the Australian car industry is in category 3 in Table 2. For nations and regions in category 3, public policy is directed at strengthening local design capability, so that locally made products can meet world demand and so return income from both design and production. The steady evolution of the Taiwanese, Korean and Sin- gaporean economy can be understood as a steady shift from category 3 to category 1; paradoxically many of their industries and regions are now drifting toward category 2 (Clark and Kim 1995).

The analysis of Table 2 shows that the position of industrial design in the production systems of firms in a riation or region can provide a powerful insight into the regional restructuring process. This means producer services research within regional science would do well to incorporate analysis of industrial design into its research activity. The final section of the paper will suggest ways that could be done.

Industrial Design, Out-sourcing and Producer Service Growth Within producer services research, considerable interest centers on the role

that out-sourcing plays in the location, operation, vitality and growth of the


service sector. Many producer services grew rapidly as activity was Iocated outside established firms and "bought in" by re-organized companies. The demand created in this way provided opportunities for many small firms, and also allowed some larger service companies to achieve the economies of scale and scope in global operation as they took on the tasks put aside by firms refocusing their efforts on core competencies.

Many manufacturers employ consultant industrial designers, just as they might use advertising or legal advice. In fact, in the UK car industry, for example, "independent design companies are going through a boom period" (Wylie 1986:55). Case studies of three firms in Wylie's paper show that the directors and owners of the new successful firms have usually come from the internal design department of big motor car producers. Mraz (1990) reviews a range of companies' experience on this matter, and notes an increase in the use of out-sourcing the design function because of the benefits that flow from specialization and breadth of experience. To gain an idea of the importance of out-sourcing, a Design Council (1983) survey found 28 per cent of a sample of 78 companies subcontracted work out. A similar result was found in a sample of European companies. The scale of these samples, and the lack of information on the method of selection, makes it difficult to generalize, though it provides some indication of the separation of "in house" and "bought in" services. Sparke's (1983) history of UK industrial design shows the independent design consultancies first emerged during the 1960's.

One reason for the increase in out-sourcing of design skill is the glo- balization of a firm's markets, and the need for a product that will meet consumer needs in a range of different contexts. The design consultancy can assemble skills to meet that need, which would be difficult for a firm to achieve with in-house staff. In addition, the shift to electronic based CAD systems has increased the flexibility of a design consultant, made it possible for small firms to operate, and made it easier to have a separation between the designer and the client. These dimensions made out-sourcing technically feasible.

There is another dimension to outsourcing that emerges from the location of the design function within an organization. This aspect relates to the Cohen and Zysman's (1987) analysis, which showed the separation of design (in the US) from production (in low wage cost countries). They argue this separation reduced the benefits that flow from production problem solving and learning by doing. Their perspective is supported by Frontini and Richardson (1984:45) who observe that "in large firms (the design task) is usually carried out in geographically and organizationally separate functions where face to face contact is infrequent and common objectives and a sense of integration are lacking." The analysis of the world car industry by Womack (1990) provides dramatic examples of this claim, comparing the isolation from production of US auto producer design departments compared to their production proximity in Japanese factories. Indeed the Womack study suggests that the success of the lean production systems developed by the Japanese producers stemmed in large part from close ties between market research, design and production processes. However, it is important to acknowledge that Japanese producers have relied upon Italian and US body design skills for a considerable time.


These problems have been addressed in management changes in many companies. Recent commentary on the US car industry suggests that the linkage of design and production has been improved substantially (Economist 1994). Baker and Black (1987) show the success associated with in-house, integrated design teams, citing the "learning by doing" experience that Cohen and Zysman (1987) believe is so important. These studies reiterate the importance of the corporate structure of a firm in the effectiveness of service provision, and that the development of service employment in some places may be influenced by the way a firm decides to organize its production. It is also likely that this effect will vary from one industry to another. In clothing and footwear, for example, out-sourced and remote design is feasible (and common) as the production processes are simple; in contrast in machine tool production, and for sophisticated medical equipment manufacture for example, there may be major advantages to have design and production close within the one firm. Yet that simple contrast is not supported by the experience of Benetton who gain major market advantages from links between design and manufacture of clothing, while Japanese car companies have begun to use Los Angeles design studios for body and component design. This complexity indi- cates that the location and vitality of industrial design within a place will reflect not only industrial process considerations, but also corporate and management structures.

The intra-corporate dimension opens up an opportunity to explore how the structure of business enterprises influences the spatial distribution of service activity. That will be an extension of the agenda established by Dicken and Thrift (1992), and will add to the research agenda in producer services in the immediate future. Industrial design is well suited to this research as it can be organized in a number of different ways: it can be supplied by out- sourcing in the traditional manner, or by intra-corporate sources which will reflect the structure of the organization. These various dimensions of out-sourcing suggest that the location of industrial design will not be a straightforward matter, and regions and nations wanting to attract design activity will need to meet a range of criteria emerging from corporate interest as well as local industrial mix. In addition, they may have to face issues about the local milieu, to be discussed below.

Industrial Design and Metropolitan Development A considerable volume of research on the location of producer services

has shown that large metropolitan areas play a special role in this activity. That role is best seen in the many case studies carried out on services like banking and finance, legal and advertising services (Moss and Brion 1991, and Daniels 1991). The clustering effect emerges from the need for face-to- face contact among the key firms, and the importance of some institutions like markets and the courts. These factors are reinforced by the project team approach to service provision where groups of independent firms collaborate on projects, dissolving and reforming with slightly different members as different tasks become available. Sassen (1991) has described this process, noting that the linkage between the members of the project groups are usually more important than the link with the client.


Industrial design is a different type of service. It differs from the other services not only because of its strong manufacturing links but also because it has no association with an established market or other critical institution that could anchor its firms in a large city. Given some of the discussion on out-sourcing above it is possible that the service will be more effective if located in industrially based regions, rather than in the core of large metropolitan areas where other producer services cluster. On the other hand, it is possible that industrial design firms, and the industrial design sections of large corporations, could be drawn to city locations by their links with other design skills in areas like fashion and architecture. The broadly based creative environment associated with the diversity of activity in a large metropolitan area could also be attractive, so that for industrial designers, close proximity with other firms in related activities may be more important than proximity to clients. The industrial design community could be another element in the creative environment of the city, contributing to the milieu that is central to the vitality of these large centers (Hall 1994). If that is so, the potential for service development in smaller, slow growth or mature industrial regions could be limited. In fact, if industrial design really needs to be close to its clients, it may be the clients who locate close to a cluster of designers, rather than the other way about. Looked at another way the service sector could shape the vitality of the manufacturing sector. That would require a study of the location of design-intensive products like scientific instruments or medical equipment. That research has the potential to establish new perspectives on the role that producer services play within regional science.

Preliminary work on the location of design firms and design employment tends to indicate that it is larger cities rather than industrial cities or small places that have attracted most of the industrial design firms. Sparke (1983:64) showed London was the main centre for industrial design in England, and was also the major location for this activity in Europe. Birch (1992) found a significant cluster of design services in Sydney, even though Melbourne is a larger manufacturing centre in Australia. In New York State, MacPherson (1994) found a cluster of industrial designers in New York City were the main suppliers for a sample of firms in the Buffalo and Up-state New York area. These results suggest that it is the big cities that are the key providers of this service. Hence the role, function and location of industrial design could refine our understanding of the links between producer services and city development. Knowledge of this link will be important in shaping of policy to address industrial and regional restructuring needs; the big city bias outlined above suggests the small isolated industrial centre may have a difficult time attracting or retaining the design function.

5. A FRAMEWORK TO ANALYSE THE LOCATION AND GROWTH OF INDUSTRIAL DESIGN SERVICES WITHIN REGIONAL SCIENCE An initial step in research on industrial design is to establish just what

activity the research will encompass. As outlined in the introduction, the term refers to a wide variety of activity. In the approach proposed below, industrial design is understood primarily to mean what Dixon and Duffey (1990) call


"engineering design", that activity associated with the development of products. This definition means that much of the research will need to be firm- based surveys, as few published statistics are available about activity that is so narrowly specified. It is possible too that separate attention may be paid to electronic design systems (CAD/CAM) as distinct from older style activities.

To show the role that engineering-based industrial design plays as a producer service requires a regionally focussed research framework that captures dimensions of corporate organization, as well as city size and industry mix. The central idea used in the review to this point is that industrial design needs to be seen as part of a production system, the interlinked set of steps used to tie resources, goods, services, labor and markets together. Where it fits in that system can influence its activity, and its industrial and locational impact. That approach is used to build the research framework described below, and illustrated in Figure 1. The diagram suggests there are three types of production systems, which will have three different regional patterns associated with them. In the simplest case, Figure I(A), industrial design is part of the production system within a firm, and is in the same location. This is perhaps an original position that may have emerged with the development of design in engineering firms in the industrial revolution, but it is one that is still important to a number of firms in a range of industries. Parts of the clothing and textile industry, for example, fit this category, as designers remain close by the cutting and sewing of their creations. More sophisticated industries like scientific instruments and medical equipment, and pharmaceutical production also fit this model, as would car component production where industrial design is an integral part of the firm's production activity. Much depends upon the corporate approach to design in these cases. In small firms, there is little option but to adopt the framework presented in Figure 1A; larger corporations may be tempted to concentrate design in a central facility, and move toward the pattern shown in Figure lB. The firms that use the approach shown in Figure 1A will have an impact on urban and regional economies through the provision of jobs in both services and production.

It is possible that the high level of integration between the two stages of production could be felt in innovative activity, and possibly higher income and growth than in other regions. A city or region that has firms in this category will need to attract labor into both manufacturing and services; that dimension could limit the location of these types of production systems to a few industries in a few favored sites, as the locational needs of both sectors will be hard to match.

A second context is the situation outlined in Figure I(B), called the "Divi- sion of Labor Model". Here the design" function takes place in a core location, probably a place with a cluster of research institutions and design firms, while production is located elsewhere, though the activity is integrated within the corporate network of the single firm. This approach to the role of design reflects the benefits that are seen in clustering the design activity in a particular centre (labor market factors, diversity of the local service base and the quality and diversity of the educational institutions could lead a firm to concentrate its design activity in one place). At the same time the manufacturing stage of the production process will respond to the benefits it sees in other locations,


A. Single firm single location within industrialised region

Industrial ~.~ Production I Design , r I

B. Division of labour

Core Location Industrialised Location

Industrial Design

Producdon

LOCATION A LOCATION B

C. Outsourcing

Major Metropolitan Area

Industrial Design

............................................. Represents a single firm

Industrialised Region . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ,

I Production FirmA I

Peripheral Region , . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ,

Production Firm B 1

Metropolitan Area , . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

1

Production Firm C I J

FIGURE 1. Indus t r ia l Des ign and the P r o d u c t i o n Process


which could be cheaper resources in a range of sectors. This model could describe the arrangement of a firm within a metropolitan area, where the firm has a design laboratory in or near the CBD, while its production is on suburban industrial estates; if a global corporation, it may have dispersed production sites linked to a central design location. The global car concept, which relies upon design in a few places, and production in many others, is an example of this approach. The regional impact of service activity will be limited to the design centre in the Figure 1B case; the clustering of design jobs will be felt in higher wages and possibly more service growth as the corporation man- ages its links with the distant plant. The long term vitality of the design location will depend upon its competitive ability relative to other design locations elsewhere around the globe.

Research here will need to focus upon the corporations in different industries within a region, like the studies of Donaghu and Barff (1989) and Clark (1993), to find out how corporations distribute their design and production activity among locations. The survey work could identify reasons for the separation of design, and factors that encourage its concentration in one location. The means of linkage between the design centre and the production sites would be important to establish; in some cases, telecommunications could be very important. Alternatively the research could focus on one industry, like autos or steel, and locate the design activity and the production sites. A contrast with the computer or electrical engineering industry would be useful, as it could indicate the extent to which scale economies in production can contribute to the separation of design from production in some activities.

The third approach to production shown in Figure 1 is called "Out-sourcing". Here the design service is provided by a stand-alone design firm, which has a range of clients, possibly in different industries, and as suggested in the diagram in very different locations. Examples of the global scale operation implied by this diagram has been described by Braham (1993) and Butler (1987). Figure I(C) implies industrial design is like many other advanced services, as its jobs cluster in locations that have other sophisticated services, research and development and knowledge-related infra-structure. The diagram could be misleading as it has only one design firm serving a number of clients. It may be that a number of design firms work together in a network; if so the inter-linkages between them could be very important to the location of the service. The diagram implies design services will be best developed in locations that have a technical and research milieu, as well as good international accessibility; that suggests design will be a metropolitan activity.

Research on this dimension would need to begin with case studies of design firms, assembling data on clients "by industry and location. The common approach is through directories of registered designers, and the information in them may be verified by some public policy research into design activity carried out by Government agencies. The purpose of the surveys will be to establish reasons for location, and to understand in particular the linkages between the designers and other professional services.

Another way the framework could be used would be to follow an industry or a firm across time. Case studies may show that firms moved from Stage A through Stage B and in to Stage C. If that is so, then the analysis would


be suggesting big cities or places with diversified technical activity have grown to play a steady role in the service sector. Alternatively, if firms can be shown to move from stage C back to stage A, to bring designers in close inside the firm, it is possible we are seeing a relocation of service jobs closer to the pattern of industrial activity. This perspective would be clearer if it could be obtained on a number of different industries.

6. CONCLUSION This paper has argued that industrial design is an important producer

service. Its importance derives from its association with knowledge and the restructuring of industry, and from the range of locations that it can adopt. It plays a key role in the competitiveness of manufacturing, but it may not need to be located close by that activity, as its location may reflect the concentration of other services. For locations, design jobs offer high wage paying opportunities, and form a part of a broader technical milieu that could attract other services. The effect of the sector on a location will vary from one industry to another, and upon the corporate structure of the firms involved. Corporate case studies need to be structured to identify both organization as well as locational dimensions. Policy to be developed to assist regional restructuring, relying upon shifts of design closer to production will need to draw upon these surveys. Finally the interdependencies between design services and other producer services could provide more insight on clusters of producer services within metropolitan areas. Hence research into industrial design promises to be a productive area, not only for producer services in general, but also for regional analysis and planning.

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Industrial design as a producer service: A framework for analysis in regional science

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