The Institute was established in 1993 as an independent foundation which receives core funding from the Dutch government. Its building - the former Fodor Museum on Keizersgracht - is provided by the City of Amsterdam. A full-time staff of eleven people supports the research, manages projects, and ensures that ideas and information are disseminated. The Institute is an international meeting point between design, industry and culture.

This note describes the cultural, economic and design contexts of the Institute's work; the issues which permeate its activities; and the projects it has undertaken during its first two years of operations.

The Design Institute itself was established formally by a Letter To Parliament in October 1992; this legislated a programme budget of Dfl 3 million a year, for four years, starting in 1993. A six-person Board was constituted, and John Thackara, an Englishman, was appointed as the Institute's first Director. He started in May 1993.

Since that date, long-term planning and inaugural projects have proceeded in parallel. The Institute is being created in three overlapping phases. The first phase (roughly, May 1993 to mid-1994) involved investigations to identify the Institute's mission, and the issues and themes which would inform its work.

The second phase involved development of an infrastructure - staff, equipment, communications, budgets; this ended with the commissioning of the Institute's new building which was opened officially in June 1994. The initial results of the third phase - substantive programme operations, dating back to Autumn 1993 - are documented in this report.

In the economic domain, design is an international service industry with a turnover in 1994 of more than 7 billion ecus (circa $ 9 billion) in Europe alone. There are about 8,000 design firms within the 12 (in 1994) member countries of the European Union, but their small size - most have fewer than 25 staff - helps explain the low profile of the industry. But although it is fragmented, it is economically very significant. All these consulting firms help clients - who may be companies, cities, or even nations - add value in many different ways to products, communications, buildings, and cities.

The design industry's skill base rests on 180,000 students currently taking full-time courses in the EU; 30,000 of these graduate each year. Just under 7.3 billion ecus in royalties and design fees was spent in Europe in 1993, of which 2.6 billion was on graphic design, 1.7 billion on product development, and 2.8 billion on interior and retail design. By the year 2000, expenditure on design by governments, cities, multinationals and small firms is forecast to rise to more than 12 billion ecus.

Design is also an important internal resource for companies.The Institute's study calculated that more than 150,000 designers work as salaried employees of medium and large sized firms in Europe. These staff designers work in project teams with other specialists from research, engineering, marketing, logistics, information technology. These teams are the engine room of innovation, product development, distribution and communications in Europe's most successful firms. 300 of Europe's biggest firms spend more than 1 million ecus a year on design - and the biggest spend many times more. One reason is that design is fast becoming a capital-intensive as well as knowledge and skill-intensive industry; design consultancies and in-house company design studios typically use high-end computers; design is a noted test-bed for new software and equipment.

For hundreds of thousands of Europe's small and medium sized enterprises, design plays an important role, too, in the so-called "New Economy" where, as the Harvard Business Review put it at the end of 1994, "the old game was results, the new game is process". As the boundaries between production, distribution, marketing and communications have blurred, design has become an important way to differentiate and add value to all kinds of products and services.

A growing number of government ministries and public institutions also use design to package, communicate and deliver public services. Corporate identity plays an important role in the privatisation of state-owned post, telecommunication, transport and other enterprises. An estimated 300 cities and regions in Europe, which are competing with each other for inward investment, use the design quality of their social amenities, branding techniques, and urban renewal programmes, as competitive weapons. From Glasgow to Groningen, from Bremen to Barcelona, dozens of cities have developed their own design policies and infrastructures within the past decade.

Design is also present in the cultural domain,where it is an increasingly popular 'cultural product' in its own right; in recent years design has been the subject of exhibitions, biennales, books, television programmes and other activities on subjects that range from chairs and clothes to computers and communications. Hundreds of independent galleries, special design features within major museums, and at least one dedicated design museum (in the United Kingdom), have been established to cater for growing public interest. Design has also become an important tool used in all kinds of cultural production: many millions of sophisticated consumers expect innovative design to be deployed as part of the books, television, exhibitions, theatre and opera they enjoy.

The Design Institute's activities are therefore divided into three core programmes:

  2D Tomorrow's Literacies
the future of graphic communication
The team's task is to develop a clear understanding of the fast-changing communications environment - and within that, to develop new applications for the skills of graphic design, typography, and illustration.

  3D Terra Nova
designing products in the "New Economy"
The programme explores the increasingly blurred boundaries between pre-industrial craft production, small-scale manufacturing, and multinational corporations.3D projects explore the consequences for design of the shrinking distance between the producers of objects, and their consumers

  4D - Doors of Perception
the design challenge of interactivity
Interactive multimedia and global networks confront design with its greatest challenge since industrialisation. The opportunity is to develop products - or 'content' - to match the stupendous speed with which worldwide 'teledensity' is increasing. (There are nearly 3.5 million internet subscribers today; that figure is projected to rise to 100 million within five years).

In each programme, the idea is to foster a team-based approach to innovation. The Institute's projects do not just involve designers, but also enlightened clients whose determination to establish ambitious goals is a precondition for progress in design. Equally important are the various publics of design - users of products or processes: in an era of continuous innovation, shared creativity is blurring the boundaries between designer and user.

The Institute is not interested in design as an end-in-itself, but as a means of technical and cultural innovation. If a proposed project does not add value to information, or to a product, or to a process; or if it does not involve different disciplines working together; then the Institute will not get involved.

 Work and Skill - Bodies and Brains
"We work not only to produce", wrote Eugene Delacroix, "but to give value to time". The importance of human work and skill in the post-industrial economy is emphasized in all programmes - from typography to telematics. Design can be complicit in the automation of many activities carried out by people - but it does not have to be. With unemployment in Europe approaching 30 million, work - whether physical, or mental, or both - surely has to be treated as a value in products and processes - not just as a cost. Besides: there are things that machines don't know, and will never know - mainly because they do not have bodies.

 Connectivity and Networks
The concept of connectivity also touches on most of the Institute's projects. The fact that consumers, using new communication networks, can dictate so much about the products and services they buy, has profound consequences for the very nature of design. Not to mention what it means to be a 'consumer'. The idea of shared creativity, with users, designers and producers creating products together, is the most exciting feature of what economists are calling the 'New Economy'.

 Sustainability - not less but different
Many designers, such as the recently established O2 Global Network, are active in the environmental movement; they share with thousands of others a concern to develop sustainable models of economic development. But most experts fear that incremental improvements will not be enough to stave off some kind of catastrophic eco-shock within a few decades. In the words of Paul Hawken, "5.5 billion people are breeding exponentially, and the process of fulfilling their needs and wants is stripping the earth of its biotic capacity to produce life. A climatic bust of consumption by a single species is overwhelming the skies, earth, waters and fauna". Radically new economic models are needed to reduce our consumption of matter and energy by a factor of about 20 within 50 years. "To create an enduring society", says Hawken, "we will need a system of commerce and production where each and every act is inherently sustainable and restorative." Consumers will only accept such products and services if they deliver different qualities and more value. Design can play an important role in making these new scenarios visible and tangible.

 Demography - design for an ageing Europe
Life expectancy has increased by 50 per cent this century. By the year 2000, 50% of European citizens and consumers will be 50 years old or more. Simultaneously, our ideas about old age are changing; the concept of a 'Third Age' - a time of relaxation and fulfilment, even though many of us will work longer, is becoming more familar. For 35 years, industry has aimed its products and services at younger people, ignoring the needs of older people. Design has a pivotal role to play in shaping a world which meets the needs of all of us. The Institute is already active in the European Design for Ageing Network; the subject will continue to inform a lot of the Institute's work.

This concept of a knowledge system is informed by the old Chinese proverb: I hear, and I forget; I see, and I remember; I do, and I understand. People act, or change, when they experience how things might be different - not through exposure to large volumes of information. So although it takes its public information duties very seriously, the Institute is therefore not primarily an archive, nor a library. When information is needed for projects it is obtained from a variety of primary information sources, such as libraries, museums, and professional archives, and from special interest networks in the educational and industrial worlds.

The Institute's project management aims to be fast, flexible, flat, focussed, and friendly. Both its projects and its internal services are organised by teams of staff and external collaborators. Programme Managers act as analysts and producers. The organisation sub-contracts a lot of its routine production work.Continuous evaluation is a formal requirement for project managers.The key criteria: that their projects involve designers, users, and other experts acting together; that they have the potential for long-term development; and that projects create and disseminate new knowledge.