IBM is a model of how to ride the waves of change in technology. And it is doing it again. IBM, founded in 1911, has had its ups and downs, though mostly ups. It's one of the few information technology companies to shift successfully and repeatedly to new products and services as the industry matures.

To keep ahead of the relentless advances in digital technology by changing what it does and the way it works, the company is changing the thinking habits of its entire workforce. Sam Ladah, HR vice president for IBM cloud and talent, works at the heart of this transition to a design-centered strategy of growth and change.

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Talent development goals

Growing and deepening specific industry and domain expertise is one of Ladah's top talent development goals. "Today's IBM is a cognitive solutions and cloud platform company. We're no longer just about hardware and software. Because we're delivering integrated solutions, it is our industry expertise that differentiates us," he says. "During an earnings call with analysts early this year, our CFO, Martin Schroeter, mentioned the importance of skills and expertise in the transformation that we're going through."

A second talent development goal at IBM is to grow early professionals' skills for the future. "Often this starts by redefining what it means to be a technical professional in a changing world, and building this into campus recruiting so that we remain a top choice for graduates as new skills and roles emerge," Ladah explains. IBM hired more than 70,000 employees last year, more than half were recent campus graduates.

A third talent development goal is to simplify the hiring process, with a focus on the candidate experience by using the Kenexa talent acquisition suite. This software enables IBM's recruiters to better predict successful candidates through a combination of cognitive and personality testing focused on the attributes critical for key job roles and how IBMers are working today. Examples of those would include digital expertise, creative problem solving, collaboration, and even curiosity. "This allows us to hire for the values and practices that are unique to IBM, such as really focusing on the client, and creating trust and personal responsibility," Ladah says.

A related goal is to "rethink the people experience at IBM to make it irresistible from start to finish." This effort focuses on key career moments such as applying to work at IBM, coming onboard, getting a first promotion, and other milestones through retirement.

Ladah's team also is charged with introducing and scaling up new ways of working. This includes introducing new workspaces for multidisciplinary teams developing new products or services. For example, developers can quickly create cloud software apps using existing components instead of writing code from scratch. Clients are frequently in the mix.

These new workspaces are called Bluemix Garages, a nod to the location and creative gestalt of many tech start-ups. Bluemix is one of IBM's platforms. "We just set up Bluemix Garages in San Francisco, Toronto, London, and Nice. These are places where IBMers can collaborate with clients using our latest technology, whether it be the cloud platform or our cognitive solutions. We also have 'agile' workspaces to encourage collaboration in some key locations such as New York, Austin, and Raleigh. Both of these new types of workspace support IBM's move to design thinking," Ladah explains.

Design thinking

IBM is no stranger to design thinking. The Selectric typewriter and the "green screen" display terminal for communicating with mainframe computers were iconic IBM designs in their day. Back then, design thinking was the concern of product designers. Today, it is being introduced throughout the IBM workforce to propel the company into a new era in which it's necessary to grow new businesses faster than old lucrative businesses are declining.

Instead of designing a product and then convincing customers they need it, design thinking starts with users' needs and then creates a product or service to meet them, often working with the users during development. It relies on iteration cycles to move work ahead quickly. In recent years it has spread from the field of technology product development to areas such as strategy development.

IBM is introducing design thinking on a vast scale as part of its transition to new businesses such as data analytics, cloud computing, mobile technology, security, social media software for businesses, and artificial intelligence technology. "We've trained more than 90,000 people throughout the company on IBM design thinking," Ladah notes. "It could be senior leaders going through a boot camp or it could be a workshop to address a specific issue or opportunity. We've made design thinking pervasive throughout the company."

A principle of design thinking at IBM is the use of multidisciplinary teams for development. "In our experience, an engineer with deep expertise, a design expert, someone who knows markets, and a talent development professional working together will be more effective developing new approaches than those functions working in isolation," Ladah says. This is where some of the new agile workspaces come into use.

Another principle of design thinking is restless innovation, or thinking of everything as a prototype. According to Ladah, "This is about getting something up and running quickly so people can react to it and you can correct it quickly. It's very different from long development cycles followed by big releases that may or may not hit the mark."

Design thinking and talent

Design thinking also has changed talent practices at IBM. "We focus on user outcomes first. Putting the user first is very different from the way many HR professionals have worked for much of their careers. It forces us to think first about who, not how," Ladah explains.

Design thinking has its own terminology. The intent to do something is stated in the form of a "hill" expressed as an outcome. Says Ladah: "In our case, we think about what we want the user to accomplish." Thinking about development and implementation of programs comes later.

"And then there is the wow factor. How are we going to measure our success and how will it differentiate us? How do we do more than just satisfy the requirement for something? How do we really exceed expectations and create an experience that's irresistible?"

Two major HR programs were developed recently using IBM design thinking. The first, called IBM Expertise, enables IBMers to locate deep experts on particular topics using a mobile phone app. "From the palm of my hand I can identify and find experts throughout the company, no matter where they work or how obscure or specialized their expertise may be, and connect them with my clients anywhere," says Ladah.

The IBM Expertise app uses inference engines to scour information about employees—their education, degrees, length of service, career progression, blog entries, content uploads, and the subject of their comments in IBM's collaborative virtual spaces. The software looks at these digital footprints and applies logical rules to infer who is a deep expert on a particular topic. There are no assessments, no manager evaluations, and no peer reviews identifying experts.

"The cognitive system gives you a list of experts. You sort through the results and navigate to the person you want to connect with," Ladah states. "This app puts all of IBM's deep domain and industry expertise into the palm of our hands."

Reinventing performance management

After their success using design thinking to create the IBM Expertise app, Ladah's group moved on to something even bigger—performance management. Implementing a new performance management system throughout the company was another top objective for Ladah. Called Checkpoint, the system features more frequent and open feedback in both directions between managers and employees.

"We invited all 380,000 IBMers to participate in reimagining and reinventing performance management. We asked them to comment on the outcomes we had defined and to provide their ideas," Ladah explains. "We were iterating quickly and they were telling us what they believed was on the mark and what wasn't." This helped build advocacy and belief in the outcome.

Early in 2016, the company began using Checkpoint across its global employee base. IBM also launched a digital feedback app called ACE for bidirectional and 360-degree feedback, not simply for assessment but more specifically for the benefit of the recipient. ACE stands for appreciations, coaching, and evaluation. It has been widely adopted by employees since the launch in February.

"We didn't do a pilot. We went from the old approach that had been in place for 10 years and implemented Checkpoint without a safety net. That's what agile and design thinking are all about. So far, the experience has been terrific," says Ladah. "We are excited and optimistic."

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