To see the future Ayse Birsel explores the past. From the office of her design firm Olive 1:1, which occupies the second floor of a former sweatshop, Birsel looks out on one of Manhattan's last gritty neighborhoods. She sees signs of the old economy. Garment makers force racks of newly sewn jackets, dresses, and pants through streets clogged with rush-hour traffic. "There are sweatshops all around here," she insists, pointing to a window across the street that's been painted black to hide what goes on inside. Birsel likes to watch workers who hustle in the same way their predecessors did decades ago, but inside her studio it's all new economy. One of the brightest designers of her generation, the 36-year-old delights in explaining the "noncube" -- an office system called Resolve that she designed for furniture manufacturer Herman Miller Inc. To create the award-winning office system, Birsel did a good deal more than just dream up shapes, sizes, and colors. She and other leading industrial designers create small miracles by watching the way people live and work, by experimenting with technology, and by looking into the future. They act as clairvoyants, anthropologists, psychologists, and technologists. Successful designers possess skills in diplomacy and persuasion because their ideas can make or break a company. No longer a quirky title housed in a makeshift office at headquarters, design has become essential to the health of many businesses. For proof look at what the iMac did for Apple Computer Inc. or the fashionable phone did for Nokia Corp. The Resolve workstation represents a radical departure from the gray-panel office system -- the cubicle -- invented by Herman Miller over 30 years ago. Fabric hanging from poles at 120-degree angles mark individual spaces. Sun streams in the windows and passes through the fabric of workstations. The office looks like a place where a worker could collaborate with associates sitting nearby, but also find a measure of privacy behind the cloth. "The large screens separating spaces are like personal canvases," explains Birsel, who has hung two dozen black-and-white photos of friends, family and pets on a fabric wall of her office. Birsel knows something about bad offices. She spent six months studying them with a handpicked team at Herman Miller. When the Zeeland, Mich., manufacturer offered Birsel the cubicle reinvention project, she requested that seven Herman Miller executives specializing in color, manufacturing, and market research work with her on the assignment. "It's a way of building corporate ownership in the project," she explains. A native of Izmir, Turkey, Birsel moved to the U.S. in 1986 to study design at the Pratt Institute in New York. Shortly after she graduated, the young woman was hired by toilet manufacturer Toto Ltd. to design a bidet-toilet combination. In Japan she learned how not to work with a large corporation. After spending three months with executives in Tokyo coming up with a concept for a plastic toilet that conforms to the body and includes a built-in water feature, heater, and odor-prevention device, she was sent to manufacturing headquarters in Kyushu. There she received a cold welcome. Engineers told her the toilet couldn't be made. "So I wrote a letter back to the president that said since you sent me here like an ambassador, I'd like to report back that there's a disconnect between your vision and your team," Birsel recounts. A few days later the engineers informed her that they were ready and able to build the toilet. The two sides had reached an understanding: Birsel relied on the engineers' expertise in manufacturing, while they relied on her knowledge of design to complete the project. Birsel formed a similar working group at Herman Miller, and their first big task was to visit offices in Minneapolis, Chicago, New York, and Los Angeles to see the way people work. They went to banks, dot.com companies, and airline offices. What they saw horrified them. Look-alike cubes, some put into place before the days of pervasive desktop computers, took up as little space as possible. "It was as if these offices were developed in the absence of the worker," Birsel recollects. As a result of the visits, the group knew what they didn't want, and also began to imagine what would succeed. The group rallied around an imaginary call-center operator, a model worker who is good at her job and proud of it. They became protective of the model worker and passionate about her needs. "We were determined to make sure the user was well taken care of no matter who made the decision about office space," explains Birsel. Balancing competing interests is a major challenge designers face. They weigh commercial values against environmental values and the needs of a mass audience against consumers' demands for customization. They balance creativity and market needs. Designing Resolve, Birsel weighed the almost-universal corporate need to cut costs against the wishes of many employees who want to display good work, photos, and other inspirational images. Birsel came up with novel ways to accommodate the call-center operator without overwhelming corporate coffers. She pitched them to the Herman Miller group every few weeks. Finally the group agreed on a concept -- a work system of steel, aluminum, and fabric that was an earlier version of the Resolve system that Birsel and her colleagues now occupy. Herman Miller introduced test models in 1999. It installed one in a Monsanto office in India where staff members hang local textiles from the poles to separate individual spaces. Earlier this year the manufacturer introduced the product to the general market. The office system was featured at the National Design Triennial held at the Smithsonian Institution's Cooper-Hewitt, National Design Museum in New York. The exhibition highlighted work of emerging artists such as Birsel and established practitioners including Frank O. Gehry who influence younger generations. It explored globalization, cultural diversity, and other issues shaping today's products. The exhibit looked at forces such as e-commerce and Web-based supply-chain management that force designers to consider more elements than ever, and to design more rapidly than ever. It explored advances in materials science, tooling, and software that ease the technical challenges of designers, but also overwhelm them with choices. The exhibition closed in August, but another is planned for 2003. Designers featured in the exhibit continue to grapple with much more than shape, size, and color. "The most interesting designers are the hybrids -- the architects who use product-design software, the industrial designers who integrate media," points out Donald Albrecht, adjunct curator for special projects at the Cooper-Hewitt museum. The National Design Triennial featured work created by the Advanced Design Group at Thomson Consumer Electronics Inc., Indianapolis, a division of Thomson Multimedia SA, Paris. Dennis J. Erber, 49, started the group in 1997 to force the division's three dozen designers to focus on breakthrough products. Erber wanted to give his designers an opportunity to build projects that may never make it to market, but that would help them see consumer electronics in 2005 and beyond. "Once they do that kind of conceptual thinking, it can transfer over and make next year's line fresher," he believes. Every Friday designers work on blue-sky projects or interests that may lead to innovation. Almost anything goes: visiting a museum in Indianapolis or walking the streets of Paris. "This frees the designers from day-to-day black boxes," acknowledges Erber. One of the most imaginative devices to emerge from the Advanced Design Group is the Internet radio. Flipping through pages in a book about Picasso, the designer came across sketches of a bull. He decided to put a stylized version of the animal's horns on the radio to give it the retro look he sought. The horns also hold compression-drive technology. In the main body sits the subwoofer that enables lower frequencies. A crucial component of design involves risk taking. Thomson is taking a chance with its Advanced Design Group -- gambling that dreamy products that will never generate corporate profits will yield innovation in goods that end up on store shelves. "If you don't take risks, you end up with an upgrade on what someone else has done," points out Sohrab Vossoughi, the 43-year-old founder and president of Ziba Design Inc., Portland, Oreg. Ziba, which means "beauty" in Farsi, takes risks with other companies' technology. It employs a hybrid design team made up of social scientists, design planners, and designers from around the world. Some 80% of Ziba's designers are foreign born, which helps them offer fresh perspectives. The 16-year-old firm, whose client list includes Black & Decker Corp., McDonald's Corp., and Microsoft Corp., is itself a hybrid. Born a traditional design firm concentrating on a device's appearance, Ziba reinvented itself as a company that considers what products a corporation should be making. When consumer-electronics contract manufacturer Vadem Inc., San Jose, came to Ziba with technology and a desire to develop its own branded products, the Portland firm went to work using consumer research and analysis of competitive products, as well as traditional design techniques. Ziba sought to create a personal-information-management gadget that employed both paper and electronic technologies, but it didn't want to churn out a modified Palm Pilot or laptop. The group enacted a process it calls "lurking." Designers followed around potential users, recording how they used pencil and paper, PDAs, and desktop computers. They observed the planned and unplanned activities people encounter every day: scrambling to write a number down after an unexpected phone call and taking notes in a meeting. Observation revealed opportunities. Ziba saw information-management needs that Vadem's competitors had missed. They understood how a slow desktop computer, for instance, failed to handle note taking related to unplanned phone calls. They came up with 25 prospective products, then narrowed that number down to three. These include the ePlanner, a wallet-sized appliance that gives users immediate access to databases and lists as well as a pen-based display and a Post-it-sized notepad; and the leather-bound MeetingPad, a letter-size paper pad as well as a pen-based electronic display. Vadem turned these suggestions into the third product. A model of the Allegro, a paper pad attached to a folding pocket-sized PDA, gained notice at the 1999 Consumer Electronics Show. It never made it to manufacturing because Vadem decided to shift its focus from hardware to software. Just as designers of consumer electronics struggle with ways to develop watershed products, so does Bijan Davari, vice president of technology development in emerging products at IBM Corp.'s multibillion-dollar microelectronics division in East Fishkill, N.Y. "The most important element in being ahead of competitors is speed, so a complicated part of product design and development is completing the cycle of idea generation to final product with the minimum number of barriers," explains the 46-year-old scientist. One of 52 IBM Fellows, the highest honor a technologist can attain at Big Blue, Davari is responsible for technology development and product design at the IBM division that leads the industry in semiconductor patents. Products that Davari and his team design appear in Apple computers, Nintendo game systems, and Qualcomm telephones. The holder of eight U.S. patents, Davari became a fellow following his work on the complementary metal oxide semiconductor that enables computer manufacturers to make devices smaller, faster, and cheaper. Now Davari is working on a systematic way of predicting what future products will be. To go about this, the Iranian-born Ph.D. implemented "idea-generation machinery." This involves gathering creative people from different IBM disciplines -- technology, business, and manufacturing -- in a room and talking about the world five to 10 years in the future. Davari also solicits ideas from universities. With a couple hundred blue-sky projects under discussion, Davari calls on his advisory board to sift through the ideas and pick out the best four or five. Those ideas are then plunked into a fast-track process that turns them into salable products. IBM's speech chip has been through Davari's idea-generation machinery. His division is taking a kernel of the speech-recognition technology and putting it into a small piece of silicon that can be built into applications such as cell phones and computers. By 2002 Davari predicts consumers will be able to buy a cell phone with a speech recognition device capable of translating a Parisian's French into English for a New Yorker, for example. Fast-tracking technologies represents a big change at Big Blue. Just five years ago product design and development seemed to occur by happenstance. After completing 15 to 20 years of research, some scientists would watch in dismay as their projects were ignored while others would see theirs go into manufacturing. "It was almost an accident for something to be made into a product. Now we've taken that process from accidental to systematic," Davari explains. The other shift involves motivation. At one time psychological walls existed between technologists, manufacturing experts, and marketing professionals. Davari is eliminating those walls and encouraging technologists to see their products through to market. "One of the strengths of IBM in the past five years has been allowing people like myself to do the execution as well as the dreaming. How do you motivate people? You let them follow their dreams and make them happen," he believes.