By Brian O'Keefe
December 22, 2017

To win in the age of cognitive computing and cybersecurity, the venerable tech giant is betting big on design thinking. How big? It now boasts the world’s largest design team.

If you want to track the fast-moving design transformation happening at IBM (ibm), try following the Post-it notes.

“I see it everywhere,” says Diane Paulenich, a managing director at the technology giant who started her career at the company working in a call center 32 years ago. “Sounds silly. But when I go into the different offices I see teams of people getting together and collaborating with sticky notes.”

The stickies are a hallmark of “design thinking” exercises, in which participants often jot down thoughts on the brightly colored pieces of paper and place them on a whiteboard as part of creating, for example, an “empathy map” to understand the perspective of the user or customer by imagining what she or he thinks, feels, says, and does.

Paulenich herself has become a convert to the design thinking process, even when she’s just brainstorming with her team. Asking people to write down their ideas, she says, suppresses what she calls “meeting bullies,” those who dominate conversation. And Paulenich regularly makes empathy maps to prepare for client meetings, complete with a picture at the center. “I actually do a little stick figure so that they’re real,” she says. “It’s just to remind me, ‘Don’t think about you, Diane. Think about them.’ ”

Perhaps you perceive IBM as an engineering company, collecting patents and manufacturing mainframe computers. (Yes, it still makes them.) Or a venerable technology power trying to find its way in the era of Google and Amazon. Or, if you’ve seen the TV ads, the company behind the artificial intelligence platform Watson. But a design leader? Probably not.

Members of IBM’s design leadership team photographed at the offices in Austin, Texas, from left: Nigel Prentice, Joni Saylor, Jeff Neely, Liz Holz, and Phil Gilbert, the general manager of IBM Design.
Photograph by Sarah Lim

Think again. Today IBM has some 1,600 formally trained designers operating out of 44 design studios in over 20 countries—the largest such team in the world. And those are just the official designers. IBM has offered basic training in design thinking to tens of thousands of employees like Paulenich.

What’s even more remarkable is that IBM has built virtually all of this capacity in just the past six years, since Ginni Rometty took over as CEO in 2012 and the next year tasked executive Phil Gilbert with teaching the 380,000-person organization how to look at business through the prism of design—or, actually, to relearn that skill.

In fact, IBM has a storied history in design. After Thomas Watson Jr. became CEO of the company in 1956, he built a first-of-its-kind corporate design program at IBM, which elevated both its products and its reputation. In 1973, Watson Jr. famously declared in a speech, “Good design is good business.” But over the years, the focus had faded.

Today, IBM’s design operations are run from two floors—totaling 50,000 square feet of whiteboards and open office—on an IBM campus in Austin. Why there? Because Austin is where Gilbert, 61, was based when IBM bought his B-to-B software company in 2010. Gilbert isn’t trained as a designer. But he got religion about the potential of design to help scale businesses at his first startup in the 1980s: “Ever since then I’ve been pursuing this notion that the magic in any product or service is how it’s experienced by the end user.”

Cloud product designers work on an “empathy map” for an app developer at IBM’s design headquarters in Austin, Texas.
Photograph by Sarah Lim

See the full Business by Design list here.

Given a mandate by Rometty to move fast, Gilbert began recruiting aggressively in 2013. At the time, IBM had one designer for every 72 coders; today that ratio is 1 to 8. The company began holding design “boot camps” for new hires, then moving them into multidisciplinary product teams—for everything from A.I. to cybersecurity to Internet of things—where they served as evangelists.

In 2017 the company launched the IBM Design Thinking badge program. More than 90,000 ­IBMers, like Paulenich, have already earned their “practitioner” badges by completing an online course, and another 21,000 have done extra work to earn at least one of three advanced badges.

The ultimate aim of such programs, says Gilbert, is to help IBM to better serve customers—with a goal of winning. “Businesses don’t care about design thinking, per se,” he says. “Businesses care about outcomes.” That’s a Post-it worthy motto.

A version of this article appears as part of our “Business by Design” package in the Jan. 1, 2018 issue of Fortune.

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