There's design and then there's design.
I've been doodling in sketch books since before I can remember—it's a form of recreation, or perhaps meditation. I love playing with shapes and lines, envisioning them in three dimensions, then articulating them in two dimensions on paper so I can further tweak them before rendering them again in a three dimensional model. Designing and then building useful and attractive bags is lots of fun and very rewarding. As I've said before, it's not unlike being an architect: I just work in ballistic nylon rather than wood and steel.
But design can also become an overly egotistical endeavor: it can be all too easy to forget that the point is to build something beautiful, yes, but that a great deal of that beauty ought to shine quietly through as (hopefully) elegant utility. So much of the man-made world we surround ourselves in—the cars, the clothing, the gear—is too "designy," IMHO. Too much has been added to show off a designer's cleverness, and too many features piled on with a "try some of that" attitude. Christopher Alexander talks a lot about this.
Over the years, I've found that observation is as important as innovation. Watching people interacting with their bag, TOM BIHN or otherwise, tells me lots about the success or failure of a design. Watching what people carry and how they carry it (or try to carry it) is just as important. These days I spend as much time watching how people engage with their external world as I do sketching or prototyping. I am not naturally some cold-reading savant of the Sherlock variety: I must make an effort to look up from my laptop or book as I sit at an airport or cafe to see the business traveler struggle with her roll-aboard luggage, or a man attempt to juggle his three good-looking (but mostly useless) bags over his two shoulders.
As I see it, design is about observing what is needed, applying some hard-won expertise about how to best address those needs, and then seeing if the proposed solutions actually work in the real world. I suppose you need to be somewhat egotistical to even set off on such a foolhardy trip. But after you're up and running, the less ego the better. This may sound disingenuous coming from the guy whose name is all over the website and on every product the company makes. That's about responsibility, not ego—but I'll maybe write about that later.