ROI of Design in Business Monday, May 26, 2014

The value that design has on a business has been a long-standing debate.

The Design Council – a design advocacy group in the United Kingdom - have completed extensive research on the topic. “Leading Business in Design” - why and how business leaders invest in design, shows detailed case studies on the absolute necessity of design in business, and in some cases, the ROI.

The report highlights three key findings on how businesses can benefit from design:

  1. Design is customer-centred 
    Benefit is greatest when design is intimately related to solving problems, especially customers’ problems.
  2. Design is most powerful when culturally embedded
    It works best when it has strong support in the organisation, especially from senior management.
  3. Design can add value to any organisation
    Design can benefit manufacturing and service-based organisations, small, medium or large.    

It’s a proven fact that companies who pay attention to, utilize,and incorporate design into their process far outperform those who don’t. The proof is in the pudding. The Design Council, reported the following findings:

  • Shares in companies where design plays a critical role consistently outperform key stock market indicators by 200 percent (specific to the Financial Times and Stock Exchange), thus establishing a connection between design and market value.
  • Design-alert businesses were able to increase their market share by an average 6.5 percent. Some companies reported that design impacted their market share by 100 percent and was essential in their ability to identify new opportunities or create new markets.
  • For every $130 spent on design, Design-alert businesses realized a $298 return.

“Our board of directors on an annual basis reviews our … design output. [We create] a very large space where we set up an extraordinary showcase of the work that’s been done in the previous 12 months. And everyone in the company files through that space … It is the real focus and attention of our board of directors. So design is not something that is sort of pigeon-holed. It is something that is held as critical to the company at the very highest levels.”

General Manager, Innovation, Diageo

The re-design of Johnnie Walker fuelled global net sales growth of

27%

 

At Trunki, design was used to create a lifestyle brand for children. The company uses design to develop innovative products that address the travel needs of both children and parents, focusing on making the journey exciting.

Design made the products stand out in a saturated market whilst giving them credibility and desirability. Trunki’s 2 millionth ride-on suitcase was sold in October 2013 – not bad for a company that only started trading in 2006!  

Other note worthy case studies come from Reckitt Benckiser, Jaguar Land Rover, Herman Miller furniture, Brcleys Bank, Speedo and Virgin Atlantic.  

To download the full report, click below:
https://www.designcouncil.org.uk/knowledge-resources/report/leading-business-design