Business Financial Value of Design

The Financial Value of Design

Increasing Revenues and Returns Through Design

Digital is transforming companies by reinventing business practices, business models, connected products, go-to-market strategies, and operational efficiencies. Companies need to be agile, pivot fast, integrate new and legacy technologies, and ensure the success of new efforts. This presents a lot of unpredictability and unknowns for an organization. The solution? Lead with design.

When companies lead with design, they are more likely to create organizational visions that have quantifiable and solid business outcomes. Strategic design is not pixels on a screen but a sophisticated understanding of the business goals and the interconnections that lead to increased revenue, cost savings, and innovation.

Today’s strategic design, or as we’ve coined it, “The Science of Design™”, is quantified through iterating analytics, user research, and testing to increasingly improve products and services. Design begins the process of creation and innovation by creating the right solutions to the right problems. 

A study by McKinsey & Company that reviewed the practices of 300 companies over five years showed that companies with design-forward approaches had significant growth in revenue and return to shareholders when compared to other companies that did not. In the study, companies with top-quartile McKinsey Design Index (MDI)* scores outperformed industry-benchmark growth by as much as two to one. 

Let’s break down what it means to lead with design:

Technology Driven

Design Driven

Design needs to determine your solutions. Technology will deliver your solutions.

Product/Service Focused

Customer Centric

Structuring your business models around the customer ensures your products and services meet their needs.

Market
Focused

Customer Focused

Leading your marketing efforts around your customers ensures you hit the mark and keep your finger on the pulse of customer needs.

Problem Focused

Solution Focused

You can’t lead based on where you’ve been. You move your business forward through solutions.

Reactive Oriented

Action Oriented

Responding to markets, competitors, and lack of user engagement can be short-sighted and siloed. You need to design actionable solutions. Lead with user research and create a strategic plan.

When you use these methodologies, the financial value of strategic design is evident.

 

1. Design strategy accelerates speed to market. When your company embraces the process of design strategy, not only will you make more educated decisions on your products and services and how to expand your market reach, but you’ll find that you start doing it faster. Like any logistical problem, streamlining is the answer. Great design and speed to market enable organizations to outpace competitors and react more quickly to change. Being agile is fundamental to the health and success of brands in today’s fast-paced world.

Fixing a problem in development costs 10 times as much as fixing it in design, and 100 times as much if you’re trying to fix the problem in a product that’s already been released.

2. Design strategy helps minimize pitfalls and expensive “misses”.  Software Engineering: A Practitioner’s Approach is often regarded as one of the world’s leading books in software engineering. In it, author Roger Pressman wrote, “Fixing a problem in development costs 10 times as much as fixing it in design, and 100 times as much if you’re trying to fix the problem in a product that’s already been released.” So much time and money are lost by organizations due to the lack of design. You can’t assume what your customer wants from your products and services, you need to ask them. You can’t assume your minimal viable product is ready to be released into the wild, you need to test it with customers.  

If time is taken upfront to discover and define the need, create a strategy and roadmap, and build and execute, you’ll not only end up with a better product, but you’re likely to save a lot of time and money in the process.

Design Process

If time is taken upfront to discover and define the need, create a strategy and roadmap, and build and execute, you’ll not only end up with a better product, but you’re likely to save a lot of time and money in the process.

3. Design strategy enables internal teams and capabilities. Through strategic design thinking, we begin to look within our own company to see how we can become more strategic in our workflows. This oftentimes leads to the creation of teams who break out of silos and learn and grow from each other’s areas of expertise. This is critical for increased collaboration, knowledge sharing, and talent retention.

Design is the silent ambassador of your brand.

4. Design strategy creates brand ambassadors by increasing customer engagement and loyalty. Great design can emotionally drive customers to become champions of your brand. As American art director and graphic designer Paul Rand once said, ‘Design is the silent ambassador of your brand.’ With so many customers self-educating before talking to a company, selling through social media channels, and increasing “word of mouth” viral recommendations, a company needs a great brand and customer experience that stands on its own.

Ready to start digitally transforming and disrupting through The Science of Design™?

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