Value is a characteristic that allows you to determine how much a certain thing is worth. People tend to make decisions based on cost – for example, “Should I buy this product?” or “Do I need to subscribe to this service?” In the case of evaluating the business value of design, entrepreneurs may be asking, “Should I hire a designer or design agency?”
A designer can’t just assign value to their work and hope that the client will agree with it. However, he can focus on increasing the effectiveness of design for the business and creating for himself the image of a first-class professional who brings value to the company.
Because businesses are primarily concerned with results (in other words, value-for-money), designers who can prove they can create value will stand out from the competition.
Why does a business need design? It helps to stand out from competitors, meet high consumer expectations, and share the global experience. But how do you create something exceptional every time? Is it worth it? In this article, we will try to answer the questions of the importance and value of design.
The business value of design
McKinsey published a study in which they show the link between design and financial performance of 300 companies. They have created arguably the most compelling proof of the value of design for business owners and leaders.
Designers have long been paying the price for not measuring the impact of their work on business performance. They need to prove that their work is about how it delivers value in design to customers and the business.
Despite the apparent benefits of a quality app or website design, it is becoming increasingly challenging to consistently accomplish this task. Only the very best products and services now stand out from the crowd due to the rapid rise in consumer expectations. The reason for this is that companies like Amazon, instant access to information and user feedback, blurring the lines between physical, digital products and services. Companies need new approaches to product and service design more than ever.
The companies with the highest McKinsey Design Index scores twice the market average in revenue and shareholder returns.
Only the best products and services deliver significant returns and shareholder returns.
The study identifies four areas of design activity that correlate with improving the financial results of companies:
- Leadership commitment to measure design results;
- Focus on customer experience;
- Cross-functional expertise;
- Continuous iterations.
Would you like your business to have a valuable design and be successful? Then we suggest you read one of our latest articles, Best App Ideas for your Business Success in 2021. Don’t miss it.
Leadership commitment to measure design results
Design management with the same focus as revenue and expense management.
- Implementation of design metrics;
- Creation of a holistic client-centric strategy;
- Anchoring the design at the level of the organization’s leadership.
The companies that do the best in this area maintain a basic customer understanding level among all executives. Leaders in these companies strive to understand what their customers need and thus become an example for the rest of them.
Focus on customer experience
Leading companies are placing user experience at the center of their culture, removing internal boundaries between physical products, services, and digital interactions that do not exist for customers.
- Start developing new products and services from users, not from specifications;
- Integration with third-party products and services that users also interact with;
- Designing a seamless customer experience at all points of contact.
Customer focus requires a broad perspective as the boundaries between products and services merge into a holistic experience. In practice, this often means starting product creation by mapping the customer journey rather than copying competitors’ solutions. This approach requires careful research into customer needs through observation and communication in a real-world context. However, only half of the companies surveyed conduct user research before creating their first ideas or specifications.
Customer centricity becomes the responsibility of all members of the organization, not just designers.
- Creation of cross-functional teams;
- Developing talented designers within the organization;
- Investing in design tools and infrastructure.
Research shows that companies that have made customer-centric responsibility for all employees, not just the design department, have the best financial performance. Mature organizations are successfully integrating the design function across all departments.
Nothing new, designers with T-shaped expertise are most in demand. These professionals understand all the functions of the business while maintaining the depth of their design expertise. However, they will only have an impact if the necessary tools and infrastructure are in place. This includes design, communication, data analytics software, and prototyping tools that increase productivity and speed up design iterations.
All this takes time and investment. Successful companies take their time to cut research, prototyping, or concept creation costs at the first difficulty. Design resources should be agreed upon at the company’s management level and not be a cost item in the marketing or development departments, as is often the case.
You already have a product, but you see that your conversion rates are falling, and customers are increasingly leaving you without making a purchase? Think your design is not valuable? Then consider a User Experience audit. You can read more about this in our article A Step-by-Step Guide on How to Conduct a UX Audit.
Reduce risk in product and service creation through insight, user testing, and continuous iteration.
- Balancing qualitative and quantitative user research;
- Combining user research, business metrics, competitors, and technology;
- Testing, modifying, repeating. Fast!
Design works best in an environment that encourages learning, testing, and interaction with users. This environment increases the chances of creating disruptive products and services while reducing the risk of extensive and costly blunders. This approach goes against the prevailing approaches in many companies that still practice irreversible design steps in the website or mobile app design development. This approach risks losing a customer’s voice or relying too much on one iteration of that voice.
The best results are obtained by regularly combining quantitative and qualitative user research. This information should be used in conjunction with reports on market analysis, competitor activities, monitoring new technologies, financial trends, and more.
Sixty percent of the companies surveyed use prototypes only for internal testing, at the end of the development process. The most successful companies deliberately develop a culture of early testing of ideas and prototypes. They also prevent designers from spending hours perfecting their early layouts or internal presentations.
Design Value Index
McKinsey offered their McKinsey Design Index. They surveyed 300 public companies and compared their financial performance to product success. As a result, the design integration criteria were identified that distinguish the most successful companies.
The noisiest was the Design Management Institute with a similar Design Value Index. It shows the capitalization of companies investing in design – in 2015, it grew 211% stronger than the S&P 500 stock index. McKinsey made a copy of their index.
Forrester conducted a survey commissioned by IBM to study the economic waste of design thinking practices. More than 80% of business leaders surveyed reported that their teams became more aligned and focused, and 37% indicated higher employee productivity due to design thinking. Ultimately, enterprises find that this increased consistency reduces the risk of project failure.
Design Council Report on the Contribution of Design to the UK Economy 2015. Exciting and pleasant numbers brought 71.7 billion pounds of gross value added (7.2% of the country’s total figure). Except that they just included a company’s full result with sound design in this figure, not only the design share.
Continuous iteration is what will make the value of your design in business possible
The best design is the result of training, testing and a series of iterations followed by user feedback. This approach increases the likelihood that a breakthrough product will be created, and the money will not go down the drain.
It contrasts sharply with the approach that still exists in many companies when the final version of the product is immediately created. The opinion of potential consumers is not taken into account.
The best results appear at the junction of quantitative (joint analysis) and qualitative user research (ethnographic interviews). This information needs to be analyzed together with analytical reports on the market, patents, emerging new technologies, possible financial difficulties, etc.
Of course, all this requires considerable effort, but you will never make a product that will ever see the light of day without this.
Those companies who prioritize design first understand that the finished product is not the end. Almost all significant developers are continually releasing updates to both the look and feel. For example, the Apple Watch has been specially modified to use in the wild.
Design is not just pictures. This is the entire user experience.
Any business can be successful in design, whether it’s a product or a service. This is indicated by the variety of companies that made it into the top quarter of our survey.
To do this, anyone needs to do what we have said more than once above: analyze, create services for both online and offline, develop multifunctional teams, regularly test, and continue even after the launch of the project.
If you cherish your time as much as we do and want to create a high-quality and value product in design for users, we will be happy to help you. Gapsy Studio has more than 130 successful projects that are appreciated by users worldwide and fully satisfy the target audience’s goals. We create high-quality and visually beautiful products, as you can see by looking at our work on Behance or Dribbble. Also, take a look at our services, they will let you know that we can handle any design industry. We are focused on results and excellent work!)