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January 3rd, 2017

Design-Centric Businesses Lead The Way

Design is more than making things look good. Good design can add strategic value to any organization of any size, in any industry. More and more companies are embracing design as an integral part of their business strategy and coming to value the end-to-end experience. The most disruptive companies choose not to play by the rules. (And that’s a good thing.)

The movie Design Disruptors, released in August 2016, recently put design in the spotlight. Design Disruptors features 15 industry-disrupting companies, collectively valued at more than $1 trillion, all with a common focus on customer-centric design. This movie, about the transformative power of design and its importance in business, demonstrates how design is a lynchpin in business today, and will be vital to business success moving forward.

That said, the value of design is challenging to measure. Design results are very hard to isolate. What’s more, design’s role and function vary by industry. Over the years, many organizations have attempted to tackle the measurement issue by looking to present evidence that will change design thinking in organizations.

The Design Management Institute and Motiv Strategies created the Design Value Index (DVI) in 2013 as a means to “measure the value of implementing best-in-class design management practices.” The Index tracks the value of publicly traded company portfolios that meet a set of design management criteria. It monitors the impact of these companies’ design investments on their stock value over a ten-year period, relative to the overall S&P Index.

In no uncertain terms, it became clear that there is a correlation between investing in design and higher stock performance.

This chart shows the Design Management Institute’s 2015 Design Value Index. It is based on a portfolio of 16 publicly traded stocks from companies considered to be “design-centric.” These companies show a 211% return over the S&P 500. Not only that, but this marks the third year in a row that this exercise has seen results in excess of 200% over the S&P. Allow me to repeat, design is more than making things look good.

Design Value Index Graph

This Index shows the value design adds to organizations and proves that the strategic use of design is not only valued, but vital. Making design a major strategic pillar of your brand and business adds powerful value. It helps to differentiate and elevate and to deliver solid business results.

Innovative companies use design to create a draw, add to brand loyalty and the brand experience, and solve problems—some that you didn’t even know you had. Design creates a great customer experience and keeps you in touch with your customers. It can even save you money with value engineering. These are just a few ways design works hard as a business strategy to drive sales and brand loyalty.

Companies who value design are future-forward. Strong evidence suggests those that are most design-centric are outperforming their peers. If your company isn’t design-centric, 2017 is the ideal time to make that change. And rewrite the future of your business.

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