Do you recognise the value of good design but find it difficult to convey its potential to your Board of Directors?
The McKinsey Business Value of Design Survey* could be the report that helps you to make your case.
In Oct 2018, McKinsey published an extensive research project into the value of design in relation to financial success. And guess what? They found a strong correlation between companies’ scores on their eponymous McKinsey Design Index (MDI) and revenue growth. Furthermore, companies in the top quartile of MDI scores had 5% higher Returns to Shareholders over the 5 year period.
McKinsey found 4 of what they called “design decisions” that have the strongest correlation with financial success. These are:
1. Analytical Leadership
Design is a top-management issue but not always recognised as such. Without someone who understands data-driven design in the board room, top-level design decisions can easily be made based on gut-feeling rather than solid data.
2. Cross-Functional Talent
Good design stems from collaboration between departments, however, many design teams work in silos. Using shared insights, different perspectives, and removing any cross-platform friction caused by internal barriers helps design work towards business objectives rather than design for design’s sake.
3. Continuous Iteration
Design isn’t a linear process. Research, analysis, iterations and learning should happen throughout. Companies who do this well move beyond tried-and-tested designs, to innovative ideas that ultimately sustain future growth.
4. User Experience
Thanks to cross-platform giants like Amazon, Spotify and LinkedIn, good user experience is no longer a USP. It is the norm. At the very least, designs should be frictionless, simple and easy to use. But furthermore, they must add value and delight the user. This can be achieved through innovative design and story-telling that’s rooted in strong, user-generated insights.
If your designs aren’t yet being held to account, you’ll be relieved to hear that you’re not alone. The report found that 50% of companies interviewed struggle to quantify the value that good design can add to business results. We often meet clients who, while they themselves are convinced by the necessity of research and customer-led design, they struggle to allocate the resources it deserves. This failing is often because design metrics and targets aren’t set, measured and therefore value can’t be proved. Therefore, so the self-fulfilling cycle goes, Senior Management doesn’t recognise the value of good design and promoting a design culture.
So next time you are heading into a board meeting to get a design related research budget approved, why not first remind yourself of some of these statistics, revealed by the clever folk at McKinsey.
At Webstars, we like to start projects with a full immersion in product, customer and competitor research. Our design decisions rely on data and research, not gut-feelings.