consulting in design research, strategy and decision-support

Wednesday, December 28, 2011

The Chasm Between Business and Design

It has been my experience that most companies are barely scratching the surface of what design can deliver to their bottom line. Corporations that understand how to leverage design, on the other hand, create huge sustainable progress. Many companies see design as an expensive, however necessary, evil. This could not be further from the truth. The design-leader Apple, for example, invests about three percent of its revenue in design. Although this is roughly the same amount of investment in design as its competitors, it is a very good investment.

To be continued January 1.


  1. Today, design is ubiquitous and is used in business consulting, branding, entertainment, architecture and governmental services to name just a few. At the same time, design has been integrated into the entire product development process. Although design has gained acceptance and expanded globally into even small firms, design is for the most part perceived as a commodity service and as a task easily outsourced to the lowest bidder. Without documentation as to how design contributes to an organization’s competitive advantage, design will remain excluded from the overall strategy. This has created a tremendous opportunity for a paradigm shift in the use of design in business.

    To be continued January 8.

  2. We are now beginning to know how design creates significant value in terms of increased revenue and stock performance. In fact, design has been proven to contribute twice the value of marketing and branding. Still, integrating design at a business and innovation level compared to integrating design at a process level, only provides an additional one percent revenue increase. How can this be? Interviewing industry experts, the consensus is that this represents a sizable opportunity for business growth.

    To be continued January 15.

    1. To leverage design competencies into a competitive advantage, there are several aspects that need to be considered. Design will have to not only integrate seamlessly with its complementary disciplines, such as financing, marketing, engineering and manufacturing, but will also have to include the creation of a corporate design philosophy, business case development and innovation and the complete end-user-experience. Design will need to address strategy and context, not just execution. Finally design considerations will need to be included in portfolio management and subsequent framing of the opportunity in the design brief.

      To be continued January 22.

    2. Research shows that design can be incorporated on three levels with increasing potential for value creation: Applying design at an execution level, including design at a contextual level and then integrating design at a strategic level. Mature corporations understand how to integrate design into the product development process, which has been shown to result in an increased revenue performance of ten percent. During the past decade, these organizations have extended their skills into managing the context in which they operate.

      To be continued January 29.