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How 'Good' Is Your Business's Design? Understanding Strategic Design Management

How 'Good' Is Your Business's Design? Understanding Strategic Design Management | Bhavish Shah

In today's business landscape, design often takes a backseat, viewed primarily as a means for aesthetic enhancement rather than as a pivotal driver of brand and strategy. However, in a marketplace where customer perceptions can shift with a single click, understanding and managing your business's design isn't merely useful—it's imperative. This blog delves into what constitutes 'good' design and why it's critical for sustaining a competitive edge in today's fast-paced economy.

So, What Is 'Good' Design in Business?

'Good' design is much more than what meets the eye. It encapsulates functionality, user-friendliness, and alignment with the brand's core values. As noted by Tim Brown, CEO of IDEO,


"Design is about delivering a seamless experience that meets the exact needs of the customer."

Good design is a strategic asset, silently communicating a company’s ethos and effectively bridging the gap between business objectives and consumer needs.


In business, good design serves multiple purposes:

  • Enhances User Engagement: Through intuitive and user-friendly interfaces.

  • Strengthens Brand Identity: By delivering consistent and memorable brand experiences.

  • Drives Innovation: By thinking creatively about solutions to consumer needs.


The Role of Design Management


Integrating design into the strategic core of a business can transform its interface with the market and internal processes. As the Design Management Institute explains, Design management aims to connect design, innovation, technology, management, and customer aspects to offer a competitive advantage considering economic, social/cultural, and environmental factors. Simply put, design management is the business side of design. It is the strategic advocacy of design across the organization, employing design thinking to solve broad business challenges. This involves guiding a team’s creative capabilities towards strategic objectives, and ensuring every design output is optimized for market impact and operational efficiency.

 New Logo and Identity for Airbnb by DesignStudio
New Logo and Identity for Airbnb by DesignStudio | Image from Brand New

The concept of design as integral to business success is exemplified by businesses like Airbnb and IBM, both of which have leveraged design thinking to transformative ends. After a pivotal redesign in 2014, Airbnb saw a dramatic increase in user engagement and bookings. The redesign focused on improving usability and incorporating high-quality photography to make listings more appealing. This not only enhanced user experience but also played a crucial role in building trust and brand loyalty.


IBM, on the other hand, has systematically integrated design thinking into its culture since 2012, creating a framework, 'IBM Design Thinking', that balances user needs with technological feasibility and market viability. This shift has helped streamline their product development processes, making them more efficient and responsive to client needs.


Tackling Common Design Management Challenges


Businesses often face several hurdles in effectively implementing design management:

  • Misalignment Between Design and Business Objectives: Without a clear connection to strategic business goals, design efforts can become disconnected from the company’s core mission.

  • Resistance to Integration of Design Culture: Companies may struggle to adopt a design-centric approach if there is a strong prevailing culture undervaluing design’s strategic importance.


Strategies to Overcome These Challenges


  • Educational Workshops and Training: Aligning everyone, from top management to operational staff, on the value of design. Having a design manager as an executive position in the board.

  • Incorporating Design Metrics into Business Scorecards: Utilizing tools such as the Balanced Scorecard, Design Value Index, and the CX Index, alongside approaches like Value Sensitive Design, helps businesses to measure and articulate the diverse impacts of design—from financial performance and customer satisfaction to ethical considerations in technology development, making it easier for business and management folks to understand and appreciate the business impact of design.


Detailed Look at Design Metrics


Design Value Index (DVI)


The Design Value Index, developed by the Design Management Institute, tracks the performance of publicly traded companies that excel in design against the S&P 500, demonstrating that design-led companies often outperform the market. Key criteria for DVI inclusion include executive-level commitment to design, integration of design practices into corporate culture, and a clear return on investment from design initiatives. This index provides a quantitative measure to illustrate the economic impact of robust design practices. But how do organizations measure and manage their design capabilities? Two key tools—the Design Maturity Matrix and the Design Value Map—provide robust frameworks for this purpose.


Design Maturity Matrix


The dmi:Design Maturity Matrix is a diagnostic tool that helps organizations assess the maturity of their design functions. It's useful for:


  • Evaluating Process Maturity: Understanding the current effectiveness and integration level of design practices.

  • Facilitating Strategic Discussions: Creating a shared language for design across different business functions.

  • Aligning Design and Business Strategy: Ensuring design investments are directly connected to strategic business goals.


This matrix allows companies to identify their current design capabilities and outline clear steps for development, fostering a deeper integration of design into the strategic fabric of the organization.   Download a PDF of the dmi:Design Maturity Matrix


Design Value Map

Based on the framework used by the American Productivity and Quality Council, the Design Value Map pinpoints where design adds value, focusing on four key areas:


  • Revenue: Impact of design on direct financial performance.

  • Customer Experience: Role of design in enhancing customer interaction and satisfaction.

  • Organizational Learning: Contribution of design practices to the knowledge and skills within the company.

  • Process: Efficiency gains in internal processes attributed to design.

This mapping tool helps organizations visually articulate and track the specific benefits of design, making it easier for business and management professionals to understand and invest in design's broad impacts.


By adopting the Design Maturity Matrix and the Design Value Map alongside the DVI, organizations can not only quantify the financial impact of design but also develop a comprehensive understanding of how design influences various aspects of business performance. These tools together ensure that design investments are strategic, targeted, and aligned with overarching business objectives, maximizing the return on investment in design.


Download a PDF of the dmi:Design Value Map based on the ©APQC model.


Balanced Scorecard for Design

Balanced Scorecard for Design by Bhavish Shah

The Balanced Scorecard is a strategic planning and management tool that has been traditionally employed to assess organizational performance in relation to strategic goals, improve internal and external communications, and match business operations to the organization's vision and strategy. Creating measurements that precisely assess how well design projects contribute to the accomplishment of business goals is a necessary step in adapting this paradigm for the design field. Here’s how it can be broken down:

 

  • Financial Perspective: How does design contribute to the financial success of the company? Metrics might include increased revenue from redesigned products, market share gains, or cost savings due to more efficient design processes.

  • Customer Perspective: How does design improve customer satisfaction and engagement? This could be measured through customer satisfaction surveys, net promoter scores, or customer retention rates.

  • Internal Business Perspective: How does design improve internal efficiencies and innovation? Measures here could include the speed of design iterations, the integration of design in product development, or the effectiveness of design workflows.

  • Innovation and Learning Perspective: How does design contribute to the learning and growth of the organization? This might look at the development of design skills among staff, the growth of a design-centric culture, or investments in design tools and technologies.

 

By applying these perspectives, the Balanced Scorecard for Design helps businesses not only track the direct benefits of design initiatives but also understand how design permeates various aspects of the organization to support long-term strategic goals.

 

Customer Experience Index (CX Index)

Customer Experience Index (CX Index) by Forrester
Customer Experience Index (CX Index) by Forrester

Forrester's CX Index™ is a metric used to measure and track the overall satisfaction and loyalty of customers with a company's products or services. It provides businesses with insights into the quality of the customer experience they deliver and identifies areas for improvement. Here's how it operates:

 

  • Multi-Dimensional Measurement: The CX Index evaluates various aspects of the customer experience, including ease of use, reliability, responsiveness, and emotional connection.

  • Customer Feedback Collection: Data for the CX Index is gathered through customer surveys, feedback forms, and other feedback channels to capture the voice of the customer.

  • Calculation of Index Score: The CX Index aggregates customer feedback to calculate a single numerical score or index, indicating the overall quality of the customer experience.

  • Benchmarking Against Competitors: Companies can compare their CX Index scores to those of competitors to assess their relative performance and identify opportunities for differentiation.

 

By monitoring changes in the CX Index over time and benchmarking against industry standards, businesses can prioritize initiatives to enhance the customer experience and drive greater customer satisfaction and loyalty.

 

Value Sensitive Design (VSD)

Value Sensitive Design Infographic by Ritesh Tiwari
Value Sensitive Design Infographic by Ritesh Tiwari

Value Sensitive Design (VSD), developed by professor Batya Friedman at the University of Washington in the late 1980s, is an approach to design that considers ethical, social, and cultural values in the development of technology. It aims to ensure that technology aligns with human values and contributes positively to society. Here's how VSD works:

 

  • Identification of Stakeholder Values: VSD begins by identifying the values and interests of all stakeholders affected by the design, including users, designers, and broader societal groups.

  • Integration of Values into Design: These values are integrated into the design process through collaborative decision-making, design guidelines, and ethical frameworks.

  • Evaluation of Design Choices: Design solutions are evaluated based on their alignment with stakeholder values and their potential impact on individuals and society.

  • Iterative Refinement: VSD emphasizes iterative refinement and continuous evaluation to ensure that design decisions remain sensitive to evolving values and societal needs.


By incorporating VSD principles into the design process, businesses can create products and services that are not only technologically innovative but also socially responsible and ethically sound.

 

These are of course some of the metrics and approaches which offer unique insights into the value and impact of design within organizations. By incorporating them into their strategic planning and decision-making processes, businesses can better understand the role of design in driving customer satisfaction, financial performance, and societal well-being. From quantifying the financial returns of design investments to ensuring ethical and socially responsible design practices, these tools and approaches provide a comprehensive framework for leveraging design as a strategic asset.


Future Trends


Looking ahead, the integration of technology in design processes is poised to redefine the landscape of design. John Maeda, a leader in computational design and tech, has extensively explored how digital tools and technology influence design. In his 2019 "Design in Tech" report, Maeda discusses how computational design and inclusive practices are becoming essential in the tech industry for creating successful digital products and experiences. He argues that by integrating technology such as AI and advanced analytics, the design process can achieve greater efficiencies and more innovative outcomes.

Further advancing these ideas, AI and machine learning are set to play a transformative role in design processes by automating tasks, optimizing workflows, and personalizing user experiences. Adobe's Sensei, an AI and machine learning platform, is already transforming creative workflows by enhancing image editing, automating tedious tasks, and offering predictive design services. As these tools become more sophisticated, they promise to unlock new creative potentials while making the design process more efficient.



Sustainability is also becoming a fundamental part of design strategies. Companies like IKEA and Philips are leading examples, embracing circular economy principles to ensure their products are reusable and recyclable, as outlined by the Ellen MacArthur Foundation. This shift involves rethinking entire product life cycles to minimize environmental impact.


In terms of collaboration and visualization within design management, emerging technologies like AR/VR are significantly enhancing the way teams interact and develop products. Figma has gained significant traction for its collaborative capabilities, allowing multiple users to work on the same design interface simultaneously. This facilitates a seamless design process from ideation to final product, ensuring that all team members can contribute effectively throughout the project lifecycle. Figma is just one of the tools that exemplify the dynamic evolution of design management practices, moving towards more interactive, efficient, and strategically aligned workflows that are crucial for maintaining a competitive edge in today’s fast-paced market environments.


The importance of inclusive design is gaining recognition as well, essential for serving the diverse needs of global consumers. Microsoft’s Inclusive Design initiative exemplifies this approach by designing products that are accessible to people with a wide range of abilities, thus expanding market reach and enhancing user satisfaction.


Lastly, ethical considerations are increasingly crucial in design, especially as technology's capabilities expand. Initiatives like Google's AI Principles and IBM's AI Ethics Guidelines are benchmarks for incorporating responsibility into design practices, ensuring products respect privacy, consent, and transparency.


These trends highlight the dynamic evolution of design management, suggesting a future where design is not only about aesthetics but also about deeply integrated, responsible, and innovative practices that align with both consumer needs and broader societal values. This broader perspective can help businesses not only stay competitive but also lead in a marketplace that values ethical, sustainable, and inclusive design.


Conclusion


The quality and strategic management of your business's design can significantly differentiate your brand in a crowded marketplace. It transcends mere aesthetics, encompassing a broader spectrum of strategic design management that aligns with your business goals, connects emotionally with customers, and propels business growth. As demonstrated by innovative companies like Airbnb and IBM, investing in well-managed design processes not only enhances functional and user-centric experiences but also ensures alignment with customer expectations and market trends.


Effective design management is about recognizing its strategic importance and committing to invest in its vast potential. By fostering a culture that values design thinking and utilizing tools that can measure and enhance the impact of design, businesses can achieve more than just aesthetic enhancements—they can secure a substantial market advantage. Ultimately, the integration of sophisticated design management tools such as Figma into everyday business practices illustrates the future of design: a future where technology, collaboration, and creativity converge to create lasting value and innovation.

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