As preparations are made to re-start business, Philip Johnson FRSA argues that business leaders could be thinking about how to revitalise company performance by realising the substantial benefits that can be delivered by design.
The need to emerge competitively from the Covid-19 crisis should make companies of every size in every sector look to design. Designers will energise the recovery by coming up with novel solutions, creating improvements and process enhancements, developing new products, services and experiences while fuelling demand through well-designed websites, marketing collateral and social media platforms. Designers will help companies start thinking about a future beyond the ‘new normal’.
Whether working in-house, as a consultant or as part of an external practice, a designer is equipped with skills and techniques that dramatically increase the likelihood of innovative solutions to problems being found, implemented and brought to market as new products and services. Designers use research, curiosity, questioning and imagination to reach creative solutions to the fundamental, ambiguous, complex and open problems that are intrinsic to the innovation process and ensure companies remain competitive. The question that arises is how well equipped are UK companies to use design?
Once it was accepted that growing businesses needed to use design in all its forms. Regardless of size, industry or sector, companies are more competitive when they use design well. The Design Council’s Designing Demand programme, which ran from 2007 until 2012, made a compelling case by delivering consistently strong returns. Independent evaluation showed that for every £1 invested in design, companies could expect over £20 in increased revenue, over £4 increase in net operating profit and over £5 in increased exports. This was in addition to reported boosts to confidence, strategic thinking, brand and business identity. Further work by the Design Council showed design to have a significant and measurable impact on the performance of leading UK businesses. Design Index demonstrated that design-led businesses outperformed the FTSE 100 by more than 200% over a 10-year period. Meanwhile, the 2018 McKinsey Design Index study demonstrated that the best design performers increase revenue and shareholder returns at nearly twice the rate of their industry counterparts.
Despite the evidence, the fundamental role that design can play in driving value and economic growth is no longer understood, let alone championed; design is not respected in – and represented on – many company boards. The UK’s two shining knights of design are always cited as proof that design is secure in the c-suite. While Sir James Dyson has built his soon-to-be Singapore headquartered business on design, and there was endless coverage about the transformational impact of Sir Jony Ive’s tenure as Chief Design Officer, few other designers are lauded by the business community.
The consistent yearly decline in numbers of young people studying Design and Technology (DT) at A’ Level that stretches back to 2010, will only contribute to worsening of UK competitiveness. Last year there was a further 5% drop as more schools stopped offering the subject. Almost from the time it was introduced and was a part of the core curriculum, DT suffered from being misunderstood and was never considered equivalent to more traditional, academic subjects, with bright minds often ushered away and encouraged instead to pursue ‘proper’ qualifications.
Just like the boardroom and the classroom, the response to design amongst the six million small and medium sized enterprises (SMEs), which make up the ‘powerhouse’ that dominates the UK economy, is less than enthusiastic.
Perhaps the fundamental problem lies with these companies in particular and the way in which they drive growth by introducing new products and services?
Whilst limited to a specific geographical area, a survey of companies in East Sussex in 2018 yields some useful insights. Senior businesspeople from over 1000 companies were asked whether they had introduced any new or significantly improved products or services within the last three years. For those in the service sector, an astonishing 68% had not introduced a new or significantly improved offering in the preceding three years, while an even more surprising 74% of those producing goods had not taken any new or significantly improved product to market during this period.
However, more enlightened business leaders do use design in every aspect of their business rather than simply inviting designers in to polish and finesse towards the end of any development. There is an urgent need for greater understanding amongst business owners about the impact of design on company performance. Design professionals must communicate a compelling narrative of cases that demonstrate the earnings that resulted.
For many SMEs, the support provided by publicly funded organisations is the vital catalyst that ensures they develop the skills and capabilities that ultimately drive growth. Support and advice for business is delivered through the network of Growth Hubs, managed through the less-than high-profile network of Local Enterprise Partnerships (LEPs) and locally targeted schemes receive support from district, borough and county councils. Sadly, many of these organisations could not be further from the exemplars of good design practice that they should be and, through no fault of their own, few, if any of those responsible for specifying or for delivering business support activities are remotely knowledgeable about the potential impact of targeted design support for SMEs. If the people specifying and funding support to drive business growth do not understand design, then how can they be expected to understand the compelling case to be made?
Limited understanding of the impact of design is also endemic in the public sector. Again, driving home the benefits in terms of effectiveness and improved efficiencies that well-designed systems, processes and services can deliver, should be something the design community – and national government – do on a continuous basis. Larger public organisations, including Innovate UK and NESTA, perform better in their use and understanding of design but are remote and disconnected from the small companies that make up the UK economy. Although their remit is ‘innovation’, neither organisation champions design as an integral part of the innovation process. Given that design and design practitioners are key to making innovation happen and to successfully getting the outcomes to end-users, this could be an area worthy of further examination
When public sector organisations do fund programmes that allow designers to collaborate with companies, it is not surprising that the critical and significant role played by designers is why the results are so positive.
The Design Index highlights four areas for companies to focus on. Firstly, they are encouraged to take an analytical approach to design and measure design performance with the same rigour they devote to measuring revenues and costs. Secondly, user experience needs to be at the heart of their company culture and internal boundaries (that do not exist for customers) need to be softened. Thirdly, companies are recommended to nurture their top design people and empower them in cross-functional teams that take collective accountability for improving user experience. Finally, companies are encouraged to iterate, test, and learn rapidly, incorporating user insights from the first idea until long after the final launch. McKinsey found that companies that successfully tackled these four priorities were highly likely to become more creative organisations that consistently design great products and services. Given McKinsey’s compelling findings and its own earlier work on Designing Demand and the Design Index, it is surprising that the Design Council is no longer taking the lead and proactively championing the use of design by UK business.
Now, more than ever, when businesses need to understand how to get the best from design, where is the trusted partner to provide support and assistance to help companies to navigate through the complexities and achieve exceptional outcomes? Who is making the case to government, HM Treasury, the Department for Business, Energy and Industrial Strategy (BEIS) and the Department for Education amongst others, that investment in design at all levels results in better economic performance? Who is explaining the critical importance of encouraging investment in design to the councillors, council officers and local businesspeople who channel business support funding through the LEPs? Above all, who articulating the case for design, actively engaging the UK’s six million SMEs and making the argument for investment in design repeatedly, accessibly, consistently and forcefully? There are at least five things that organisations can do that will make a significant and immediate impact. First, get a designer into run a workshop and to help learn and prepare innovation for improving performance post Covid-19. Second, get a designer to review internal and external branding. Third, get a designer to help with everything from internal culture, product development, online and physical branding. Fourth, get a designer to help to identify how well your workplace is configured for the throughput of work and suggest efficiencies and improvements that can be made. And finally, get a designer to investigate what the experience of your customers is like.
As we become more dependent on digital technologies and connectivity, the design sector needs to ensure that the use of design becomes a central component of accepted best practice in business with a value commensurate with that of other professions. The sector urgently needs to establish design as a business discipline, especially amongst senior business leaders, improving their understanding of design impacts and the relationship between designers and the companies they work for. The sector needs to help institutional investors and shareholders to interrogate corporate boards about how effectively companies are using design. The evidence that investment in engaging programmes of design-led intervention yields significant returns needs to be shared far more widely amongst those who advise government, make policy and arrange support for businesses,
And finally, to give design the weight, authenticity and credibility that it deserves, the bodies educating and representing designers need to establish a form of accreditation so that people can be assured they are working with a designer who has attained a recognised standard of performance. Other professions have understood this, accountants, lawyers, doctors, electricians, builders and the technicians who fix your car have to be able to show their credentials and comply with a set of industry codes and standards. Why does the same not hold true for a designer?
The end of lockdown will see massive changes. Companies will be desperate for creative support, not only in their product, service and business development but also in their green transformation. Where companies are operating with disrupted supply chains, it may be time to think about more local production; this could prompt a shift in which urban areas once again become the framework for production, only on a smaller and greener scale. Designers should actively champion these new and more responsible approaches. By addressing companies and all types of public sector organisations, from councils, to healthcare providers, to emergency services, designers can play an increasingly important role in ensuring organisations are genuine participants in their local communities, less concerned about shareholders and more accountable to their stakeholders.
There is a chance to help the UK’s SMEs to power the economy back to growth and, at the same time, drive a greener and more sustainable approach to a circular economy for all of our futures. Let’s ensure we are all equipped to make it happen.
Philip Johnson has a background in design, marketing and design promotion. He has worked at the Design Council, Patent Office, PERA Innovation and Denmark’s Ministry of Foreign Affairs and is now encouraging business growth in the south east as part of Locate East Sussex.