Image Courtesy of British Design Council
Though design thinking has undoubtedly captured the attention of the business world, return on investment (ROI) is still the elephant in the room. Designers are often at pains to point out that many of the subjective benefits of design are difficult to quantify – so they don’t bother. Businesses, on the other hand, ignore the benefits of design on the basis that “if it can’t be measured it doesn’t exist”. Personally, I’m a strong believer in combining the insight of qualitative data with the rigour of quantitative data.
I was thinking about the ROI for design recently when a blog posting by Bart Doorneweert pointed out the British Design Council’s Report “Design Index: The Impact of Design on Stock Market Performance”. The report shows that businesses which invested in design consistently outperformed their peers. The report looks at a decade’s worth of data between 1994-2004, and shows that design-led companies outperformed the FTSE 100 index by as much as 200 per cent. What’s also interesting to note is that the results are consistent in both bull and bear markets.
The Sharing Experience Europe (SEE) network has put together a useful resource for businesses wishing to evaluate the impact of design. The SEE Policy Booklet No. 3 evaluates the impact of design impact on: Companies; National Industry; Programmes & Policies, and Economy & Society.
Another promising piece of research is the Design ROI tool which is a collaboration between the Finish Design Business Association (FDBA) in collaboration with academics from the Aalto University in Helsinki. The tool aims to measure and predict the financial outcomes of design and could be particularly useful for SMEs wishing to quantify the impact of design investments.
by Andrew Pope
Impact of Design on Stock Market Performance