If I told you there was a simple strategy to improve your chances of success in business against your competition by 200%, that was available to both small business and large established business incumbents, would you believe me? No you are right. I wouldn't either.
But there is.
The secret is....ready for this? Good design.
In a presentation by Doug MacLeod titled Design, Economy & Policy: Towards a More Effective Canadian Design Sector; at a Roundtable Meeting, June 14, 2007 of the Canadian Design Research Network (CDRN), that I was invited to, Doug offered research from the UK Design Counsil that shows that companies that incorporate good design into their products or services, over a ten year period outperformed their competition that had mediocre or no design elements in their offerings by 200%, both in good times and bad recessionary times. Specifically 63 companies identified as effective users of design (called the Design Index) outperformed the UK FTSE 1000 index over the full 10 year period by 200% .
...and here we are talking about all designs stripes ranging from product/industrial or fashion design to interior design to landscaping or architecture or graphic design etc.
Canadian designer John Arnott adds a side note to the above
Walter,
"The studies that Doug quoted were from the London School of Business and are quite old; late 80’s I think. I mention this because from my reading, I suspect (but don’t have proof) that today the returns may be far more substantial. Look at a company like Apple (clearly exceptional) which I used as one case study in my course. Literally everything is well designed and I mean everything, including behaviour. This is what I call ‘Touch Point Control’. They are a marvelous example of what can be achieved with a relatively small team of designers (20) when the CEO is committed. The shareholders should be ecstatic as the value of the firm has doubled in the last year and is projected by Business Week to double again in the next two years. And this is from a company that is using off-the-shelf technology that is available to all its competitors! Design can be very powerful when properly executed."
John.
JOHN ARNOTT. IDSA, DMI President STRATEGIC DESIGN MANAGEMENT
So, is Canada a design-intensive economy? Well, NO.
According to statistics presented by John Arnott, at the DX annual conference, a full 88 % of Canadians businesses do not use or create any form of new technology, therefore they are unlikely to be big design employers. Furthermore, of the ones that do, all the studies I've seen that ask entrepreneurs where they go for good business ideas, never once have I seen a study that mentions "designers" as a primary source of inspiration. Then, what do the 12% of the firms use when creating new products?-well mostly your in-house engineer, who may or may not be trained in design. We seem to have two solitudes-SME's and designers, who like oil and water don't mix. We need a new social innovation - a"social emulsifier" to get these two groups talking to each other.
It's a shame. According to Richard Florida, Ontario already has one of the biggest regional clusters of creative people, which includes the design profession, and they all seem to be so under-used and under-appreciated.
The other myth is that only large companies can afford good design talent. That's not true. Small startups can always work with students designers who are still in school, and who are always looking for real world experience to complete class projects and assignments (example Vertical Farming)
For every dollar invested, banking returns 1.4; computing returns 1.47 design returns 1.76 ...an increase of 26% over banking and 20% over computing, according to the CDRN and International Enterprise (IE) in Singapore .
Final word?
I can't think of a better business case -200% to take a designer out to lunch and explore new business opportunties together. Want some introductions? call me.
...and with Canada falling behind in global competitivenes from 6th in the world in 1999 to 16th spot in 2006, we need all the "creative edge" that's out there. When I was speaking at VTT in Helsinki last year I was told that Finland, with a population of only 5 million people, ranks fourth in the world in terms of innovation and second in the world in terms of overall global competitiveness. Canada ranks 13 and 16 respectively. What's on the horizon? In 2000, China only produced some 1500 industrial designers annually. By 2005 China was producing over 10,000 industrial designers with 400 schools offering design courses
Source: Certificate program in Entrepreneurship & Innovation; U of T, School of Continuing Studies, St George Campus.
© 2005-2007
Walter Derzko -"Changing the world, one idea at a time"©
Walter Derzko teaches at the Certificate Program on Entrepreneurship and Innovation at the University of Toronto, School of Continuing Studies, which starts in the Fall of 2007
Expert, Consultant and Keynote Speaker on Emerging Smart Technologies, Innovation, Entrepreneurship, Strategic Foresight, Business Development, Lateral Creative Thinking and author of an upcoming book on the Smart Economy "
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