How does one assess the business value of design? The question is not easy to answer. Precise measurements are possible only when an event takes place in real, and when the number of variables is small. The real-life, however, is too complex and dynamic to enable the development of valid metrics and to facilitate their precise measurement.
The Economic Times, Ahmedabad (21 July 2009) reported Coca-Cola's intention to engage their advertising agencies on the basis of a result-based payment system. This is an interesting development though for a long time there have been doubts about the usefulness of advertising in terms of fetching business in proportion to the spend on advertising. However, the concept of advertising along with its glamour quotient has been sold so well that businesses did not question its Return-on-Investment (ROI) ability.
The issue of the value of design (as a professional activity and its ensuing deliverables) is in some way similar to case of advertising (design). If the proof of the pudding is in eating it, the proof of design is in its intended users paying for it and effectively using it. In this competitive and media-driven world some designs are often given "good" design awards - as it happens so frequently in the design and architecture communities. However, the intended users might be reluctant in using these, and in some cases abandon them all together. The Palio car from Fiat is a good car, technologically speaking, though it has failed to make any significant impact in the marketplace. A lot of buildings designed by professional architects are good as signature forms in a landscape but fail miserably when end-users use it and experience it.
Though some companies like IKEA, Apple, and 3M have leveraged design and innovation to impact the economic bottom line of their businesses, most of those involved in running businesses still lack a framework and methods to assess the business value of their offerings before they put them in the marketplace. I believe that there is a need to research this area in a concerted and holistic manner.
If design as an important management function has to claim its rightful place in business, the design and design management researchers have to develop frameworks and methods that would aid in assessing the value of design in a business context. In some of the following posts I will present some useful directions in this regard based on my experience and learnings in the field of design, human factors engineering, engineering, and design management.
(c) Copyright Vinai Kumar
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