Design and Innovation: Economic Leverage for Technological Development

Tony Rey Paulino
Tony Rey Paulino
August 30, 2023

Design and innovation have become essential driving forces in today's economic landscape. You are witnessing a transformation in which these elements play a crucial role in driving technological development and creating competitive advantage. This synergy between design and innovation has a profound influence on product differentiation, company growth and the creation of added value in various industrial sectors.

In this article, you'll discover how design acts as a catalyst for technological innovation. We'll look at methods for assessing the economic impact of design, and explore the concept of design management as a development strategy. In addition, we'll discuss the importance of cultivating a design culture within organizations to improve their competitiveness and foster sustainable growth in a constantly evolving market.

Contents

Design as a catalyst for technological innovation

Design has established itself as a key element in the technological innovation process, playing a crucial role in product differentiation and the creation of added value. This synergy between design and innovation has a profound influence on the competitiveness and growth of companies in various industrial sectors.

Definition and evolution of design

Design, long perceived as a mere aesthetic discipline, has evolved into an essential strategic tool for technological development. Today, it is understood as an intrinsic element of any innovation strategy. Design thinking, in particular, has become a central process around which all departments of a company revolve. This approach puts people at the heart of thinking, improving the quality of the user experience and making interactions more intuitive.

The role of design in the innovation process

Design plays a fundamental role in the innovation process, providing a new vision of design and tools to facilitate designers' work. It translates needs and ideas into concrete applications, while optimizing resources. This user-centered approach contributes to the success of companies by fueling innovation through differentiation in usage, intuitiveness and emotion.

A MacKinsey study revealed that a well-mastered design approach can boost a company's revenues by 32%, and deliver a return on investment of up to 56% for shareholders. These figures underline the importance of design as an economic lever for technological development.

Synergies between design and R&D

Collaboration between design and research and development (R&D) creates powerful synergies for technological innovation. Design brings an extra dimension to R&D by considering the universe as "sensitive" and focusing on the needs and aspirations of users. This approach enables the development of innovative products and services that are not only technically feasible, but also desirable to consumers.

By integrating design principles, R&D offices become catalysts for progress, fostering an environment where calculated risk-taking, experimentation and continuous learning are encouraged. This fusion of design and R&D enables the creation of revolutionary solutions to pressing societal challenges, particularly in terms of the environment and sustainability.

In conclusion, design is proving to be a real catalyst for technological innovation, transforming the way companies approach the development of new products and services. By putting the user at the heart of the process and fostering interdisciplinary collaboration, design helps to create meaningful innovations that have a positive impact on the competitiveness of companies and society as a whole.

Measuring the economic impact of design

Measuring the economic impact of design is essential to demonstrating its value and justifying investment in the field. While this can be a complex task, there are a number of approaches to assessing the contribution of design to organizational development.

Key performance indicators

To quantify design's contribution, it's crucial to define relevant key performance indicators (KPIs). These KPIs must be aligned with the company's strategic objectives, and may include :

  1. Return on investment (ROI): This measures the financial return on design projects in relation to their initial cost. For example, a company using design thinking to rethink its product development process might find that one dollar invested generates three dollars in additional revenue.
  2. Reducing operational costs: Design can help optimize processes, reducing downtime and improving resource utilization.
  3. Increased revenues: Design can stimulate growth by creating innovative products that better meet customer needs.
  4. Customer loyalty: By enhancing the user experience, design can increase customer lifetime value and long-term profitability.

The challenges of assessing design ROI

Despite the importance of measuring the economic impact of design, there are several challenges:

  1. The difficulty of isolating the impact of design: design results are often interconnected with other factors, making it difficult to attribute benefits directly.
  2. Long-term effects: Measurable design results can take time to emerge, requiring a long-term approach to evaluation.
  3. Diverse fields of application: Design extends to many aspects of the business, from user interface to strategic design, making it difficult to identify in the value chain.
  4. Lack of standardized metrics: According to a McKinsey study, over 50% of companies have no objective way of evaluating or setting targets for the results of their design teams. 1.

International benchmarks

To compensate for the lack of national data, it is useful to draw on international benchmarks:

  1. In the UK, the design economy generated €96.22 billion in GVA in 2016, or 7% of the country's overall GVA.
  2. Digital design accounts for a significant share of this value, with 44.3 billion euros in 2016, or 38.5% of the value of the design economy.
  3. In France, the economic weight of design is estimated at between 1.9 and 3.4 billion euros.

These figures underline the growing importance of design in the modern economy, and its potential as a lever for technological development and differentiation. To maximize its impact, companies need to integrate design at every level of their organization, from product conception to customer experience to global strategy.

Design management as a competitive advantage

Design management is becoming a strategic lever for companies seeking to stand out in a competitive environment. By integrating design at all levels of the organization, companies can create significant added value and stimulate growth.

Corporate design maturity levels

Design maturity within an organization can be assessed according to different levels. A recent study revealed that 41% of companies focus primarily on the visible aspects of design, while only 5% involve design in their business strategy. 1. This disparity underlines the importance of a more holistic approach to design management.

To move towards a higher level of design maturity, companies need to take a number of steps:

  1. Understanding user-centricity
  2. Apply design techniques and methodologies
  3. Adopt iterative design processes
  4. Set up specialized user experience design teams
  5. Changing the distribution of power and organization
  6. Integrating design into the company's business objectives

Integrating design at all levels of the organization

To make the most of design as a competitive advantage, it is crucial to integrate it at all levels of the organization. This means rethinking innovation by placing use and the user at the heart of the process. Design is no longer limited to product aesthetics, but extends to services, organization, business models and communication.

A design-innovation strategy transforms the way companies develop their products, services and processes, influencing their identity, positioning and brand. This holistic approach enables companies to be more competitive and innovative.

Design as a differentiation tool

Design is proving to be a powerful differentiation tool for companies. Studies show that companies that use design are twice as innovative as the average, export more and are more resistant to crises. 2. By acting on the quality of their offering, design enables companies to stand out from the competition and create added value that is perceptible to customers.

To maximize the impact of design, companies can work on four main levers: process, brand, customer relations and offering. These levers, based on a cross-functional strategic vision, enable design efforts to be aligned with the organization's fundamental objectives.

In conclusion, design management, when fully integrated into corporate strategy, becomes a genuine catalyst for technological development and innovation. It offers companies an effective means of differentiating themselves, improving their competitiveness and stimulating growth in a constantly evolving market.

Developing a corporate design culture

To take full advantage of design and innovation as economic levers, it is crucial to develop a design culture within the company. This approach places design at the heart of strategy, making it a genuine catalyst for technological development and differentiation.

Raising awareness among managers

The first step is to make managers aware of the importance of a design approach. According to an IDC study, 72% of business leaders believe that adopting design thinking has improved collaboration between their teams and increased their agility. 1. To convince decision-makers, it is essential to present concrete cases of companies that have successfully integrated design into their strategy, and to organize workshops to reflect on the challenges of design for the company.

Team training

Once management has been convinced, it's time to train teams in design methods and tools. This can be done through in-house training programs or by calling in external experts. The aim is to develop design thinking skills and encourage a user-centered approach. For example, Google introduced the "Sprint" program, which enables teams to test ideas in just five days, generating a 60% increase in conversion rates for the resulting prototypes. 2.

Interdisciplinary collaboration

Design thinking encourages collaboration between different disciplines within a company. By creating multidisciplinary teams, you can stimulate creativity and innovation. For example, Airbnb launched the "One Airbnb" initiative, which brought together employees from different departments to rethink the end-to-end customer experience, resulting in a more coherent and intuitive service.

To facilitate this collaboration, we recommend setting up collaborative workspaces and using appropriate digital tools. Some companies have even created dedicated innovation labs, offering a secure space for experimentation and risk-taking.

By developing a design culture, you can create an environment conducive to innovation and growth. This approach not only enhances your company's competitiveness, but also creates significant added value for your customers. By placing design at the heart of your development strategy, you give yourself the means to differentiate yourself in the marketplace and stay at the forefront of technological development.

Conclusion

In conclusion, design and innovation have a considerable influence on the technological development and competitiveness of companies. Their strategic integration creates added value, enhances the user experience and stimulates economic growth. Design management has established itself as a powerful tool for standing out in a constantly evolving market, by placing the user at the heart of thinking and promoting a global approach to innovation.

Ultimately, developing a design culture within organizations is essential to reap the full benefits. This involves raising awareness among managers, training teams and encouraging interdisciplinary collaboration.

By adopting this approach, 1POINT61 gives companies the means to stay at the forefront of innovation, respond effectively to consumer needs and generate sustainable growth in a complex and changing economic environment.

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Tony Rey Paulino
Tony Rey Paulino
August 30, 2023
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