Explaining how design adds value

It’s sad but true; most clients don’t see design as creating value. They’re focused on gaining a competitive advantage, selling more products or services and making bigger profits.

Manufacturers want to buy raw materials cheaper, get then delivered quicker and quickly convert them into high value products they can easily sell.

Retailers want to buy high quality products at a cheap price, add some services and sell them with a large mark up.

Service businesses sell intangibles. Take insurance. To sell insurance, businesses need to turn it into a ‘product’ (eg life insurance). This makes it more tangible. The insurance agency ‘buys’ from an underwriter, packages the product to suit a clients needs (eg travel insurance) and sells it.

Knowing that’s what they want, how do you explain design value to manufacturers, retailers and service providers?

Talk like a client

Try not talking about brand essence, personality, story or promise. Many clients don’t understand it – remember most have trouble distinguishing between a logo and a brand.

Instead, talk their language.

Clients are interested in how design will add value: that is, add profit.

They understand profit comes from creating and capturing:

Value created and captured less cost of creating that value = profit margin

The more value an organisation creates, the more profitable it will be. And when you provide more value to your clients’ customers, you build competitive advantage.

We know design can add value and build competitive advantage but how do you prove it?

Prove it by using their value chain.

The value chain

All businesses, regardless of size, have a value chain: 10 activities that create value for their business.

These activities create value in the chain that moves from raw materials/services to satisfied customers.

Get a copy of the Design Value factsheet to see how design can be used in every part of a businesses value chain. This factsheet takes you through the 10 activities and gives examples of how design can add value in each activity.

Takeaway

The mistake is to only talk about design as marketing and comms activities.

We know design is valuable in all activities of an organisation, for example:

• in human resources; from well branded recruitment ads to efficient onboarding/training of new staff;
• in operations; activities like analysing and visualising workflow to improve productivity and
• inbound logistics; such as the design of more efficient packaging that costs less to freight

to name just three.

The task is to be proactive and explain these examples of value to our clients.

Contact Greg if you would like to learn more about using the design value chain to create competitive advantage for your clients

Greg Branson

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Want more?

Here’s more information on design maturity:

1. Walk a day in your clients shoes – empathy mapping
2. Understanding a client to develop new business
3. How design mature are your clients.

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