Design Council proves business case for design

Companies that invest in design outperform those that fail to use the discipline, according to a survey of British business by the Design Council, but less than half say it has become more important over the past ten years and many still don’t appreciate its potential.

Design Council chief executive David Kester claims ‘Britain’s fastest growing companies are using design to drive their businesses forward’, while firms making ‘little or no use of design are at a standstill or falling behind’.

Sixty-four per cent of ‘rapidly growing businesses’ attribute their competitiveness over the past three years ‘to a great or fair extent’ to ‘design, innovation and creativity’, according to the research.

In comparison, only 14 per cent of businesses overall say the same, leading Design Council business director Harry Rich to observe a ‘worrying performance gap between design-aware businesses and companies which are failing to exploit design properly’.

However, while 74 per cent of these growing companies say design has become more important over the past ten years, this definition covers only 2 per cent of the total canvassed. Among the majority of businesses, only 44 per cent recognise design’s importance during the same period.

Moreover, only 8 per cent of businesses say they have a formal process for consulting designers, though this figure is higher – 47 per cent – in the manufacturing sector.

The study also highlights the UK’s under-investment in research and development. ‘R&D intensity’ in the UK – defined as investment as a percentage of sales – is only 2.2 per cent, compared to 3.1 per cent in France, 4.1 per cent in Germany and 5.1 per cent in the US.

Ian Mitchell, senior economist at the Centre for Economics and Business Research, says UK productivity has a long way to go to match its major competitors. Though surveys of this kind are ‘difficult to judge’, Mitchell adds it is ‘broadly on safe ground’ in asserting the positive effect of design.

Rich says, ‘The sample is of a really significant size and the small number of fast growers is a macro-economic statement rather than purely about design. The trend is the interesting thing – that the rate of growth of a business is linked to the value it places on design.

The survey, published in the Design Council’s Design in Britain 2003-4 report this week, was based on interviews with a cross section of 1000 UK firms in various industries.