fEATURE what is the reaL vaLUe OF desiGn? 1 The wow faCToR DMI DESIgN-VAluE INDEX Great design helps make products and Selection Criteria services more aesthetically pleasing, more the dMi design value index by Motiv is value-weighted according to market compelling to use, and more relevant in a world capitalization data from the close of business on the last trading day of June and december in the years 2003 through June 2013. that seems to change at an ever-increasing what constitutes good design can be viewed as highly subjective; therefore, pace. this is one reason the world is currently the selection criteria developed for inclusion in our index focus on the following: in love with tesla Motors, which has given us 1) PUBLICLy TRADED IN ThE US fOR 10+ yEARS drop-dead gorgeous cars that help save the Only public companies were eligible for selection to ensure access to planet and get 200 miles on one charge. Or financial data surrounding share prices and stock performance. The 10-year think about how much of the public has been timeframe was to select for companies that have maintained a consistent, completely enamored with Apple products long-term focus on design. over the course of their introductions over the 2) SCALE Of DESIGN ORGANIZATION AND DEPLOyMENT IS AN INTEGRATED fUNCTION AND ORGANIZATIONAL last decade. CATALyST fOR ChANGE the wow factor can also draw consumers the strategic use of design is employed in the organization, both within into supporting certain companies over time. business units and as a centrally managed function with a high degree of influence with its senior leadership team. the use of design can have in the 1990s, for example, discount retailer outsized influences on a company’s bottom line that multiply as it is target faced increasing competition from assimilated into the organization and its culture. similar stores such as Wal-Mart and K-Mart 3) GROWTh IN DESIGN-RELATED INVESTMENTS and realized it faced three options: AND INfLUENCE hAVE INCREASED OVER TIME “to specialize, to become the low-cost design has been well resourced through talent acquisition, appropriate facilities, competitive technologies, and the application of design research producer, or to differentiate,” remembers as a tool, among other investments. design cannot be expected to thrive Gerald Storch, target’s vice chairman at the when proper resourcing is neglected. time. the first choice would have crippled 4) DESIGN IS EMBEDDED WIThIN ThE future growth; the second was already a ORGANIZATIONAL STRUCTURE battleground. So, the company decided to go It is well understood where and how design fits within the organization. While there are several precedents set for successful operating models that can be used, with the third: differentiate through design. the common theme is that design is clearly built into the structure and processes that decision led to target’s domination of of the organization (org charts, process maps, raCi charts, and so forth). the mass merchandising market as tar-zhay, 5) DESIGN LEADERShIP IS PRESENT the mass purveyor of stylish yet affordable AT SENIOR AND DIVISIONAL LEVELS goods. it didn’t miss the mark—thanks to its design is given a seat at the table with an experienced executive or executive-level head of design who can interface with senior leadership. typically, design ethos, which can be found in everything this head of design has 15 to 20 years of experience managing design-related from its product offerings to its store layouts functions (strategy, organizational development, budgets, talent management, to its commitment to innovation. indeed, and so forth) that drive the company forward with design goals. companies like Apple and target have raised the 6) ThERE IS A SENIOR-LEVEL COMMITMENT TO DESIGN’S bar so high in their use of design that the public is USE AS AN INNOVATION RESOURCE AND INTEGRATIVE fORCE fOR POSITIVE ChANGE more aware than ever of what good design looks a corporation’s commitment to design shows up in many ways, including like and what design-led companies are capable the level of interaction the design executives and function have with other parts of producing. there is no doubt that this factor is of the organization, and in how the CeO and other leadership team members represent the importance of design in their day-to-day work and public relations showing up in company growth trajectories, as efforts as well as the extent to which the organization participates and wins design well as in their stock market results. awards, sponsors contests, fosters university affiliations, or other design-related activities such as encouraging its designers to speak publicly about their work. 32 DMI Winter 2013