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Releases World-First Study Quantifying the Financial Value of Design to Business by McKinsey & Company

20 November 2018

On the last Thursday, October 25 in New York, the McKinsey & Company, the trusted advisor to many of the world’s most influential businesses and institutions, released its first-ever study on the business value of design.

 

After tracking the design practices of 300 publicly listed companies in multiple countries and industries over a five-year period, McKinsey’s study is one of the world’s most rigorous in linking the financial value of design to business.  McKinsey’s research found a correlation between design best practices and financial performance. Each company was given a single metric for its design performance: the McKinsey Design Index (MDI) score, which was based on hundreds of design actions they had taken. Those companies scoring in the top quarter of the MDI saw increased revenues and shareholder returns at nearly twice the rate of their industry peers on an annual basis.

 

Companies from a wide variety of industries consistently showed financial benefits from good design: from retail banking to medical devices to consumer goods.

This suggests that companies that improve their design capability can improve their financial performance whether they are making physical products, digital apps, services, experiences or a combination of these things. 

 

McKinsey’s research found that shareholder return and revenue growth differences between the fourth, third, and second quartile MDI scorers were marginal. The market disproportionately rewarded top quartile companies whose design performance truly stood out from the competition.

 

We can say good design is a good business!

 

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