In today’s competitive business environment, design is no longer just about aesthetics—it’s a strategic tool that drives innovation, enhances customer experiences, and shapes organizational success.
This blog, gets into the fascinating evolution of design from mere aesthetics to a driving force behind business success and how companies like Nike and Tata Group have embraced design thinking to reshape their brands, boost customer loyalty, and achieve remarkable growth.
Ready to see how design can reshape the future of your business? Let’s get started!
About the Author
The Evolution of Design Thinking in Business
To quote Nobel laureate Herbert Simon, the act of design “devises courses of action aimed at changing existing situations into preferred ones.”
It is important to understand the word ‘Design’ and the potential it holds. If we observe nature closely, it becomes clear that design is everywhere.Simply put, design is how things work. And anyone can bring this sensitivity in their life to bring about a positively meaningful impact.
Traditionally, design was seen as a way to improve the visual appeal of products. However, in today’s business environment, design thinking has evolved far beyond just aesthetics. It is now a strategic tool that shapes decision-making across entire organizations. Businesses no longer see design as just a visual enhancement; instead, it’s a methodology for solving complex problems and creating innovative solutions.
How Design Thinking Shapes Organizational Success
From a small businesses to a large corporations, design culture can be embraced by all. There is a default design that is adopted – either through regulatory compliances or generalized ideas about operations like marketing, sales, production, administration, accounts, HR and others. This default functioning leads to creeping inefficiencies leading to unseen or untapped opportunities for growth. Design has the potential to transform the way the companies do business, make products, markets and sells products, hire talent, compete, and build their brands.
According to the Design Management Institute’s Design Value Index, for example, design-driven companies have maintained a significant stock-market advantage, outperforming the S&P 500 by an extraordinary 219 percent over the past ten years*. –
At individual companies, you don’t have to look far to see the value of design.
When Walmart revamped its e-commerce experience, unique visitors to its website increased by 200 percent. When Bank of America undertook a user-centered redesign of its process for account registration, online-banking traffic rose by 45 percent**.
.1*Jeneanne Rae, “Good design drives shareholder value,” Design Management Institute, May 2015, dmi.org. **Jim Ross, The business value of user experience, D3 Infragistics Services, January 2014, infragistics.com.
(Subscribe for alerts to stay updated with new podcast episodes and blogs for MSMEs & Startups)
Design as a Way of Thinking: Shaping Organizations Through Creative Problem-Solving
Design thinking has redefined how businesses or startups approach product development, customer engagement, and even internal processes.
At its core, this new approach to design is driven by empathy—the deep desire to understand and meet the evolving needs of consumers. It involves going beyond surface-level aesthetics to dive into the consumer’s pain points, desires, and behaviors. Design thinking, a popular methodology, embodies this mindset, encouraging businesses to place the customer at the heart of every decision. Through techniques like user research, rapid prototyping, and iterative testing, design becomes a tool for problem-solving and innovation, ensuring that solutions are aligned with what customers truly need.
This design-centric approach does not remain confined to product teams or marketing departments. Instead, it spans entire organizations, influencing various aspects of the business, from the development of new services to the optimization of operational workflows. Companies that embrace this broader definition of design integrate it into their culture, fostering creativity and collaboration across teams. Whether improving a website’s user interface, refining a customer service process, or developing a new product line, design thinking offers a structured yet flexible framework for innovation.
By leveraging design as a problem-solving tool, businesses can create solutions that are functional, user-friendly, and future-proof. This can mean simplifying complex processes, improving product usability, or developing services that provide a seamless, enjoyable experience. Design thinking enables companies to ask the right questions, test assumptions, and ultimately deliver products and services that resonate with their audience.
In this way, design thinking has become a driving force behind business innovation and competitiveness. Companies that adopt this mindset are better positioned to adapt to market changes, anticipate consumer needs, and create products or services that stand out. As a result, businesses that integrate design into their strategy not only enhance their offerings but also differentiate themselves in increasingly crowded markets. This design-led transformation is why many of today’s most successful companies, from tech giants to consumer brands, credit design as a key pillar of their growth and success.
(Are you a business or expert serving MSMEs and startups? Spotlight your services and expertise – partner with MSME TALK to create podcasts, blogs, listings, and social media content that truly reach and inspire!)
The Financial Impact of Design : Why Design-Driven Companies Outperform the Market
(This blog is authored by Parag Bhuptani, Founder, Pencil point Designs)
The financial benefits of adopting a design-led approach are well-documented. Over the past decade, companies that prioritize design as a core part of their strategy have consistently outperformed their competitors, including the S&P 500, by a remarkable 219 percent. This substantial stock-market advantage highlights the tangible value that design brings to a company’s bottom line.
So, why do design-driven companies see such impressive financial returns?
Design enhances customer experience
Businesses that invest in understanding their customers and crafting solutions to meet their needs create more loyal, satisfied clients. This loyalty translates into repeat purchases, increased customer lifetime value, and strong brand advocacy. Whether it’s through intuitive product design, seamless service delivery, or user-friendly digital experiences, these companies build trust and deepen their relationship with customers, resulting in a steady revenue stream.
Fosters innovation, a key factor in maintaining a competitive edge
Design-driven companies are more agile and adaptable, continuously experimenting with new ideas and solutions. By leveraging design thinking methodologies—such as rapid prototyping and customer feedback loops—these businesses can quickly iterate and refine their offerings. This innovation not only allows them to introduce products and services that better resonate with consumers but also helps them stay ahead of market trends and disruptions.
Improves efficiency and cost-effectiveness
While design is often associated with aesthetics, it also plays a crucial role in optimizing processes and systems. Service design, for example, streamlines customer interactions, reducing friction and operational costs. Similarly, well-designed digital platforms minimize errors and improve productivity, saving time and resources. These operational efficiencies directly impact profitability, giving design-driven companies a financial advantage over less optimized competitors.
Differentiation through design is a powerful market strategy
In industries where products and services can be easily commoditized, businesses that use design to stand out—whether through unique visual identities, memorable brand experiences, or superior usability—command greater customer attention. This differentiation leads to higher margins and premium pricing, further contributing to their financial outperformance.
Ability to attract and retain top talent
.The long-term success of these companies is also reflected in their ability to attract and retain top talent. Design-driven organizations create environments that foster creativity, innovation, and collaboration. This culture not only appeals to talented professionals but also ensures that teams are continuously pushing the boundaries of what’s possible, driving growth and market leadership.
Examples
1. Nike: Embracing Design for Innovation and Emotional Connection
When & How: Nike began its design transformation in the 1980s by focusing on product innovation, such as the Nike Air Max and other cutting-edge athletic shoes. With collaborations like Tinker Hatfield’s designs, Nike shifted to a design-driven culture that placed equal importance on performance and aesthetics.
Before Design Focus: Nike’s initial success stemmed from functionality and athletic endorsements, but it struggled with competition from brands like Reebok in the 1980s.
After Design Culture: By integrating advanced design and technology, Nike became a global leader, achieving a 57% share in the U.S. athletic footwear market by 2020. Design innovations such as Flyknit and its digital ecosystem (Nike+ apps) strengthened customer loyalty and elevated the brand to a cultural icon.
2. Tata Group: Design as a Differentiator Across Diverse Industries
When & How: Tata Group embraced a design-led culture in the early 2000s, especially under the leadership of Ratan Tata. By creating Tata Elxsi, a design-focused subsidiary, Tata fostered design thinking across sectors like automotive (Tata Motors), telecommunications, and software services.
Before Design Focus: Tata was known primarily for its large industrial and commodity-based businesses but struggled to differentiate in highly competitive markets like automobiles.
After Design Culture: Tata Motors’ launch of the Tata Nano and acquisition of Jaguar Land Rover in 2008 showcased its shift toward design excellence. JLR’s design revamp significantly increased sales, with revenue growing 22% annually from 2009 to 2015. Tata’s design-led innovation has also supported growth in sectors like IT and consumer products.
Nike and Tata Group demonstrate how adopting a design-focused approach can transform not only products but also brand perception, customer loyalty, and overall financial success. By shifting to a design-driven culture, these companies have achieved substantial revenue growth, expanded market share, and gained global recognition.
(If you are planning to start an export business, then this blog Capacity Building of First Time Exporters (CBFTE) Scheme: A Government Scheme for Entry-Level Exporters is for you)
Conclusion
In summary, the stock-market outperformance of design-driven companies is not a coincidence—it is the result of strategically embedding design at every level of the organization. By enhancing customer experience, fostering innovation, improving operational efficiency, and differentiating their brands, these companies are able to generate higher revenues, command greater market share, and build lasting competitive advantages. As design continues to evolve as a critical business function, its financial impact will likely remain a defining factor for success in the years to come.
Ultimately, design has become more than just a tool for creating visually appealing products—it is a way of thinking that drives success across the entire organization.
This blog is authored by Parag Bhuptani, Founder and Chief Design Strategist at Pencil Point Designs. He brings over two decades of global experience in strategy and design services, helping clients build distinct and differentiated brands. In case you want to explore services of his companies, contact is given in his profile.
(Subscribe MSME TALK for alerts to stay updated with new podcast episodes and blogs by experts for MSMEs & Startups)