Exploring the Role of Design Management maturity in driving firm performance

Design plays a pivotal role in a firm's value creation chain, influencing innovation, brand recognition, and consumer preferences. However, leveraging design effectively requires strategic management rather than mere investment. A recent study investigates the impact of design management maturity on product innovation performance and financial performance, emphasising the mediating role of top management expertise.

Key Insights from the Study

Design Management Maturity and its Evolution

Firms utilise design in varying ways, reflecting their maturity in managing design. Early stages focus on styling, while mature approaches integrate design into all aspects of the new product development (NPD) process, fostering collaboration and enhancing user experiences. Strategic design management positions design as a core value driver, enabling competitive advantages and innovation.

Impact on Performance

The study, involving 200 companies and analysed through PLS-SEM, finds that design management maturity does not directly enhance product innovation. Instead, its impact is mediated by top management's expertise in design management capabilities and design leadership. This highlights the necessity of leadership in aligning design with strategic goals.

Role of Top Management in Design

Strategic design integration requires active involvement from senior executives. The establishment of roles like a Chief Design Officer (CDO) demonstrates the importance of embedding design expertise at the leadership level. The study underscores two constructs critical to this:

Design Management Capability: Managerial skills for overseeing design.

Design Leadership: Driving innovation through a clear design vision.

Implications for Practice

The findings emphasise the need for firms to elevate design from a functional activity to a strategic priority. Organisations should invest in developing top managers’ expertise in design management, ensuring alignment across departments. This approach maximises the transformative potential of design on innovation and financial outcomes.

Contribution to the Field

While previous studies have recognized the potential of mature design management, empirical evidence has been scarce. This research bridges the gap, providing robust data on how design maturity, mediated by leadership expertise, enhances firm performance. It further proposes a holistic framework to evaluate a firm’s design maturity, moving beyond conventional metrics like the number of in-house designers or design awards.

By shedding light on the strategic integration of design and leadership’s role, the study offers valuable guidance for firms aiming to harness design for long-term success.