Category Design economics

Measuring the value of design

In the 20th century the role of designers was majorly understood as that of shape-makers, skilled folks who refine the way objects look. Think car-styling, or how the fashion industry delivers new clothing styles every season. Beyond surface and form, design is a skill that creates new products or services. Design has been embraced by business schools, like Rotman School of Management, and even governments, like Singapore or South Korea have incorporated a design culture to improve on public services.

However styled, or invisible the outcomes of design might be, design has the ability to deliver financial value. For many years the Design Management Institute tracked how design-driven companies, like Apple, IBM, Nike, Starbucks, or Procter & Gamble outperformed others in the Standard & Poors 500 index by over 200% between 2005 and 2015. In their studies, designers have a seat at the C-level of these corporations and are able to consistently innovate across their industries.

Graph of Design Value Index 2005-2015
Design Value Index 2005-2015

 

How can designers demonstrate the value of the work they do?

Ultimately, designers can demonstrate value on a before-after basis, before and after a product re-design. For instance, increase in sales of a product, customer satisfaction, overall revenue growth.  The Design Management Institute has a tool to help frame how designers add value in four parameters: revenue, customer experience, organizational learning, and processes. 

In another project I was personally involved in (The Sustainable Design Standard), a cohort of designers created a framework for evaluating the value of design incling metrics beyond financial value. Based on the premise that designers can also create social, cultural, and environmental value, we created metrics to determine whether designers are helping create products that are healthy, that promote human rights, or that do a lesser damage to the environment. Spoiler alert: Virtually all products designed today are not sustainable.

Provenance is a good example of how designers can gauge the performance of the things they design. The Provenance tool enables both consumers and companies to trace who and how products were made. The tool visualizes the supply chain of participating products and is connected to a verifiable database that rates suppliers and materials.

Provenance app

Designers are known for their skills to create attractive products. As the design practice continues to evolve this century, we can expect the design industry to lead the way in making complex information easy-to-understand and actionable.

Super MoneyMaker by Kickstart

In several African countries, poverty is experienced in agricultural fields where families subsist on what a small farm can provide. In the late 1990s, Martin Fisher and Nick Moon, from Kickstart, discovered that one of the most effective ways to reduce poverty is to help these families increase their production, thus shifting from subsistence farming to commercial agriculture that could generate income.

They developed a pedal water pump called MoneyMaker Irrigation Pump, a two-cylinder pressurized pedal pump that pumps water from a river, or lake, up to seven meters deep. It allows farmers to irrigate up to two acres of surface. The advantage of this product is that it can increase the production of a family by up to 400% allowing them to grow a variety of products even in the dry season when crop prices rise.

This product was thought of around a business model with people and users at its core. Interested buyers are advised on ways to manufacture these pumps and sell them in their community, thus generating a new market in the local economy.

Kickstart estimates that with its products they have helped 533,700 people out of poverty and currently generate eight hundred businesses a month using their products. The selling price of Super MoneyMaker ranges from $ 35 to $ 95 depending on the location, since its inception in Nairobi, Kenya, Kickstart now operates in Mali and Tanzania.

Sanitary towels by SHE

 

One of the best investments in developing countries is education since it prepares young people with skills for their adulthood. However, many women and teenagers in several countries lose school days and work during their menstrual period since they lack sanitary towels. If they exist in their community, they are often not within reach.

That is why many women prefer to stay at home during those days and avoid embarrassing moments in public or use non-hygienic products as an alternative: rags, pieces of bark, or even mud, resulting in potential infections. The shortage of these products in these countries results in labor or school losses of up to 50 days a year, up to five years of a person’s life.

Elizabeth Scharpf decided to do something about it. Instead of creating a charitable organization for its cause, Scharpf decided to address this situation from the perspective of business, a solution that can work in the long term. Scharpf is a social entrepreneur with two Harvard masters and with experience in organizations such as the World Bank and the Clinton Foundation. The 33-year-old entrepreneur started an experiment in Rwanda in 2009.

With a small team of friends Scharpf experimented with different materials to make their own female towels. They tested yucca leaf fibers, pieces of cloth, bark fibers and leaves from the banana tree and placed them in a blender, one material at a time, to test which was more absorbent. Fiber from banana leaf was the best option, also proving to be a cheap, biodegradable and a readily-available material in the region.

The organization she started was called Sustainable Health Enterprises (SHE), where she continues to develop their health product in collaboration with a team of students and alumni of the Massachusetts Institute of Technology (MIT) called Komera that seeks to improve the manufacturing process. Part of the challenge is not just to make towels at a low cost. They also work on ways to make it a viable business.

By offering these sanitary-towel-making machines to entrepreneurial women by means of a loan, they can acquire a business that manufactures and distributes this product. For each business, or franchise, SHE estimates that 100 jobs are generated, benefiting 100,000 women and young people. The current price of these towels in Rwanda is between $2 and $ 3 for a pack of 10. SHE hopes to reduce the sale price to 75 cents with this product.

In their first tests in Rwanda, they have received comments from women mentioning that the product appears to be of inferior quality to imported towels. SHE and Komera are working to improve the appearance of the towels, making them more round and adding wings for greater acceptance. Last year, SHE received the CurryStone Design Award for its initiative and innovation potential.

http://www.sheinnovates.com/

Bicimáquinas by CACITA

Bicimáquinas are bicycles that are transformed into motorized tools for daily use, whether to grind coffee, blend a sauce, process corn, or pumping water. These bike-machines are created by CACITA, also known as the Autonomous Center for the Intercultural Creation of Appropriate Technologies (Centro Autónomo para la Creación Intercultural de Tecnologías Apropiadas). Cristian Guerrero, one of the group’s founders has given courses and demonstrations to rural communities in several states of Mexico along with their collaborators.

Part of the philosophy of appropriate technologies is to develop designs that use materials and tools available in communities, especially marginalized areas. By turning old bikes into income generating tools, bicycles are accessible to the community and are methods that can be used without the need of an outside consultant and without having to buy expensive raw materials or technologies.

Photos by Revolucionemos Oaxaca, Cristian Guerrero, Ecoaldeas México.

Remembering Hassan Fathy

Some designers such as Karim Rashid, Hani Rashid (Asymptote), both born in Cairo, Karim Mekhtigian, Rami Makram (Alchemy), and Tarek Naga are some of the contemporary designers and architects from Egypt. At a critical moment in the history of the African country, after four days of protests against President Mubarak, I remember the architect Hassan Fathy (1900-1989), a pioneer of what today would be considered sustainable architecture or appropriate technology.

Astonished by the lack of good design in marginalized areas of Egypt, Fathy rescued the ancient building techniques of his country and reintroduced the use of adobe in the construction as well as the vaulted ceilings that improve the thermal and ventilation efficiency of buildings and potentially can contribute to the buildings duration for hundreds of years. Materials and technique dictate the proportions and shapes of Fathy’s buildings. The curves of the ceilings harmonize with the walls, creating well-lit spaces, but most importantly: spaces that are accessible to the population with fewer resources.

In his project that encompassed a set of houses for 900 families in Gourna, who were forced to evacuate a cemetery they had invaded and converted into a residential space, Fathy tried to integrate the character and culture of the inhabitants in their design.

“Design should not be a false tradition or a false modernity imposed, rather architecture must be a living and permanent expression of the character of the community,”

explains Fathy in his book Architecture for the Poor. His architectural considerations included a ventilation, solar orientation, social integration, environmental surroundings, food production, drainage, among other factors.

During his career he designed shelters for refugees in Gaza, Palestine. Also within its repertoire of works exist residences, mosques, hotels, and buildings of mixed uses in Jordan, Saudi Arabia, Spain, the United States, among other countries.

Fotos of the new Gourna village: Chant Avedissian, Christopher Little, Aga Khan Trust for Culture.

Crowdsourcing for those who need it most

In 2006, Wired magazine published an article called The Rise of Crowdsourcing. Jeff Howe, the article’s author, is also credited with inventing that term that refers to using multiple sources or contributors of content, ideas, or resources to carry out a project. Since then organizations like Innocentive, dedicated to technological innovation; iStockphoto, a photo site; Or Current TV, a television channel that used to broadcast programs made by ordinary people, defunct in 2013, used the power of the crowds to create new pharmaceutical patents, sell low-cost photographs, or create a mini-documentary of punk rock.

Organizations that work in defense of human rights, the environment or to reduce poverty levels have also used crowdsourcing techniques to achieve their goals. The MIT IDEAS Global Challenge, out of Massachusetts, has created an online platform that allows different teams to propose solutions to bring clean water, sanitation, or education to marginalized communities. In their first ten years, the IDEAS competition channeled more than $ 260,000 to over sixty teams in twenty-eight countries, improving the living conditions of tens of thousands of people.

With the idea that each person can have a real and significant impact on the planet, Citizen Effect created online tools for each person to become a Citizen Philanthropist, so that with the help of friends and family a group of people in Beirut Can help a family in Haiti, for example. By donating $ 5 or $ 5.00, Citizen Effect kept track of project progress, giving donors feedback on the effect their help has on people’s lives.

Using a corporate sponsorship model, the design firm IDEO seeks ideas from the general public to design solutions for people in developing countries through its Open IDEO platform. They recently organized a project to design learning tools for students in poor countries and received 269 ideas, 109 design proposals and ten finalist ideas that the sponsoring organization implemented in the countries where it works.

Other examples of massive collaborations for the common good include Jumo.com, now Global Giving, founded by one of the creators of Facebook; DESIGN 21: Social Design Network, supported by UNESCO (no longer in operation); Charity: Water, which has funded 3,196 potable water projects with donations from the public, and Architecture for Humanity founded by architect Cameron Sinclair, which operated for sixteen years, until 2015.

 

Note: Some edits were made to the original article. Some organizations mentioned are no longer in operation: Citizen Effect, Design21, and Architecture for Humanity.

Foot-powered water pumps

It is estimated that four billion people around the world live on less than $ 3 a day at the so-called base of the economic pyramid. One of the most successful designs that has helped millions of families out of poverty is the pedal-based water pump that was first released by non-profit organizations such as International Development Enterprises (IDE) and Kickstart in 1980s.

This machine uses the weight and strength of a person to pump water from a well up to 7 meters deep and irrigate up to one acre of agricultural land. The cost of this product is around $ 25 dollars but is considered an investment since a family can double its income in a year.

With products like this, Paul Polak, one of the founders of IDE, has helped about 3.5 million families escape poverty and hope to help about 30 million families by 2020.