Design-driven companies, shows 10-year returns of a remarkable 219%
The Design Value Index (DVI) is a market capitalization-weighted index comprised of design-driven companies.
The DVI has outperformed the Standard & Poor’s 500 Index (S&P 500) by 219% over the past ten years, from 2004 to 2014. This remarkable return is due to the increasing importance of design in today’s economy. Companies that design attractive and user-friendly products have a competitive edge in today’s marketplace. As a result, consumers are willing to pay more for well-designed products, and investors are eager to invest more in companies with a high design value. As the importance of innovation continues to grow, the DVI is expected to continue outperforming the S&P 500.
Qualifying to be part of DMI’s Design Value Index isn’t easy. First, companies must have met the following criteria over the 10-year research period:
- To ensure consistency of financial reporting standards, corporations must be publicly traded in the U.S. over the last ten years.
- Design must have been represented in the corporate hierarchy for the period through a central design function led by an executive and the broad deployment of design staff and practices in all significant business units.
- Over time, these companies have increased design-related investments in headcount, infrastructure investments, and volume of projects.
- There must be a distinct and recognized operating model for design that promotes cooperation and integration with other corporate functions such as marketing, R&D, and operations.
- Design leadership must be present at the senior and divisional levels.
- Finally, the corporation’s senior management must show a deep commitment to design as a critical strategic enabler and a resource for innovation and change.