How Can We Measure The Impact of Business Design?

One of the things I’ve grappled with as a business designer is how to measure impact when so much of what we do as designers is either intangible, or dependant on leadership teams choosing to implement your designs in the way they were intended. For measuring success in many roles, the default answer is tied to the bottom line: contributions towards increased revenue, reduced costs, or improved profit margins. Now, whilst these financial metrics are undeniably important, they don’t necessarily capture the full impact of a thoughtful and well-rounded business design initiative.

Business design is about reshaping how a company operates, collaborates, and delivers value. The changes it drives; cultural shifts, operational efficiencies, and enhanced customer experiences, don’t always show up immediately on your balance sheet. Yet these are the very factors that determine long term success of your work.

When assessing a business design initiative, financial metrics like ROI or cost savings often take centre stage. However, these metrics can be misleading or incomplete for several reasons:

• Time Lag: The financial benefits of operating model changes or cultural shifts may take months or years to materialise.
• Financial Intangibility: Critical improvements, such as better collaboration, increased employee morale, or improved retention don’t immediately translate into £s.
• Context Dependence: Financial outcomes can be influenced by external factors (e.g. market conditions) that obscure the real impact of the design work.

Equally, in an organisation where change is frequent, it can be almost impossible to confidently say that when your work does start translating into money terms, those results were driven by your business design initiative (rather than other things that have happened in the meantime).

To truly evaluate the impact of business design, we need to expand our toolkit. Here are some alternative, non-financial metrics I like to consider:

Cultural Impact

Business design often requires cultural shifts, such as breaking down silos or enabling an environment of innovation. These shifts can be measured through:

• Employee Engagement Scores: Higher scores can indicate a more collaborative and motivated workforce.
• Qualitative Feedback: Stories from teams about improved ways of working or increased psychological safety.
• Innovation Contributions: Track the number of new ideas or process improvements suggested by employees. A rise in contributions often signals a culture of openness and innovation.
• Attrition in Key Roles: Monitor turnover in critical roles or departments. High retention often signals alignment between organisational culture and employee needs.

Process Efficiency

Operational improvements are a hallmark of successful business design. Metrics here might include:

• Cycle Times: The time it takes to complete key processes, such as onboarding or claims handling.
• Error Rates: A decrease in errors often signals clearer processes and better alignment.
• First Contact Resolution (FCR): This evaluates how often customer requests and issues are resolved during the first interaction, without the need for follow up contact. While prioritizing FCR might lead to longer average handle times (AHT), it is a more customer centric measure that will help to reduce failure demand. By addressing customer needs fully in the first instance, you can not only improve customer experience metrics (which we will come on to in a second) but also lower the overall volume of repeat interactions.

Customer Experience

Customer satisfaction is one of the most immediate indicators of design success. Consider metrics like:

• Net Promoter Score (NPS): NPS is often used to gauge customer loyalty by asking how likely a customer is to recommend a service. However, there is growing debate about its effectiveness, particularly in capturing the nuances of customer sentiment.
• Customer Effort Score (CES): CES measures how easy it is for customers to complete a specific interaction, such as resolving a query or making a purchase. Lower effort usually correlates with higher satisfaction.
• Customer Satisfaction (CSAT): CSAT, typically measured through post-interaction surveys, is becoming an increasingly preferred tool over NPS. While NPS provides a broader, long term view, CSAT focuses on the customer's immediate experience, making it more actionable for short-term improvements.

Organisational Agility

Adaptability is key in an ever changing and competitive market, so monitoring metrics which give an indication of how (lower case) agile an organisation is can be very powerful. Key metrics include:

• Time to Market: The speed of launching new products or services (speed isn’t everything here though, so make sure you balance this with meaningful metrics that demonstrate the product or service has launched successfully!)
• Change Readiness Surveys: Employee perceptions of how well the organisation adapts to change.
• Time to Decision: Measure the speed at which the organisation can make critical decisions, especially during uncertainty or change. Shorter decision making times generally reflect clearer processes and better communication.

Risk Management 

Business design initiatives often aim to reduce organisational risk by improving processes, clarifying roles, and enhancing controls. In fact, I would argue that every piece of business design work should have risk improvements in scope. Measuring risk related outcomes can demonstrate how design efforts contribute to stability and resilience. Key metrics include:

• Incident Reduction: Track the frequency of risk events or operational failures, such as compliance breaches, data errors, or security incidents. A decline in these events indicates stronger processes and controls.
• Time to Risk Identification: Measure how quickly potential risks are identified and escalated. Faster identification often reflects improved transparency and communication.
• Control Effectiveness: Evaluate how well risk controls perform through internal audits or assessments. High effectiveness scores demonstrate that new processes are mitigating risks as intended.
• Financial Risk Exposure: Quantify the reduction in potential financial losses from operational or market risks due to enhanced processes or strategies.
• Supplier/Partner Risk Ratings: Monitor risk scores associated with external partners, especially in scenarios where operating model changes impact partner management.

Adoption and Engagement

For any business design initiative to succeed, people need to embrace it. Metrics to track include:

• Implementation Rates: Measure how frequently your design recommendations are taken forward for implementation vs left as shelf ware. This one might feel a bit of a wrench because you could put your heart and soul into something and then find that the appetite for change isn’t quite where you thought it was. It’s so important to measure this though because designs are nothing without implementation. Understanding who you are working with and for when doing design work is critical.
• Stakeholder Satisfaction: Feedback from both leadership, and teams on the receiving end of designs about the relevance and effectiveness of the changes.

And of course… numbers tell part of the story, but qualitative insights provide crucial context. Combining both creates a fuller picture. Consider dashboards which allow you to connect different metrics to build out the story (i.e. CSAT and cycle times). Or case studies which allow you to highlight specific examples where design changes made a tangible difference.

Now measuring these alternative metrics won’t be without challenges, particularly if this is very different to the norm. Metrics around things like cultural impact can be harder to quantify, and leaders accustomed to financial metrics may need convincing of the value of broader measures. 

Strategies to overcome these include co-creating metrics with stakeholders and tying qualitative insights to measurable business outcomes.

Success in business design means many things to many people. While financial metrics will always be important, they are only part of the story. By keeping tabs on a broader set of measures, us business designers can better capture the true impact of our work and demonstrate its value to the organisation.

Oh, and now is probably a good time to highlight that you’re going to want to be really good pals with your Data and Insights team so that you can get your hands on this stuff!