Design in the South East

The headline

At first glance, businesses in the South East don’t appear to fully embrace design. They’re less likely to use it, or see it as crucial, than businesses in the rest of the UK. Investment is also low.

Yet paradoxically, half of them employ designers internally. That’s well ahead of the trend elsewhere.

It may be that while the region has the people to handle design activity, it’s relatively unaware of the bottom-line benefits of design and the breadth of its use.

The details

What role does design play in business?

Disappointingly, almost half (46%) the businesses in the South East think design doesn’t have any role in their business. That’s almost double the UK average.
UK average 25%

In fact, it makes the South East the UK’s least enthusiastic region about design. Only one in four think design plays either an integral or significant role.

How important is design to success, compared to other factors?

One in ten (10%) South East businesses think design is crucial to their success. Other factors are more important to them.
UK average 15%

For example, 73% of the region’s businesses rate financial management as crucial. And 71% point to the quality of their staff.

Some regions – such as the East Midlands – are three times as likely to rate design as crucial (29%).

How do businesses use design to compete?

One in three (30%) businesses in the South East believe that, over the past decade, design has become more important in helping them compete.
UK average 46%

This is far less than for businesses in the East Midlands (68%) and the South West (65%).

Businesses in the South East are also less likely than others to invest in design. Over the past three years, one in five (20%) have increased their investment. But three times as many (57%) haven’t invested at all.

Like many other regions, South East businesses mostly compete on the added value of their product or service (77%). One in five assign the same role to innovation (20%).

How many businesses have developed new products or services?

A third (34%) of the businesses in the South East have developed new products or services in the past three years.
UK average 40%

While this is slightly below average, it’s better than some other parts of the UK. In the North East and Northern Ireland, for example, only one in four businesses have done so.

What types of design do businesses use?

Almost all types of design are used less in the South East than elsewhere. Only service design is marginally more popular, with one in ten (9%) businesses using it.
UK average 6%

Almost half the region’s businesses don’t use any of the design services we surveyed.

Do businesses use designers?

Paradoxically, businesses in the South East lead the UK in employing designers internally. Over half (52%) say they do, compared to one in three across the UK.
UK average 34%

Where do businesses apply design?

Compared to the rest of the UK, South East businesses apply design less to all areas of their business. In fact, nearly half don’t apply it to any of the business functions we asked about (43%).
UK average 24%

Businesses are most likely to apply design to marketing and externally facing functions, such as branding and corporate communications.

Regional portrait

The South East makes a major contribution to the UK economy in terms of gross value added (GVA). In 2004, its GVA of £158.2billion represented a 15.7% share, the second largest contribution after London.

While the service sector is the region’s main driver, the South East England Development Agency (SEEDA) points to the significance of manufacturing in the region. Manufacturing accounted for 12.5% of the region’s GVA in 2002. Nearly 20,000 businesses are engaged in in the following sectors: marine (leisure and defence) aerospace, electronics, construction and pharmaceuticals. Over 3,000 of these businesses are engaged in high value manufacturing, including the production of advanced instruments for measuring, nanotechnology, medical instrumentation, motor sports and new materials development.

In 2001, over a quarter of all expenditure on research and development in UK businesses took place in the South East. The South East has areas of high production and there are concentrations of the use of advanced technologies such as in the Thames Valley, Surrey and North Hampshire areas. IT, digital and electronics sectors are particularly important in these areas.

The region is characterised by substantial variations in performance. There’s a relatively high-performing core (a belt around central London), but a weaker periphery near the coast. Performance is not as high in coastal areas where there are significant challenges in terms of employment and regeneration.

The South East England Development Agency is currently producing, in consultation with partners and communities a new Regional Economic Strategy setting out the key challenges and opportunities facing the region.

For more information, please visit these websites:

• Government Office for the South East
• Government Office for the South East, Regional Economic Performance
• South East England Development Agency
• Office for National Statistics.

What approach can I take with this information?

If you’re a business intermediary

For businesses in the South East, design is a latent resource.

Its potential is there – particularly in the form of internal designers – but more could be done to extract competitive advantage from it.

We can help you make this case. In particular, What design can do for your figures and The link between design and better business performance provide strong evidence of design boosting the bottom line.

Businesses could then review how and where they apply design. Something that’s commonplace elsewhere, for example applying design to externally facing functions such as branding and corporate communications, is undervalued here.

Another initiative that might help is encouraging businesses to use their internal designers even more in developing new products and services. The region performs better than some others at this, so getting ahead of the average is feasible.

If you’re a design business

Despite the South East being the UK’s second biggest regional economy, and home to 16% of the design industry, design agencies face some challenges here.

Businesses are nearly four times more likely to employ their own designers than they are to commission an agency.

However it doesn’t mean there aren’t opportunities for design businesses. In fact, almost every type of design service is used less by businesses in the South East than elsewhere.

For example, just one in 20 of the region’s businesses uses interior and exhibition design. Across the UK, take-up is around three times higher. Likewise only one in five South East businesses uses digital and multimedia design, compared to nearly one in three elsewhere.

And as well as the results of this survey (which look at what your clients are doing), we’ve also looked at what your peers are doing. The business of design The business of design is the first comprehensive survey of the design industry.

Among other things, it compares the supply of design services in your region to that in others. This complements the demand for services discussed above, and should further help you discuss these issues with your clients.

If you’re a design educator or student

Researchers might be interested that a surprisingly high percentage of businesses here (46%) think design has no role to play in their operations. Discovering why this is the case could be an area for further study.

For students interested in a career in design, it’s worth noting that businesses here often prefer hiring their own designers to using external agencies.