Finding Our Way

Show Notes

In this episode, Peter and Jesse compare notes from Config, Figma’s AI study, Lenny’s newsletter survey, and countless conversations to read the current state of design leadership. The signals: existential AI panic has cooled into exhaustion, organizational chaos and leadership churn are the new normal, and design still stumbles on business acumen. Their case for thriving—lead, don’t just design, and reclaim design’s unfinished mandate.

For more from Jesse James Garrett, including his AI transformation practice: https://jessejamesgarrett.com/

For more from Peter Merholz, including his newsletter, his consulting, and thought partnership: https://petermerholz.com/

Transcript

Jesse: I’m Jesse James Garrett,

Peter: and I’m Peter Merholz.

Jesse: And we’re finding our way,

Peter: navigating the opportunities

Jesse: and challenges

Peter: of design and design leadership.

Jesse: On today’s show, Peter and I are listening to signals of the current state of design leadership. We’ll get into what we heard in our recent conversations with design leaders at events such as Config in San Francisco, and what recent research studies from Figma and Lenny’s newsletter reveal about the emotional toll of the current environment on leaders and teams.

Plus, we’ll explore what leaders can do to keep the promise of design’s value alive with the rise of AI.

Peter: I wanna start with this question.

Jesse: Okay

Peter: Have you seen the movie Backrooms?

Jesse: I have not seen the movie Backrooms, Peter.

Peter: I finally saw it four or five weeks after it was released, and it is easily the most interesting thing happening in cinema right now. Full stop, end of story. If you like movies, you need to see Backrooms. If you think it’s a horror movie, it’s not. If you don’t like horror movies, don’t worry about it.

Go see Backrooms.

Jesse: Okay. All right, thanks

Peter: I haven’t walked out of a movie kind of excited about the form in a very long

Jesse: Cinema yeah.

Peter: In cinema. No, for real. But what’s on your mind, Jesse?

Jesse: Well, you know You know, here on this podcast, Peter and I, we’re like the great psychologist Fraser Crane. We’re always listening. And we’ve been listening a lot over the last six, eight weeks, since the last time we recorded this podcast.

We’ve been listening to the signals out there. We’ve been having conversations with folks. We’ve been together at a couple of events. We’ve been taking in what’s going on, and there’s enough going on out there that I thought it would be worth us getting together and talking about our reactions to some of the signals that we’ve been seeing out there.

So, for example, you and I were at Config, the largest design event in the world now, it’s gotta be, in San Francisco just a couple of weeks ago in June. Had a chance to talk with a lot of different design leaders about their challenges and about what they were seeing, and of course, all of us were trying to read the tea leaves of Figma’s product strategy and what that meant for design teams and what they were maybe seeing about where all of this is going.

They published the results of their latest survey of design practitioners and design leaders about the state of AI in their practices and had some interesting insights and reflections based on that.

Config 2026: from existential dread to exhaustion

Jesse: But I’m curious about what stood out for you. Let’s just start with Config. I mean, there’s been a bunch going on, but let’s just start with Config. What stood out for you about the conversations that we had and the experiences and the ideas that were in play in that gigantic gathering of 10,000 designers in San Francisco?

Peter: What stood out from Config specifically for me was that AI was no longer seemingly an existential concern for design and design leaders the way it had been in the prior two Configs.

It was two Configs ago when Figma was like, “We’re about product people,” and didn’t really mention design much. And designers started freaking out that they were about to be replaced by AI. I mean, yeah, so that was

Jesse: Or simply product managers.

Peter: Or product managers…

Jesse: You decide which fate is worse.

Peter: Sure. And then in 2025, Figma said, “Psych, we love design. Design is great. Here’s a bunch of tools for designers,” and that’s when they launched Figma Make as well.

But the conversations I had last year were deeply existential, It was around that time last year that you and I started really hammering away on the kind of liminal concepts and the phase shift concepts and all that kind of stuff coming out of this dialogue that was occurring.

This year it feels like folks have settled in. This AI stuff is real. They’re still figuring out what to make of it, but it’s real. It’s not going away, but it’s also not causing the kind of existential crisis it had before. It’s a tool. It’s a means to do their work.

And yeah, so folks were far less hair on fire than they had been the prior two years.

But what’s replaced that or what, has emerged, I think, as the dominant sentiment is they’re just tired. Everybody is fucking tired. Everybody is exhausted.

I think a big reason they’re tired is that all this new stuff has simply been layered on top of whatever their existing job had been. And so folks are just expected to do more. Even though the promise of this new stuff is that you don’t have to do as much ’cause the machine does it, instead, the reality, at least right now, is, perhaps while people are figuring it out, it’s like you have to do your old job, which already maxed you out.

You were probably already at

Jesse: least…

Exactly. Everybody was already plenty busy.

Peter: Yeah. Yeah, you were already maxed out, and now we’ve just layered on this new thing you have to figure out, and we’re pretty much giving you very little guidance about that.

So that’s my primary takeaway from Config. I honestly could care less about Figma and its product suite and whatever that indicates. I don’t think that’s nearly as much of a bellwether or harbinger as maybe it used to be.

But yeah. The sentiment curve has shifted from fright to just tired.

Jesse: Mm-hmm. Mm-hmm. Yeah, I think it’s interesting to note, first of all, the emotional tenor, I think the optimism is there, but it is I think somewhat muted relative to previous years. The people who are optimistic are a little more cautiously optimistic. It’s like the two sides are kind of meeting in the middle a little bit, that the skeptics are learning to appreciate a bit of what the technology can do and where it’s going, and the optimists have maybe had their irrational exuberance tempered a touch by the intervening year.

But I think that one of the things, and we touched on this in the Liminal conversations as well, one of the things that is a recurring theme for these leaders is the emotional resilience required to continue to manage ongoing change, and the fact that none of this is gonna be settled soon.

And in fact, the new steady state is an extreme unsteadiness for a lot of leaders in a lot of organizations. And in some cases, I feel like people, what they’re honestly looking for is something to anchor to that’s proving hard to find.

Corporate chaos and the broken job market

Peter: And I think it will continue to be hard to find for a while. Earlier today there was a post on LinkedIn that I ended up reposting with a bit of commentary. I forget the name of the woman who wrote it, but she was talking about her job hunt journey.

She’d been… I don’t know if she’d just quit or been laid off in January. It is now June or July, she’s starting a new job. And she had statistics to go with her job hunt experience. Within those statistics was, she got through all rounds with 10 different companies, right? Which is a strong signal at least when I run recruiting and hiring. If you make it through that round, you’ve got a one in three or one in four chance usually, right? There’s not many candidates get that far.

So 10 companies, she made it through all rounds. But then after getting to that point, she pointed out with four of those companies, something went haywire. The hiring manager quit or got fired, there was a reorg, there was layoffs, there’s something organizational occurring in 4 out of the 10 companies.

So these are companies that thought they were stable enough to go through a recruiting and hiring process, get through, I’m sure, multiple candidates through many rounds, and oh, and then at that point it turned out they weren’t that stable.

Some organizational chaos occurred and the job just disappeared, right? The requisition disappeared.

And what that to me was a sign of, or is a sign of, it’s anecdata, but, I’m seeing other indicators, and it goes with the exhaustion thing, is that companies have lost their collective minds right now. The degree of instability within corporations, I mean, it’s been high for a while, and it seems higher now.

When you talk about listening and signals, like one of the signals I’m getting is just a greater degree of uncertainty. It’s not necessarily layoffs, although that’s part of it. You and I have had friends recently who just found themselves without a job in the last few weeks that…

Jesse: mm-hmm.

Peter: At large, massive, otherwise seemingly very stable companies.

Jesse: Stable-looking. Yeah.

Peter: Yeah. And it’s just like, the analogy that just came to mind is, we’re all on a ship.

That ship is just rocking, and we’re all just holding on to the ship for dear life as waves are coming overboard, and we’re just trying to make our way through this period until the seas calm down.

Jesse: Trying not to get too sick over the rails.

Peter: Well, yeah.

Jesse: Yeah. Well, I think that, and you touched on some of these teams that have been really decimated in the last year, design teams out there that have been for whatever reason, one reason or another, they ran out of runway before they could get aloft and what these teams are facing now is, in some of these cases, you have these teams that have been so severely cut back that they have to renegotiate their mandates because they can’t keep doing what they were being asked to do before under these new structures. And the leaders are in the position of having to do that renegotiation of the value prop of their team, right? Of what we’re here to do and what we’re here to be measured for and what you can look to us to provide.

The organizational and cultural shifts are as, at least as radical as the technological and process shifts.

Leadership turnover and its ripple effects

Peter: Well, y- yes, and I don’t think it’s necessarily just a matter of cutting back, though that’s definitely happening. So I conducted a listening tour, or I’ve been conducting a listening tour of design executives. It was something I was doing in May before I went out on a family vacation.

And I talked to about 20 design executives. I’m still poring over the data. But something that was intriguing to me is of those 20 design executives, three or four were between jobs. Like I hadn’t realized when I’d reach out to them they weren’t working.

But they hadn’t been laid off because of reduction. Each of them wasn’t working because there had been a leadership change in their organization, and the new leader didn’t want them in the org. Which, kind of, again, is speaking to a certain organizational chaos. The senior leadership are encouraging change within design organizations that involves just getting rid of current leaders.

Not the whole team, just like, “That person doesn’t belong here anymore.” And sometimes it’s a new leader wanting to put their people in place. I just had something outside of the listening tour, but a friend just got fired really, not even laid off, because a new CTO is like, ” We’re gonna do things different now.”

And I think as part of this chaos, something I believe is at the highest levels of a lot of these organizations, there is leadership turnover right, in the C-suite or just below.

Jesse: Mm-hmm.

Peter: That seems to be happening more often in the last year or two, and what we’re seeing is the impacts of that, the ripple effects of that within design.

It might take three, six, nine, 12 months to finally get to design, depending on the size of the company. One firm that you and I are familiar with, had 50,000 employees, so it took a good nine months between the new CEO…

Jesse: yep.

Peter: …And the leadership shift. But in most of the cases I’m aware of, it’s not about reduction, it’s just about turnover, and, on the part of these senior-most leaders, a total disregard for the turmoil they are causing.

Jesse: Hmm. Mm-hmm.

Peter: Just disregard, disinterest. You’d think you’d want some degree of stability so that the business can do its work well, and there’s absolutely no interest in that from what I’m witnessing.

Jesse: Yeah. Well, it’s interesting to think about just the sheer number of people who have some qualifications for leadership or management roles in a digital product development or design organization who have been turned out on the market in the last couple of years, which has really made it a buyer’s market, so to speak, when it comes to especially middle management.

So, I’m seeing the same pattern that you’re describing of these wholesale leadership turnovers. You get a new CTO brings in a new CPO brings in a new VP of design, and the ripple effect goes all the way down. And just by virtue of having been in the organization a while, you become perceived as a liability to the new order, so to speak.

And so for leaders, it then becomes this politics game of proving in that nine months, that you deserve to stick around.

Peter: You used the word order.

Jesse: I know, and you’ve been talking about chaos.

Maybe executives are just bad at their jobs?

Peter: Well, and I think concomitant with this upheaval is, at least for me, an increased recognition that the people running these companies, that m- many, I don’t know about most, executives are just bad at their jobs.

They’re not accountable, right?

They’ve had– they wouldn’t be in that role if they hadn’t had some success. I tend to, in private conversations with folks, just disregard this class of executives as dumb or stupid and that’s probably overstating it ’cause, again, they probably would not get into that role if they were categorically dumb. If they were just dumb. They clearly knew something, figured something out, got into a position of authority and influence.

I suspect their wisdom is very narrow, though, and now they’re in this broad– they have the much broader mandate, and they’re trying to apply this wisdom from their narrow point of view to the broader mandate, and that’s where the stupidity is.

And as I continue to reflect on that, design was probably never in whatever that narrow band was.

Jesse: No, it never was. Yeah.

Peter: And so the moment it expands to include anything that might include design, design will not be treated well because those executives, like we saw with Cloudflare where once the design system was put in an LLM, the CEO’s like, “We don’t need designers anymore.”

Because he’s an engineer, and he just sees the world as, like, a machine you fiddle with or salespeople to sell it, and has no understanding of kind of the actual value that design was delivering, ’cause the only sense of value he perceived was the creation of assets or screens for engineers.

Jesse: Yeah. Yeah. So again, it comes back to the value the design is delivering, the way that value is perceived, and whether it’s your AI transformation strategy or how you manage the politics of this kind of organizational change, it’s on the design leader to keep their eye on what that value prop is.

Peter: Well, and to figure out how to communicate it in a way that resonates with, hopefully, people who are listening. Something I wonder, you said earlier that this is this new kind of unsteady state.

Jesse: Yeah

Peter: I was about to call it a steady state, just meaning we’re gonna be in this state for a while, but that state is…

one steady state of unsteadiness, yeah

of unsteadiness, yeah.

This is something I’ve found myself thinking about potentially developing some training material around which is, what can design leaders do to

maintain resilience and even ideally not just maintain, but thrive in this discombobulated mode. I’m wondering where your thoughts go.

Jesse: Yeah, no, I think you’re right to call that out. I had a client a while ago who went through another performance review and said to me, “Look, I’m tired of being called out for my resilience. I’m tired of my brand being my ability to take a bunch of hard shit and stay standing. I’d like for this career to mean something more than that to me.”

And I think that’s right on. And in, again, going back to the liminal conversations, those explorations, I think were about trying to figure out, well, what is the skill set that allows you to remain upright and not be knocked about as much? But I do think also that thriving means taking control of the narrative. I think thriving means taking control of your destiny.

In a lot of organizations, the constraints are so severe that becomes practically impossible for leaders. And, it almost goes back to the leadership ceiling kind of stuff, like where can you actually move your constraints or influence your constraints to create new opportunities for yourself and for your team?

Lenny’s survey: chaos is the new normal

Jesse: A lot of this stuff also resonates with the survey that was released a couple of days ago through Lenny Rachitsky’s newsletter. And I’ve forgotten the name of the researcher who conducted the study, but

Peter: Noam Segal.

Jesse: All right. So Noam, thank you for your work. It’s very interesting stuff.

What came out of this, especially as it connects with some of the things that have already come up in this conversation, one of their findings is that the current norm is chaos, that across the board people are reporting just organizational disarray broadly.

And they don’t do a lot to try to identify root causes for that, but it definitely is one of the big patterns that came out in their study.

So they talked to I think close to 6,000 self-reporting, subscribers to Lenny’s newsletter who volunteered to take the survey. The other thing, aside from the chaos, actually this was a finding from Andrew Hogan’s work for Figma as well in their AI study, which was that there is no one central kind of experience that people are having right now.

Everybody’s experiences are all over the map. It’s like I was saying about AI transformation a couple of episodes back. Every path through this wilderness is different because every organization is starting from a different starting point with different resources and different cultural advantages and liabilities that determine how steep the climb is through all of this stuff for people.

Peter: Yeah. In a pre-AI world, things had settled into a few different archetypes of organizations, at least with respect to their relationship to design. Think about your maturity model or something, right? And it’s got three or four stages and where you fit in that.

I’m doing a bit of just follow-on research. I launched a pulse check survey specifically for designers to get a sense of how they’re feeling.

And after 100-some results what’s interesting is a similar story, which is there’s no narrative. There’s no theme. It’s scattered. My listening tour revealed that as well with the 20 executives that I spoke with. And I guess that’s part of being in this moment.

One has to imagine shit’s gonna settle down. But It’s interesting to me that as things become less existential, I would think we’re starting to approach this with a more pragmatic point of view, right? As opposed to a hair on fire point of view. You would expect the settling to start, but it’s not.

So I’ve got Lenny’s thing up here, and there’s a chart showing that from 2025 to 2026, burnout increased by 20%.

Jesse: Mm-hmm.

Peter: And optimism decreased by about 10%. And so even though we’re kinda getting our hands around this, we’re not feeling any better about it.

It’s not getting us into a calmer mode. It’s also weird, though, he had this question about how much better are you at your job? And about half of the respondents said very much or extremely better. Now, I would love to see that cross-tabbed with different functions.

I’d be curious what percentage of designers would say that. I mean, engineers, yes, I’m sure they consider themselves largely better at their job. But I still suspect a lot of designers would say that they are feeling very much to extremely better at doing their own work, if they can just put a little boundary around that.

But also recognize that, yes, I can do my thing better, but the space in which I’m operating,

Jesse: But the rest of you

Peter: is not.

“More work, same pay” and the employer’s market

Jesse: Can’t be trusted. Yeah. It’s interesting to think that people can more readily feel optimistic about the individual scale impact, but when that starts to add up to an organizational scale impact, then they get nervous about it.

One of the things in Noam’s survey was the notion of What are you afraid is gonna happen with AI? And people are not afraid of losing their jobs. They’re afraid of having more work piled on their plates. To your point, they were already busy before this stuff came along, and more than half of the people in the survey said that their worry, the top of their list, was: expected to do more work for the same pay.

So the sense is that the executives and management are just going to continue to increase this pressure on teams to be productive and to perform. Again, which is why for managers and for leaders I think you’ve gotta get really clear on the value that your team is delivering and making sure that you’re optimizing for that.

Peter: Well, and this is an expression of executives taking advantage of what they see as an employer’s market, right? When it was an employee’s market, you get a bunch of glorious perks. You get massage and free lunches and all this other stuff. Plenty of vacation time and all that.

But when it’s a employer’s market, at least in the United States where we are without any meaningful employee protections, yeah, they’re just gonna keep piling stuff on you, and if you can’t do it, they’ll fire you and see if they can find someone else who will do it.

Jesse: Yeah.

Peter: And they’ll find someone who will raise their hand to do it ’cause there’s a bunch of people out there who need work.

Jesse: Mm-hmm.

Peter: I don’t quite know what the solve is for that besides unionizing or uh, some other form of collective bargaining. But that’s not actually u- unions won’t aid many, most of the people who listen to this podcast ’cause they wouldn’t be in a union because they’re management.

Jesse: So what is, do you think, the impact for people who are in management or leadership roles here? So if, and this is another finding from Noam’s study, the burnout is becoming sort of the dominant place where people find themselves in this industry, as leaders, we have to take responsibility for that. We have to take ownership of that in some way, even if we ourselves are also feeling it.

Why design and research are the lowest rated career recommendations

Peter: Related to that, and if we wanna talk more specifically to our podcast audience, in answer of the question: How likely are you to recommend a career in your role to a friend starting out today? Far and away the lowest scores were design and research. Everything was actually below zero, so no one– on average, no one would be recommending a role in tech to a friend, which holy shit.

But design and research is far and away the lowest.

Which also actually pairs with another finding in here, about the value of management and managers and how manager effectiveness was correlated to burnout and job enjoyment. And so people who felt their managers were extremely effective rated four out of five on job enjoyment and well below the average on burnout.

But and then there’s a note, there’s not specifics, the worst rated managers cluster in data/analytics and design.

Yep. And so, there is a need for our peers, many of the people listening to this podcast. Though probably if you listen to this podcast, you’re a little ahead of the curve.

Jesse: We hope so.

The craft trap and the business-acumen gap

Peter: We hope so. But, we’re not doing our job. Why are design managers the worst rated, right? What is it that they’re doing or not doing, causing their teams to feel ineffective and burned out and hate their jobs, right?

I could speculate but regardless of the speculation, it’s easy for designers to point fingers at others in situations like this, but I actually go back to part of the reason I wanted to write Org Design for Design Orgs a decade ago was because I saw designers pointing their fingers at all these other people about why their team was not as effective as it could be.

Product isn’t doing this, and engineering isn’t doing that, and leaders don’t understand us. All of which might be true, but if I looked at almost any design org in 2015, they were poorly run.

The person in charge didn’t know what they were doing. They didn’t know how to set up a team, an organization, a structure.

Jesse: Yeah

Peter: Yeah, so I wrote the fucking book to, like, here’s a playbook to, like get out of your own way so that at least you could then credibly start complaining when others aren’t doing their job, or when their behavior is affecting your team’s ability to perform.

I suspect though that, a decade or so later, that most design orgs are still just poorly run entities because the people in charge don’t know how to do it.

Jesse: Yes and, maybe this is too charitable a stance, I don’t know. A lot of design leadership roles are not set up for success. They’re reporting to the wrong people. They are supported in the wrong ways. They are granted the wrong scope of authority to actually deliver on what they are on the hook for. So I think it is important to separate incompetent managers from poorly constructed management as a system in an organization.

Peter: I have research that would support some of what you’re saying. But, part of me would want to be able to control for those factors with other functions, right? Does, engineering perform better or whatever because it’s in the right place in the organization or given the right mandate? Marketing, sales?

Marketing and sales is actually funny in this report because there’s a section in the report around, different functions in their relationship to whether they are destabilized or diminished, tired, overwhelmed, anxious, worried about losing their job, or would recommend to others. And what I thought was super interesting about that was that sales and marketing folks, would do things like, they would score badly on things like being tired.

They’re more tired than most other functions. Salespeople are more overwhelmed than most other functions. But sales and marketing folks were also the least anxious and the least worried about losing their jobs. Oh, and the least destabilized in their role, they felt like they’re just continuing to do their work.

And so I thought it was super interesting and so it was design, research, engineering, operations, PM, data, sales, marketing, and whether or not you were a founder. Sales and marketing are the two functions that are not specific to tech…

Jesse: mm-hmm.

Peter: That have been in businesses for 180 years or whatever.

Jesse: There are a million, billion businesses out there that do nothing with tech that have still got those functions. Sure.

Peter: Not only that, but 130 years ago when General Motors or whatever, railroad or Procter & Gamble or whatever company is, starting, like they know they need sales and marketing. So there’s a longevity there as well that seems to be allowing these folks to be less anxious and worried regardless of if they feel like they’re tired or overwhelmed.

And so part of it is likely due to the newness, right? Of all the functions, this is something I beat on. Of all the functions, particularly that have gotten some degree of first-level recognition within an organization in design and research it’s spotty, but it’s there. Design is the newest.

Design and Research

Jesse: Yes.

Peter: are the newest.

And so I think part of it is we’re still figuring out where we belong. We’re still figuring out what our mandate is. We’re still figuring out our value proposition, both ourselves and communicating it to others.

Which then leads to another contention that I continue to have, which is that design leadership is the hardest of the leaderships because of this. I occasionally get pushback on that, but there’s mounting evidence to support my contention.

But the design leaders are also just perfectly willing to shoot themselves in the foot and wallow in their ineffectiveness by not shutting up about craft, right? Like, lauded, elevated, vaunted members of our practice, their primary message is the importance of craft when literally no one else in their organization cares about that stuff.

And it’s fine. Craft matters. We all know that it matters. But if you as a design manager are spending most of your effort on ensuring craft within your organization and not effectiveness, right? The word that they used in this research was effectiveness. ” Not effectiveness” as a manager. And effectiveness I would expect it to mean, if you’re asking if a manager’s effective are they able to have an impact and get things done and move things forward or whatever, right?

Jesse: Mm-hmm.

Peter: Craft is interesting only to the degree to which it drives impact. But designers are really bad at caring about impact and caring about being effective, right?

And that’s where I … It doesn’t matter where they are in their organization, who they’re reporting to, or whether or not they’re set up to succeed. There’s still this mentality that many design leaders and design managers have that their job is not one of effectiveness and impact. And then they get dinged in surveys like this.

Jesse: So if I think about where the leverage point is on this topic it seems to me that it has to do with the tone that is set by design leaders, the culture that they create, and honestly what they hire for.

In that if you as a design leader have put in place a bunch of senior practitioners who are all craft-forward ICs, and that’s all you ever hear those guys talk about, you’re creating an environment in which these are the ideas that we care about, these are the ideas that get reinforced, these are the conversations that we have about design on an ongoing basis.

And it seems to me that to break out of the craft trap, the manager has to consciously, deliberately, intentionally drive a different kind of dialogue within the design team itself about what they’re doing and why.

Peter: I think that’s right. Some of this goes back to my mediate the membrane concept, right? Where the work of design is just so different from the work of the rest of the firm that designers are part of, and the role of design leaders is to serve as this interface between the two. And part of that is communicating to the design team the importance of understanding the business context in which they’re operating, ’cause that is how you become effective.

And vice versa, communicating to the rest of the company the distinct practices and value that design can deliver. We talk about not just clarifying a value proposition, but expanding that value proposition.

Jesse: Yes.

Peter: There’s work that the design team could and should be doing that’s likely not happening, that the design leaders need to articulate in some way that it will resonate with those folks outside of that design org.

And, that takes work to figure out how to land those messages. I had an interesting conversation this morning related to this. So I’ve been teaching a masterclass through IF Design Academy, the class wrapped up, so we were having a wrap-up conversation, and then we were talking about the most popular other class in the academy, which is on hold, hold… business and design.

The class that people are most interested in taking is basically an MBA 101 class. And it is far and away the most popular class because all these design leaders are like, “I need to understand business.”

The first thing that Garan does in his class is say, ” We are never going to talk about the business value of design. We are not gonna talk about clarifying the value of design. No one in the business cares. I am going to teach you about business. I’m going to assume that you’re like a, an MBA student, and you’re here to learn how business works, and that is what I’m going to teach you. Afterwards, you can figure out how to take what I have taught you and make it relevant to your world, but we are not here for you to justify or validate or whatever the business value of design because no one cares.”

And as this was being explained to me, I was reflecting on it. I’m like, ” Yeah, like, everyone else in the business understands that calculus…

Jesse: right

Peter: …except for designers.”

Jesse: Yeah

Peter: They all are just running spreadsheets and making, doing math or whatever the thing is to communicate in the language of the business. And designers just can’t get over themselves enough to just do that, to shut up about design for a while and just take part in that conversation.

Jesse: It’s so interesting how this stuff just keeps coming back to fundamentals. The fundamentals of politics and managing those relationships with your executive stakeholders as well as your cross-functional partners. The fundamentals of business and design and spreadsheets and all of that stuff.

Peter: As this was being shared with me, I was reflecting how 25 years ago, almost to the day or something, right, Adaptive Path published a report on ROI and design, right? And we talked about ARR, and we talked about NPV, and we talked about all this shit. And I’m just like,

Jesse: What’s

Peter: why isn’t it sticking, and why do design leaders continue to say that this is the most important thing for them to learn, say that this is the lacuna in their practice?

I heard that on my listening tour as well when I asked folks how they could be a better leader. Almost half of them said basic business acumen.

Jesse: Yeah

Peter: One, it’s not that hard. The heart of business is the simplest, dumbest math.

And it’s not like it’s been a secret for the last 25 years, much less, just, you’re in a business, of course, you should understand how business works.

It’s mystifying how there’s something about this subject that is just…

The image I have in my mind is designers look at this subject, and it’s as if they’re looking through a clear glass window, but then the glass turns opaque, and they’re just like, “Doop.” Just poof. Nope.

Jesse: Yeah, I gotta wonder about, I mean, first of all, I think it’s important to look at Noam’s study with, a bit of a grain of salt in that again, these are people who self-responded, people who were subscribers to Lenny’s newsletter. Design and research together only make up a little over 10% of total respondents to the survey.

Product management nearly closing in on 50%, 46.9. So nearly half the people who responded to this survey are coming from an entirely different perspective. In fact, almost everybody who responded to this survey is coming from a different perspective than the perspective of design and research.

And I would say the other thing is that it skews really senior because of his newsletter and its audience. So he’s got uh, right around 11% are people in design and research functions, and right around 11% are also people who are founders or, senior level executives. So, the founder class is as represented as the designer class in this data and it skews accordingly.

I thought this finding was hilarious that founders are the happiest ones in technology, ’cause I’m like, ” No shit, man. When has that not been the case?”

Peter: Well, yeah and the implication I would argue is that things would skew even more negative if these populations were normalized. And when they do slice it by these populations, you see that negativity shine through. ‘Cause I still think even though it’s only 10%, if you combine design and research, 10% of nearly 6,000 is still 600, right?

So that’s a decent population. I’m– I feel good about the signal he’s getting about design and research more than I would say about data and analytics at 3%,

Jesse: Yeah. Well, all I’m saying is that when he’s not talking about design research specifically, that data we ought to be looking at through more of a product lens, because those are the people who are responding. Yeah.

Unfinished: reclaiming the broader mandate

Peter: So something else I wanted to bring up, which kind of touches back on our podcast miniseries, Liminal, and our friends Jorge Arango and Greg Petroff, who have a business called Unfinishe. Because So I’m helping prepare or program the Design Leadership Summit in November, taking place in Toronto.

And as Preet, who is the primary organizer for the event, and I have been talking about the programming, we were batting around thoughts on theme.

And the theme that we are landing on is this one of unfinished. For me, it all started with our conversation with Roger Martin, and trying to figure out what happened after 2009 when there seemed to be this opportunity for design to be more expansive, to have that broader value proposition.

And then over time, that just narrowed and narrowed until starting around 2015, 2016, and we adopted product designer as our primary mode, and that was seen as someone who produces screens. And the AI moment has really highlighted that limitation, but also an opportunity, to recast our value proposition.

And as I’ve been thinking about that, I’m like, I feel a little bit like Jack from Lost. “We gotta go back.”

Jesse: Spoilers

Peter: Sure, for a 20-year-old television show.

And, go back to that period of fecundity and hope and potential that we were scratching at in 2006, ‘7, ‘8, and ‘9. And embrace that broader mandate.

And I’m hearing and I’m seeing some signals to that. Something I didn’t mention coming out of Config not a big thread, but a persistent thread, and I hadn’t only heard it at Config, is the rise of service design. Is this something that you’re hearing?

Jesse: A bit, yeah. Yeah. I mean, there’s definitely, I think, an increased interest and awareness of the value of it, if not necessarily… You know, the investment is always gonna lag that. But I definitely had more than one conversation with design leaders about service design at Config, and in the last several months it’s been coming up more.

Peter: Yeah, I’ve been surprised by that, and I think there’s just something about the overwhelming complexity that,

Jesse: I think

Peter: everyone is facing.

Jesse: Everybody needs more context in order to make better decisions, and if that context is something that can be incorporated into some of these AI-driven workflows, then that’s an advantage.

You know, my hope is that there’s mountains of good, valid service design work out there that’s currently languishing in PDFs on various shared drives that can be potentially unleashed here.

Peter: Going back to this theme of unfinished. So not just that we need to go back to 2008 and pick up that thread, though that’s part of it.

But this recognition that to a certain degree, design is always unfinished. I’ll read here some language that I came up with.

Design’s work is never done. You wanna treat design not as a fixed function, but ongoing infrastructure. The work of design is, if we get to Herbert Simon-land is to improve conditions. To be a designer is to always improve, and if you’re always improving, you’re never done, right? You’re never finished.

If I don’t wanna be down on things, when I’m trying to pick myself up and look at the potential, there’s potential. There’s some signals, like we just talked about with service design.

There’s some signals like we’re seeing some teams are shifting left as the production function is being…

Jesse: yes

Peter: …consumed by AI.

And I think as there’s an opportunity to reintroduce that broader mandate for design, hopefully, we can take advantage of the things we’ve also learned in the subsequent 20 years about doing a better job communicating, connecting with the people around us.

One of the reasons we struggled back then, or the mandate didn’t stick is, that expansiveness had very little to do with our express effort to make it so, and instead was more a reflection of forces outside of our control. Apple’s success and some other kind of realizations that like, oh, people want good experiences and are willing to pay for it. But not really driven by design.

And now 20 years later, how do we make that better case for ourselves to connect with these things and not wait for,

Jesse: Yeah

Peter: moments outside of our control to give us permission, but instead how do we make our own permission, kind of like making our own luck to do this broader work?

Jesse: Yeah. And I think that’s an example of what I might call out as the general pattern or the general recommendation that I would make here, which is to use your leverage to be the antidote to these negative trends.

If the trend is burnout, create a culture that better supports people. if the trend is disempowerment and commoditization of your team and its value, then fight for and work toward a less commodifiable…

Thinking again about the comparison with sales and marketing. They have skill sets and knowledge and expertise that is not easily replicated by automated processes. That’s why they feel secure. Find that same security for yourself and your team. I think the opportunity for leaders is to take the microphone, is to set a new tone, is to assert what’s true because in this place of chaos right now, going back to liminal, the chaos contains within it the seed of possibility.

It contains within it the opportunity to create a different kind of order out of this chaotic moment.

Peter: And it will require design leaders to lean on the leadership part of that phrase and not the design part of that phrase.

Jesse: Yes, exactly so Peter, thank you so much for the conversation

Peter: This has been great. I’m actually excited by where we landed

Jesse: Cool. All right. Thanks

Peter: Until next time.

Jesse: For more Finding Our Way, visit findingourway.design for past episodes and transcripts, or follow the show on LinkedIn. Visit petermerholz.com to find Peter’s newsletter, The Merholz Agenda, as well as Design Org Dimensions featuring his latest thinking and the actual tools he uses with clients.

If you’re looking for help with AI transformation or you just need a private advisor to help you solve your hardest leadership problems, visit my website at jessejamesgarrett.com to book your free one hour consultation.

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