“We are moving into the decade of design: One where design, not just code, is at the center of product development and successful organizations. … it’s no longer optional to have good design.” wrote Peter Levine, general partner at venture capital firm Andreessen Horowitz, in his article “Investing in Figma: The Decade of Design”. For us, this confirms a shift we’ve been seeing for a couple of years in our own collaborations with clients, and the industry in general. A shift where the field of design has evolved from ‘being a production role that makes products and interfaces look good’ to being recognized as one of the driving forces in successful innovation and product success. And in the decade to come, we’re expecting design to take an even more prominent role in successful digital transformations.

2010 - 2020: Software is eating the world: the decade of code

Allow me to take you on a trip down digital memory lane, to August 20, 2011. On that day, Marc Andreessen—co-founder of Andreessen Horowitz—wrote the now-famous article “Why Software Is Eating the World”. The article perfectly described the software revolution that was coming, and how it would disrupt all major industries: “More and more major businesses and industries are being run on software and delivered as online services—from movies to agriculture to national defense. Many of the winners are Silicon Valley-style entrepreneurial technology companies that are invading and overturning established industry structures. Over the next 10 years, I expect many more industries to be disrupted by software.”
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Every company would become a software company, and so they adapted their strategies accordingly. Digital transformations were initiated and accelerated, aiming to pull software into the core of the business and product offering.
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But as the term ‘software’ implies, most of the digital transformations that took place in the past decade have been strongly technology-driven. Companies first invested in the IT & technology capabilities to pull software into the core of their business, and then focused on adapting the organization to deliver this software to the market (read: agile transformations). And while design has always played a role in these transformations, it has often been a merely supporting one. Of course it was important to provide a good user experience, of course it was important for user interfaces to be usable at least and delightful at best. But mostly, design found itself to be constrained in a narrow playing field of already defined business requirements and technical specs.
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Ten years ago, you could even argue it made sense for some companies. In the early years of the decade of code, companies could actually find a competitive advantage in simply having the software (vs. competitors who didn’t). Early e-commerce adopters easily took market share from traditional retailers—banks with an extensive digital offering won over the growing segment of digital natives. But alas, this competitive edge soon becomes difficult to hold.

Digital leaders adopt a design-led strategy

Digital leaders understood from the start that ‘running on software’ or ‘delivering digital products and services’ alone wasn’t a defensible long-term strategy. Having the software and technology capabilities weren’t the goal, they were just the enabler. An enabler for new and innovative business models (‘direct to consumer’, ‘as-a-service’ ...), and an enabler for evolving customer expectations (on-demand, omnichannel, self-service …). Seeing this, they took an entirely different approach to design, giving it more space than the previously described supporting role. These companies use customer research to understand changing expectations and guide the long-term strategy. They use rapid prototyping and user validation to make product decisions. They use design and customer experience as a strategic differentiator.

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This design-led strategy soon showed its business benefits. Between 2013 and 2015, the Design Management Institute performed a study in which they compared the market value of design-led companies relative to the S&P 500 companies. The results were quite impressive: the design-led companies outperformed the S&P by an extraordinary 211%.

2020: The Decade of Design

More than just benefiting from their own performance, these digital leaders collectively raised the bar for what a great digital product is. Being spoiled by the great experiences their products deliver, we’ve become not just critical, but flat-out intolerant for subpar experiences. And as technology touches our lives in more impactful ways, we’ve rightfully become more demanding. We want the technology to be serving us, not the other way around. More and more, a great user experience becomes the differentiator. Becoming a design-led company doesn’t magically happen overnight (unfortunately). It requires time, focus, and dedication. The most successful companies take a deliberate step-by-step approach for bringing design into their organization, and gradually increasing its strategic value. This approach allows for early wins and visible progress, acting as a catalyst towards the next step.

Five levels of design maturity

Building on our own decade of experience in designing products, platforms, and services for our clients, we identified five levels of design maturity through which companies can become more design-oriented, and ultimately design-led. Beyond our own experience, this model builds on a research report published by InVision, that was based on insights from over 2,200 companies worldwide.

Level 1: design equals aesthetics

~40% of companies currently find themselves at this level.

Companies in this entry level only focus on the visible aspects of design. UX and design are mostly seen as seasoning: sprinkled on top of technology or business-driven products, hoping to achieve ad-hoc usability improvements. Design work is typically performed by an individual or small design team, often working detached from other departments such as business and technology.

At this stage, design can already show value by improving usability and visual consistency. Yet, the effects mostly show in cosmetic changes and rarely translate to tangible business value.

Companies looking to level up from this level should first focus on cross-team collaboration. Designers should encourage other stakeholders to actively take part in the design process by hosting user validation sessions, design reviews, or ideation workshops. Collaborative design tools like Figma provide a great opportunity to include non-designers in the design process. Doing so will help colleagues understand that design is more than just pretty pixels on a screen.

"Design is more than just pretty pixels on a screen."

Level 2: project-based design

~20% of companies currently find themselves at this level.

Having developed a more collaborative approach to design, companies at this level usually allocate dedicated budgets and designers to projects. Design work is taken up in a cross-functional project or product team, usually through facilitated workshops. However, it still occurs that design recommendations get overruled by engineering or business processes, as they often have the upper hand in these teams.

Value in this level is noticeable through a better understanding of design and shared workflows between designers, product managers, and engineers. This mostly leads to internal efficiency gains and improved usability and customer satisfaction.

What’s still lacking on this level is a business-wide integration. As design is funded and practiced per project, value often does not transcend that project level, and inconsistencies across products increase. Two ways to level up are:

1. investing in design systems to boost collaboration, consistency, and efficiency across products;
2. investing in service design to better understand the relationships between the customer, the activities they take part in, and the touchpoints or products they use. Creating this holistic overview will highlight challenges and opportunity areas on the system level rather than just a single project or product.

Level 3: Methodic UX design

~20% of companies currently find themselves at this level.

Companies at this level will focus on clarifying the roles, responsibilities, and processes that enable design to scale throughout the organization and the product development cycle.

Typically we’ll see that design starts getting involved earlier on in the decision-making process. Many of the design practices (user research, sketching, ideation workshops, prototyping, …) are quick and inexpensive tools to visualize and validate often abstract strategic concepts. Even if most of the generated ideas will turn out to deliver little or no value, chances are high that the insights and learnings from a ‘failed prototype’ prove to be more valuable than the cost of generating and prototyping that idea. For those ideas and prototypes that do stick, the visual and tangible aspects of the prototype quickly help to generate a shared understanding among stakeholders.

At this level, however, the design work and processes are still largely internally focused. A lot of design is happening throughout the company, with efficiency and scalability as key benefits. But what’s often still lacking, is how all this design work leads to actual customer and business value.

In order to level up, companies should invest in their research, experimentation, and validation skills.

Level 4: Strategic UX culture

~10% of companies currently find themselves at this level.

Looking to better understand and prove the business value design can bring, companies at this level will focus heavily on making design more data-driven. This materializes in a couple of ways:

• design starts taking place even earlier. User research is set up to uncover customer needs and opportunities before diving into solutions or technologies. Design informs strategy, rather than merely executing it;
• during product development, prototypes are consistently used to validate hypotheses before building or launching the product;
• product analytics and A/B tests are used to measure and improve the performance of live products.

Another key characteristic of this level is the important realization that good design requires more than a team of expert designers. Where in the previous levels, design would scale by growing the design team, this level requires design skills throughout the organization.

"Executives play a key role in supporting and sustaining the strategic design culture. Not just through funding, but by openly declaring and driving the strategic role design plays in the business."

Level 5: UX leads the company vision

~5% of companies currently find themselves at this level.

With all the key elements—the design team, processes & collaboration, success metrics, …— in place, companies at this level are ready to become truly design-led. Differentiating through a superior user experience is no longer an ambition, but an integral part of the business-wide strategy.

Companies at this level have made the commitment to put the customer front and center in their business strategy, product roadmaps, and the entire organization. This outside-in perspective allows them to:

• continuously inspect and adapt the business strategy based on changing customer expectations;
• design and deliver winning cross-platform strategies built around customer journeys rather than internal departments;
• create a sustainable competitive advantage by leading the market instead of trying to catch up with competitors.

Thriving in the Decade of Design

"In the coming years, we expect that a lot more companies will give design a more prominent place in their organization and digital strategy."

We hope that our five levels of design maturity will provide a tangible starting point for assessing your current maturity level and defining a pathway for growth.

Should every company aim to reach level 5? Although we’d like to encourage you to do so, the more thoughtful answer is ‘probably not’. While we’re deeply convinced that pursuing a design-led strategy is one of your best shots at digital success, there are other ways to succeed as well. However, what we do want every company to realize is that the table-stakes expectations for good design are increasing. It’s no longer optional to have good design. We expect ‘level 3: methodic UX design’ to soon become the new entry level, as our tolerance for fragmented experiences across digital products will drastically decrease. If you currently find yourself at level 1 or 2, we’d strongly recommend you invest in the described tactics to reach level 3. Happy to see you’re already at level 3 or above? Then definitely don’t settle, as your competitive edge is only sustainable if you continue to level up.