By Janus Boye
Peter Merholz has worked at the intersection of design, technology, and humans for over 25 years. Currently, he’s an independent consultant focused on improving the effectiveness of design organizations. His clients include JP Morgan Chase, Ceridian, The New York Times, Roblox, and Starbucks.
He co-founded Adaptive Path, a globally renowned user experience consultancy, acquired by Capital One in 2014. After leaving Adaptive Path, he has served as a design executive, leading teams at Groupon, OpenTable, Capital One, Snagajob (now Snag), and Kaiser Permanente.
He co-wrote Org Design for Design Orgs, still the premier book on building in-house design teams, and co-hosts Finding Our Way, a podcast exploring design leadership. Oh, and, yeah, he coined the word “blog.”
Recently Peter kindly hosted an 'Ask me anything' session as one of our regular member calls. The conversation started with his book and took us through current design leadership topics onto his take on the recent tech layoffs, also named by some as a social contagion phenomenon.
A handbook for building in-house design teams
My copy of the book, which has helped me look good at a few of our recent design leadership peer group meetings.
As Peter explained, he had a job back in 2015, which he knew he wasn’t going to keep for long. He had been doing conference presentations on leading design with good feedback and together with his co-author Kristin Skinner, they approached O’Reilly about the book.
The book was published in August 2016, and as Peter said in the call, there’s still good stuff in there. It’s a handbook for building design teams, but his thinking has also evolved since then.
One shortcoming, according to Peter, is that the book really does not talk much about leadership. The role that leadership plays, shortcomings in leadership behaviour, and how leadership gets in the way is worth exploring further.
There aren’t many books on this topic, but if you want to read more, Peter mentioned this one as a related book: Liftoff! - Practical Design Leadership to Elevate Your Team, Your Organization, and You
The book also covers how people develop in their career. His current take, now almost 7 years after publication, is that the book has a somewhat simplified career framework. Today, companies often ask him to craft career architectures, which covers how you grow in your design career, how you grow as a design manager, how to shift tracks and how that informs recruitment and much more.
OK, enough about that seminal design book and onto a question that made Peter laugh:
Where should design sit within the enterprise?
Quick and to the point, Peter replied:
“What really matters is that the ‘head of design’ should be no more than 2 levels from the CEO in a smaller org, or 2 levels from the GM in a larger business unit.“
It’s the access to senior management that is key and less important, according to Peter, where in the organisation that the design leader sits. Being a part of the product team is common, and can work well, but experience design can also be a part of marketing.
Peter added one more interesting angle to this: About a decade ago, design leaders were not ready to be in senior management as chief design officers were not demonstrating that they could belong in senior management. Today, that has changed and design leaders increasingly understand business.
Where have you seen a perfect example of scaling design?
On this one, Peter hesitated a bit and said that while he has seen many good examples, it still feels like early days and too soon to have a perfect example. The conversation then took us first to change and then to metrics.
Peter opened by mentioning a few examples that come close though and referenced recent conversations in the Finding Our Way design podcast, which he hosts together with Jesse James Jarrett, one of the co-founders of Adaptive Path.
Together they recently interviewed several chief design officers, and what he found really interesting was that most of them talked at length about change management. Peter has written more about this in a recent blog post - Design leadership is change management - which opens with a quote on being change agents by Katrina Alcorn, GM of Design for IBM, where they have over 800 designers.
There was also one design leader, Daniela Jorge, Chief Design Officer at PayPal, who didn’t talk about change, but rather about vision, delivering on an end-to-end customer experience, growing and developing the next generation of leaders and taking advantage of design skills such as facilitation. As Peter said, she is probably as close to a really good example of scaling design as she’s really not trying to change things.
Referencing the podcast with the conversation with Daniela, titled the The Actualized Design Executive, she mentions that they’ve set up great systems and structures. She sees her job as keeping them going and providing guidance. Not as a change agent.
In May 2022, we had a member call on design leadership featuring Richard Dalton from Verizon. In the call, Richard shared their design operating model. Read more: Leading design at Verizon
Interestingly, Peter mentioned that Paypal has reached a point of maturity, where there are no metrics for design. Metrics lives at the initiative level, but it wouldn’t make sense to have separate design metrics at that high level of maturity. As Peter said, when design is super immature there are no metrics, but then as design matures it needs to demonstrate impact using metrics. Then, at some point, the value is just understood and then you no longer need to measure the impact of the function. So, at the most mature, you are no longer measuring the value of design, but measuring the impact where it matters.
Using data to match careers and future careers
One of our members shared an experiment they are doing on matching mentors and mentees based on data, rather than magic and personal connections. He asked if Peter had any experience using data for his career architecture and the short answer was no.
The longer version turned into an important point on how the career architectures that Peter has helped build allows for fluidity. In other words, it allows you to change tracks, something which many career paths don’t.
This means that people who are early in their career can look forward and see where they might want to go. The career architecture is flexible so people can hop tracks if they want. This is based on having core and elective skills, so if say, at some point a person wants to be a principal designer and then later a leader, they can see what is expected of them.
Getting back to the question: Peter could imagine using data to better connect mentors and mentees within this career architecture, but so far it’s been all manual.
Can innovation help elevate design to enable us to succeed in our careers?
Then we moved onto innovation and Peter opened his answer by going back in time to 2005 and a popular essay by Michael Bierut titled: Innovation is the new black.
In the article, Michael mentions that design kept being talked about as innovation, but as a design crafts person, design has value in and of itself, not just to do other things.
As Peter said:
“Design is about helping define new better outcomes”
Better outcomes is by definition innovation, but when you reach a certain level of maturity in design, you are not trying to do concept cars and grand gestures. Rather, as Peter said, it’s about using design to solve people’s problems in better ways.
According to Peter, he finds it problematic that too many design leaders try to convince senior management to do something bold and glossy, rather than fixing what’s broken. The focus should always be on getting the current systems working well. If you keep launching new stuff, the customers are frustrated because they can’t get anything done.
Going back to the previous point on change management, what you do need is a vision on what you are changing towards - use this to align an organisation around a common goal. Here, there’s a unique role that design can play, unlike any other parts of the organisation. But we don’t want design to be seen as a means of innovation. Design should always focus on the problems people are having today.
What would you say to designers that are viewed as short-term fixers?
As Peter said, this is quite common and this is where leadership comes in.
He mentioned that he’s working with the consumer branch at JP Morgan Chase. When their design leader, Kaaren Hanson, came in and saw most of the design team doing production work, she knew there was much more opportunity. This team needed to scale and do more, but when you don’t have enough designers, designers get fully booked on production.
Now the design team at JP Morgan has grown from some 350 designers to over 800. To get there, they’ve looked at the ratio of designers to engineers, and Kaaren has also helped her leadership understand the real value design brings.
Design should really be in every conversation at every level, but in order to make that happen, JP Morgan has been building a leadership level of designers. Today they have about 100 designers at director level or above.
Inspired by his work with Kaaren, Peter mentioned that this is about realising the importance of internal relationships. You need to have design leaders that can connect to peers at the same level across the organisation for design to be taken as a serious part of the conversation. Quite interesting according to Peter, how Kaaren has used relationship management as a key lever for design. Focusing a bit less on strategy or the quality of the deliverables, and more on relations.
By having leadership at those levels, you bring up the level of design, so that they can do much more than production. Kaaren has been helping her organisation and executive leaders understand the role that design plays.
And then, the final bonus question, which was prompted by the recent tech layoffs, but as expected Peter sneaked in a very good design leadership lesson in his answer.
What’s this social contagion?
Peter recently wrote a post on Linked, where he somewhat provocatively wrote:
“I suspect that the overwhelming cause of these layoffs is 'social contagion,' meaning, they're doing it because others are doing it”
The term comes from a Stanford study in December, which was mentioned in Stanford News: Why are there so many tech layoffs, and why should we be worried? To quote from the news story:
“The tech industry layoffs are basically an instance of social contagion, in which companies imitate what others are doing. If you look for reasons for why companies do layoffs, the reason is that everybody else is doing it.”
As Peter mentioned:
“Most companies doing layoffs don’t have a business case for it. Instead, the reason they are doing it is because everyone else is doing it.”
He also reminded us that scaling was also a social contagion. That is, when everyone hired like crazy in 2022, it was not because it was a sound and considered business choice. It was because everyone else was doing it.
So, what does this mean to design leaders? Peter was quite blunt:
“The lie that we tell ourselves is that people who run our businesses are making rational evidence-based decisions.”
That’s not true. As he said, we as designers, especially as we don’t know much about business, think that other people have figured it out, but it turns out that the managers haven’t figured it out either.
If designers try to be good and study economics and management, we are only going to be more confused. That’s not how decisions are made. Managers, at least most of them, make decisions based on what others are doing, not on what is rational.
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Thanks Peter for getting up early on the West Coast and finding the time to share with us! What a conversation! I recommend following Peter on LinkedIn for regular updates.
Learn more about design leadership
Design and UX has been a part of our community since the early days some 20 years ago. We’ve featured quite a few design leaders including:
One of our most popular member calls last year was on How to design for the human stress response.
The conversation continues in our design leadership groups and at our upcoming conferences, including the UX Connect 23 conference in June in Aarhus and the Boye Aarhus 23 conference.