Co-written by RitaSue Siegel.
Design is experiencing a golden age, with everyone from CEO's, to workers and tourists now experiencing the value design can bring to their quality of life. Its growing success speaks to how well design and design businesses anticipate and engage in change, integrating technology with meaning into every aspect of their products, services and experiences. However, if designers' contributions to the bottom line are increasing, are they then securing commensurate compensation in this increasingly competitive environment?
As far as design is concerned, the most significant event of the last ten years is that everyone in business knows that they need a designer if they are going to compete. Increasingly, CEOs pay designers as much as their top performers in any other functional activity on the organizational chart. The average numbers for the year 2009, based on sixty-six respondents, for industrial designers from the Industrial Design Society of America (over 3,000 members) tell the story for the U.S., depending on region (average salaries):
Entry-level designers earn between US$42,000 and US$52,000
Designers earn between US$51,400 and US$74,000
Seniors designers earn between US$73,400 and US$85,400
Design Directors earn between US$125,000 and US$165,000
VP of Design, earn between US$180,000 and US$222,500
So the answer is clearly, "Yes," for the top designers in US corporate or design consultancies. However, for the second tier designers doing "meat-and-potatoes" design, their jobs have moved to China, Taiwan and Thailand. The US companies forfeited making cheap plastic stuff at home decades ago and the domestic furniture industry has been almost entirely wiped out by low-priced Chinese imports. Now, only high-end domestic and commercial furniture are still made in the US and many of those components are sourced abroad.
Designers traditionally embark on one of five paths: working in a corporation, working in a design consultancy, starting their own design firm, selling their designs to companies or else manufacturing and selling their own products. The cost of setting up shop continues to decline, therefore, the design industry itself becomes a "red-ocean" or the place with heavy competition, making starting a traditional design office less attractive. So could an alternative for startup design consultancies be to become a catalyst by engaging designers in for-profit or non-profit social entrepreneurship?
Over the past decades, social entrepreneurship has experienced a boom as well. Success stories such as Grameen Bank's micro loans to women, The George Foundation's Women's Empowerment Program, empowering women by providing education and cooperative farming continue to inspire and One Laptop per Child offering an inexpensive laptop designed for children in developing countries. Since social entrepreneurship projects are long-term as compared to product development projects, combining these two very different types of projects could help designers build competencies and produce meaningful results in commercial as well as public areas. For example, when the economy expands, design consultancies could create products or systems for corporations from new technology, cultivating markets and building capabilities. When the economy contracts, designers could phase from commercial products to social challenges, building the social and cultural knowledge base. Working in a for-profit organization teaches one skills that can then be used when working in non-profit, and vice versa.
Building and leveraging unique design competencies together with a broad understanding of what people need and want, through strategy, context and performance metrics is key to creating value. However, to capture more value for oneself, in the end, one needs to understand the economic landscape. Comprehending how designers are being compensated in competitive industries and being able to defend with data the value one has added, then allows one to negotiate a fair share of the pie.
Special thanks to RitaSue Siegel for researching and co-writing this article.