Budgeting: The Art Of Show Vs. Tell

Kevin Lee at UXDX Europe. Video: https://youtu.be/9WQ6OYeRvu8

Readable transcript: edited from the recording's captions for readability (fillers and false starts removed, punctuation and section headings added). Wording is the speaker's own. Timestamps are positions in the video. Names marked [?] could not be verified against the audio.

Budgeting is persuasion

[00:00:04] Kevin: All right, good afternoon, everyone. If you noticed, I'm the second speaker today who is using the podium; we're just trying to break the pattern. The topic I'm going to talk about is budgeting, which is a really fun topic. I'd like to ask a question: how many of you are actually in a position where you're responsible for a budget? All right, there are some. OK, it's not bad. So those who didn't raise a hand, you don't care about budget? Is that what it is?

[00:00:30] Budgeting is tough. When I was asked to talk about this, my entire presentation was about five slides, because that's all there is to getting the budget that you need, and I had to extend it to fit into the 25 minutes. So this is where you're going to come in to help me fill the gap. I have to show this; there's a company policy.

[00:00:59] Now I'm going to start with this. Does anybody recognize this buddy? Or I shouldn't say buddy, but this person.

[00:01:08] Audience: What is that?

[00:01:10] Kevin: OK, close enough. Can you speak up? Right, he's Aristotle, one of the greatest Greek philosophers. Now, what does he have to do, a guy from 2,000 years ago, by the way, with budgeting? Can anybody take a wild guess? By the way, those of you in the front row, you are my go-to. You'd better answer the question. So, anybody? This is very important, because if you don't get it, you lose the rest of the presentation.

[00:01:50] Audience: You will see four [?].

[00:01:52] Kevin: OK, that's good enough. The reason that he's relevant is because he is almost the founder of this whole thought of persuasion. His philosophy is around persuading people to do something that he wants them to do. And at the end of the day, budgeting, whether you want to get budget or you're going to give someone a budget, is all about persuasion. So far so good? I need to make sure that you believe what I'm about to tell you.

[00:02:23] There are rhetorical principles that he shared over 2,000 years ago, and those are around three principles, which is what I'm going to build the rest of the presentation around. The first one is ethos, or, translated into this context of budgeting, credibility. The second is logos, or logic, again in the context of budgeting. And the last one that he talked about was pathos, which is emotions.

[00:02:58] These three things are very important, and not just for budgeting but for everything that we do as designers. I assume you're designers in this room; if you're not a designer, you should be in the other room. I'm going to tell a lot of stories and case studies about how ethos and logos and pathos are so foundational, the things that you have to keep in mind in getting into the budgeting conversation, and the type of budget that you need to get to do the things that you need to do.

Ethos: reputation

[00:03:34] So let me dig into the first one, about credibility. Within credibility there are two things I want to talk to you about. To many of you it's straightforward, but it's very important to know how this is relevant and how you can translate that into your actions. First of all, it's about reputation. How many of you honestly think that you really have a reputation? Thank you for your bravery. There are a few. The reason that you didn't raise your hand is because what? You don't think it's a bad one? OK, that's one way. But be honest, come on. This is all interactive; I need to consume the 25 minutes I have. What you're saying honestly is a really important dialogue.

[00:04:24] Audience: Ego.

[00:04:25] Kevin: Ego. OK, that you think that you're better than others, so you didn't have to raise your hand?

[00:04:29] Audience: No, the other way around.

[00:04:34] Kevin: What's good about reputation is this: it's one of those topics that you have little control over. You may think you have a reputation or you may not have a reputation; it doesn't matter. What matters is that people next to you are going to perceive you one way or the other, whether you like it or not, and they will form their opinion about you, and that becomes your reputation. That's a really sad reality. However, in the context of budgeting, it's incredibly important for you to build a reputation.

[00:05:08] So what you need to do now is forget about your past. Past as in five seconds ago. Those who didn't raise a hand, now it's time for you to act, in the present, and do something different about it. So when I ask you a question in a few minutes in this presentation, you want to participate, you want to raise your hand, and you want to answer questions. That's how you rebuild your reputation. Pretty straightforward. It's just that your ego or your mindset is in the way of getting where you need to get to. All right, so far so good?

[00:05:47] Now I'm going to tell a story to build on my assertion. Another question: does anybody recognize these two logos? OK, so the top one is frog, and the bottom one is AKQA. What do they have in common with my talk here, other than that they're among the top 10 global design innovation agencies around the world? Anybody want to guess? Well, it has to do with these two people. On the top is Patricia, who is a former founder and CEO of frog. At the bottom is a guy named Jeff Norcott [?], who manages a lot of studios for AKQA, mostly in Europe and Asia.

[00:06:44] The reason that I use them as an example for reputation is this. When I moved from San Francisco to London to build up a new design function for Visa, putting aside my global role, I met a lot of people, because I really didn't know Europe. I'd been here many times but never lived here before, so I had to connect with a lot of people who could give me some sort of guidance. And Patricia was one who I met in San Francisco, and she said, "Kevin, when you go to London, you must," she used the word must, "meet this guy, Jeff." I said, "Who is this guy?" And she said, "Well, he runs a few offices for AKQA." And as soon as I heard AKQA, is there anybody who works for AKQA here? No? Good. I had this allergic reaction, because I just did not want to work with AKQA.

[00:07:36] However, I'm working with them right now. So that's the flip side of the story. The reason is that she came with a highly credible reputation in the world of design. Anybody in the design world should recognize her name, or the agency that she came from, that she founded with her husband. So I met the guy. Long story short, he had another reputation I did not know about. It's a regional reputation, not a global one, but it was something that I was really sold on.

[00:08:04] The point I'm trying to make here is this: you have to do the homework, and sometimes it's reciprocal. You may be the receiving end of a budget or you may be the one giving the budget, but you have to do the homework of understanding who that person is. The reason that Jeff impressed me a lot is that he actually studied my LinkedIn profile from top to bottom, and he asked a lot of questions that honestly a stranger wouldn't care about, from my school to my first job to some of the LinkedIn articles I wrote. He literally spent time to really get to know me. That is the investment you need to make to regain or rebuild your reputation, because it's a two-way street.

[00:08:51] The second lesson learned about reputation is that you have to request an introduction. People in those positions have what they call a social circle, professionally and socially. You need to get into their circle somehow. That's the number one task for you to either gain or regain your reputation, and that starts with a really authentic conversation that you need to have. Through that you get connections, more than you could ever get on LinkedIn, for example. I'm sure a lot of you are spending time today and tomorrow connecting with one another. That's OK, but try to build that introduction through another person that you know who's reputable.

[00:09:39] And lastly, it's about making a lasting first impression. Those of you who have dated someone know what I'm talking about. Making that impression the first time is going to guarantee you at least another date, if not marriage, if not happily ever after. So that's pretty straightforward.

Ethos: demonstrating credibility

[00:09:55] But let's get into a more complicated topic. The other thing that matters for ethos, or credibility, is demonstrating your credibility. Let me ask another question. I just talked about reputation. Does anybody see a correlation between reputation and credibility? This is a tough one. Yes, you raised your hand, so you'd better speak. OK, I'll give you a pass.

[00:10:31] Reputation is all about relationships; it's relational, and it's about how you actually build your credibility. Credibility, on the other hand, is actually what you do: basically achievements, and the things that you are capable of right now. The reason it's important to discern them, and to focus on this one, is this. What do all these brands have in common? Speak up.

[00:11:06] Audience: They're companies.

[00:11:06] Kevin: Yes, they're companies. These are the companies that I have worked for in the past 20 years. The reason that I mention this isn't so much to show that I came from all these different backgrounds. It's about how I failed at every single one of those companies at least once, and how I then regained and rebuilt that credibility. The way you do this is pretty simple: you have to be honest about the failures you had.

[00:11:38] Oftentimes we are the type of profession that's trained to talk about accomplishments. The gentleman in the front talked about ego. We have so much ego that the last thing you want to talk about is the failures that you've had. But on the other hand, failure is what makes a very strong candidate for what the next job is looking for. That's one thing that I really learned from all these companies. There are traps that you're going to fall into, and what the leadership, or whoever is about to trust you with budget, is looking for is you demonstrating humility: that you are a human being, you have shortcomings, but you can now demonstrate how you can do better with the failures you've had.

[00:12:20] So there are three lessons that you need to take away from this, other than all these companies that you may hope to work for in the future. First, you've got to build a very strong portfolio. This is something that I talk to a lot of people about: sometimes going into other industries. I don't know where you come from; you're all from different backgrounds. But think about staying in one industry. For example, those of you who work in commerce probably don't want to leave the commerce world, whether because it's the hottest industry or because it's comfortable. But I encourage you to actually take a leap of faith and go to a random industry, whether it's healthcare, whether it's IoT, whether it's the service sector, because that's how you build a portfolio, not within the vertical that you're going to be in for 20 years.

[00:13:09] There's nothing wrong with that, by the way. I'm not making any point other than this: if you want to build a portfolio to build a reputation and credibility, sometimes the easiest way is just going into a very different industry, gaining two, three, five years, and then coming back. Because when you come back you become incredibly competent, someone that companies are going to want, and therefore trust with all the administrative stuff, including the budgeting, that you really need to manage for the organization.

[00:13:40] The second thing is really about developing your personal brand. As I said before, this is really about your style of communicating, how you interact with each other, and how it becomes foundational to build your credibility and reputation. For example, a lot of people, myself included, make a bunch of mistakes. I think in one of the presentations earlier, maybe it was you, someone talked about not hiding behind email. If I relay that message: emails are either a fast track or a derailer for you to build credibility. We often misuse email as a sort of revenge, or as a way of defending yourself, but that also leaves a trace. So if you want to really build credibility, keep the email very short, to his point. Pick up the phone, have a face-to-face conversation, and don't leave a trace, because once you leave a trace, it's really hard to regain that type of credibility. That's something that you can probably do right away: stop emailing each other and start picking up the phone.

[00:14:54] The last one is about removing any feeling of doubt. As I said before, this is all about failure. You have all experienced failure. You might have failed yesterday, before you came to this conference, and you feel down, and you want to talk to some speakers and presenters for some tips and guidance. But the fact of the matter is, because you failed, or didn't quite succeed as you wanted to, you're now a much stronger person than yesterday. So embrace failure. Be honest. Talk about why you made a mistake, because no one's going to penalize you for being honest. That's one thing that is very important to build credibility. OK.

Logos: be specific about what you want

[00:15:32] Now the next thing is about logic, and it's about being very specific about what you want. This is something that a lot of people are asking about, and I'll give you a really quick story. This is a person. I'm not going to quiz you, because you probably don't know this person. It's Carrie, one of my top designers, who I've worked with in three different companies so far. Those of you who work in the commerce world, marketplaces like eBay and Amazon: she came to me one day saying, "Kevin, I need half a million, and give me two months, and I will show you what this new marketplace needs to look like, so that we can actually build it."

[00:16:15] Quite daunting. A principal designer comes to you with that amount of money and that duration, and you kind of think it's crazy, but I believed it. And long story short, she succeeded immensely, to the point where the current marketplace you see on ebay.com is somewhat an indirect result of her work. The point I'm trying to make here is very simple. When someone makes you a request, as either a budget requester or a budget receiver, and they're being very precise and very concise, trust them, because they know what they're doing. If someone comes to you with elaborate slides or PowerPoints and they try to convince you, don't trust them, because they don't know what they're doing.

[00:17:00] That's exactly how the industry works, because for most of the stuff that you are working on today, you are not the first one. That is one of the things that we have to take away: you're not the first one who's working on it. So why are you elaborating a lot of things that you can easily be concise about, by pulling things from the places where people have done it for you?

[00:17:21] Number two is about conveying a clear demand. Again, she came to me with an unforgettable number. I really felt like that was almost half of my budget, that I had to give to one person for two months. What was I going to do with the other 10 months? But when the specific demand is clear, that means that person understands how, and therefore the someone who's about to decide whether to give out the budget or not tends to be pulled towards the magnet that this person brings to the table. So it's not about the passion; it's about being clear about the demand that you're asking for. By the way, this is also about understanding how you can chunk it. She could have asked for one million, but she chunked it down to half a million, because she knew what she could deliver with the other product people and researchers in the company. So it's about understanding and being programmatic about it.

[00:18:18] The last thing is about highlighting the why. Again, the reason that I was convinced is because at the time, the eBay marketplace was a really stinking experience, those of you who remember back to the early 1990s. So it was pretty daunting; we had to do something about it, and no one was doing anything about it. The product team was a little bit conservative, talking about incremental A/B testing. So we as design needed to take a leap of faith, and that was a pretty obvious bet that we had to make, which fortunately panned out.

Logos: what's in it for me

[00:18:52] Another example of the logic principle, and this is very important, is: what's in it for me? This is the number one question that everyone asks. If you come to anybody with, "Hey, I need anywhere from 50 grand to 500 grand," the number one thing in their head is, "Well, what's in it for me? I hear you, but what's in it for me?" And it's not so much a selfish response.

[00:19:15] Here is an example of demonstrating APIs. Those of you who are familiar with APIs: Visa is a platform full of APIs that anyone can build on top of to create commerce and payment experiences, and this is one of the big customers that we're working closely with. But no one understood the APIs. They really understood the consumer experience, but they didn't know how to translate it. So what we did was we basically built a prototype out of all the APIs that we can consume at Visa, and we built it into a very beautiful experience that actually helped clients, but also internal teams, to understand what it is that we're actually trying to communicate to the world.

[00:20:00] That is a very important part of the lessons learned. Number one: visualize where possible. If you're a designer, you need to use mockups or prototypes as your primary language. Do not fall into the same language that the product team is using or developers are using. You have that artistic value that you need to use for maximum benefit. The second one is honesty. When we did this, we didn't claim that we knew all the APIs. We actually invited all the product folks to help us understand what those APIs were doing in terms of consumer experience, and then we translated it as quickly as possible. And lastly, make the decision easy by building this prototype. That's the fastest way to get someone to make a decision, whether go or no-go. The consequences don't matter; your job is to help someone make a decision faster. That's how these principles come in.

Pathos: familiarity and a common language

[00:21:05] I'm moving into the last one, which is emotion, or pathos. Familiarity is another key one, and this is something that I think most of you know how to do, but I'm going to reiterate the importance of it. This is our president, Ryan McInerney. He's standing in front of 3,000 of our clients, at something like a Google I/O type of event for Visa, and he's showing a prototype vision that we as a design team built. It wasn't on the product roadmap, but he showed it to all the clients of the world. The reason he did it is because he saw how compelling it was, and that it helped build familiarity: familiarity of language, familiarity of strategy. So he actually chose to use it in front of all the 3,000 clients that he was hosting.

[00:21:56] That's another example of the power of building that familiar language, not from a design perspective but from a business perspective. Oftentimes we shy away: "Oh, I don't need to know the business jargon. I don't need to understand the business strategy." In fact, you have to embrace that first, before you start talking about the value of design and design thinking and all the things that come with your profession.

[00:22:22] The quick lessons learned here are very simple things. Use a common language, but it's not a design language I'm talking about; it's a business language. We need to use the business language consistently with stakeholders to make sure that they open up their wallets. Number two, use prototypes. How many of you are actually using prototypes as your only way of communicating? Very few hands. I challenge you to use prototypes before you communicate with PowerPoints or Keynotes with a bunch of words. If you're a designer, you have to use the language that you know how to use best, because that language is the one that connects emotion to emotion and heart to heart. So don't rely on another language that you're not quite familiar with.

[00:23:07] And lastly, build stories around real people. We often talk about human-centered design, user-centered design. That's important, but your stakeholder is also very important. If not, they're the most important human being that you ever need to care about, before you go to the consumers, because if they don't listen to you, nothing else matters to you anyway from the company perspective. So what we did was always include our president, Ryan, as a persona, and then we built things around him, so that we understood how he sticks with the story. And we also iterated along with that, not necessarily about building a final product, but trying to get to the budget stage where we really needed it most.

Make yes the only answer: the design system

[00:23:49] Make yes the only answer. One way to do it is to build a design system, and I'm going to show a quick two-minute video, because I know I'm running out of time.

[00:25:50] OK, I know I'm over time, so I'm going to wrap it up with this one message. What you saw was done internally, fully in-house, and it demonstrates the combination of prototype, APIs and a design system. I know we talk a lot about design systems, but if you don't have a design system in place, I really, really urgently ask you to start investing your money and effort to build that first, because without it, none of those budgeting conversations can ever happen. At the end of the day, what people are asking is, "How am I going to scale that? OK, I hear you, designers, you're asking for one headcount to help build this out, but how am I going to scale it to all my 200 products?" That's what budget holders are asking, and the only way to justify it, unfortunately, at this point is a design system.

[00:26:41] So with that, before I get kicked off the stage, I just want to leave you with these three thoughts. Again, I rushed through it. I guess I lied that it would take me 15 minutes rather than the entire 30 minutes. But this is really important, and I might not have delivered it as effectively as I wanted to, but I want to challenge you to leave this room with these three philosophies, or principles, and apply them, because these are things not just for budgeting but for your own profession and the contribution that you can make from a design perspective. So with that, thank you so much.