As cloud computing and developer tools made software easier to build, competition surged. This shifted business value from pure engineering to design and user experience, which became critical for standing out. Design went from a cosmetic afterthought to a core strategic function.
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As AI makes it easy to generate 'good enough' software, a functional product is no longer a moat. The new advantage is creating an experience so delightful that users prefer it over a custom-built alternative. This makes design the primary driver of value, setting premium software apart from the infinitely generated.
Atlassian's CEO argues that as AI makes software creation cheaper, the key differentiator becomes design鈥攈ow a product feels and works. This is a scarce resource that is much harder to copy than features, making it the new source of competitive advantage.
Designers once felt like imposters, but the profession grew rapidly, championed by figures like Steve Jobs. Now, design has a "seat at the table" and is recognized as a critical differentiator and a core business process for problem-solving, not just aesthetics.
In the dot-com era, design was a superficial afterthought. Today, with increased software competition and user expectations set by companies like Apple, design is a critical factor for a product's success, influencing function and user experience, not just aesthetics.
As AI accelerates software development, basic functionality becomes table stakes. Figma's CEO contends that differentiation and winning now depend entirely on design, craft, and a strong point of view, as 'good enough' products will no longer succeed.
As AI makes software creation faster and cheaper, the market will flood with products. In this environment of abundance, a strong brand, point of view, taste, and high-quality design become the most critical factors for a product to stand out and win customers.
AI tools are dramatically lowering the cost of implementation and "rote building." The value shifts, making the most expensive and critical part of product creation the design phase: deeply understanding the user pain point, exercising good judgment, and having product taste.
The obsession with lean methodology has created a market of low-quality, uninspiring software. In this environment, building a polished, considered, and beautiful end-to-end product is no longer a luxury but a true competitive advantage that stands out and inspires users.
As AI lowers the barrier to creating functional software, "good enough" products become mediocre. To stand out, companies must differentiate through superior design, craft, brand, and storytelling, moving the competitive battleground "up the stack" to more subjective, human-centric values.
The era of winning with merely functional software is over. As technology, especially AI, makes baseline functionality easier to build, the key differentiator becomes design excellence and superior craft. Mediocre, 'good enough' products will lose to those that are exceptionally well-designed.
