Does anyone know how the corporate decision making works for designing their characters? Like, when Phase picked up Pippa, how did they decide she would be a rabbit with a bunch of hair clips and a patchwork sweater? Someone asked me this and I did not have a good answer.
I don't think there's a singular answer to that question; it will vary over time even within the same corporation. In addition to what's already been mentioned about Pippa and the cat model, there was also a stage in planning where she was going to be a tanuki (magic racoon) character, to play off of kitsune/tanuki lore in interactions with Tenma, whom she was friends with even before Phase. Sometimes there's a general concept/design ready to go, but the talent can request tweaks before finalization/rigging.
Then there are talent-specific situations, especially when someone is bringing their already-extant IP with them. For Sleepy, now a member of Phase's Invaders Quest generation, the broadest strokes of her original design (elf with long wavy purple hair) were kept, the particulars of the outfit were mostly determined by the artist (who is very well-known), with input from Sleepy requesting things like frog-themed accessories, and some aspects of the final design being something of a surprise to her (especially the chest size). It should also be noted that on her debut under Phase, Sleepy jumped essentially immediately from having ~200 CCV normally on YT to having ~1k-1.6k, meaning that even after the company takes its cut she's going to be earning several times as much as she used to.
But with a startup micro-corpo, you're almost certainly getting an off-the-rack model, because revisions cost money and most micros are running on shoestring budgets.
Regarding overdesign, that's something that changes over time. There's a definite difference in overall philosophy when you compare the models of Hololive EN's Myth generation to later ones like Advent and Justice.
