Entrepreneurs are problem-solvers at their core. Creating solutions is about adding value and enhancing people's lives. In order to enhance people's lives, solutions have to be both effective and responsible.

No one needs convincing that product effectiveness should be top of mind. Quality products that do what they set out to do are often adopted, used, and even loved by the consumer.

But how often do we hear praise for responsibly designed products that handle users with care? Effectiveness without responsibility can lead to products that are, at best, not truly in service of the user and, at worst, manipulative and deceptive.

In a world where tech behemoths like Facebook are mishandling user data, and phones are designed to be black holes for our attention, we have to talk more about entrepreneurial responsibility.

With Entrepreneurial Power Comes Great Design Responsibility

One way to ensure new solutions are both effective and responsible is to properly leverage existing knowledge about the way people behave.

Our environment shapes our behavior-- and there is no absence of that dynamic. Even the smallest of details, intentionally designed or not, can move you to make a decision in one direction or another.

As an entrepreneur, you must think of yourself as a designer of environments-- and therefore an influential driver of human behavior. Given this power, it is crucial to look to existing knowledge-- particularly findings from experimental research-- to inform your product design.

These insights can and should be used in service of society-- to design experiences to influence behavior in a positive direction that is in the user's best interest. Otherwise, you risk unintentional harm because of unintentional design (or worse, use behavioral insights to influence for selfish gain at the expense of the consumer).

Taking Responsibility to the Next Level

While you can easily begin with making informed design decisions, responsibility goes far beyond the setup of choice environments. Holistic and proactive responsibility seeps into all the ways a company can act with integrity in their corner of the world.

Take Lemonade, an unusual insurance company, for example. (Dan Ariely, head of Duke's Center for Advanced Hindsight where I run a startup incubator, is also the Chief Behavioral Officer of Lemonade). The company is structured such that premiums are treated as the policyholder's money that goes right back to them in the event of a claim (not as profit for the insurer). After Lemonade takes a flat fee, premiums are freed up to pay claims, and any leftover money is donated to causes policyholders care about.

Lemonade exhibits effectiveness and responsibility in three important ways:

  1. Product: The Lemonade app's UX/UI makes it easy for users to quickly file claims. This function is in service to the customer, unlike typically cumbersome filing processes. They also use AI to verify and pay out claims with unprecedented speed.

  2. Mission: Lemonade's underlying social good mission realigns incentives to enhance trust, accountability, and reciprocity between and among policyholders (and Lemonade has intentionally built on research on these concepts). Unclaimed premiums go to user-selected causes rather than to the company's bottom line. Money is pooled with a peer group of policyholders that care about similar charitable causes, so that you're less likely to embellish a claim at the detriment of the group's donation.

  3. Company Values: Lemonade values and demonstrates transparency as a company. Lemonade's API is open and they are forthcoming with their wins and losses, publishing transparency reports annually.

Lemonade squarely checks the effectiveness and responsibility boxes by shifting the typical insurance dynamic to be more responsive to users' needs.

Start with Research-Backed Design

Not every company is perfectly fit to attach its core goals to a social good mission, or to make concerted efforts towards Lemonade-level transparency. But all entrepreneurs can equip themselves with existing knowledge in order to design solutions for humans from an informed and conscientious standpoint.

The body of behavioral science research provides insight on the drivers of decision-making-- and this is a good place to start in pursuit of effective and responsibly designed products.

Proactive responsibility will differentiate companies, marking them as true servants of their users' best interests. If you design processes and tools that people interact with and make decisions through, then it's a no-brainer to first and foremost put academic research to work for you-- to enhance effectiveness, for the good of your business, and responsibility, for the good of your users.

Published on: Apr 18, 2018