Ethical Risks in Service Design

The trend of incorporating systems, platforms, and service ecologies represents a fundamental shift that has a great impact on human relationships. Examples like Starbucks, Apple, and Google demonstrate how service systems have the potential to reshape industries and improve user experiences.

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The Risk

Service design is promising, but it's not without ethical risks. Take Uber, for example. While it facilitates countless rides, it also extracts a substantial percentage from drivers—often exceeding 10%, and in some cases, 25% to 50%, according to Reddit discussions. Drivers and passengers might benefit more from engaging directly without platforms like Uber taking large cuts from their services.

"When products become commodities, manufacturers look for ways to differentiate them— ways to make them unique again. For a time, quality materials, quality manufacturing, and quality product design offered differentiation. As competitors begin to match quality, businesses must look elsewhere for differentiation and value." (Connecting things: Broadening design to include systems, platforms, and product-service ecologies)

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Expanding into service and system design can sometimes feel like a way to create ongoing needs for profit. Platforms such as Uber and Airbnb charge significant service fees, creating tensions between users and providers. This raises questions about fairness and sustainability. Innovation must be balanced with ethical considerations, and the risks of such designs must be thoroughly understood.

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Being Transparent

Transparency builds trust between users and providers. When customers understand the fee breakdown, they are more likely to feel valued. Designers can communicate this via clear visualizations or infographics. Additionally, providing detailed explanations during the booking process and having dedicated sections to explain service fees can enhance user trust.

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Adding More Value

If customers feel a service fee is unjustified, they may seek alternatives. Platforms can address this by offering additional value, such as enhanced customer support or unique features. Gathering user feedback on their experiences can help adjust offerings and improve satisfaction.

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Tiered Pricing

Customers typically prioritize fair pricing over added services. Companies need to balance cost with quality. Offering tiered pricing models, where customers choose the service level, or subscription plans for frequent users could provide better value. Dynamic pricing based on demand can also ensure customers feel they are paying a fair rate.

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What If No One Wants to Pay

Businesses often worry that tiered pricing will push customers toward the lowest option, reducing revenue. Companies can enhance higher tiers by adding exclusive benefits, such as priority support, faster service, or special promotions. Framing these offers as valuable or exclusive can entice customers to spend more, even if the value is somewhat perceived.

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In conclusion, ethical service design demands a balanced, socially responsible approach. Innovation and efficiency are essential, but fairness, transparency, and equitable value distribution must also be prioritized. As designers expand into complex service systems, we must do so with awareness of the ethical implications of these transformative changes.