Ethics doesn’t come up often in service design, so after the coverage of recent international financial crises and the Occupy Movement, I thought it might be worth pursuing.
Unfortunately, I'm a designer, not an economist. I had to go away and do some research, so here's what I found.
After initial searches, my research focused on ‘self-interest’, as the DNA, foundation and heart of business. As it turns out, the concept of self-interest is very old, and offers a proven framework for how a company can best work, both ethically and economically. For a service designer, that’s a very exciting and stimulating result. So here’s the brief and strange story of self-interest for your enjoyment.
1. Ruled by the passions
The concept of ‘self-interest’ was developed from the 1500s – 1800s as a way to counter the destructiveness of despotic rule and exploitative business practices. Its success rested in part on the view that business made people more peaceful and productive than strong political and religious beliefs, which invariably resulted in conflicts.
European history up to the 1700s was marked by despotic forms of rule with cycles of corruption, poverty, disease, internal conflicts, and outright war. Here’s a diagram showing how critics and thinkers of the time saw things.
 They observed kings and nobility driven by personal ‘passions’ – pride and ambition, greed and pursuit of wealth, and lust for sex and sensual satisfaction. When acting from these passions, a ruler might gain his immediate rewards, but gains for the nation were arguable and the side-effects were severe.
The Church’s approach had always been to use reasoned arguments, based on famous biblical figures and the virtues and lessons they offered. Their effects were observably weak. The result was a self-reinforcing loop with destructive side-effects.
2. Self-interest as a solution
Over the 1500s – 1700s philosophers worked on much a stronger case with increasing success. Their initial idea was to play the passions off against each other: to paraphrase, ‘if you want to be famous, restrain your pride and focus on achieving the results others will admire you for’. Unfortunately this gave reason a rather limited role, but it was clearly on the right track.
This is where the concept of ‘interest’ arrives in politics and business thinking. From the early 1600s thinkers introduced ‘interest’ as a metaphor for well-considered behaviour and applied it in politics and business. To paraphrase, ‘if you invest in good behaviour, the interest you earn will be disproportionately good for you, personally and organisationally.’ This metaphor came with benefits, as philosophers could now argue convincingly for careful reasoning and considering the needs of others. The ‘self’ of 'self-interest' was later added to emphasise individual responsibility, and to help distinguish individual from company or national interests.
 The radical new concept of ‘self-interest’ worked well in business, and was quickly popularised. It was realistic about people and practical about outcomes. It accepted the often-dark realities of human motivation, while providing practical ways to coordinate passions with reason and the needs of others. It was also easily scaled from individual to business, market and national interests. Here’s a diagram showing the structure of the new self-interest.
It was so well understood by the late 1700s that Adam Smith could use it, without explanation, to characterise the ‘invisible hand’ of the market. Self-interest now defined the quintessential business: collaborating with others to realise its own goals.
Self-interest originated in economies driven by sole operators, family businesses, and small enterprises: the origin of Adam Smith’s phrase, ‘a nation of shopkeepers’. The effects of an owner’s passions could be witnessed locally, directly and immediately. In economies where larger companies are common, self-interest might seem less powerful. But the concept also helps describe how the interests of owners, shareholders, executives, partners, customers and other stakeholders may be integrated. In recent decades the emphasis is very clearly on strengthening the left-hand loop: the process for defining a business’ self-interest, be it the market or the external forces that impact on it.
3. Self-interest is increasingly political
From the early 1600s criticism of business’ exploitative and monopolistic behaviours had been significant, both within and outside business. Criticism grew in the 1800s with the burgeoning side-effects of the Industrial Revolution and criticism itself became a key driver of change. Determined, well-reasoned criticism of business contributed to growth of leftist political movements, trade unions, regulation, social agencies, the welfare state, and more recently, new scientific and corporate disciplines (corporate social responsibility being an example of the latter). Criticism's impacts are cumulative and profound, as in relation to climate change and sustainability.
The intense criticisms of the last four decades are not new. They have re-emphasised the power of side-effects and their consequences for global stakeholders, including the environment. Business’ self-interest is being made more transparent and politicised by a wide range of stakeholders, from world experts to concerned citizens across the globe. The power of stakeholders in defining business self-interest is increasing slowly, and with this, emphasising more democratic decision-making and more collaborative forms of business design. These include models such as collaborative consumption and practices such as co-design, co-creation, open innovation, and in public services, as co-production.
We might argue that the above notion of self-interest is a dated relic, that today self-interest just means ‘selfish greed and stupidity’ and nothing more. Fair enough. Ideas and language change, and we shouldn’t hang on to impotent ones.
But the brief and strange history of self-interest brings us straight to the heart of a modern business: how do we gain our rewards and serve stakeholder interests through a business? The concept of self-interest is foundational and the key to business sucess, even today.
4. Summary: asking self-interested questions
What have I learned? Self-interest is the foundation and heart of business. It also happens to have a strongly ethical basis. By understanding self-interest better, we are better at doing business, criticising it, and designing it. Self-interest’s history is full of great ideas, different ways of thinking, and workable solutions.
Self-interest is an old and proven concept underpinning the process for designing a business. In designing different and better forms of business today, it’s in our collective interests to first define the self-interest of a business in full. | 
