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Mechanism Design meets UX

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Bringing together concepts from mechanism design and game theory with the classic mechanism design example of sharing a piece of cake between Alice and Bob.

We relate easier to stories, told through different human perspectives. The birth of Alice and Bob showed us that it was easier to understand cryptography through our favourite characters and communicate complex concepts.

If you're familiar with mechanism design, learn how to apply concepts from UX like personas, journeys and usability testing. And if you're familiar with UX, gain insight into what game theory, protocols and tokens mean in the context of users.

We'll be using a structured technique that we've run with several groups of designers in Australia to explore and experiment with their protocol design. We use the cake sharing exercise as a warm-up technique, which helps bring these concepts out of the land of the abstract where you act out the roles of real people and share real cake.

Moving on, we'll explore insights around complexity in actor interactions, and share the worksheets we've created so you can more easily conduct low fidelity experimentation with incentives, penalties, and design options across different industries and ideas.

@the_flightplan mail@theflightplan.io

Published in: Technology
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Mechanism Design meets UX

  1. 1. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN UXMECHANISM DESIGN ALICE CRYPTO-CURIOUS GRAPHIC DESIGNER “I want to earn money using my skills for blockchain projects”
  2. 2. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN A technology with power to redesign how people organise. We hope to see our vision and values come to life. What we implement now will create a future that will be our legacy. BUT HOW WILL THIS GAME PLAY OUT?
  3. 3. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Our focus is on creating utility and adoption. We work with the UX/Product/Design community. Our platform creates full stack Dapp instances without coding, integrating web3 UX patterns. DESIGN-LED USE CASES
  4. 4. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN UXMECHANISM DESIGN ALICE CRYPTO-CURIOUS GRAPHIC DESIGNER “I want to earn money using my skills for blockchain projects”
  5. 5. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN User Experience
  6. 6. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN UX Understanding the user’s experience when they interact with your product. Afocus on the emotional and functional details. From abstractions and assumptions, into how things work out in real life.
  7. 7. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN UX DESIGN APPROACH RESEARCH User interview Competitor analysis Value prop testing INSIGHT User journeys Personas User flows PROTOTYPE Wireframes Mockups Designs VALIDATION User testing Multivariant testing Simulation D iverge D iverge Converge Converge
  8. 8. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Personas Help bring to life different users, customers or other actors who participate in our ecosystem. See the world through their perspective ALICE CRYPTO-CURIOUS GRAPHIC DESIGNER “I want to earn money using my skills for blockchain projects” Currently a no-coiner but wants to learn more about crypto and blockchain
  9. 9. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Mockups and prototypes Rapidly implement your concept in low-fidelity. Allows you to start testing and validating your design directly with users Role play Paper prototype
  10. 10. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Simulation & user testing Get into the specific details of potential user behaviour and system outcomes by stepping through user’s action and watching how people use your product Different people simulating behaviours of different actors in the ecosystem Finding insights in the high and lows Patterns and extremes
  11. 11. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Mechanism Design
  12. 12. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Mechanism Design An approach to designing ecosystems and people interactions towards a desired outcome Aims to create compatibility between the goals of individual actors and the system
  13. 13. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTOR TYPES Actors and their preferences for different outcomes OUTCOMES Potential end results according to actor preferences GAME MECHANISM Strategies available to actors and how final outcome is determined MECHANISM DESIGN DISCIPLINE Stanley Reiter diagram illustrates a game of mechanism design
  14. 14. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN SYSTEM MECHANISM INCENTIVES TOKENS Alice, Bob and friends Goal of the System Game mechanics Outcomes Rewards Incentives Penalties MECHANISM DESIGN IN PRACTICE Privileges
  15. 15. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN SYSTEM MECHANISM INCENTIVES TOKENS Alice, Bob and friends Goal of the System Game mechanics Outcomes Rewards Incentives Penalties Privileges GAME THEORY
  16. 16. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Helps us understand the strategy model of actors in the system based on the expected payoffs for different actions, allowing us to identify potentially dominant or equilibrium strategies GAME THEORY A B C A (x, y) (x, y) (x, y) B (x, y) (x, y) (x, y) C (x, y) (x, y) (x, y) Player 2 Player 1 Example of a Payoff Matrix
  17. 17. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Strength in approaching complex human behaviour UXMECHANISM DESIGN Strength in economic discipline around system design
  18. 18. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Mechanism Design Apiece of cake?
  19. 19. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN The “Actors” We have 3 actors. We bring the actors to life by giving them personas. A role, and a quote describing their goal in the system
  20. 20. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN About the System The system describes the goal of the ecosystem and the item at the center. In this case the system aims to fairly distribute the cake SYSTEM GOAL Equal distribution of cake between Alice and Bob
  21. 21. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN 1
  22. 22. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Mechanism Design Options The Dad decides. Dad cuts the cake and allocates the slices. One child decides. Alice cuts the cake and chooses her slice. P2P Cake sharing. Alice cuts the cake, Bob choose the slice. These are the rules of the game. In this cake game we explore 3 mechanism designs based on the 2 actions: cutting the cake and allocating the slices
  23. 23. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY FORM YOUR GROUP 3 people Organise into groups of 3
  24. 24. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Instructions, worksheet, facilitating
  25. 25. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN 2 Dad cuts the cake & allocates the slices
  26. 26. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY 2 3 SIMULATION The Dad Decides Play out the first mechanism design, each person acts out one of the roles: Alice, Bob or Trent Capture insights on the experience and whether the system goals were met
  27. 27. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN One child decides & P2P Cake sharing
  28. 28. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY 2 3 SIMULATION One child decides & P2P Cake sharing Play out these mechanism designs, each person acts out one of the roles: Alice, Bob or Trent Capture insights on the experience and whether the system goals were met
  29. 29. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN FUNGIBLE OR NON FUNGIBLE?
  30. 30. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Penalties After doing something bad, penalised Rewards After doing something good, get a reward Privileges Special powers or authority granted Incentives Declared upfront in exchange for some action or outcome. 4 INCENTIVE DESIGN
  31. 31. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Adding the use of TOKENS Earned as rewards Taken away as a penalty Staked to access special privileges Secured for future transfer to incentivise Exchangeable for utility today/in the future
  32. 32. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY 4 DESIGN Incentive design & tokens Based on the insights, apply incentives/rewards/privileges/ penalties. Optionally add tokens
  33. 33. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY 5 SUMMARISE Your cake mechanism design Describe your mechanism design succinctly. If you have used a token, come up with a memorable name
  34. 34. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN YOUR CONCEPT
  35. 35. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN
  36. 36. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY YOUR CONCEPT In your groups, think of a concept ecosystem to simulate.
  37. 37. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN The System and Actors
  38. 38. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY 1 THE SYSTEM Identify the: - Actors and fill out the persona details: role and quote for Alice, Bob and friends - The centrepiece (e.g. cake) - The system goals - The actions that various actors take in the system
  39. 39. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Start with the current design
  40. 40. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY 2 MECHANISM 3 SIMULATION INSIGHTS Identify the: - Basic starting rules for the initial mechanism design - Which actors perform which actions Play it out and capture insights CURRENT DESIGN
  41. 41. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY 2 MECHANISM 3 SIMULATION INSIGHTS Create 2 possible variations to the mechanism design Play them out and capture insights FUTURE DESIGNS
  42. 42. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Incentives and tokens
  43. 43. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY 4 INCENTIVE DESIGN & TOKENS Based on the insights, apply incentives/rewards/privileges/ penalties. Optionally add tokens
  44. 44. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Summarise
  45. 45. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN ACTIVITY 5 SUMMARISE Your new mechanism design Describe your mechanism design succinctly. If you have used a token, come up with a clever name
  46. 46. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN CAKE DESIGN CONSIDERATIONS Ease of cutting Ease of eating Flavour popularity Fractionalisation Fungibility Low fidelity to encourage experimentation Thank you Patisserie Saint Tropez!
  47. 47. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN IMPLEMENTING
  48. 48. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN REQUEST FOR COMMENT 1. What did you find useful 2. How might we improve it 3. Want to get involved? Leave your details so we can get in touch
  49. 49. THEFLIGHTPLAN.IO@THE_FLIGHTPLAN Gendry Morales & Nas Munawar Twitter @the_flightplan theflightplan.io mail@theflightplan.io Thanks

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