If you want to design a good villain, think in more simple terms. First of all, there’s no "hero" to your story. There’s only the Protagonist. The morality of his actions are NOT important whatsoever. (More on this later.) All that matters is what he/she WANTS to accomplish. Also, establish what he/she NEEDS (but is completely unaware of). The WANT is external - it’s a thing they can hold, or a finish line they can cross. The NEED is internal - it’s a realization they have to make, a change they must undergo. The ENTIRE story revolves around them starting down the road toward their WANT, but by the end they must realize the NEED - and the climax is either them transforming or failing. So that’s protagonist in a nutshell. From there, to answer your concern more directly, you’re going to need an ANTAGONIST. Don’t say ’villain’ because then that gets into the morality stuff that you absolutely must avoid. (...sounds harsh, I know ’villain’ is the common term, I use it myself, but you know what I’m getting at...)
The antagonist wants something in direct opposition to the protagonist. That’s all it is. Every plot movement the prot. takes forward - every choice he/she makes - must be met with CONFLICT. The hidden or direct hand of the Ant. must be present - either he/she shows up to fight, or his/her lieutenants are sent on his/her behalf. Or he/sh has laid a trap, etc. etc.
@A. White is right - the antagonist does NOT have to be an actual character. It can be a force of nature, or supernatural, or even just the voice in the prot.’s own head (good luck with that one, but it’s doable). Again, this is defined by the conflict that the story needs. (Your good ol’ man vs. man, self, nature, yada yada yada.)
Now... An explanation about why morality doesn’t matter: There’s no such thing as good vs. evil. - - Good vs. evil is boring. - - The hero/protagonist may think that what he’s doing is good. The thinking/belief/conviction part of it is all that matters. Now, Likewise, the villain/antagonist must believe that what they’re doing is good too. ...now you’re moving in the right direction.
So avoid labeling your conflict as good vs. evil. A step in a more correct direction after that is to think in terms of right vs. wrong. - - But even that isn’t the correct way to go. It’s better than good vs. evil, but right vs. wrong is also going to end up being something terrible.
...so what you ultimately want is Right Vs. Right. Let me explain...
The ’villain’ (ah, let’s just call him that!)... The villain views himself as the hero of his own story. What he’s doing is RIGHT. If you want a really powerful, resonant villain, then you need to make sure that his ideals are something that the readers will identify with, maybe not on the surface, but somewhere deep down. No matter how terrible, disgusting, horrific the villain is by his actions and beliefs, somewhere deep down the reader must say ’you know.. I can see where he’s coming from.’ ... ever read Watchmen? Ozymandias - the villain - did what he thought was right. And deep down, I somewhat identify with that. I listened to Tool’s song "Aenima" once too, you know. Sometimes I wish a catastrophe would befall humanity so that maybe, at last, we can all work together and live in peace... ......Holy hell what am I saying?!?!? ...see? Great villain.
So in the end, when you’re trying to make a great villain - always remember that it’s a matter of right vs. right. The villain, just as much as the hero, has to be someone that readers can identify with. Ultimately, the hero comes out on top. (....or does he?)
Sorry to supply such an elaborate answer, but these are the kinds of things that really set my writer-brain on fire! :D I love talking about this kind of stuff. I used to teach it, in fact. And I got all this story-structure stuff just boiling over. I would love to discuss further in this thread!