OD & HRBP PRACTITIONER, L&D Leader - HR Policies | People Strategy, Organization Development & Change Leadership | GenAI, HR Transformation | Talent Management & Retention | Employer Branding
I would like to ask you few questions.
Think about a time that you decided to go out for lunch and you saw two restaurants, one that is full and the other that isn’t too full which one would you consider to have your lunch at?
You go out for shopping into a mall, you have a predefined list that you need to shop, yet when you’re standing in a queue to pay the bill you reach out o that pack of chips or chocolates with a limited edition written on top of it and end up buying the same. When you actually don’t need it.
Think about a time, when you saw the sign sale and asked the person employed in the store if the sale will be there tomorrow and his/her response is, we can’t tell about tomorrow however the sale is only for today and you have ended buying things instantly. Or think about the time that you get messages stating 60% sale only for weekends and you end up buying.
Also, think of a situation when you saw 90% fat free written on the can of your milk and you ended up buying.
I bet that you all have experienced this where you have either picked up something which was not on your shopping list, yet to got it. Things you bought because you were not sure if the sale will be on the next day or bought something because it was 90% fat free or 60% sale for that matter. Do you know why does this happens?
We believe for a person to take an action, they need to have information. Unfortunately possessing the information does not always lead to taking appropriate action. For example: We all know that exercising is good for your health, yet we do not end up doing some form of physical exercise despite of spending more than nine hours on the desk. We all know the benefits of healthy eating, yet we most of us take fancy to fast foods.
According to Daniel Kahneman and Amos Tversky the author of thinking fast and slow- there are two modes of thinking System 1 and System 2.
System 1 is intuitive thinking-its fast, emotional, depends on mental shortcuts, its automatic and biases that results in impression, feelings and inclinations. For example if someone throws a ball at you, you would tend to duck it. If you see a toddler smile, you too would smile back.
System 2 is rational thinking-its slow, deliberate, systematic and based on considered evaluation that results in logical conclusion. Usage of both the system is good, over utilization on one system is not good. That’s when we end up buying things that perhaps are not needed, if you come to think of it.
Richard Thaler and Cass Sunstein the author of their book called “Nudge” state that by knowing how people think we can nudge them to make decisions that are good for them. A simple device like GPS while driving gives us a nudge that enables us to make a better decision for our good. May be reaching office on time, or a fitness tracker that enables us to keep track of calories that we are burning in a day or when you step onto the treadmill/ jogging.
Following are the ways through which you can nudge an individual.
- Choice architecture- the way the product/information are presented to the individual which has am impact of the said presentation on one’s decision making. Hence you end up buying a limited edition chocolates at the mall while waiting to pay the bills.
- Path of least resistance- Things that make life easier will be preferred or consumed first. Getting in to the restaurant that is full as opposed to the other will be preferred first.
- Framing- The way the context is framed influences the decision making, Purchasing a can of milk where its written 90% fat free as opposed to a can of milk where its stated only 10% fat.
- Feedback- Providing timely feedback helps to nudge the behavior
- Priming- Using certain words will trigger behavioral response from the person
- Loss aversion- Lose is of more value as opposed to gaining something. Buying when the sale is only for today or for that matter when its 60% off.
Friends by applying these principles at your work place you can nudge your employees for their good- it could be a simple nudge as encouraging your employees during the time of a process or introducing a system change.
I encourage you to think about ways in which you can nudge employees in your organization.