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Embedding behavioural economics in your business

Category: Blog & News

This is the third and final instalment on embedding behavioural economics (BE) in your business.  Part 1 looked at building a business case for behavioural techniques and Part 2 covered where your BE function should sit in your organisation. In part 3 we will be examining how to go about actually embedding BE – where to start and what to do.

How to embed Behavioural Economics

How you go about embedding BE in your business will, of course, be shaped by where you want it to fit within the organisation (e.g. centralised or decentralised, in-house or outsourced). But whether you are recruiting a BE specialist or using external expertise to up skill your team, there’s a roadmap you might like to follow.

1.     Initiation

By reading this blog I can tell you are, at the very least, in the initiation phase where you are curious about behavioural economics and looking for ideas about how to use it. Typically this is when people come across books like Thinking Fast and Slow or Nudge, read an interesting article or see one of Dan Ariely’s TED talks. For me it was reading Predictably Irrational. From there the natural question is, how do I get hands-on with this stuff?

2.     Up-skilling

In the up-skilling phase, you and/or your team are looking to get deeper into BE and what it means for you. This might mean attending a workshop or online course. From what people have told me, workshops like the ones I run are a good commitment device – you commit to carving out the time and know by the end that you will walk away being able to apply the science. Online courses can sometimes slip into “I’ll get around to it” bucket.  The key is to make sure your training moves beyond theory.

3.     Application

Now that you have been exposed to what BE has to offer, it’s time for rubber to hit the road and to put pen to paper. That means applying what you’ve learnt to real-life issues. Start small with something like an email, presentation or web page that is easy to benchmark, contain and measure. Ideally you will be able to shadow an expert or be coached through your first few attempts so you gain confidence.

4.     Consolidation

After you and your team have had some time applying your BE learning, it’s good to regroup and share experiences. What worked? What didn’t? What do you need to know more about? As a catalyst, reconvene around a short and sharp BE refresher training session, recapping the core theory and mashing it up against your experiences from the field. Reviewing training materials once you’ve had a go at applying it will make it much more resonant.

5.     Transfer

Time to pay it forward! Now that you or a group within your business has achieved a degree of confidence and competence in applied BE, it’s time to work out how to disseminate and maintain it. This is particularly important to ward against inevitable staff changes, as some newly minted BE experts will move on, and some newbies will come on board.

To transfer skills and become self-sustaining you have a few options from which to choose. First you can circle back to phase 2. Up skilling, where you seek a course or workshop; second, you can nominate some key staff to become BE train the trainers, where they learn how to teach others, or third, and perhaps most cost-effectively, you can design (or commission) a modular-based self-guided BE training program that staff can access to either acquaint or refresh themselves as they need.

Incorporating with business as usual

Aside from developing and embedding a BE skills base, your goal should be to incorporate BE terminology and concepts in as many business as usual (BAU) activities as possible. That means things like:

  • Team meetings – get people talking in terms of what their behavioural challenge is, and how to move people from current to desired behaviour
  • Briefing documents – include a “what is your behavioural objective?” question, along with other prompts to tease out the intent of the work being requested
  • Emails – pay attention to subject lines, structure and the behavioural objective
  • Presentation templates – design the narrative to engage both System 1 and 2, clarify the desired outcome and address points of inertia
  • Job interviews – overcome reliance on System 2 answers and access System 1 instead
  • Performance measurement – reconsider the emphasis placed on self-reported vs. observed behaviour

Special offer:

Get your FREE download of the 8 page "Embedding Behavioural Economics in your Business" PDF containing this article as well as Part 2. How to Resource your Behavioural Economics function and Part 3. Embedding BE.

This article also appeared in Smartcompany.

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