How to embed behavioural economics in your business

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

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.

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?’.

Up-skilling

In the up-skilling phase, you 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 can be a good commitment device – you commit to carving out the time and know you will walk away being able to apply the science by the end. Online courses can sometimes slip into the ‘I’ll get around to it’ bucket. The key is to make sure your training moves beyond theory.

Application

Now that you have been exposed to what BE has to offer, it’s time 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.

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.

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. Firstly you could circle back to phase two, up-skilling, where you seek a course or workshop. Secondly, you could nominate some key staff to learn how to teach others in BE. Thirdly, and perhaps most cost-effectively, you could 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 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 (in Kahneman’s terms) both system one and two, clarify the desired outcome and address points of inertia
• Job interviews – overcome reliance on system two answers and access system one instead
• Performance measurement – reconsider the emphasis placed on self-reported vs. observed behaviour