Information-Driven Business
Robert Hillard

Need plus nudge equals sustained change
by Robert Hillard

Everyone loves a nudge! That’s because we’re addicted to stories of trivial (and cheap) business hacks which have caused major changes to the way staff or customers behave. New processes and technology sometimes seem easy in comparison to even small changes to human behaviour, but without these changes there is no point investing in any business transformation.

Ever since Richard Thaler and Cass Sunstein wrote Nudge in 2008, the term has been a popular adjunct to behavioural economics. It is amazing how many ways we can be influenced through small and often unexpected interventions.

Classic nudges include reducing litter by removing bins (getting people to take their rubbish with them), painting lines on a supermarket floor (to direct traffic to profitable items) or even just giving a lolly to a child to get them to do a swimming lesson.

The problem with most nudges is that they don’t last. Removing bins works initially, but after a while people get into the habit of littering. The supermarket lines encourage compliant behaviour until one hurried trip and the new norm is broken. The child who learns to expect a bribe for a swimming lesson will gradually increase the stakes demanding a treat before they’ll do anything.

Nudges create sustained change when paired with needs. A need plus a nudge equals a transformation.

No matter how much we love the hack of a nudge, needs are the big things that underpin everything we do. We need to be paid for our jobs. We need to eat. We need social interaction. But nudges can build on what we want. We want bonuses. We want sweet treats. We want to play games.

Not only do nudges on their own fail when not paired with a need, they can also cause lasting harm. For example, we have seen that bonuses (the nudge) that are outsized compared to the underlying pay (the need) cause poor, and sometimes outright corrupt, behaviour.

Social media understands the power of pairing needs and nudges well. We have a need to connect and communicate with the people we know. But when on the platform, we can be nudged to extend our network, read updates from people we don’t even know and create new content of our own.

The same challenges face organisations every day. Whether it is a government department or a private enterprise, there are backend systems that require accurate data entry, adherence to procedures and really only work if people collaborate.

Nudges to get people to do all of these things are notoriously fickle and short lived. The problem is that disciplines of data management require investment by people that aren’t the beneficiaries. Customer Relationship Management (CRM) only works if everyone who interacts with customers updates the system. Space management, reserving desks, meeting rooms and other resources, only works if people don’t just dump their stuff on any free table. Knowledge Management (KM) only adds value if the best intellectual property of the enterprise is collated for others to use.

The nudges we are looking for create altruistic collaboration, proper data management and properly maintained resources like email lists. Just asking others to “pay it forward” only goes so far.

We can learn a lot from commercial coworking spaces and startup hubs which work best when many needs are co-located and supported by nudges. Individuals working alone need social support and can be nudged by aligning with others of similar interests. Startups need funding, hence hubs often include investors, and can be nudged by the offer of pitch nights.

Organisations seeking to use office space to create an innovative, collaborative culture can do the same. No matter how cutting-edge the design, offices need to offer room for personal privacy, room for personal artefacts and access to resources (the needs). These same offices can borrow from coworking spaces by nudging beyond these needs with clever neighbourhoods of interesting colleagues, opportunities for projects to be seen by their stakeholders and celebrations of achievements.

In the same way as needs and nudges can be combined for the space in which we work, what we do can also benefit from the approach. Data management around CRM can be motivated by making the contact update screens the location where sales resources are found. Email distribution lists can be combined with the location where payroll details are maintained. Space management reservations can be treated like a coworking space with all the associated rewards.

With the basic needs met, any number of nudges can be invented with regular recognition for the best customer interactions, games accessible only to members of email lists and public celebration when knowledge assets are leveraged.

No organisation is static, with every approach needing constant reinvention. Perhaps a need and a nudge for the first of every month!

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