Iterating for good
Posted by Kathi Enderes on February 5, 2019.
What if your organization could shape workforce behavior to achieve desired outcomes? What if there was a way to optimize people’s productivity in your organization and have them embrace it?
At Deloitte’s 2018 Nudgeapalooza conference,1 I spent the better part of the day talking about people analytics and the impact of nudging on the future of work.2 We know that just 2 percent of organizations are highly effective in people analytics—and those organizations have an astounding 96 times higher revenue.3 With results like this, leveraging people analytics is understandably seen as a top priority going forward. If your organization hasn’t added a New Year’s resolution to its to-do list, right now would be the ideal time to prioritize building people analytic capability. We’ll explore this journey in a monthly HR for Humans edition.
From avalanche to opportunity
How much data does your organization have? As technology has heightened our ability to collect, store, and analyze everything under the sun, we have become inundated with enormous quantities of data. But what good is data if nothing happens with it? Collecting information simply for the sake of having it may have made sense when organizations didn’t have enough. Now that organizations have enough (perhaps too much?), it’s time to turn that avalanche into an opportunity. The most mature organizations are turning data into insights for managers, teams, and individuals that aim at influencing behavior and actions. One innovative technique mature organizations are using is to nudge their workforce toward the right behaviors.
We know what a nudge is: a gentle prodding that influences our action. People experience them all the time to encourage good behavior (e.g., fitness app alerts) and to help avoid bad or potentially dangerous behavior (e.g., traffic signals). We all know that exercising is good for us, and walking out into traffic has unpleasant consequences, but having these little reminders helps people do (or avoid) these things. Could we choose not to exercise? Of course. Could we choose to cross the street in the middle of traffic? Absolutely. (But please don’t.) Nudges work because choices are still available. Individuals get the reminder or suggestion, but it is still up to them to follow it.
The choice paradox
Mature organizations are putting people data and the power of behavioral economics together to achieve desired outcomes by incorporating nudges into the flow of work. A major key to effectiveness is maintaining the element of choice. As soon as workers are required to do something, it is no longer a nudge.
It’s easiest to imagine a nudge as a pop-up alert in a dashboard, but they can exist in many forms. Take, for example, the work cafeteria. Perhaps your organization would like its workforce to make healthier choices at lunchtime. A logical action might be to remove the sweets, sodas, and fattening foods altogether, and replace them with steamed veggies and brown rice. Sounds delicious, right? Behavioral economics helps us understand that this is exactly the wrong action to take. As soon as the unhealthy choice is removed, people will eat their lunches offsite or have less healthy options delivered because they are being forced to eat healthy. Perhaps paradoxically, the best action for achieving the outcome of healthier food choices is to keep those less healthy options in the background and place the healthier foods front and center. Simply put, don’t make candy bars easily accessible, and put fruit at eye level.
Discovering which behaviors an organization should focus on is the challenge for data science. Learning which nudges make an impact is the challenge for behavioral science. How are organizations discovering and learning what works? Mature organizations are using the iterative technique of analyze / identify / define / intervene from design thinking to find new and powerful ways to incorporate nudges into the flow of work (or lunch).
That avalanche of data your organization has been collecting? Now is the time to leverage it. Mature organizations are using their people data to understand their current state and identify opportunities, using design thinking and behavioral science to supplement data science to improve productivity and performance.
Source: : Bersin, Deloitte Consulting LLP, 2019
For example, an organization with extensive new-hire statistics can look at multiple variables to identify gaps in hiring. People analytics leaders can then present these gaps as opportunities for the organization.
After analysis of new-hire data, the organization finds its diversity is not as inclusive as previously believed. Increasing the diversity of new hires thus becomes an organizational action item, achieved by mitigating hiring manager biases. But how is bias mitigated? Information on resumes or other pre-hire materials that might indicate gender, ethnicity, age, or other characteristics are redacted before managers receive them. Removing this information is a nudge—it does not make a decision for managers, but instead supports them to make less-biased decisions. It’s more effective to remove bias from the process rather than the person. During the hiring process, managers might receive another nudge about the unconscious bias training they had attended, gently reminding them of the principles of unbiased hiring practices.
After hiring decisions are made, the people analytics team can look at whether redacting data influenced the hiring decision. Managers were still free to hire the person they wanted to hire, but the removal of obvious identifiers mitigated bias as much as possible. If it worked, great! HR teams can then include that intervention in the hiring process. If it didn’t help meet the goal of increasing diversity, the team can then iterate and test a new solution.
Nudge it forward
Thinking more expansively about behavior change in the workplace requires all of us to consider how change interventions can be more effective. At Bersin, we will be studying the role of behavioral science in the workplace and nudging you to think about this, too. In the coming months, look for more on nudges, behavioral change, and the role of people analytics.
If you have a story about your own challenges or successes with nudging in the workplace, please email Kathi Enderes (email@example.com) with the details.
1 “Deloitte’s ’Nudgeapalooza’ at Georgetown University’s McDonough School of Business,” Georgetown University McDonough School of Business, 2018, https://msb.georgetown.edu/gicr/events/nudgeapalooza.
2 “Notes from Nudgeapalooza: Are nudges enough?,” Bersin, Deloitte Consulting LLP / Melissa Cavanaugh, 2018, https://capitalhblog.deloitte.com/2018/12/14/notes-from-nudgeapalooza-are-nudges-enough/; (2) “Notes from Nudgeapalozza: Behavior Change for Good,” Bersin, Deloitte Consulting LLP / Melissa Cavanaugh, 2018, https://capitalhblog.deloitte.com/2018/12/17/notes-from-nudgeapalooza-behavior-change-for-good/; and (3) “Notes from Nudgeapalooza: How Organizations Can use Data to Influence Behavior,” Bersin, Deloitte Consulting LLP / Melissa Cavanaugh, 2018, https://capitalhblog.deloitte.com/2018/12/18/notes-from-nudgeapalooza-how-organizations-can-use-data-to-influence-behavior/.
3 The People Analytics Maturity Model, Bersin, Deloitte Consulting LLP / Madhura Chakrabarti, PhD, 2017.