Culture is the lifeblood of every organization. It sets the tone for how your employees work, interact, and contribute to your company’s success. When building a robust, resilient, and people-centric company culture, it might be surprising to learn that small interventions or ‘nudges’ can create meaningful change. This technique leverages behavioral economics and cognitive psychology to influence decisions subtly and encourage actions in the right direction.
The Power of Nudging
Nudging has shown effectiveness in various fields, from promoting healthy habits to environmental conservation. A famous example of nudging was Volkswagen’s “The Fun Theory” initiative, where a set of stairs was transformed into giant piano keys next to an escalator. The stairs-piano saw a 66% increase in usage over the escalator, proving that a fun and engaging nudge could encourage healthier choices.
Similarly, Copenhagen Airport introduced singing dustbins to encourage passengers to dispose of their trash correctly. These playful nudges were successful in significantly reducing littering in the airport.
Nudging in Action: The Home Depot’s Success Story
Even in a corporate setting, nudging has shown remarkable results. A prime example is The Home Depot’s leadership development strategy. The Home Depot faced a significant challenge in scaling its high-touch, highly customized “High-Potential Program” to its more extensive “New Director Program.” The success of the High-Potential Program was based on “action learning,” a method that facilitates behavior change through practice and habit-building. The high-touch coaching approach worked as a nudge, promoting active learning.
Michael Cabe, Senior Manager of Learning Strategy at The Home Depot, and his team used email nudges to deliver action learning directly to the learners’ inboxes to scale this approach. These nudges served three primary purposes: action learning delivery, reminders for mandatory work, and follow-ups after peer meetings.
By nudging new directors to engage with action learning, The Home Depot saw an increase in attendance at peer meetings and in-person sessions and significantly improved engagement with content and the quality of discussions in peer meetings. This success story underscores the potential of well-designed nudges in driving behavior change at scale.
Applying Nudging to Your Company Culture
According to Daniel Kahneman’s dual-process theory, nudging appeals to our intuitive, automatic thinking, subtly influencing our choices without consciously realizing it. Developing a successful nudging strategy requires deeply understanding your organization’s objectives, employees’ behaviors, and the overall work environment. As leaders, here are some questions you can ask yourselves to help formulate an effective nudging strategy:
- What are our organizational objectives? Understanding your objectives, including a nudging strategy, is the first step in any strategy. The goals will guide the direction of your nudges.
- What behaviors do we want to encourage or discourage? Identify the specific actions you want your employees to take or avoid. These could range from encouraging more sustainable behaviors (like using less paper) to promoting healthy habits (such as taking regular breaks from the computer).
- What are the current behaviors? To design effective nudges, you need to understand the existing behavior patterns of your employees. Use surveys, observations, or data analysis to understand how things currently work in your organization.
- What obstacles are preventing the desired behaviors? Once you know what you want to achieve and the status quo, identify the barriers that prevent your employees from behaving in the desired way. These could be a lack of knowledge, motivation, or structural barriers such as inconvenient processes.
- Where and when can we best deliver the nudges? Timing and location are crucial for effective nudges. Consider the context in which your employees decide about the behavior you want to change.
- How can we make the desired behavior the path of least resistance? Nudges work best when they make the desired behavior easy and frictionless.
By answering these questions, you’ll be well on your way to creating a nudging strategy that can positively influence behavior and contribute to a more productive, engaged, and positive company culture—nudging works by tapping into how our brains make decisions.