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How to nudge your way to better performance, McKinsey

  • 2min.

What you need to know

  • Based largely on the work of Nobel Prize winner and behavioural economist Richard Thaler
  • Thaler… [shows that] people make decisions quickly under pressure, based largely on intuition, and unconsciously guided by biases and psychological fallacies.
  • So how do we make reasonable decisons that benefit me, the team and the business?
  • The answer is nudge – subtle interventions to guide people
  • Nudges can, “… can effectively influence behaviour and drive results in solving some of the most pressing issues for today’s companies, from talent management to customer retention.
  • Virgin Atlantic used nudges to reduce fuel. Three groups: a control group, a group who received monthly reports, a group who received reports & targets which when met would equal a charitable donation
  • Group 2 & 3 delivered results, 3 the best and saved 3.3 million GBP
  • Behavioural science is rather a turbo-charger for efforts on cultural change and corporate transformation
  • A nudge approach with small targets, and outside perspective and rewards can be the first step for a team to start their change

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