Behavioural insights are being deployed in many spheres. Known by many people as “nudge theory”, they are being used in efforts ranging from fostering greater compliance among taxpayers (by letting people know what proportion of people pay on time) to helping people make better choices at supermarkets (by featuring straight-forward nutritional information).
But behavioural insights can also be a powerful tool for building the desired culture of an organisation.
At the heart of any organisational culture change is employee behaviour and decision-making. Behavioural insights offer an array of strategies for helping employees make choices about their behaviour that align with the desired culture and values of an organisation.
Culture is complex and dynamic. In any cultural change or improvement program, it is important to consider the biases at play – for an individual employee and for the whole workforce. Behavioural insights encourage experimenting with possible solutions to identify what strategies work, where and in what context.
Like a grain of sand that sits at the heart of a shiny pearl, behavioural insights strategies can help to make a cultural change effort attractive, resilient and worth celebrating.
Through our work Nous Group has identified three heuristics that influence employee behaviour, and each of them yield three behavioural insights strategies that can help your cultural improvement effort succeed.
Bounded rationality refers to the fact that employees will make decisions based on the information available to them, even if it is incomplete or ambiguous. Employees therefore need good information to make informed decisions about how to act and where to invest their time during a cultural improvement effort. That is why communication of information is essential.
For example, Nous partnered with a financial services firm to transform its culture in order to improve organisational performance and the experience of its employees, customers and clients. By providing its stakeholders with simple, engaging and consistent information about the initiative, the client debunked some myths about the strategy and supported effective decision making by leaders and staff.
How can we work with bounded rationality to support effective cultural change and improvement?
Changing social norms is integral to successful cultural change. Social norms (essentially, what others do) have a powerful influence on individual employee behaviour, and therefore need to explicitly inform any strategies or interventions.
Recently Nous supported the integration of two major government departments. In this cultural change and leadership development project, leveraging the power of social norms was critical to driving cultural change across the new department and ensuring the espoused behaviours become a consistently lived experience for all 14,000 staff.
How can we leverage social norms to support effective cultural change and improvement?
Seen as a common barrier to successful culture change, resistance to change can be daunting for organisational leaders and organisational design practitioners. Status quo bias may be critical in perceived resistance because people are hardwired to prefer the current state rather than accepting change.
We should not think of employee resistance as a by-product of poor change management. Instead, behavioural insights suggest we can expect, and therefore plan for, employee resistance. In partnering with a health organisation to shift its culture to improve organisational performance and the experience of employees, customers and clients, Nous tackled status quo bias head-on by redefining the new ways of working.
How can we overcome status quo bias to support effective cultural change and improvement?
None of these strategies on their own are likely to deliver a successful cultural improvement, but in aggregate they can help break through barriers of resistance. Drawing on these techniques can help turn your grain of sand into an exquisite pearl.
Get in touch to find out more about how Nous Group can help make your cultural change a success.
Written by Deanna Paulin during her time as a Nous Principal.
 Simon, H. (1997). Models of bounded rationality. Cambridge (Mass.): MIT Press.
 Hallsworth, M., et al. (2014). EAST: Four simple ways to apply behavioural insights. UK Government.
 Reynolds, K., Subašić, E. and Tindall, K. (2015). The Problem of Behaviour Change: From Social Norms to an Ingroup Focus. Social and Personality Psychology Compass, 9(1), pp.45-56.
 Kahneman, D., Knetsch, J. and Thaler, R. (1991). Anomalies: The Endowment Effect, Loss Aversion, and Status Quo Bias. Journal of Economic Perspectives, 5(1), pp.193-206.
 Lencioni, P (2002). Make your values mean something. Harvard Business Review
 Rogers, T., Milkman, K. and Volpp, K. (2014). Commitment Devices: Using initiatives to change behaviour. JAMA, 311(20), p.2065