Product managers, marketers, and designers are often confused as to what they should do to increase the chances of customers’ engagement and uptake of their offering. Changing individuals’ behavior to enhance engagement, productivity, innovation, and happiness isn’t straightforward.
It takes a lot of effort, time, and resources to execute initiatives aimed at transforming behaviors and Organizational Culture. However, most people aren’t interested in changing and like the status quo to prevail. This is where Behavioral Economics can help to know how customers behave, interpret their decision-making methods, and create solutions targeting those behaviors.
Product designers and marketers aspiring to drive acceptance of their products can make use of the 3 Bs of Behavioral Change to change understand consumer behavior. The 3 Bs of Behavioral Change classify the 3 elements essential to change behaviors, i.e.:
Understanding and employing these 3 Bs helps the designers and product managers instill change, inspire design and strategy-related decisions, increase the acceptance of new products / features and product engagement levels, and build new behaviors in people.
Let’s discuss the first 2 elements in detail.
People have an inherent tendency to maintain the status quo. Behavioral change necessitates:
- Identifying individuals’ existing attitudes.
- Assessing and tackling psychological biases affecting individuals’ decisions.
- Carefully tracking behaviors that need to be changed.
- Ascertaining the most important desired behavior and exact action that is imperative to drive results.
- Getting the buy-in from all stakeholders on the key behavior.
- Deciding if the behavior should be permanent or transient.
Examples of key actions to change behaviors include spending 30 minutes thrice weekly doing cardio exercises and consuming salad at lunch daily to stay healthy.
Understanding the barriers in behavior adoption assists in creating effective solutions to improve uptake of key behavior. The second step to induce behavioral change is to reduce barriers in its adoption.
- Every decision that a product user has to make, no matter how negligible, increases resistance in the likelihood of completing a specific behavior.
- These actions and decisions an individual has to take in order to achieve the desired behavior create points of friction in embracing key behaviors. For instance, people often find it difficult to decide when presented with complex choices. They tend to procrastinate or become a victim of decision paralysis.
- Removing the points of friction and resistance from any key behavior necessitates documenting and streamlining all decisions. The path of least resistance leads to desired key behaviors.
Examples of barriers include the thought process involved in the decision to select where to have dinner. This thought process is, in fact, a psychological barrier in actually going out and having dinner. Likewise, the decision to walk or drive to a restaurant is a logistical barrier and a point of friction that warrants making a decision.
To eliminate these barriers, we can either remove barriers entirely or just simplify the decision. For instance, elimination of a non-critical, open text field from a sign-up form—that probed the users about their business, which requires significant time to think and answer—can increase page-over-page conversion. In case choices are helpful for the users and cannot be eliminated, then it is best to simplify the decision process by giving fewer options instead of many, or by suggesting “recommended option” to the users.
Interested in learning more about the details of the 3 Bs of Behavioral Change? You can download an editable PowerPoint presentation on 3 Bs of Behavioral Change here on the Flevy documents marketplace.
Are you a Management Consultant?
Business environment has transformed drastically from what it was a century ago. It has become immensely challenging due to competition, disruptive technologies, laws, and globalization. These challenges warrant better performance to address customer needs and to survive—and outpace—intense competition. Consequently, organizations have become complex.
The work that individuals perform in an organization has also shifted from manual labor and clerical jobs to knowledge-based experiential tasks. Traditional workforce was required to adhere to commands and stick to routines, whereas today’s workforce needs to be more empowered, innovative, able to adapt to varying circumstances, and render sound judgment.
Adapting with the constantly changing business environment is essential for organizations aspiring to succeed in today’s competitive markets. In order to stay competitive, more and more organizations across the globe are undertaking Business Transformation programs to reorganize their businesses. However, a large percentage of such programs fail to achieve the desired outcomes.
For the Organizational Design to be successful, leaders need to be mindful of the revolutionized work settings and business environment of this age. One of the major factors attributed to these failure rates is utilizing traditional approaches to reorganization, which are proving ineffective in this digital age. These traditional approaches appreciate “level of control” and power, and underestimate the significance of employee autonomy and innovation.
The Smart Design Approach to Organization Design
Today’s Knowledge Economy necessitates the employees to be more empowered to decide on their own than merely following commands. People act in ways that are best for their own interests. The new approach to reorganization—termed Smart Organizational Design—aligns the workforce’s best interests with the organizational mission rather than seeking control over the employees. The focus is on changing the environment (context) and mindsets of employees willingly and instilling team work and cooperation, thereby enhancing organizational performance considerably.
The Smart Organizational Design approach entails classifying the existing workforce behaviors, ascertaining the desired behaviors critical to improve performance, and providing environment (context) favorable to develop new behaviors. The approach encompasses 3 main steps:
- Define why reorganization is necessary (objective)
- Determine the behaviors critical to support reorganization
- How to execute the Smart Organizational Design
Let’s dig deeper into the second step.
Determine the behaviors critical to support reorganization
The next step involves the leadership to determine the “what” element of the Smart Organizational Design approach—i.e., definition of certain behaviors critical to achieve the transformation purpose. Determining the desired behaviors necessitates thinking through the following 4 critical Smart Organizational Design aspects. These 4 design aspects work in tandem to shift the environment (context) for the workforce and motivate them to embrace the new behaviors crucial for improved performance:
- The Organizational Structure aspect—pertains to management reporting lines, spans of control, and layers of hierarchy.
- The Roles and Responsibilities aspect interprets individual and shared accountabilities to cultivate teamwork and cooperation.
- The Individual Talent aspect specifies the right skill set and motivation to perform responsibilities of each role effectively.
- The Organizational Enablers aspect outlines the elements necessary for creating the right context (environment) for embracing the desired behaviors, i.e., decision processes, performance management, and talent management.
Interested in learning more about the other step of the Smart Organizational Design approach and the factors critical for its success? You can download an editable PowerPoint on Smart Organizational Design here on the Flevy documents marketplace.