Want to go on an exuberant, incisive ride through why so many initiatives flounder and how, conversely, you can increase the odds of success? Then listening to John List will be for you. List takes us through his favorite, highly relevant behavior economic principles: loss aversion, confirmation bias and framing among them. Then this episode digs into why 50 to 90% of initiatives fail to scale. List emphasizes the role that false positives and unscalable ingredients play. As to the secrets of building out an idea, knowing when to quit stands out for reasons worth listening in for. Finally, the importance of scaling a company’s corporate culture explains why the gladiatorial culture at Uber wasn’t sustainable at scale.
John List is a professor of economics at both the University of Chicago and the Australian National University. After being the chief economist at Uber and Lfyt, he now holds that role at Walmart. He’s also previously been on the Council of Economic Advisers for The White House.
Once you realize that the average person makes 35,000 decisions a day, it makes total sense that habits drive 95% of our behavior. Otherwise, we’d become paralyzed with analysis paralysis in trying to choose what to do next. As Melina Palmer fully recognizes, behavioral economic principles help to unlock the mystery of why people do things that seem so confounding. How could it be, for instance, that giving the gift of two mints with your check in the restaurant can lead to a 14% increase in the average tip for the waiter? Well, gratitude—the principle of reciprocity—weighs in. From the difference between satisfaction and delight to what the peak/end rule can make a small business more prosper if used well, this is both a fun and meaningful episode.
Melina Palmer is the founder and CEO of the Brainy Business and hosts the podcast by that same name. She received a Masters in behavior economics from the Chicago School of Professional Psychology, teaches at the Texas A&M Human Behavior Lab, and writes a column for Inc. magazine [NBN logo]
Dan Hill, PhD, is the president of Sensory Logic, Inc. His latest book available on Amazon is Emotionomics 2.0: The Emotional Dynamics Underlying Key Business Goals.
Who welcomes change? Basically, nobody – except maybe a baby with a dirty diaper! Behavioral science is an umbrella term that covers the realms of social psychology, behavioral economics, and sociology among other fields. As applied in business or government, behavioral science is often a matter of creating small “nudges” in designing changes to human behavior in hopes of achieving buy-in rather than resistance from those who are wedded to the status quo. Khan and Newman, who co-edited and contributed to this book, are candid about the challenges involved in enacting real change in organizations. Without executive buy-in, and a few quick wins to placate the doubters, the odds of enacting change get pretty long. For more tips, listen in as In this episode focuses on a pair of behavioral science applications relevant to business: running human resources (HR), and promoting innovation.
Released today: episode #102 of my podcast series “Dan Hill’s EQ Spotlight,” featuring Zarak Khan and Laurel Newman, discussing Building Behavioral Science in an Organization. Click this link to get to the new episode.
Zarak Khan is a Senior Behavioral Researcher at Duke University’s Center for Advanced Hindsight, as well as a Behavioral Science Fellow at the University of Pennsylvania and a board member of Action Design Network. Lauren Newman is a behavioral scientist at Edward Jones, and a former psychology professor at Fontbonne University.
What goes around, comes around—and that is especially true when it comes to behavioral economics. Who was quick to recognize that emotions drive people’s financial decisions and behavior? The answer is Adam Smith, who was both instrumental in creating the field of economics and a moral philosopher to boot. In that same vein is my guest this week, Nika Kabiri, who knows the Confirmation Bias is among the most important factors to navigate in helping her clients make their investment choices. Along the way, this conversation takes in the movie The Big Short, Federal Reserve Board chairman Jerome Powell, and what may lay ahead for an economy trying to emerge from the ravages of Covid-19. Five types of investors are likewise discussed in this episode, from the more-is-better investor to the what-has-always-worked investor. Figure out which type of investor you are, and how you can become more confident about your investment strategy.