Ten years on: What’s next for behavioural insights?

Opinion: Success has been built on three Es — empirical, experimental, ethical

This piece was written by Faisal Naru, who has spearheaded the work of the OECD on Behavioural Insights and is currently Head of Strategic Management and Coordination in the office of the Executive Director of the OECD. For more like this, see our government innovation newsfeed.


It has been over 10 years since the influential book “Nudge” by Richard Thaler and Cass Sunstein was published, and now over 200 behavioural insights initiatives exist permanently in governments, regulators and organisations across the world. Some of the latest being in Rio De Janeiro’s City Hall and Saudi Arabia’s Ministry of Health.

The three Es

So what are the key lessons, and why are behavioural insights becoming a mainstay in so many institutions?

Empirical evidence

Evidence is often required when deciding on an action to take, and decision makers — whether a minister, senior civil servant or CEO — seek the best available evidence on which to base their decisions. Will it work? Will it really change behaviour?

The evidence used can come from a variety of sources and can be based on a number of assumptions. The reason that behavioural science is increasingly being deployed in many institutions is because it provides “actual” or observed evidence, often with greater rigour, for decision makers.

Experimental

This “actual” or observed evidence comes from the testing or experimentation that behavioural insights initiatives rely upon. Randomised controlled trials (RCTs) are often the choice of behavioural units in determining whether one intervention is more successful at achieving the desired outcome, or indeed if it has any impact at all. But other methods are also used, such as lab trials.

This experimental approach brings innovation: new ideas are brought in, drawing upon the vast research in the behavioural and social sciences. Will personalising a message work better than a threat of sanctions? Will knowing that others are doing something make someone change their behaviour

Ethical

Some critics argue that the behavioural movement is nothing new and is purely marketing and manipulation. And as such it is dangerous, particularly for public bodies to use. These are misconceptions as described by Cass Sunstein.

It is also the case that behavioural insights is often asked to adhere to a different set of standards, scientifically and ethically, to other tools. Nonetheless behavioural practitioners have been careful and have been adhering to their own institutions’ ethical guidelines, especially in public policy domains, which are often of a high standard (OECD 2017).

It is important to maintain ethical considerations because behavioural insights not only tries to find what works in encouraging a change in behaviour, but also why. Ethics matter when justifying the reason for the use of an intervention — whether that is to shareholders or customers, or to citizens, parliament or congress. The backlash that Uber faced from misapplying behavioural techniques, or sludging not nudging, is a lesson for all about the importance of maintaining the highest ethical standards.

Behavioural units have also been transparent by publishing their work and results in academic articles as well as annual reports. More units should do so to continue to share what has worked and more importantly what has not worked, and why not.

What’s next?

While the proliferation of behavioural units in public policy, and now chief behavioural officers in organisations, is welcome, there is still greater potential to benefit from the application of behavioural and social sciences.

The study of behavioural insights brings a number of disciplines together — including psychology, cognitive science, decision-making and economics. It also builds bridges between academia and practice.

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This multi-disciplinary approach must also exist in behavioural initiatives, by including design, data, and social scientists, as well as environmental, public policy, human resources, education experts, to name a few. By involving many relevant disciplines, behavioural insights can be mainstreamed into organisations.

There are three key areas where these multi-disciplinary teams in organisations could begin to work together to mainstream a behavioural approach.

Defining problems

Why does the problem exist? Why are people choosing to do something, or not? By understanding the reasons behind a behaviour, whether it is for pensions, tax compliance, “green choices” or managerial decisions, we can help understand why a situation exists. Applying a “behavioural lens” to the perceived problem may not result in a behavioural solution, but it can lead to a better understanding of the problem, and therefore what could be done about it.

Design

Behavioural insights have been applied extensively to implementation or interventions. One step before that, thinking about how to address a problem is an area with great potential for behavioural insights. For instance, it is often assumed that incentives are required to change some behaviour, such as financial incentives. But this may not be the case, and in fact may have the opposite impact. The approach of experimenting and finding empirical evidence can assist in the design of more successful programs or interventions.

Evaluation

After a program has been implemented, did it have the desired impact? Was it responsible for any change? Evaluation often occurs, but not always scientifically. Decisions can be made in a rush to action, and it can be scary to find out the answer to whether an intervention was indeed responsible for any impact. By programming in evaluation techniques from the design stage, and applying more rigorous methodologies, the learning process and continuous improvement cycle can be enhanced in public policy and organisations. Both the public and private sector can determine whether the action was value for money and whether there was sufficient “bang for your buck”.

One of the achievements of the behavioural movement has been to break down the silos in traditionally separate theories and traditions. It would be a shame if behavioural initiatives inside organisations are siloed themselves inside their organisations.

As more behavioural initiatives grow globally, I am optimistic that behavioural practitioners continue to embrace, and be embraced, for the common goal that we all have — to do good and have a positive impact for people. Actual people. Not the assumed “rational actors” we are supposed to be. The real humans we are. — Faisal Naru

The opinions expressed and arguments employed are those of the author and not the organisation.

(Picture credit: Unsplash)

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