Can aiming low make an ideal example for modern management theory?
This is a story of men’s urinal at the Amsterdam airport. Where the janitor painted a realistic looking fly in the urinal near the drain.
Men started aiming low at the fly to make it fly away and spillage around the urinal came down by 80%. Cost of cleaning reduced by 8%.
This was a favorite example of the great Behavioral Economist T.H. Thaler. Thaler and Sunstein formulated a theory which was defined as a choice “that alters people’s behavior in a predictable way without forbidding any options (No stick) or significantly changing their economic incentives.(No carrot)”
They called it “ libertarian paternalism”
In simple English it is called “Nudge”.
Nudge refers to a gentle push or a prod for desired behavior. An extremely useful concept for improvement of Health, wealth and happiness.
EFF Factor also uses it for health (no pressure work environment), wealth (achievement of firm’s profit goal year after year) and happiness (of all the stakeholders)
Eff factor uses it at various places as a choice architect with astonishing results.
Take a case of logging of time by an employee for work done on a project.
While he is recording the time , he sees
- Time still remaining to complete the task and
- Option to report extra time required if any
So there is no stick for not finishing before time or reward for finishing in time. Just relevant information of how much time is left, with liberty to state how much extra time he would need. A perfect fulfilment of the term “ Libertarian paternalism “.
Result – in most cases there is no time or cost over-run.
Leading to meeting of profit targets for most of the projects and healthy bottom line.
You can try it on 50% of the projects and leave 50 % out of this.
The outcome would convince you that Nudge principle works.
And choice becomes easier.
“Carrot and stick or? “
Naturally
EFF factor for nudge.
