Over the past few years, we have seen a shift in how organizations value their internal communications. In the past, employee focused communications were often an afterthought. Companies would spend significant time, effort and money on developing out their incentive plans, making sure they were designed to drive the right behaviors and performance, only to communicate it to the field in an e-mail with a 30-page, single-spaced legal contract attached.
Thankfully, this is starting to change.
Today, organizations realize that they need to invest time and resources into their internal communications to optimize their value and impact. As companies make this investment we are seeing a significant improvement in the design and visual appeal of internal communications – from incentive compensation to benefits to operations; the production value of employee communications has risen.
However, merely making a communication look pretty and appealing isn’t sufficient in today’s hyper-competitive world. Organizations need their communications not just to inform, but also to spur new behavior and actions.
When companies communicate about programs that require employee action, they often only see a small change in employee behaviors (or no change at all) – even when these actions have clear benefits for the employee (i.e., increasing their contribution to their 401K plan, using a flexible health care spending account, or changing their selling behavior to align with the new incentive plan to maximize their own earnings).
This is where behavioral science comes in.
Behavioral sciences such as psychology, sociology, and behavioral economics help improve organizational communication and drive both action and behavior change. These cutting edge scientific concepts are currently being used heavily in consumer marketing with positive results – and now they are being implemented by many companies as part of their internal employee communications to achieve similar results inside the company.
Read further to make sure that you’re not being left behind.
Expecting a rational response leads to failure – employees are not robots
One of the clear insights from behavioral science is that people do not always respond in a rational way. No simple formula drives behavior.
Daniel Kahneman, one of the preeminent behavioral economists over the past 40 years, describes our decision making as being controlled by two systems: System 1 and System 2. System 1 is our impulsive response; automatic, emotional fast and easy thinking. System 2 is our more rational, computational side, but takes more effort and as such, we do not activate it as much (the brain is typically very lazy and tries to do things with the least possible effort). Even when we need to use System 2, sometimes our System 1 takes over.
For example, Kahneman uses the following to highlight this concept.
Quickly think of the answer for the following – try to get the answer in 5 seconds or less:
- A bat and ball together cost $1.10
- The bat costs one dollar more than the ball
- How much does the ball cost?
What was your quick response?
If you are like most people, the answer you came up with first, was 10 cents. Which may seem right and easy, but is wrong. If you run through the math, the answer is 5 cents ($.05 + $1.05 = $1.10). Our mind defaults to the quick heuristic and often gets stuck there.
As humans, we are not good at distinguishing how we come to our beliefs or actions. We tend to rationalize those beliefs and actions after the fact. Our System 1 makes an initial response, and then we try to validate that response. Think about the following two scenarios – which option would you pick if you were a patient and had to pick between two different treatment options:
- Treatment 1 has a 90% survival rate over the first three months
- Treatment 2 has a 10% mortality rate over the first three months
Which did you pick?
Most people will pick treatment 1, even though, rationally, we know that the outcomes are the same (interestingly, doctors if given this same scenario also tend to pick treatment 1).
This irrational thinking process has implications for how we communicate to our employees.
Communication and behavioral science – helping drive behavior change
Using behavioral science principles, organizations can design their messages to be more impactful and drive greater actions and better behaviors. We will highlight just a few of those principles and how they can be applied to communications.
How we talk about a program or situation can significantly impact how it is perceived. Think of the treatment situation from above – the same information is interpreted differently because of how it is presented.
From a communication perspective, one of the tools that we can implement is how we frame a particular situation. Organizations should look for ways to actively frame their communications to drive emotional engagement and increase their employees’ intrinsic motivation. This can be done by considering what your employees will gain versus what they will lose and then framing the communications around those concepts. In other words ask, “do we communicate what our employees would gain from an action or what they could potentially lose from inaction?”
Typically companies use either prescriptive or informational based communications (i.e., telling people what to do or detailing out the information) or positive based communications (i.e., what they can gain). Organizations in the past have been hesitant to position programs from a loss perspective for fear of appearing too negative. There is validity to not wanting to use a fear-based approach which is designed to scare people (i.e., scare tactics). However, if done right, these messages can be some of the most powerful motivational pieces.
People tend to feel the pain of loss more intensely than the pleasure they receive from the same amount of gain. This behavioral economic principle is called loss aversion. The loss that people are motivated to avoid is not strictly monetary – they also want to avoid social loss (e.g., friends, job status), emotional loss (e.g., regret, sadness), and physical loss (e.g., health, illness). All of these perceived losses are powerful motivators.
Let’s look at three examples that highlight how these different type of messages might be used in an incentive communications piece:
- “Make sure you know this year’s incentive plan!”
- “Think about how much you can earn with this year’s plan – make sure you know how to maximize your earnings!”
- “Don’t leave money on the table this year – make sure you know how to maximize your earnings!”
The first one is prescriptive (i.e., here is what you need to do), the second one is framed as a gain (i.e., focuses on what you can earn), and the third is framed as a loss (i.e., don’t regret your decision or inaction). To have more of an impact on motivation and behavior, organizations should focus on the ones that are framed as a gain or loss – with the more powerful one being the loss aversion option.
Rationally, we would think that the more information that a person is given, the better informed they would be and therefore would make more sound decisions. However, this is not typically the case. People can become overloaded with information, at which time the System 1 thinking kicks in and uses all sorts of shortcuts and heuristics that don’t always provide optimal outcomes. Specifically, when people encounter cognitive overload, they tend to:
- Fall back to their established habits and routines
- Fail to process the new information or ignore it completely
- Have myopic focus, cherry picking information and placing it into a pre-existing schema
- Become overwhelmed and shut down
From a communications perspective, this means that we need to design our communications so that they don’t overwhelm. This is not saying that we always need to reduce the information that we provide, sometimes it is making sure that the information is presented in a way that is easy to follow, graphically represented or chunked (i.e., grouped) together in meaningful segments. It may also mean that your benefits program or incentive plan communication needs to be a campaign approach rather than just a one-time reach out.
For a real life example, we consulted with a large pharmaceutical company on helping their salespeople better understand how all the different sales operations platforms, reports and activities connected together. Overall, this information was quite complex, with lots of data points and a high level of detail. We were worried about how we could communicate all of this information without overloading employees – our solution involved designing a piece that used a puzzle graphic to help show how all the pieces “fit” together. The use of a common analogy provided a way to simplify the information so that it was not perceived as overwhelming, was grouped together in logical ways (i.e., each puzzle piece), and had easy to understand connections displayed graphically. We integrated this concept into the overall campaign and were able to utilize it across multiple communications and media. This branding helped solidify the concept and ease the understanding across multiple fronts while simultaneously reducing cognitive load.
At the core of our nature, we are social creatures. We look to others to determine how we should behave and what the right actions to take are in a given situation. This is particularly true in situations that are new or that have a great deal of uncertainty. John Moses, a researcher for Aon Hewitt, states that we take cues from others because:
- “We need to make a quick decision.”
- “We observe what leads to success or failure for others.”
- “We want to conform to accepted social norms.”
- “We want to be accepted by others.”
Organizational communications can integrate social proof as a way to improve the likelihood of employees changing their belief and behavior. Communication can be structured so that it highlights how others are already on board. For instance, think about the following two headlines:
- “Make sure that you are using the new recognition app to recognize your peers!”
- “Over 60% of your peers are already recognizing each other with the new recognition app, make sure that you join the fun!”
The second headline, while longer, invokes social proof that others are doing this and would likely be more effective in getting the remaining 40% to use the new app. Communicating this way provides descriptive norms for people, showing them that this is what the “normal” behavior is. Descriptive norms showcase what it means to “fit in,” and as humans, “fitting in” is a powerful motivational force.
Social proof can also be highlighted by showing best-in-class, best-practices or simply by including personal testimonials. Personalizing a program or component can be key to getting people to buy in. This type of communication provides social cues that employees can recognize and understand that this is the injunctive norm (i.e., approved or expected behavior) of their peers and the organization. Messages that include an individual’s story are highly motivational and can be the difference between a message being acted on or discarded.
A word of caution on using social proof inadvertently – you want to ensure that you are not providing negative social proof. Sometimes organizations use a “burning platform” to try to motivate people. These can be motivating, but unintentionally, we may be providing social proof for the wrong behavior. For example, if an executive said in a speech or email: “I found out that only 10% of the company has signed up for our maximum 401K match – this is unacceptable, and we need to do better.” To an employee, the unintended social proof statement might be “most people don’t think that the max 401K match is a good thing” or “I’m ok, I’m doing what everyone else is doing.”
Bringing it all together
Corporate executives and communication departments in organizations all across the world are realizing that incorporating behavioral science principles in their internal communications can help drive the behaviors and performance improvement that their companies need. When organizations recognize and effectively utilize concepts such as framing, cognitive load, and social proof, they tap into the underlying psychology that drives us as humans. This can drastically improve, not only the effectiveness of your communications but how people perceive the organization.
And as always, remember – behavior matters!
About the authors:
Kurt Nelson Ph.D. is the founder and President of The Lantern Group which helps companies use behavioral science to improve their internal communications and motivational programs. For over 20 years, Kurt has worked with global companies to apply behavioral science principles to drive change in their organizations. Kurt lives in Minneapolis, MN, is married and has two, grade school children. He enjoys the outdoors, reading, skiing and a good craft beer.
Ben Granlund is the Vice President of Communication and Marketing at The Lantern Group. He applies his design background to optimize how our client’s communications are built. Ben combines behavioral science principles with graphic design, crafting communication pieces that actually change the way employees behave. In his spare time, he likes to travel the world, downhill ski (he’s skied at least once every month for almost two years straight), mountain biking and spontaneous adventures.
Ariely, D., (2009). Predictably irrational: the hidden forces that shape our decisions (revised). Harper Collins, New York, NY.
Kahneman, D., (2011). Thinking, fast and slow. Farrar, Straus and Giroux, New York, NY
Moschetto, M., (2010). Communicating about total rewards benefits employers and employees. Total Reward Communications: a collection of articles from World at Work. World at Work.
Moses, J. (2013). Using behavioral economics insights to deliver benefits messages. Benefits Quarterly, 3rd Qtr.
Thaler, R. H., (2004). Save more tomorrow: using behavioral economics to increase employee saving. Journal of Political Economy.
Volpp, K. G., Asch, D. A., Galvin, R., & Loewenstein, G., (2011). Redesigning employee health incentives: lessons from behavioral economics. New England Journal of Medicine, p. 365-390.
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