Harnessing Behavioural

Insights: A Play book for

organisations.
Rotman Management Magazine. Spring 2019, pp. 7-12. Harvard Product Code: ROT385-PDF-ENG
Background:

Inspired by the growing interest in BI from all sectors as well any formal guidelines
for embedding them within an organisation, Behavioural Economics Action at
Rotman (BEAR) has published a ‘Playbook’ to help interested Leaders navigate the
realm of BI.

Context:
Some of the smartest organizations have begun to embed behavioural insights (BI)
into their everyday processes. The authors describe how organizations can
incorporate behavioural insights into their practices is central to their work.
Key Insights

Various roles Behavioural insights (BI) can play in their organization.

•For instance, practitioners could think of BI as a problem solver. Considering human behaviour might
solve previously unnoticed problems and drive organizations to simplify forms, eliminate confusion
and present choices more clearly to their stakeholders.

• BI can be an Auditor. By thinking like behavioural scientists, organizations might discover what did or
did not resonate with stakeholders with their newly launched application processes, marketing
campaigns or policy decisions. Better yet,

•BI might be an organization’s lead designer, inspiring the development of new products that are
intuitive and easy to use.

•BI should be every organization’s chief strategist, driving the way it designs both internal and
external processes.
Three Truths about Behavioural Insights

 PEOPLE ARE ONLY RATIONAL TO A CERTAIN EXTENT.

 PEOPLE HAVE LIMITED SELF CONTROL

 PEOPLE ARE INFLUENCED BY THEIR ENVIRONMENT

The ABCD Framework for Using Behavioural Insights

A. ATTENTION – make it relevant, seize attention and plan for

inattention
B. BELIEF FORMATION – Guide search, make inferences intuitive and
support judgement
C. CHOICE – Make it attractive, frame prospects and make it social
D. DETERMINATION – Work with friction, plans, feedback and create
commitments
Embedding BIs in organisations: Four Approaches

Concentrated Diffused
Expertise Expertise

Application Application
Narrow
FOCUSED CAPACITY BUILDING

INTERNAL BEHAVIOURALLY
Broad

CONSULTING INFORMED
ORGANISATION
Conclusion:

The Behaviorally Informed Organization tells you what you need to know: from the
roles that behavioral insights can play within an organization, to the business case, to
specific examples of companies to learn from and in making decisions
The Hidden Traps in Decision Making
Hammand, J.S., Keeney, R. L., & Raiffa, H. (1998). Harvard Business Review, 76(5), pp. 47-58
Background:
The hidden traps in decision making By John Hammond, Ralph Keeney, and Howard
Raiffa examines the psychological traps that can affect the way we make business
decisions.

Context:
Bad decisions can often be traced back to the way the decisions were made–the
alternatives were not clearly defined, the right information was not collected, the costs
and benefits were not accurately weighed. But sometimes the fault lies not in the
decision-making process but rather in the mind of the decision maker. There are various
traps that discussed in article: the anchoring trap, the status-quo trap, the sunk-cost trap,
the confirming evidence trap, the framing trap, and the estimating and forecasting traps.
Key Insights
Let us examine below psychological traps that can affect the way we make business decisions.
•The anchoring trap leads us to give disproportionate weight to the first information we receive ( Seek Inputs, Think
before asking , Take a different perspective)
•The status quo trap biases us toward maintaining the current situation–even when better alternatives exist. ( Know
you have options, Dont settle)
•The sunk-cost trap inclines us to perpetuate the mistakes of the past. ( Allow Outsiders, accept mistake has Happen)
•The confirming-evidence trap leads us to seek out information supporting an existing predilection and to discount
opposing information.( Consider all evidence , Avoid people dont agree with you)
•The framing trap occurs when we misstate a problem, undermining the entire decision-making process. ( Always
reframe, Think in Neutral frame, Challenge others frames)
•The estimating and forecasting traps were made of three traps the overconfidence trap, the prudence trap and the
recallability trap
-The overconfidence trap makes us overestimate the accuracy of our forecasts. ( Question estimates, Challenge
extreme)
- The prudence trap leads us to be overcautious when we make estimates about uncertain events. ( Aim for
accuracy)
- Recallability trap prompts us to give undue weight to recent, dramatic events. ( Check facts, Examine
assumptions)
Conclusion:

Even though there are some specific ways Manager/Executives can guard against
these trap its is important to remember the best defence to avoid all the traps is
awareness–forewarned is forearmed.

Executives who attempt to familiarize themselves with these traps and the diverse
forms they take will be better able to ensure that the decisions they make are
sound and that the recommendations proposed by subordinates or associates are
reliable.
Understanding another person, Part I
The Individual Frame of reference:
Harvard Business School, 9-473-009
Background:
Understanding another person part 1 The Individual frame of reference case
prepared by Anhong G Athos and John J . the purpose is case study is to introduce a
way thinking about individuals that can make it easier to understand them from thier
own point of view and thus enable you to become more effective in understanding
and anticipating individual needs wants and problem

Context:
* The first is that it very difficult to seperate ones own subjective of another person
from how that person is apt to see himself.
* The second is trying to understand another person grows out of above difficulty and
related for to fimalar paradox.
Key Insights:
A way of think about individauls: Approach to understand another pesron from his/her own point of
view and His/Her frame of reference. ( Perceptual , personal or phenomenological)
Individual frame of Reference: assumes that each person sees the orld somewhat uniquely based on his
past experience and his own personal meaning. Persons self concept will have great bearing on the
person’s behavior.
Idea of Self concept: Self concept is the internalised set of relatively stable perceptions that a person has
of himself and of who is he. Self concept are usually acted upon in person’s behaviour in what matters to
individual , how the individual is likely to respond to situation and how the individual is apt to see himself
in situation
* Persons self concept develops in relation to past experiencing and the meanings a person makes
from this experiencing
* Once a self perception has been firmly established as part of persons self concept ,the self
perception will affect how the person experience future situations.
Key Insights:
Understanding Another persons frame of Reference : Self concept alone is not a sufficently broad idea
to encompass all of individual’s frame of reference . How a person behave in one situation may be quite
different from how he might behave in another. because each person’s world is experienced in terms of
important assumptions, perception and feelings. ( understand how differenr people could experience the
same encouter diffrently)
Assumptions are Built in Beliefs , Values and attitudes.

Perception: includes all those process by which an individual recieves information in his environment by
seeing , hearing.

Feelings: emotive and affective reactions of person in response to given situation.

Conclusion

• As in real life , effective actions cannot be taken without first understanding

points of view of individual concerenrned and why they see a situation the way
they do

• The more capable you are understanding others the better able you become of
understanding your own dilemmas and conversely, the more in touch you are
with yourself and your baises and assumptions the more capable you become of
understanding others.
The Treadway Tire Company : Job Dissatisfaction and High
Turnover At lima Tire Plant
Skinner, C . W (2008). Harvard Business School, HBS No. 2189-PDF-ENG
Background :
• Treadway tire company is a supplier of tyres to major company
• Engaged 9000 hourly and salaried employees in North America
• Lime Tire was one of eight manufacturing plants operated by Treadway

Context
To identify context root Cause of problem which is turn over and the other one
creating job satisfaction among employees at Lime tire

Problem
High attrition rate in Line Foreman category in which out of 50 foreman 23 had left
in 2007.
 Strength :
24/7 Working
Cost efficient
Higher production capacity with upgraded equipment
Weakness
12 Hr shift ( 2 shifts)
High attrition rate in line foreman category
lack of Training
lack of proper communication
Opportunity
Improved recruitment process
Proper training
Support from plant superiors
Boast the morale of line foreman , Line foreman can make direct impact
Threats
Unionized work environment
Demoralization
problems infects entire plant
Loss of cost effectiveness
Key Learnings:
Treadway was depedent on union , foreman’s had no choice but accept the behaviour issue of
Hrly employees, The lack of authority and conflicts led to high level of frustrations by
foreman. By reviewing the exit interviews it was clearly understandable the company was not
developing its employees to next level. Line foreman left alone without neccessary skills/tools
to perform the job. the Hrly employees showed no respect to line foremans. Lack of
communication between line foreman and superiors.

Solutions:

-To improve the recruitment process

- Reduce shift hours of hourly workers into 3 shifts
- Introduce proper structured way of formal training
- Introduce proper communication channel
- In aspect with dealing with union Company should negotiate with union with
regarding authority of line man and dividing work force
 What makes a leader?
By Daniel Goleman
Goleman, D (1998). Harvard Business Review, 76 (6), pp. 93-102
Background: Effective leaders are alike in one crucial way: they all have a high degree of emotional intelligence.

• IQ and technical skills are important, but emotional intelligence is the

sine qua non of leadership
 The Five Components of Emotional Intelligence at Work
Components Definition Hallmarks
Self-Awareness The ability to recognize and understand your  Self-confidence
moods, emotions, and drives, as well as their  Realistic self-assessment
effect on others  Self-deprecating sense of humour
Self -Regulation The ability to control or redirect disruptive  Trustworthiness and integrity
impulses and moods  Comforts with ambiguity
 Openness to change
The propensity to suspend judgement to think
before acting
Motivation A passion to work for reasons that go beyond  Strong drive to achieve
money or status  Optimism, even in the face of failure
 Organisational commitment
A propensity to pursue goals with energy and
persistence
Empathy
Social Skill
 Ramesh And Gargi (A)

Background :
This case illustrates the straining relationship among the three individuals in an
organization. Ramesh Head- L&D, Chrysalis Pharmaceuticals, gets a few bitter
experiences at his office. Ramesh believes he being replaced wit a new, extremely
capable, and youthful woman employee named Gargi and will be eased from the
company.

Context
It is unclear whether Ramesh is going to leave the organization or stay on due to
deterioration of the relationship.
Problem:
• Chrysalis was a developing Pharmaceutical company with 1200 employees in which
Ramesh Headed L&d Department Earlier Ramesh has worked for more than fifteen years
in all divison of HR .
• The arrival of Gargi Sinha has made Ramesh to check his performance in the organization.
• Gargi’s experience is of three years in Microsoft which was less as compared to Ramesh.
• Gargi became comfortable easily, impressed everyone with her skill.
• The activities of Gargi made everyone to praise her. This affects Ramesh
• A gap formed between Ramesh and the organization.
• Though he mentally prepared and try to familiar with the activities but that not forms a
good result.
• The ideas of Ramesh was not accepted by organization.
• Ramesh was not aware of any information that happens in the organization.
• The name Ramesh was started to disappear within the activities conducted in their
organization.
Key Learning:
• Ramesh was not very open to Gargi.
• For taking any decisions or conducting any meetings Ramesh was informing to everyone
he informed to Gargi as well but she didn’t give prior information to Ramesh( Since her
engagement with Chrysalis was 60% CSR and 40% L&D)
• Gargi refused to organize Ramesh’s meeting.
• Gargi created an impact among the team members through her working style
• Ramesh was jealous of gargi because he lacked self esteem and he was distracted from his
work ,which even created problems in his personal life.
Solution:
• Ramesh needs to talk personally with CEO and VP Kamla and he should identify the
reason why they have constantly ignored him .
• He must speak openly to gargi .
• If none the possible alternatives work out he must immediately he must look for another
job and quit this job . Suppose if they respond positively he should stay in the company
and prove that he is better than everyone else in the company .