Nudging in HR

Nudging in HR

So, what actually is nudging? And what does it have to do with HR? Nudging is not only indispensable in politics and technological development, a nudging strategy can also be a big winner for HR.

Nudging in HR

How can we persuade people to behave voluntarily in a certain manner without plastering the world with signs telling people what to do and what not to do? Nudging deals with this question and, thanks to its clever answers, it is enjoying great success.

What is nudging?

Rudely awoken by a shrill noise, my reflex is to press the snooze button on the alarm clock so that I can drift back to dreamland for a short while. Suddenly it occurs to me that I have agreed to a morning jog with a work colleague – a way of keeping my New Year’s resolutions. This appointment with the work colleague is a way I have found of achieving a desired behaviour. That’s nudging.

With his nudging theory, Richard Thaler has laid the foundation stone of a liberal alternative to the unpopular prohibition culture. The concept of nudging was originally developed as a political strategy based on behavioural economic insights and findings. The intention is to encourage people into a certain behaviour by small pokes – so-called “nudges”.

Nudging rests on two basic assumptions. First: People do not always do what they would like to. The intention to be more active in sports more often than not fails due to feeling tired. Second: The problem of the first assumption – tiredness – is very easy to outwit.

So, is nudging a wolf in sheep’s clothing?

The question of whether this instrument of behavioural control restricts our freedom of choice is justified, of course. While looking for answers, we come across further questions of whether there is such a thing as transparency in politics or in business management. But questions about the importance of human autonomy and personal responsibility also become necessary.

The key feature of nudging is that the circumstances under which decisions are made are changed such that it is more likely that the person will act in a certain way. The intention is to influence human behaviour in a positive way by slightly shifting the frame of reference.

But therein lies the crux of the matter: Who decides in which direction should be nudged? Who defines the moral standards of “right” and “wrong”? This raises major questions of social ethics. It becomes clear, however, that nudging is a promising way of influencing the behaviour of people. For example, people can be nudged into healthier eating habits by reducing the standard plate size, positioning salads in a certain way or relegating unhealthy dishes to the second page of a menu.

The question of whether nudging is a wolf in sheep’s clothing, although thoroughly justified, can now be answered with a confident “no”. Nudging is a tool that, like many other tools, can be used destructively or constructively, positively or negatively, benevolently or maliciously. How nudging is used is decisive.

Nudging in HR

But how does nudging work in a company – who decides the direction in which to steer? Every company is dedicated to a certain goal, and everything is tried in order to achieve that goal. Against this background, it seems that the method of nudging has great potential as an instrument in successful corporate management and therefore also in HR.

Almost two years ago, the former HR boss of Google, Laszlo Bock, founded the startup Humu – a tool based on nudging theory and intended to create innovation in the HR area. Humu gives employees and managers personal and motivational suggestions tailored to their personality characteristics and potentials. In doing so, Laszlo Bock, has achieved a successful use of nudging in HR.

However, a much wider field for the use of these subtle pokes opens up if HR can use nudging to significantly optimize corporate culture and employee well-being. Push messages on smartphones or computers can remind employees to go out into the fresh air, to blink or their eyes or to do something else that’s good for them. Nudging can also reduce the burden for employees by defining realistic objectives for projects. Another nudging approach to promote employee well-being would be to set all email accounts to inactive by default at weekends.

Financial and HR departments can also benefit directly from nudging. Expenditure on travel expenses can be reduced by setting the travel app to second class by default for rail journeys, for example, or by flashing up a message that 70% of the employee’s colleagues choose second class. Although travelling in first class would continue to be allowed, the employee is given incentives to choose second class.

We are of the opinion that nudging is a method worth trying out. Used correctly, it can help a company on the way to positive changes and even spare employees from a corporate culture being regulated in an authoritarian way.

Want to talk about how you can use HR Nudging in your company? Our HR Strategies team would be happy to answer your questions.

Published: 1. February 2019

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