How a deeper understanding of human behavior is shaping organizations

@IE University

At the heart of it, the economic system, corporations and governments are all fueled by one thing – human behavior. And now, findings from behavioral and social sciences are providing invaluable insights and tools to help all kinds of organizations perform better from the inside out.

Humans are complicated animals. Getting to the bottom of why we do the things we do, what drives our desires, and our strategy for connecting with the world is no easy task.

Yet, today there are more tools than ever at our disposal to help understand our actions. 

From ever-improving scientific understanding of the mind to the production of massive digital data trails and the accumulating insights from a wide variety of academic disciplines, the understanding of human behavior is becoming deeper and deeper.

This wealth of understanding has become extremely valuable to organizations across the board.

From tech companies to retailers and non-profits to governments, organizations are starting to wrap their heads around the complexity of human decision-making – not only to better engage with their clients, citizens or partners, but also to retain and attract the best human talent possible.

For instance, Microsoft is reportedly the largest employer of anthropologists in the world, behind the U.S. government. Prabhakar Raghavan, a senior vice president at Google, said social scientists are key to his company.  “A social scientist is not content to know that someone clicked on a page. They want to know why: what were the background and cultural factors that played a role in that choice?” he said in a 2012 interview.

According to Jessica Tollette, Academic Director of the Bachelor in Behavior and Social Sciences at IE University, understanding is one piece of the pie, but there is also an actionable element. “Behavior and social sciences combine ideas from different social science disciplines to think about why people make certain decisions, and also how to pull different levers to influence and change certain behaviors and decision-making patterns,” she explained.

A glimpse into the toolkit

Far from being rational actors, human beings are swimming in contradictions. Despite knowing the negative consequences of bad habits, these can remain ingrained. Instead of carefully weighing out the pros and cons of a particular decision, we rely on our gut feelings. People even often surprise themselves.

However, there are a variety of concepts derived from behavioral and social sciences, trends which have been observed and tested, that help organizations understand how and why people act. Some of these terms have even made their way into the popular lexicon.

Consumer behavior black friday
Retail events like Black Friday draw on behavioral science, creating states of excitement and using knowledge of the psychology of gains and losses to drive sales.

Take the term implicit bias, for instance. The coffee company Starbucks made headlines by training nearly 175,000 workers in the idea of implicit bias to reduce racism. According to the concept, even though many people say they don’t judge based categories like gender or race, many actually do at a subconscious level. Interested in what your own implicit biases may be? You can take a series of tests developed by world-renowned scientists here.

Social contagion is another framework that shines some light on our actions. It refers to the propensity for individuals to copy someone else’s behavior. From moods to generosity, and fashion trends to the spread of online ideas, numerous studies have found that our actions are not isolated. In organizations, marketers in particular have seized on this idea, using online influencers as ‘patient zero’ for the spread of new trends. One study conducted in partnership with Twitter even found that nearly 40 percent of its users said they’ve made a purchase as a direct result of a Tweet from an influencer.

What clients want

Apart from using insights from social sciences to understand and influence more general societal trends, several companies have employed behavioral scientists to engage directly with their customers.

For instance, in the early 2000s, Adidas realized it might have overlooked that its athletic gear had uses outside of competitive sport. So, the company brought in Red Associates and their staff of behavioral and social scientists who spent 24 hours straight with a cross-section of Adidas customers, observing them and asking them why they used the products.

The result of those studies? It was found that Adidas customers were not just interested in competitive sport, but instead wanted products that helped them lead more healthy lifestyles. With that finding in hand, the company changed its branding with more inclusive messages, and started tailoring its products toward those who were not high-performance athletes. With its currently broad range of everything from yoga clothes to urban streetwear and yes, still, technical sporting gear, Adidas has managed to remain a leading performer in the sports apparel sector.

According to an article in the Economist, James Carnes, a creative director at Adidas, gives big credit to Red Associates, attributing “a general effect on everything” to the team of social scientists.

adidas consumer behaviors and social sciences
A corporate photo showing the Adidas’ Climaheat Down Jacket goes far beyond appealing to professional athletes.

A ‘visitor’ on the inside

The quality of an organization’s staff can make or break a business. Organizations are constantly on the search for the best talent, but even that process can be problematic. The insights of behavioral science can also be very useful when turned inward.

For example, studies on bias have shown that even the best recruitment officers don’t always act rationally in the hiring process. After all, they too are human. For instance, a study in Canada found that Canadian jobseekers with Asian names were up to 40 percent less likely to receive a callback than their equally qualified peers. This, despite the fact that study after study has shown that diversity in the workplace is actually beneficial to companies.

So, behavioral scientists are finding new ways to improve the process. The Behavioral Insights Team (BIT), launched as an initiative of the UK government, has created a platform that anonymizes resumes so that employers don’t make unconscious decisions based on a candidate’s name. Going even further, the platform also allows for blind scoring of responses so that candidates are not judged differently based on their answers to previous questions.

Once an organization has found the ideal people for its team, the next step is not only getting them to stay, but also to thrive and perform to the best of their ability.

By conducting research on a company’s values and culture, behavioral scientists have been able to help executives at organizations understand how the image they think they’re presenting varies from the image their employees conjure up. Behavioral scientists can find patterns of employee behavior and compare and contrast conditional values, such as headquarters or geographies, to make recommendations on where to change or build on existing behaviors.

We know from hard science, and particularly the field of positive psychology, that people’s daily emotions – the concrete, daily positives and negatives we all experience in a workday – can have a big impact on performance,said Lee Newman, Dean of the IE School of Human Sciences and Technology.