[MUSIC] The second one in the ABC's is obviously the B, this is for the barriers. And there's a variety of barriers we have, some of them not so obvious. So I was born and raised in Hamburg, Germany. My father was Iranian, my mother's German. And so Germans, good people, of course, and you might say very similar to Austrians. Turns out, not so similar on one dimension. It turns out when it comes to donating your organs should you die, have you signed over your body parts basically to help somebody else live? Dramatic difference, only 12% of German adults have done so. Whereas in Austria, almost 100%. You might ask yourself the question, well, why is this? What is the cultural difference between Germans and Austrians? It turns out that there is none. The only difference is, in Austria, when you get a driver's license, the default option is you give your organs. And you have to opt out. You have to say no, I don't want to do this. Which is, actually a way of saying well, why wouldn't I? And you'll probably come to the conclusion, no, I probably should. In Germany, the default option is to opt in. The default meaning is I don't give. Now, you have to say, well, I'm not giving. Should I give? And you think of all the reasons. It's my organ, some people have religious issues with this, so it was completely different starting point. But the more general conclusion is that the status quo, the way things have been done already, they're very much like the default option. People take the status quo for granted. This is what I've always been doing, and it takes a lot to change that status quo. What can you do to make the status quo the behavior that you actually want to encourage? Maybe through your induction program, standards, procedures, whatever that might be. Other barriers are also maybe sometimes quite surprising. There's a big gap between what we want to do and what we actually end up doing. And one of the reasons between this gap is these barriers. So in the UK, they have this program from the government where literally nine out of ten homeowners qualified for free insulation in the attic. So you could have insulation put in the attic to conserve energy which is part of the initiative of the UK government. But a very, very small number of households actually went ahead and took advantage of this free offer from the UK government. Now you might say, well, that's kind of silly. It's free. They're going to save on energy. But, we're thinking about the idea. We're not thinking about implementing that idea. So in terms of actually implementing your behavior, if I tell you I will insulate your attic for free, just think about it. What goes through your mind? You're probably thinking, hm, my attic. A picture emerges. It's probably, if it's anything like my attic, completely cluttered. There's stuff in there you didn't know you still had, there's stuff you're not sure you want to get rid of, it's a huge effort. So even though you have a free offer, here's a step that you have to take before you can take advantage of it. So the UK government has what we call the Nudge Unit. It's now an independent organization. They did a simple experiment. They either gave the discount, which is the free installation where the behavior didn't change much from what people do in general. Or without any discount, they simply gave you information about a service that will clear your attic for free. A lot of people will come in, they'll clear your attic and basically pay for it with whatever they can clear. That led to dramatic increase in terms of the number of people having their attic cleared. Because that is a step that had to happen before the final step and was also a lot cheaper for the UK government to do so. So better and cheaper both at once. Another barrier to the behavior is often that there are many, many different goals we have at any different time. So let me give you and example. This is from my time at MIT. They were developing this crazy clock there. It's called Clocky. It's an alarm clock for the morning. It's got these big wheels on it. It rings in the morning, and if you hit the snooze button, it sort of tolerates that once. Soon enough, not only does it ring louder, but it starts moving, the wheels start spinning. It jumps off of your bedside table, it goes around the room, and it becomes so annoying that you'll try to catch it, you roll after it, and by the time you shut off the alarm altogether, you're awake. So what happens here is if you think about gold competition, when you set the alarm clock maybe to go running in the morning. It was the evening before, you clearly had your health and fitness goal in mind. But in the morning you're in your sheets, it's nice and cozy. You don't want to get out of bed. So there's your competition between maybe the long term goal, the things you know you should do, and the short term goal in terms of what you want to do. And whenever goals like that are in competition, the short term goal kind of wins. Another example is the Michelin tire. So if you change tires on your cars, you probably know that when you walk into that store, you get sticker shock. Really, is that how expensive tires are? Because we don't think about the cost. We don't do this very often. So at the moment of purchase, the goal of saving money becomes huge, and you start looking at prices, and price starts driving your decision process. Now, Michelin has been spending a lot of time on advertising about, think of what's riding on your tires, the safety, your children, the people on the road. Now in the moment though, in the store, so if you think about that gap between maybe knowing and doing, you know you should buy the safe tires. But it's not what you do because that knowledge is not active in the moment. So what Michelin did is they put a little cardboard cutouts of the baby inside the tire in the store, just to reactivate that goal of safety so they have a chance to compete with price. And of course as managers, if we want to have on brand behaviors, we have to constantly remind people so that they remember that goal in terms of actually living the brand because there's many competing goals at the same time. You're constantly nudging your own people in order to exhibit the right behaviors. [MUSIC]
