Nudge Theory: Indirect Encouragement for Better Decision-Making

5 Min Read
Nudge Theory: Indirect Encouragement for Better Decision-Making

Nudge Theory is the science behind how to subtly lead people into making the ‘right’ decision. Gently persuading people to do things differently without them even realising using behavioural science.

People make bad or irrational choices and need to be nudged toward better decisions. Imagine walking along the street and someone gave you a gentle nudge in a friendly caring way so you don’t slip on the banana skin ahead in your path. Not forcing you to change direction but to gently guide, nudge you away onto a better path.

Are we really in control of our own decisions in this day and age? In a time where we have never had so much personal freedom do we even notice the gentle pushes that are steering us into the choices we make?

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What is Nudge Theory?

Nudge theory is about understanding how people think, how they make decisions, how they behave and how they can improve their thinking and decision making. Nudge is based on indirect encouragement and avoids direct instruction or strict enforcement.

Philosophy of Nudging is “behavioural economics” bridging between economics and psychological analyses of decision-making.

Nudge theory is how human psychology can help shape economic decisions and offer insights that help people recognise useful tricks but avoid bad decisions. 

Nudge theory became more well known after the 2008 concept book, ‘Nudge: Improving Decisions About Health, Wealth, and Happiness‘, written by the fathers of behavioural economics  Richard H Thaler (Nobel prize-winner for economics 2017) and Cass R Sunstein both American academics. The book is based around the work of Israeli-American psychologists Daniel Kahneman and Amos Tversky and heuristic.

Humans Avoid Decision Process

Humans are prone to making decisions almost without even thinking when choices become overly complicated. We let our autonomous nervous system make decisions for us, avoiding the thinking process bailing out of the decision process altogether, meaning we can make very random choices.

Heuristic is a term for a mental shortcut ability that enables us to solve problems and make decisions quickly. Heuristic allows us to function without having to constantly stop and think about what to do next. Humans have tendencies to think and decide instinctively which often leads to mistakes.

Helping people make better decisions, while not limiting what decisions they can make themselves is key to nudges working. The best nudges follow the EAST acronym: Easy, Attractive, Social and Timely

How Does ‘nudge’ Theory Work?

The human mind is susceptible to nudges toward better decision making.

Nudge theory is about people being subtly guided, encouraged and nudged towards the right decision, rather than being told.

Often given two choices, we are likely to select the wrong choice even if it is detrimental to ourselves. Lack of time to think, bad habits and poor decision making can mean making the wrong decision even when presented with full facts.

Understanding how people make choices and how you can subsequently influence their decision-making tendencies to make better decisions.

People often choose what is the easiest option over what is the wisest choice. Some great nudge examples here and more information on how the theory can improve workplace performance.

Nudge in Change Management

Nudge theory is very relevant to motivation, productivity, and change management.

Changing business processes or the way things run can come up with negativity and nudge theory can help minimise resistance which can arise if a more forceful ‘enforced direction’  method is used to try and change behaviour and actions.

Checkify can help in change management by offering a way to guide people in the best way to perform a task in the form of a checklist.

Checkify gives you a way of making decisions easier by influencing choices with facts and business knowledge at your fingertips so things get done the right way every time.

Checklists Offer a Way to Nudge Decisions

Checkify offers guides with checklists on how things are best done to nudge people towards the best way to complete a task. To guide them to not missing out on an important step in a process but while allowing them to make suggestions on better ways to improve and allowing input and encouraging feedback.

Checklists nudge, encourage progress for better decision making.

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