Why understanding human behavior is a key success factor for every business

Less is more, right? Well, according to Betty Crocker’s marketing and data in the 1950s, context matters.

At the time, General Mills had thought that they hit a goldmine with their creation of a line of cake mixes that included all dry ingredients needed to bake a tasty cake, including eggs and milk in powdered form. Any person (which, in those days, was undoubtedly expected to be a woman) could add just water, stick the pan in the oven and watch a cake rise.

The only downside? The miracle mixture didn’t sell.

So, GM brought in a team of psychologists to better understand their less than sweet situation. What they found was that women felt they were deceiving their husbands given the minimal effort. In turn, the stagnant sales were an outcome of a widespread sense of guilt.

Rather than using marketing to combat this emotion, Betty Crocker’s “Add an Egg” slogan and solution was born. By adjusting the product, removing the powdered egg, and granting women the responsibility of adding an egg, guilt was no longer part of the box.

Now, what does this have to do with Behavioral Thinking?

Absolutely everything.

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The Rise of Behavioral Science

Every business relies on activities that shape and influence people’s behavior - whether it is customers, users, employees or partners. Companies that know their audience, in a deep manner, become disruptors in their industries. Airbnb, Duolingo, Lemonade, Spotify, Uber and Zappos are a few players who have proven the latter. These game changers were neither first to market, nor were they responsible for breakthrough technology, but nevertheless, they all became leaders in their niche because of their in-depth sense of people.

If understanding human behavior was so straightforward, every business would do it right. The truth is that human behavior is very delusive. As the anthropologist Margaret Mead once said: “What people say, what people do, and what they say they do are entirely different things.”

Put simply, human behavior can often be:

• Counter-intuitive - people are willing to donate significantly more money to a single named starving child than to two named starving siblings
• Context-dependent - people prefer to buy a small popcorn for $3 over a big one for $7, but will choose to buy a big popcorn for $ over a medium-size popcorn for $6.50
• Partially unpredictable - deaths from paracetamol overdoses fell by 43% in England and Wales in the 11 years after pack size was reduced from 32 tablets to 16

The good news is that with the appropriate methods, human behavior can also be studied and consequently shaped.

During the last decade, there has been a revolution in behavioral sciences. The field of Behavioral Economics grew beyond the walls of academia and has since become a buzzword in Marketing, UX, Product, and Policy, among other fields.

In 2008, Nobel Laureate Richard Thaler and Cass Sunstein coined the term Nudge, which later gave birth to more than 100 Behavioral Insights Teams around the world, often called “Nudge Units,” which are governmental institutes applying evidence from behavioral science to inform public policy.

The scientific approach continues to make its way into businesses around the world to help understand hurdles, like the General Mills one referenced above.

But, you shouldn’t get married to a single method

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The Dark Side of Methodological Thinking

While there has been a rise in the options of methods (Behavioral Design, Systems Thinking, Service Design, etc.) that are used to help solve business problems, create better services and improve customer experience in both the public and private sector, there is a downside.

Such methods can turn out to be double-edged swords; the benefits of using them to solve problems become their disadvantages. Seeing the world through a lens of a specific methodology helps to overcome blindspots and come up with solutions that may have otherwise been overlooked. Yet, with each method comes its own related assumptions, both implicit and explicit, which ultimately narrows your lens.  

The cliche holds true - if you give a kid a hammer, everything looks like a nail.

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What is Behavioral Thinking?

To resolve the aforementioned, we developed an approach called Behavioral Thinking. Behavioral Thinking is an interdisciplinary approach to complex problem-solving and strategic decision-making that is based on a deep understanding of human behavior.

Let’s unwrap a little more:

Deep understanding of human behavior: The main focus of Behavioral Thinking aims to uncover the way people think, feel and act (not necessarily in that order). However, trying to understand behavior through a lens of one discipline can lead to partial, or even wrong, conclusions.

Interdisciplinarity means that you shouldn’t get married to a single method. Every method has its blindspots, and so, methods are means to an end. The combination of methods helps to reduce errors and uncover more valuable insights.

Complex problems are complex due to their constant change and dynamic conditions. This makes their understanding and analysis resistant to the reduction of just one point of view or methodology. As such, complex problems rely on a multidisciplinary approach to be able to solve.

Strategic Decision-making is made by integrating facts and intuition. The Behavioral Thinking approach relies on data rather than mere opinions, but it also takes into account our intuition to interpret the facts. Our expertise in cognitive biases allows us a conscious decision as to when to trust your gut feeling (and when to definitely not).

Can You Have Your Cake, and Eat It, Too?

The study of human behavior is a science (and an art, I would argue) that uncovers how people think, feel and act. Luckily, we live at a time where we have the tools to go beyond assumptions to understand human behavior and solve problems accordingly.

At Q Behavioral Thinking, we work with experts from various disciplines, and so our team is able to question ourselves in a constructive and critical way. We begin our process by assessing our assumptions before moving forward.

Through our interdisciplinary approach, we can gain the power to provide an answer to (almost) any (human behavior-related) question. And so, it turns out that you can have your cake, and eat it, too.