Has your business got a sustainable New Year’s Resolution?08/01/2020 By Ted Utoft
At this time of year we often find ourselves focused on annual resolutions. And often our goals sound all too familiar. Living healthier, saving more, reducing climate impact. We’ve made and broken these personal promises before.
New Year’s resolutions are a perfect example of the gap between intent and action. Breaking well-established habits is hard. And knowing what to do differently is rarely enough.
Small changes in our environment and routines can make a big difference in our behaviour. This is behavioural science 101. For anyone struggling to keep their New Year’s resolution, I recommend Wendy Wood’s Good Habits, Bad Habits: The Science of Making Positive Changes that Stick.
Change is also difficult but necessary for organisations. To adapt, improve and prosper, companies also need to break their established habits.
So what should a New Year’s resolution look like for a business?
Surely a resolution should involve more than aiming for slightly higher revenues, margins and profits. In today’s context of political polarisation and climate-crisis, you’d expect companies to more fervently pursue sustainable business models. I’m referring to sustainability in a broader sense: designing organisations to thrive for many generations. This can be achieved by serving the long-term needs of all stakeholders (including broader society).
Some mistakenly assume that sustainability requires breakthrough innovation and fundamental overhauls in strategy and incentive structures. But there is lower-hanging fruit.
Businesses can achieve sustainability by addressing the ‘intent-action gap’. And by helping people achieve their personal goals. This vision may sound idealistic or simplistic. Yet there are actually very clear and accessible opportunities across all business sectors.
- Financial services can help investors to save money and plan better
- Consumer goods marketers can assist shoppers in making healthier choices and portion control
- Healthcare organisations can influence patients to take medicines as directed
- Hotels can help guests to conserve energy and reduce waste
These (and many more) are examples of ‘win-win-win’ scenarios. They benefit businesses, their customers and society. In each, behavioural science can be used as these situations require behaviour change rather than new technology. In fact, they are all areas where small, low-cost interventions (such as defaults, reminder systems and visual design) can nudge people towards better decisions and desired outcomes.
Importantly, this is not just the right thing to do. It is a formula for success in a changing world, in which people are increasingly looking for meaning, purpose and connection.
Both academic research and common sense suggest that:
- Customers will form deeper relationships with companies that actively help them reach their personal goals
- Employees will feel more engaged and loyal to organisations that clearly serve a deeper purpose
So as the decade begins, we have made our own resolution. To help more businesses recognise their own self-interest, embrace a new vision and employ behavioural science as a catalyst to drive the changes needed for long-term sustainability.