A nudge… is any aspect of the choice architecture that alters people’s behavior in a predictable way without forbidding any options or significantly changing their economic incentives.

A choice architect is one who indirectly influences the choices other people make. They are entitled to the responsibility for organizing the context in which people make decisions. If you design the ballot the voters use it to choose candidates or design the form that employees fill out to enroll in the company health care plan you are a choice architect. People will need nudges for rare and difficult decisions, for which they do not get prompt feedback and when they have trouble translating aspects of the situation into terms that they can easily understand.

Who is a Choice Architect and why do we need nudges?

A good system of choice architecture helps people to improve their ability to map and select options that will make them better off.One way to do this is to make the information about various options more comprehensible, by transforming numerical information into units that translate more readily into actual use.If I am buying apples to make into apple cider, it helps to know the rule of thumb that it takes three apples to make one glass of cider.

Understand Mapping

For a given choice there is a default option, an option that will obtain if the chooser does nothing, then we can expect a large number of people to end up with that option. Automatic renewal for magazine subscriptions is a classic example.If the choice architect forces to choose then keep 2 points in mind:<ul><li>Humans will often consider the required choice to be a nuisance or worse.</li><li>It should often be considered for simple yes or no decisions than for more complex decisions.</li></ul>

Defaults are ubiquitous and powerful

<ol><li>Either play on the fallacies and biases that pattern our automatic (lazy) thinking (see list further down),</li><li>Or jolt people into reflective thinking by providing them with a new way of thinking about something </li></ol>

How to Change the World

iNcentives - The right incentives for the right people enable good decision-making processes.Understand Mappings is how people can better relate to the consequences of different decision pathwaysDefaults - People often leave the default decision on if they are too lazy to make a decision.Give Feedback - A good way to help humans improve their performance is to provide feedback.Expect Error - To err is human and designs should be made such that people are forewarned before a more disastrous outcome happens.Structure complex choices - having too many choices can cause choice overload, simplify.

6 Principles of good choice architecture

<ul><li>Loss Aversion: We prefer not to lose rather than gain</li><li>Myopia: We make choices based on short term gain, often at long-term costs</li><li>Conformity: We tend to make choices to conform with the behaviour and expectations of others</li><li>Anchoring Bias: Choosing by relying too heavily on the first piece of information offered. </li><li>Availability Bias: Choosing by overestimating the likelihood something will happen because you can imagine it (e.g. being in a plane crash)</li><li>Representativity Bias: Choosing by overestimating the likelihood something will happen because it fits (is representative of) your expectations</li></ul>

Biases and fallacies in how we choose

The authorities at Schipol Airport in Amsterdam have etched the image of a black housefly into each urinal in the men's room. Men usually don't pay much attention to where they aim but if they see a target, their attention and accuracy increases.The natural urge is to aim (and drown the fly) resulted in 80% less splash. Cleaner restrooms lead to less cleaning leading to less harmful chemicals being used and also it doesn't hurt to make people laugh.

The Fly in the Urinal

Insights from the architecture of choice reveal two opportunities for the innovator based on basic psychology and the fact that people have two distinctive thinking styles that they flip between;<ul><li>Reflective thinking (aka “Systematic”, “Central”, “System 2” thought) that is temporary, slow, considered, effortful and deliberate</li><li>Automatic thinking (aka “Heuristic”, Peripheral, System 1″ thought) which is our default style – quick, instinctive, impulsive and, critically, highly error-prone)</li></ul>

Two Opportunities

How to prioritize what matters, and how good decisions are made.

problemsolving

Problem Solving

communication

Communication

personaldevelopment

Personal Development

timemanagement

Time Management

Making Better Decisions

Although this book is focused more on policy innovation, I liked the parts which show that any consumer-focused innovation should begin with understanding how consumers choose. 

Every day we make decisions: about the things that we buy or the meals we eat; about the investments we make or our children's health and education; even the causes that we champion or the planet itself. Unfortunately, we often choose poorly. We are all susceptible to biases that can lead us to make bad decisions that make us poorer, less healthy and less happy. And, as Thaler and Sunstein show, no choice is ever presented to us in a neutral way. By knowing how people think, we can make it easier for them to choose what is best for them, their families and society. Using dozens of eye-opening examples the authors demonstrate how to nudge us in the right directions, without restricting our freedom of choice. Nudge offers a unique new way of looking at the world for individuals and governments alike.This is one of the most engaging, provocative and important books you will ever read.

Understand yourself and those around you.

psychology

Psychology

business

Business

creativity

Creativity

books

Books

Nudgeis the book that changes the way we think about choice, showing how we can influence people, improving decisions about health, wealth and happiness. Using eye-opening real life examples, Richard H. Thaler and Cass R Sunstein show that no choice is ever presented in a neutral way. The question is- when do we need a nudge in the right direction? SOME NUDGES-'I love this book. It is one of the few books I've read recently that fundamentally changes the way I think about the world. Just as surprising, it is fun to read, drawing on examples as far afield as urinals, organ donations and marriage' Steven D. Levitt, co-author of Freakonomics'This book is terrific. It will change the way you think, not only about the world around you and some of its bigger problems, but also about yourself' Michael Lewis author of Liar's Poker'Nudge won't nudge you - it will knock you off your feet' Daniel Gilbert, author of Stumbling on Happiness 'Hot stuff . . . an idea whose time seems to have come' Bryan Appleyard, Sunday Times'Hugely influential . . . choice architects are everywhere' Andrew Sparrow, Guardian'All the rage . . . the issue is not 'to nudge or not to nudge'; it is how to nudge well' Matthew Taylor, Daily Telegraph

RICHARD AND CASS

Similar ideas

The perfect nudge

2. Economist

How Economic Incentives Affect Our Choices