Are post pandemic work settings ideal for HR Nudge?
As vaccination rates go up, there is hope in the corridors of India Inc. - hopefully it will be back to business as usual very soon (Economic Times, 2021). As organizations prepare to resume operations -one key consideration will be that all employees should be fully vaccinated so that the office environment is least susceptible to the vagaries of the pandemic. While initially there was a dearth of vaccines, in present times the availability has not been a major issue for established organizations since tie ups (Times of India, 2021) with major hospital chains have managed to cater to the needs. However, conversations with few HR leaders pointed to a very different challenge for organizations.
Debesh Bhattacharya (name changed due to request), who heads the Human Resources function for a large manufacturing organization outlines his challenge, “we have been conducting regular vaccination camps for the last few weeks-however the attendance in these camps were far from satisfactory. While some employees did manage to get slots on their own and would have got vaccinated themselves, there are still substantial numbers left to be covered-especially for our factory workers. What puzzles me is that we have been sending regular reminders with a choice of date and time slots using our official emails and using poster campaigns in factories as well - however still we are not getting the desired responses.”
Judgments and Decision making - Why do employees procrastinate?
It turned out that Debesh’s problem is not a unique one - conversations with more than 10 HR leaders revealed that Debesh was not the only one who faced /are facing this reluctance from employees to get vaccinated on time, even though it made logical sense going by the normative theories of judgment and decision making. However, what befuddles Debesh and the other HR leaders was that in spite of regular communication which should have elicited a rational behaviour for the employees - in this case,” employees should got themselves vaccinated at the earliest”, why did/do they end up behaving differently and are unable to act as can be explained by rational choices. Perhaps the answer may lie in Nudge - a book written by Nobel Laureate Richard Thaler and legal scholar Cass Sunstein. While insights from behavioural economics have been shaping policies for the governments of many large countries, the implications of the same in non-governmental work settings have received limited attention. Nudge leverages some of the principles of behavioural economics and throws light upon how the effective design and presentation of a choice can potentially solicit the desired response from a potential respondent. This is where there could be a lesson or two for HR professionals like Debesh and indeed for organizational leaders as well. Let us see how Debesh’ problem can be handled better.
Nudge Theory and Choice Architecture may be the answer
Traditional decision-making models assume rational choices as the order of the day. The domain of behavioural economics highlights certain limitations with this approach when it comes to human decision making -when making a choice humans are unable to consider all the available options and are unable to differentiate the best choice from the worst one - humans end up choosing the first available choice that “satisfices, or that which meets the lowest level of acceptance” (Ilieva and Drakulevski, 2018).
Nudges are subtle ways of designing options that push humans towards the best choices-the bias laden choices that are normally made by humans- if the same were not to be influenced by cognitive bias, temptation, or social influence- an effective nudge can help reduce the inherent decision making weaknesses in humans and can enable beneficial - or, at least, less harmful – choices (Thaler and Sunstein, 2009). The choice architecture , closely related to nudges as an interface of available options can make the critical difference- how is the menu of choices shared-the options that pop up first, whether a default option is given or not or is there an attached incentive can make the difference. Specifically, the issue facing Debesh and for the HR leaders -the choice of a “Default’ option (Thaler et al., 2010) can be explored. Instead of sharing multiple date and time slots in the emails or poster campaigns , the employees can have “pre-set data and time slots” allocated against their names. What this Default option basically would mean is that, while the employee has a choice of opting out of the default option-in case he/she does not opt-out, then the time and date option by default would be applicable to him /her for the vaccination slot. Past studies related to “choice architecture” (Thaler and Sunstein, 2009) have shown that the probability of actions which individuals procrastinate (like contributing in a defined contribution plan, retirement savings plan etc.) increases when an “opt-in” option is substituted with a by default “opt-out” option. So, while the choice of opting out would still remain with the individual employee,it will not require him/her to make an effort to make a choice of a date and a time.
Implications for HR Professionals and Organizations
While this is a specific example of how behavioural economics can play a role in work settings, it offers an important lesson for organizations-particularly HR professionals since many of the endeavours that HR professionals champion within organizational settings are assumed to be cognitive processes only. For example, priming effects can be leveraged to reduce the cognitive efforts that are required to be made by an employee to understand the holistic purpose of an endeavour. An example is in order -organizations, big or small, have historically struggled to complete the performance appraisal processes within the stipulated time frame -be it the mid-year performance appraisal or the end term performance appraisal. Instead of automated dry reminders from the IT system, a message using visual cues (probably with a photograph of the team member -which can easily be enabled by modern HRIT systems) highlighting the importance of the same in his/her career may aid the manager to act promptly. The visual cue may act as a nudge thereby increasing the probability of timely completion of the desired action.
While the jury is out on whether organizations should “nudge” or should not “nudge” - one thing is for sure that post -pandemic work settings will pose significant challenges for organizations and HR professionals would be forced to think beyond the established ways of working and thinking- at least when it comes to human behaviour. Behavioural economics and its workplace implications can support organizations in enabling and adopting an experimental mindset which can ensure that such behaviour change interventions are designed accordingly. Keeping in mind the 'choice architecture’, we can sum up by saying, “The good news is that -organizations have a choice” - but then the bad news is also that “organizations have a choice”. So, will a “default option” work? Are the HR leaders listening??