Embrace Your Inner Scientist With Behavioural Economics

For our April TechConnex Innovation Peer Group, we were thrilled to have Kelly Peters CEO and Co-founder of BEworks, present driving innovation by bringing behavioural science to the boardroom. 
Behavioural science and behavioural economics are getting a great deal of press lately, and well deservedly so. Behavioural economics combines elements of psychology, neuroscience and economics into a cohesive and more scientific approach to solving today’s business problems.  If you don’t see yourself as a scientist, think again! Most of us use parts of the scientific method (developing hypotheses, testing them, observing the results and drawing conclusions, etc.) every day, we just don’t realize that we’re doing so (like when you are trying figure out how to reduce traffic congestion or speed up a grocery store check-out line). 

Fact-based decision-making is more reliable than opinion or intuition-based decision-making. Having a proper fact-base increases the chances of success and decreases the cost and risks associated making important decisions based our biases and intuition.   
Kelly also presented the BEworks Method, which has five key elements for building an evidence-based decision-making strategy. Often when teams begin working on innovation very smart people want to jump directly into ideation. However, to increase your chances of success, Kelly suggests that teams need to introduce discovery and behavioural diagnostics phases before ideation, and then add a build and experiment phase after ideation. To learn more about the scientific method, Click Here. 

As a group, we participated in trying to predict the results of an experiment to compare the effectiveness of potential methods to incent retirement savings. There was no question that the final result achieved would not have been concluded using traditional ideation, paradigms and economic models. Interestingly even when presented with fact-based results from well-designed studies, individuals in our group looked for reasons to ignore the facts in favour of personal bias rather than to take it at face value and use the information as a basis for further exploration, testing and decision making. To learn more about the study, Click Here.   

Our strong preference is to use behavioural science to make better decisions that advance innovation and risk-taking. From time to time we might still default back to intuition-based decisions, but for truly important work, we need to complement our intuition and experience with science-based research about how people act in the real world. When opportunities like this arise let’s remember behavioural economics and embrace our inner scientist! 

Click Here for Kelly’s Presentation.  

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