Power, deprivation and nudges
Creativity is the power to connect the seemingly unconnected - William Plomer
The power of Texas
Have you heard about the Texan delivery driver who, last week, was stranded at a customer’s home during the storms that shut down much of that state’s electricity and gas? When the driver said she had no heat at home, the customer offered to put him up for the night. She stayed five days.
Heart-warming, yes, but honestly, why are such Good Samaritan acts needed at all?
What I saw (from afar) was a crisis of deregulation. There’s no incentive, or coordinating entity, that demands power suppliers in Texas manage peak energy spikes (predicted peak demand was 67GW, but actually reached 75GW). There is no regulation about plant efficiency ensuring they perform during cold spells (at one point this week, a staggering 45GW of the 67GW was off-line). Nor were they set up to purchase energy across borders (Texas operates a myriad of suppliers and self-regulators lacking cross-state collaboration).
In a self-regulated market, whose job is it to ensure preparedness? Blue-moon or black swan events disadvantage individuals, and even entire populations, but there is only limited downside for suppliers who, in fact, end up charging peak rates for power, because few rate caps exist.
Question: What do you need regulated more — or less — in your area of work?
Deliberate deprivation
Last week, I wrote about Netflix co-founder Marc Randolph’s approach to testing bad ideas. He also speaks about deliberate deprivation as a tool for self-discovery.
Randolph was part of a group of experienced outdoors adventurers who wanted to be exposed to something that pushed them outside their (already very large) comfort zones. Sleeping in the rain wasn’t going to do it. Nor was climbing a high cliff, or fording a rapid, or having to forage for food in a forest. But their group came up with something that terrified all of them: drop them in the middle of an unfamiliar city without money for 3 days. Let them fend for themselves.
Randolph’s own experience was initial fear, followed by a burst of energy and resourcefulness. He tried begging (without success - although he suggests everyone tries this at least once in their lives). He tried surreptitiously eating discarded meals at a food court (with some success, but he felt humiliated). Finally, by the second day, he tried just being honest, walking up to people, telling them he’s hungry, and asking whether they could spare some money (and, yes, many could).
Years ago, I had a disability support organisation as a client whose directors had discussed with me their desire to gain greater insight into the ‘lived experience’ of their customers. They wanted to understand, deeply, how disempowered and disindividuated these people felt. When one of their 5-person residential units was going to be vacant for a month prior to a renovation, I saw their big chance. I suggested that directors should move in for a night, in a couple of groups. They could eat communal meals cooked by staff, watch TV together, and be helped to bed. For those brave enough, they could be shaved, or dressed the next morning.
Can you guess what happened when faced with deprivation of liberty? They unanimously refused. In my opinion, they passed up a stellar opportunity to experience a different life, just for 24 hours.
Question: How could you artificially, but challengingly and purposefully, deprive yourself of something you take for granted?
Why nudging works better than shoving
Um, sorry to talk about urine, but this is such a good story, I have to share it. Urine spillage in particular. Here we go.
At Amsterdam’s Schipol airport the cleaning director was dismayed at the inability of peeing men to aim properly at urinals. It was costing his staff time and money to clean up every day. He decided to put tiny photorealistic stickers of flies onto the urinals, right near the drainage hole. He guessed that men would aim for the flies, figuring that they’re a nuisance. He was right. Aim increased (spillages were down 80%). Cleaning costs went down (8% in fact).
The reverse nudge occured in India, where village men were peeing on walls outdoors. The town heads had the bright idea to stencil images of Hindu gods onto the walls (even though they hadn’t read the study on Schipol airport, I don’t believe). The peeing abruptly stopped, as nobody wanted to deface an image of Shiva or Lakshmi.
Both are clever examples of nudges used to encourage — or discourage — behaviour. Richard Thaler has an entire book devoted to this phenomenon, which is a big feature of behavioural economics.
Question: What nudges could you create to increase compliance amongst your customers — or staff?
Thanks as always for reading. I hope you can use the questions above to either stimulate your own strategic insights, or those of your colleagues or teams. Do drop me a line to let me know how you use these questions. And, of course, please click below to like or, even better, to pass on 5MSM to others in your network.
Have a great weekend, and see you next Friday,
Andrew