Lessons from Corporate Nudging

Mixing Behavioral Science, Economics and Psychology.    Its likely that this concept will influence AI methods as implemented in assistant technologies.  But there are lots of issues in such methods.  Utimately its a test of how machines manage people.   Important challenges hinted at here.

Lessons from the front line of corporate nudging  By Anna Güntner, Konstantin Lucks, and Julia Sperling-Magro in McKinsey

Executives setting up a behavioral-science unit should start by challenging themselves with six questions.

If you’re serious about setting up a behavioral-science team—or a nudge unit, as we’ll more colloquially refer to it in this article—you need to ask yourself some tough questions, such as what it should do, where it should sit, how you’ll know it’s succeeding, and whether you’re ready for the ethical tensions it may raise.

Lessons from the front line of corporate nudging

Subtle interventions to help people make better decisions are hardly new. Since the 1950s, behavioral scientists, using a mix of economics and psychology, have studied human irrationality and devised ways both to improve the choices made by consumers and influence how employees react in the workplace. Increasingly, over the past two decades, companies have used the insights of behavioral science to reduce bias in boardrooms, improve strategic decision making, provide benefits for customers, enhance the effectiveness of marketing campaigns, and avoid making bad bets on major acquisitions or investments.  ... " 

Goal Setting, Nudges and Machine Learning

Interesting study-based results.   Now should the same approach be used for training and goal setting of machine learning?   Not just the ML of current systems, but  machine 'learning' in general.   It would seem that the 'nudge' theory would seem to say its better to set many, easier goals, than big jumps.  Why not here?   Is it because human feedback is different?  A fundamental question, I think.  Especially if the feedback can be more conversational that one-step.

Why You Should Stop Setting Easy Goals
Amitava Chattopadhyay, Antonios Stamatogiannakis, Dipankar Chakravarti in the HBR

When setting team goals, many managers feel that they must maintain a tricky balance between setting targets high enough to achieve impressive results and setting them low enough to keep the troops happy. But the assumption that employees are more likely to welcome lower goals doesn’t stand up to scrutiny. In fact, our research indicates that in some situations people perceive higher goals as easier to attain than lower ones — and even when that’s not the case, they still can find those more challenging goals more appealing.

In a series of studies we describe in our latest paper, we tested how people perceive goals by asking participants on Amazon’s crowdsourcing marketplace, known as Mechanical Turk, to rate the difficulty and appeal of targets set at various levels and across spheres from sports performance and GPA to weight loss and personal savings. We asked about both “status quo” goals, in which the target remained set at a baseline level similar to recent performance, and “improvement goals” in which the target was set higher than the baseline by varying degrees. .... "

Alexa Hunches for Smart Homes

Just started experimenting with Alexa Hunches, a method that claims to makes suggestions for you (Nudges from a Nudge engine?)   Can a skill tune your hunches to a context?  Based on data regarding your behavior ...    Privacy issues?  Will report further, as yet have received no smart home 'hunches'.  Out of toilet paper? 

Alexa Hunches can now suggest actions based on daily behavior
By Shannon Liao@Shannon_Liao in TheVerge

Amazon is now launching Alexa Hunches, where the voice assistant will predict your future needs. It uses deep neural networks to understand behavior and Alexa Hunches is first going to focus on the smart home.

How it works is that Alexa will feel like it’s getting a “hunch” and if it’s confident enough, it will say something like, “Hey, I think you left the porch light on, would you like me to turn it off?” Alexa could also remind you to lock the front door if you haven’t already when you say “Goodnight.”  .... " 

Amazon describes hunches.

Coaching Networks: Humanity's Fighting Chance

The recent look at the concept of the Nudge Theory and Nudge Engines led me to a reference about 'Coaching Networks'.  Term was new to me.   Can it be that AI itself will keep us from being automated out of job?  Seems to be the premise.  Like the idea.  Examining.

Coaching Networks / AI
Coaching Networks: Humanity’s Fighting Chance
Artificial intelligence is about to give humanity a fighting chance to win the race against automation.
By Gordon Ritter, Founder + General Partner

" ... We don’t view artificial intelligence as a threat that replaces us, but as an asset that helps us unlock our full potential as people. Our prediction: the consumer internet is about to radically transform into a framework that rescues us from passive addiction and places human creativity, productivity, and brilliance firmly at the forefront of the future.  ... " 

Nudge Theory Now delivered by a Nudge Engine

First the Nudge Theory, now a Nudge engine to make you notice it. Calibrating the use, timing and strength of the nudge may be the most important thing to to figure out.  If you have resources, there should be better ways to efficiently use them.   And better to do that all along the process than just at the end.   How will people used to typical management process react?  I even recall some of the softest 'informational' nudges, like of MS Paperclip being rejected.

After two years in stealth mode, the former head of HR at Google reveals his new startup  By Simone Stolzoff in Quartz

" ... In a blog post,   Bock described Humu’s flagship product, called Nudge Engine. It’s an app that uses behavioral science and machine learning to deliver workers personalized “nudges” throughout the workday. Nudges can be simple reminders to thank a coworker who has been doing a good job or to seek out the opinion of a quieter team member during a meeting.

Though the word “nudge” might have a soft connotation, the theory that underlies Humu’s technology comes from hard science. Professor Richard Thaler won the Nobel Prize in economics last year for his research on “nudge theory,” which proved that small prompts can have a big impact on people’s behaviors. ...  " 

Digital Nudging

From the July 2018 Communications of the ACM:

"Digital Nudging: Guiding Online User Choices through Interface Design," by Christoph Schneider, Markus Weinmann, and Jan vom Brocke, shows how design elements like presentation and workflow influence buying decisions in digital environments. Schneider describes various digital nudging techniques in an original video at http://bit.ly/2Mn3Hw9

Hype of Virtual Medicine

Good points are made here,  in particular are systems like smartphones, effective at addicting us otherwise, useful for health habits?   WSJ article:

The Hype of Virtual Medicine
High-tech health care hasn’t proved effective at changing patients’ bad habits.... 

Podcast on the Nudge Nobel

How Richard Thaler’s ‘Simple Insights’ Led to a Nobel Prize
Wharton's Katherine Milkman discusses the awarding of the Nobel Prize to behavioral economist  

Richard H. Thaler, the “father of behavioral economics,” has this week won the 2017 Nobel Prize in Economics for his work in that field. Thaler has long been known for challenging a foundational concept in mainstream economics — namely, that people by-and-large behave rationally when making purchasing and financial decisions. Thaler’s research upended the conventional wisdom and showed that human decisions are sometimes less rational than assumed, and that psychology in general — and concepts such as impulsiveness — influence many consumer choices in often-predictable ways.

Once considered an outlier, behavioral economics today has become part of generally accepted economic thinking, in large part thanks to Thaler’s ideas. His research also has immediate practical implications. One of Thaler’s big ideas – his “nudge theory”  – suggests that the government and corporations, to take one example, can greatly influence levels of retirement savings with unobtrusive paperwork changes that make higher levels of savings an opt-out rather than an op-in choice. In fact, he co-authored a book, Nudge: Improving Decisions About Health, Wealth and Happiness, which became a best-seller.

In this Knowledge@Wharton interview, Katherine Milkman, a Wharton professor of operations, information and decisions — and a behavioral economist herself — discusses Thaler’s influence in economics and the practical applications of his ideas already underway. She attributes part of his success to his great clarity in thinking and in writing. She had interviewed professor Thaler for Knowledge@Wharton in 2016 regarding his then-new book, Misbehaving: The Making of Behavioral Economics.  ... " 

Nudge Behavioral Economist Gets Nobel

In the BBC, this has gotten criticism because it can be seen as manipulative.  Who has decided what nudges we need?   And to what extent?  This has always reminded me of work by BJ Fogg on Persuasive techniques, but Thaler chose a better buzzword.

'Nudge' economist Richard Thaler wins Nobel Prize
US economist Richard Thaler, one of the founding fathers of behavioural economics, has won this year's Nobel Prize for Economics.

Prof Thaler, of Chicago Booth business school, co-wrote the global best seller Nudge, which looked at how people make bad or irrational choices.

Judges said he had demonstrated how "nudging" - a term he coined - may help people to exercise better self-control.   .... " 

Manipulators of the Mind

Was brought up in this same age of of behavioral economics and advertising tricks. But they never came of age until there was technology interactive enough to deliver them.   Good or bad?

In News from the Edge:  https://www.edge.org/    5/1/2017

Invisible Manipulators of Your Mind     By Tamsin Shaw  

In 2007, and again in 2008, Kahneman gave a masterclass in “Thinking About Thinking” to, among others, Jeff Bezos (the founder of Amazon), Larry Page (Google), Sergey Brin (Google), Nathan Myhrvold (Microsoft), Sean Parker (Facebook), Elon Musk (SpaceX, Tesla), Evan Williams (Twitter), and Jimmy Wales (Wikipedia). At the 2008 meeting, Richard Thaler also spoke about nudges, and in the clips we can view online he describes choice architectures that guide people toward specific behaviors but that can be reversed with one click if the subject doesn’t like the outcome. In Kahneman’s talk, however, he tells his assembled audience of Silicon Valley entrepreneurs that “priming”—picking a suitable atmosphere—is one of the most important areas of psychological research, a technique that involves offering people cues unconsciously (for instance flashing smiley faces on a screen at a speed that makes them undetectable) in order to influence their mood and behavior. He insists that there are predictable and coherent associations that can be exploited by this sort of priming. If subjects are unaware of this unconscious influence, the freedom to resist it begins to look more theoretical than real.

The Silicon Valley executives clearly saw the commercial potential in these behavioral techniques, since they have now become integral to that sector.…..

Invisible Manipulators of Your Mind
Tamsin Shaw APRIL 20, 2017 ISSUE
The Undoing Project: A Friendship That Changed Our Minds
by Michael Lewis .... " 

Uber and Behavioral Economics

Fascinating piece about behavioral economics.      Behavioral economics seems to be OK when everyone agrees that it is good and fair, by their definition.  Back to the nudge, with some basic guidelines:   Nudge me only for clearly aligned company and employee interests, with a clear permission to opt out.    Or is it more an environment than a nudge?

Uber Shows How Not to Apply Behavioral Economics  by Francesca Gino
A recent New York Times article on how Uber is using various insights from behavioral economics to push, or nudge, its drivers to pick up more fares — sometimes with little benefit to them — has generated quite a bit of criticism of Uber. It’s just one of several stories of late that have cast the company in a poor light.

When I read the piece, it reminded me of a question executives often ask me when I talk to them about the benefits of behavioral economics or give them examples of how they could use it in their own organizations: “Aren’t you afraid it will be used with ill intent?”  ... '

Psych and Economics in Hindsight

In Knowledge@Wharton: 
" .... In the new book Misbehaving: The Making of Behavioral Economics, Richard Thaler, coauthor of Nudge and a behavioral science and economics professor at the University of Chicago, recounts his struggle to change the way traditional economists look at the impact of human psychology on economics. Wharton operations, information and decisions professor Katherine Milkman recently spoke with Thaler about why he wrote the book, where behavioral economics has had the most impact, and which decision-making bias he would remove if he had a magic wand. ... "  ... “The evidence for hindsight bias is overwhelming, and this has huge managerial implications.”