Leveraging Irrationality

Leveraging

IrrationalityMargaret Hudacko

College of Engineering

NC State University

Behavior Framework

Clout

Commitment

Value Attribution

Diagnostic Bias

Perception of Fairness

Aversion to Losses

Value of Dissenting Opinion

Motivation

Commitment

Commitment

If once you start down the dark

path, forever it will dominate

your destiny.

Commitment

People stick with a course of action

even though it’s not working.

Commitment

Balance Your Arguments

People stick with a course of action

even though it’s not working.

Commitment

Balance Your Arguments

Ditch Bad Directions

People stick with a course of action

even though it’s not working.

Value Attribution

Value Attribution

My Precious!

Value Attribution

People place a value based on the cost, previous

reputation, physical attractiveness or current setting

that has nothing to do with the actual value.

Value Attribution

Be Mindful of the Why

People place a value based on the cost, previous

reputation, physical attractiveness or current setting

that has nothing to do with the actual value.

Value Attribution

Be Mindful of the Why

Recommendation Comparison

People place a value based on the cost, previous

reputation, physical attractiveness or current setting

that has nothing to do with the actual value.

Diagnostic Bias

Diagnostic Bias

They call it a Royale with cheese.

Diagnostic Bias

People live up to however they are

labeled.

Diagnostic Bias

Avoid Negative Language

People live up to however they are

labeled.

Diagnostic Bias

Avoid Negative Labels

Collect Objective Data

People live up to however they are

labeled.

Diagnostic Bias

Avoid Negative Labels

Collect Objective Data

Set a Waiting Period

People live up to however they are

labeled.

Perception of Fairness

Perception of Fairness

You cheated!

Pirate.

Perception of Fairness

People will sabotage their own goals to “teach”

someone a lesson.

Perception of Fairness

Focus on Goals

People will sabotage their own goals to “teach”

someone a lesson.

Perception of Fairness

Focus on Goals

Share the Process

People will sabotage their own goals to “teach”

someone a lesson.

Motivation

Motivation

Fortune and glory, kid.

Fortune and glory.

Motivation

People will work harder for free than

they ever will for cash.

Motivation

Close doors

People will work harder for free than

they ever will for cash.

Motivation

Close doorsDrop the price to zero

People will work harder for free than

they ever will for cash.

Motivation

Close doorsDrop the price to zero

Let me help

People will work harder for free than

they ever will for cash.

Value of Dissent

Value of Dissent

That rug really tied the room

together, did it not?

Value of Dissent

People always think they know best.

Value of Dissent

Cultivate Dissenters

People always think they know best.

Value of Dissent

Cultivate Dissenters

Ask Every Customer

People always think they know best.

Aversion to Losses

Aversion to Losses

Yes, brave Sir Robin turned about, and

valiantly, he chickened out.

Aversion to Losses

Take the Long View

People will act far more aggressively to avoid a

potential loss than for a potential gain.

Aversion to Losses

Take the Long View

Frame Risks as Loss Mitigations

People will act far more aggressively to avoid a

potential loss than for a potential gain.

Aversion to Losses

Take the Long View

Frame Risks as Loss Mitigations

Craft Balanced Ownership

People will act far more aggressively to avoid a

potential loss than for a potential gain.

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Conclusion

Resources

• Summary mind-map - Michelle Labrossehttp://www.qualitydigest.com/inside/metrology-column/using-irrational-behavior-your-advantage.html

• Review of Sway – John Groholhttp://psychcentral.com/lib/sway-the-irresistible-pull-of-irrational-behavior/0001385

• Forbes Article – Ron Ashkenashttp://www.forbes.com/sites/ronashkenas/2012/07/23/how-to-make-sense-out-of-irrational-behavior/

• How to Persuade People – wikiHowhttp://www.wikihow.com/Persuade-People

• A Beginner's Guide to Irrational Behavior – Dan Arielyhttps://www.coursera.org/course/behavioralecon

• 12 Ways That People Behave Irrationally – Vivian Gianghttp://www.businessinsider.com/predictably-irrational-2012-6

Bonus Tracks

Don’t try to fight irrationality with rationality.

It will only make you more frustrated and the other person

more defensive. No matter how many well-constructed

arguments you offer, you won’t make headway until you

understand the underlying motivation that is driving the

other person.

Bonus Tracks

Focus on discovering, understanding, and embracing the other person’s rationale. Even if your adversary is being driven by unconscious motivations, it’s important to try to figure them out. Resistance to apparent logic always comes from somewhere, and you won’t be able to break through until you understand the reason. For example, sales people often resist logical and straightforward sales-model changes because they fear that compensation will be affected, or that customer relationships will be harmed. Until you understand and deal with those underlying issues it’s difficult to make headway.

Bonus Tracks

• What commitments drive your current behavior? How can you change your commitments?

• What value do you place on achieving your goals? How can you increase the value for yourself?

• What labels can you give yourself that will help you achieve your goal?

• How can you make it a “fair” game to achieve your goal?

• What intrinsic motivators get you fired up to go for your goal?

• Who challenges you? How can you get them to do it more so you get that fire in your belly to go for it?

• What will you lose if you fail to reach your goal? How can you avoid experiencing that loss?