Innholdsfortegnelse for Spring 2020 i Rotman Management

IN FALL 2016, THE LEGISLATURE OF THE NETHERLANDS wished to increase the percentage of Dutch residents who consented to organ donation. The nation’s House of Representatives narrowly passed a highly publicized bill intended to change the donation consent procedure from one requiring explicit consent (an opt-in default) to one of presumed consent (an opt-out default). Under the policy change, residents would automatically be considered donors unless they returned a letter or went online to elect out of participation. The bill was motivated by recent successes that policymakers around the world have had in applying insights from Psychology and Behavioural Economics to promote better decisions. In particular, policymakers have made gains by modifying choice architecture — characteristics of the environment in which options are presented, such as how relevant information is…

SELF-CONTROL FAILURES CONTRIBUTE to a range of outcomes in our society, from educational achievement and retirement savings to the obesity epidemic. Not surprisingly, people with greater self-control fare better in terms of health, wealth and many other dimensions of human flourishing. Unfortunately, temptations — rewards that provide short-term gratification but impede people from long-term goals — are ever more abundant today, thanks to convenience stores, one-click shopping, social media, 24/7 streaming, and other newfound vices. In a recent paper, we synthesized the research on approaches to reducing failures of self-control, organizing them as approaches that are either cognitive or situational in nature. In this article we will summarize some of the key cognitive strategies for improving self-control. We will categorize these strategies under two headings: interventions that are self-deployed and…

DO YOU CONSIDER YOURSELF a great communicator? Hopefully the answer is Yes. When the Graduate Management Admission Council surveyed the needs of 500 global employers, ‘communication excellence’ ranked as the most in-demand asset that an employee can bring to the table, with ‘presentation skills’ ranking close behind at number four. Clearly, the ability to make a compelling presentation is a critical competency for career success. Yet many of us dread it. Experts at Chapman University estimate that at least 25 per cent of us experience significant levels of public-speaking anxiety also known as ‘speech anxiety’. This type of anxiety falls under the larger umbrella of ‘performance anxiety’ and is similar to the struggles that professional athletes and actors experience throughout their careers. Public-speaking anxiety involves a pervasive and chronic pattern…

I know exactly how the conversation will go. I’m interviewing Chris, a 52-year-old man living in a small coastal town, for the second time. We’ve been exploring the new checkout process for a client’s redesigned website. The new site isn’t performing as well as the company thought it would, so I’m exploring why and seeing what we can learn from competitors. “Only two rooms left? They don’t expect me to believe that, do they? You see that everywhere.” I leave with a wry smile. The client won’t be happy, but at least the project findings are becoming clear. Companies in certain sectors use the same behavioural interventions repeatedly. Hotel booking websites are one example. Their sustained, repetitive use of scarcity (e.g., ‘Only two rooms left!’) and social proof (‘16 other…

FEW PEOPLE WOULD ARGUE that innovation is vital to every organization’s growth and competitiveness. Yet most are still struggling to put it into practice. Consider this typical example. Recently, my colleagues and I worked with a large bank to improve credit card repayment behaviour. One test we proposed was very simple: print the bill statements on coloured instead of white paper. The rationale? After a customer opens a bill, it often gets buried in a large stack of paper, and as a result, they lose track of it — as well as when it is due. We thought a good hypothesis to test was one that increased the visibility of the bills. There is good research supporting the role of colour in increasing attention and in turn, memory, and we…

How do you define ‘social norms’? Social norms are our understanding of what is expected of us and what is appropriate in particular situations. Some people describe them as informal ‘rules of behaviour’. We learn these over time as we encounter other people and observe how they behave and hence what is expected of us. For example, in different cultures there are different expectations around tipping behaviour. In some places you tip the server a certain percentage, while in others you might just tip a few cents. Another example is norms around how we interact with strangers in different places around the world — such as whether we look them in the eye and smile at them on the street. Norms are enforced by our peers’ interactions with us. When…

I WILL BEGIN WITH A BOLD STATEMENT: The people reading this article are some of the poorest in the world, and I can tell this without even looking at their bank accounts. What I’m referring to isn’t a scarcity of money, but rather a scarcity of time. Over 80 per cent of working adults today report feeling ‘time-poor’. Put simply, they have too many things to do in a day and not enough time to do them. The problem is, these rising rates of ‘time poverty’ have crushing effects on our happiness, our social relationships, and our physical health. Time poverty silences our laughter, steals our joy and depletes our personal well-being. So where do these feelings of time poverty come from and what can we do to overcome them?…

You have said that the most important leadership competency for the 21st century is the ability to navigate differences. Why is this so important right now? One of the most amazing things we have witnessed in our time is the ability of platforms and technology to connect us all virtually. But with this vast ecosystem of connectedness comes an obligation to really take in and absorb what is coming at us — and not simply from the lens of our own experience. We need to attempt to understand other people’s experiences. Effective leadership is not simply about leading people who are like-minded. It is about leading across differences. Notice that I say leading across, not managing or dealing with differences? That’s because to me the terms ‘managing’ and ‘dealing with’…

AT THE END OF TODAY, four million blogs will have been posted, 80 million Instagram photos uploaded, and 600 million Tweets released into cyberspace. That’s more than 7,000 tweets per second. Why do we spend so many precious moments every day sharing information? There are probably many reasons, but it appears that the opportunity to impart our knowledge to others is internally rewarding. A study conducted at Harvard showed that when people have an opportunity to share their pearls of wisdom with others, the reward centre in the brain is very strongly activated. Put simply, we feel a burst of pleasure when we share our thoughts, and that drives us to communicate. It’s a nifty feature of our brains because it ensures that ideas are not buried with the person…

NO ONE WOULD ARGUE that the Internet has transformed the way we live, work and play. Today you can make ‘friends’ around the world without ever saying hello; compare products from dozens of shops without leaving the house; or plan a date with a stranger without breaking a sweat. But while the benefits of life online are significant, so too are the economic and social costs. By now, most readers are familiar with the term ‘nudge’; but there is a darker side to the evolution of online and digital markets: ‘Sludge’ and other techniques seek to harness our behavioural biases against us rather than for us. Nobel Laureate in Economics Richard Thaler, a long-standing adviser to the Behavioural Insights Team, often signs his books with the maxim ‘Nudge for good’.…

At the beginning of the final report of the Expert Panel on Sustainable Finance, you state that the relationship between the economy and the environment “is at a vital inflection point.” Please describe the current scenario. Too often, discussions about the economy and the environment are framed around one or the other. That needs to change. Our economic and environmental aspirations need to become one and the same, because fundamentally they are indivisible. We are at a pivot point right now: We are increasingly seeing the impact of climate change in the form of more extreme weather, flooding, forest fires and hurricanes. As the world continues to get warmer, these extreme weather events will become even more pervasive. Weather patterns are going to shift, and the human and economic impact…

How do you define a difficult conversation? Douglas Stone: A difficult conversation is anything that is hard for someone to talk about. It can range from asking your boss for a raise to providing negative feedback to a subordinate to complaining to your neighbour about his dog barking. These conversations are particularly tricky because there is often a gap between what people are really thinking and what they say. Of course, whether something is difficult to discuss (or not) is subjective, but these conversations tend to share some key characteristics. One is that there is usually something important at stake. As a result, we might be concerned that engaging in the conversation will negatively impact the relationship. In addition, there are often questions of identity on the line. We all…

THE EXTRAORDINARY SUCCESS of people like Steve Jobs, Richard Branson and Oprah Winfrey is often attributed in part to their high levels of passion for what they do. Indeed, popular discourse commonly describes successful individuals as paragons of passion. Academy Award-winning music composer A.R. Rahman stated this eloquently: “Success comes to those who dedicate everything to their passion in life.” Prior research has taken an intrapersonal perspective and found that people who are passionate for their work attain increased success by exhibiting high levels of engagement, proactivity, cognitive flexibility and self-efficacy, as well as reducedlevels of stress. This perspective suggests that the beneficial outcomes of passion stem from characteristics within the individual. In recent research, my colleagues and I offer a complementary perspective. Taking an interpersonal perspective, we propose that…

WOMEN’S REPRESENTATION IN MEDICINE has slowly increased over the past few decades. However, this rise in numbers of women — gender diversity — has not been matched by a rise in gender inclusion. Despite increasing representation, women still encounter bias and discrimination when compared with men in these fields across a variety of outcomes, including treatment at school and work, hiring, compensation, evaluation and promotion. This disconnect between diversity and inclusion is not unique to medicine. In this article we will identify five myths that perpetuate gender bias and five strategies for improving not only the number of women in medicine — and other industries — but also their lived experiences, capacity to aspire, and opportunity to succeed. Myths About Diversity and Inclusion The year 2017 marked the first time…

IN AN INCREASINGLY COMPLEX WORLD, the scarcest collective resource of the modern leadership team may just be the most important one: attention. In vigilant organizations, executive attention is leveraged for greater agility and advantage, whereas in vulnerable ones, misdirected attention creates blind spots, myopia and delayed reactions. The contrast between vigilant and vulnerable organizations is striking. The leadership of vulnerable organizations — such as Blockbuster, Toys‘R’Us, Kodak and many other now defunct companies — remains preoccupied with operational concerns and coping with daily pressures. As a result, most of their time is spent reacting to events, rather than shaping them and anticipating avoidable crises. This treadmill of ‘firefighting’ can easily become a downward spiral, with less and less time available to sense weak signals from the periphery or to probe…

You believe connectivity is one of two megatrends (along with artificial intelligence) that are profoundly altering the way we work. Talk a bit about how near-constant connectedness affects our lives. Smartphones have fundamentally transformed our relationship with our jobs. We are now connected to work on the train, on the bus, and even on the couch. If you ask workers ‘what makes for a good boss?’, one thing they will mention is how quickly their boss responds to their emails. We all want people to answer us as quickly as possible, and the end result of this is that the average work day has increased by two hours in the last 15 years. Work has also invaded our weekends. One study found that 60 per cent of professionals remain connected…

You work for one of the most creative companies in the world. How would you describe Cirque du Soleil’s approach to innovation? Our innovation is not the result of a few isolated actions. It’s part of our DNA. We challenge ourselves to never do the same thing twice. We’re constantly trying to not just push the limits of what we already do, but create new spaces. From the very beginning of our journey more than 35 years ago, the idea was to re-invent the concept of the circus itself, and we continue to do that as we transform into a global leader in live entertainment. Another thing we do well is approach innovation with a multidisciplinary perspective. Innovation is everywhere in this organization. When teams come together to work on…

Influencing others to take a new approach is an inherent — yet often problematic — leadership challenge. Despite the broad application of Design Thinking’s customer-centric tools and frameworks, my colleagues and I have discovered that there is an untapped opportunity to use this mindset in a new way: to increase influence. Fundamentally, design thinkers start from the customer or user’s perspective, rather than assuming they have all the answers. Early in my career, I consulted on the reorganization of a pharmaceutical plant in Puerto Rico. On the way home, the senior partner on the engagement, Frank, turned to me as we leveled off after takeoff and asked me what I thought had gone well and what could have gone better during the meeting. He agreed with my general observations, but…

AS A MANAGEMENT CONSULTANT, I’ve seen more than my fair share of ludicrous corporate decisions resulting from hasty leaps to poorly designed solutions. Before becoming a consultant, I was an employee at several companies over the course of 15 years, and I’ve lived through the ramifications of these poor decisions. I’ve seen the sales declines, the layoffs, and the damaged lives. Frankly, I’m tired. Tired of seeing leaders jump to conclusions and taking action without really understanding their problem. Tired of seeing leaders arrive at a ‘solution’ that doesn’t solve the real problem at all. Tired of seeing the staggering waste of money and opportunity caused by this knee-jerk approach to problem solving. When leadership teams don’t understand the real problem and simply jump to a conclusion, they tend to…

You have said that every organization is fundamentally in the same business. Please explain. Whether it be a for-profit business or a government agency, every enterprise is in the business of behaviour change. In each case there is a collection of individuals interacting with other individuals with a particular goal in mind. It could be a sales team dealing with external customers to sell a product or service; HR managers dealing with an employee base to optimize productivity; or a CFO dealing with shareholder concerns. All of these interactions involve some form of desired behaviour change. Some scholars have focused on the persuasion aspects of changing behaviour, but I would argue that what we are really doing is helping people get things done and make welfare-enhancing decisions more easily. Once…

• Recommendation 1: Map Canada’s long-term path to a low-emissions, climate-smart economy sector by sector, with an associated capital plan.• Recommendation 2: Provide Canadians the opportunity and incentive to connect their savings to climate objectives.• Recommendation 3: Establish a standing Canadian Sustainable Finance Action Council (SFAC), with a cross-departmental secretariat, to advise and assist the federal government in implementing the Panel’s recommendations.• Recommendation 4: Establish the Canadian Centre for Climate Information and Analytics as an authoritative source of climate information and decision analysis.• Recommendation 5: Define and pursue a Canadian approach to implementing the recommendations of the Task Force on Climate-Related Financial Disclosures (TCFD).• Recommendation 6: Clarify the scope of fiduciary duty in the context of climate change.• Recommendation 7: Promote a knowledgeable financial support ecosystem.• Recommendation 8: Embed climate-related…

STEP 1: PREPARE BY WALKING THROUGH THE THREE CONVERSATIONS Sort Out What Happened: Where does your story come from (information, past experience, rules)? Theirs? What impact has this situation had on you? What might their intentions have been? What have you each contributed to the problem? Understand Emotions: Explore what emotions are present, and what concerns might be behind the emotions. Ground Your Identity: What is at stake for you, or about you? What might you need to accept to be better grounded? STEP 2: CHECK YOUR PURPOSES AND DECIDE WHETHER TO RAISE THE ISSUE • Purpose: What do you hope to accomplish by having this conversation? Shift your stance to support learning, sharing and problem-solving.• Deciding: Is this the best way to address the issue and achieve your purposes?…

WHEN YOU RESEARCH DECISION-MAKING for a living, it’s hard not to observe choice architecture everywhere you look — even on vacation. Disney World is the land of magic and fairytales, but even there you cannot escape science. When ordering something to eat, one of us (Jon) noticed that the default choices for kids’ meals were all geared towards healthier options. The menu swapped soda for juice and french fries for fruits and vegetables. Indeed, a recent study shows that this change in Disney World’s policy led to the consumption of 21 per cent less calories, 44 per cent less fat and 43 per cent less sodium. These defaults are helping ‘the happiest place on Earth’ become a healthier one. Defaults are one of applied behavioural science’s biggest success stories. There…

IN 2005, 37-YEAR-OLD Elaine Bromiley, a married mother of two, entered the hospital for routine sinus surgery. Not too long into the procedure, Elaine’s airway became obstructed. The three experienced surgeons in the operating room proceeded to insert a tube into her trachea to attempt to open her airway. The surgeons continued their attempts for many critical minutes despite suggestions from two nurses that could have changed the course of events. One nurse retrieved a tracheostomy kit from another room and informed the surgeons that a kit was available. The kit would have provided another means by which to open Elaine’s airway. The surgeons ignored her. Another nurse entered the room, immediately noticed that Elaine was in distress, left the operating room, and called the intensive care unit. Once she…

Being ‘indistractable’ has been called the essential skill for our time. Why is it so critical right now? In today’s world, technology and interruptions are everywhere. If you sit down to work on a project with a fast-approaching deadline, it won’t be long before you hear the swoop of a text message or email coming in; or a colleague might drop by to chat. Even at home, screens of various shapes and sizes get in the way of spending quality time with our loved ones. Just imagine what we could all accomplish if we could stay focused! In this day and age, if you are not equipped to manage distractions, your brain will continue to be manipulated by time-wasting diversions. We all need to learn how to avoid distraction. Explain…

When it comes to making decisions about saving money for the future, many of us are ‘grasping at straws’. Why is that? Figuring out how much to save for the future is no easy task — and the fact that many of us will now live to be 100 makes it even harder. There are so many contingencies to consider: unforeseen medical expenses, childcare expenses and changes to your income. When you add in stock market risk and economic shifts, it really is a complex scenario. Given this complexity, rather than doing the hard work and research, people tend to engage in ‘social learning’. They might just ask their friends what they are doing, listen to experts on the radio or read personal-finance magazines and follow the norms that they…

IN THE LATE 1970S, a research team out of Maryland’s National Institutes of Health released the Five Factor Model of personality, theorizing that most human character traits can be described using five dimensions: Agreeableness, conscientiousness, Neuroticism, Openness, and Extraversion. Nearly 50 years later, tests that assess these ‘Big Five’ personality traits are considered reliable and are widely used by psychologists around the world. More recent research indicates that of the Big Five traits, conscientiousness may be the best predictor of success. In a variety of studies, people who test high in Conscientiousness have higher incomes and job satisfaction, and research indicates that this trait is an important factor for finding and retaining employment. The benefits extend beyond the workplace: Highly conscientious people commit fewer crimes, have fewer strokes, lower blood…

IMAGINE THIS SCENARIO: You are designing a new customer experience to drive a shift in customer behaviour. You have reviewed the reports and dashboards describing current behaviour. You have asked customers how they felt and incorporated their feedback in hopes of crafting an experience that meets their needs. But even after ticking these boxes, your customers are still behaving the same way as they did before. You and your colleagues are stumped. What is it about your new experience that is falling flat? You’ve provided exactly what customers told you they wanted — so why hasn’t it resulted in the desired behaviour change? This is an ideal question for a behavioural scientist — why someone’s behaviour deviates from their stated intentions and motivations. As customer experience becomes an increasingly crucial…

A FEW YEARS AGO, I was working with the talent management team at a large financial organization. The firm was struggling with retaining its top talent. Far too many of its identified high-potential employees were leaving at the VP level. We set out to figure out why this was happening and what could be done about it. The talent team wanted to do a survey of the organization. I proposed a set of deep-dive interviews, instead. I believed spending more time with fewer folks was likely to give us a richer understanding of what these high-potential leaders were thinking and feeling about the organization. The talent team agreed and came back with a list of 35 questions to ask in the interview. I countered with a list of two: What…