Over the past several decades, science has infiltrated leadership in ways it once would have been hard to imagine. Business and management gurus, including Peter Drucker, Jim Collins and Tom Peters, have been joined by psychology researchers like Daniel Kahneman, Amos Tversky and Richard Thaler. Those newer names may or may not ring a bell. Still, the insights these experts put forth and that influence all leading-edge leadership advice today surely do, including cognitive dissonance and confirmation bias, thinking fast and slow and the unexpected power of nudges.
Such concepts have delineated the growing field of behavioral change and behavioral economics. It sounds science-y, but it’s undeniably about leadership and business. It’s the territory within which leaders come to understand the difference between what they hope or expect people to do and how they actually behave and why, including what employees and customers will or might actually do to impact a leader’s plans for success. At a high level, if behavioral economics has taught us anything about leadership, it’s that leaders can no longer just command the behaviors they seek. They must instead take actions to try to influence it — a very different conclusion from the top-down, command-and-control image of traditional leadership.
It’s a hard reality for many leaders to embrace. It’s hard because it contrasts with long-held beliefs and with leadership mythology. Yet it can be just as hard because of the volume of tactical advice out there about how to lean into this new knowledge. Indeed, research by McKinsey & Company and others has repeatedly shown that while many senior leaders are familiar with these concepts and their potential, few feel they have a handle on how to consistently and effectively impact behavior. Indeed, more than half acknowledge that, on the whole, they fail to effectively implement strategies that drive lasting behavioral shifts to achieve the desired results. It’s time to change that, and it may be easier than you think.
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