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Knowledge Doesn’t Change People’s Behavior – Great Leaders Do

To celebrate the Holiday Season, we will publish a blog post every weekday until the Christmas Eve. The December blog series will examine the changing landscape of leadership and management. Various guest writers will bring their expertise to the blog, and we will cover such topics as customer experience, sales, marketing, business intelligence, employee engagement and thought leadership from management point of view.

Knowledge Doesn’t Change People’s Behavior – Great Leaders DoDuring the last couple of years, I’ve taken part in the workforce survey conducted by the Statistics Finland. What this means is that they’ve asked me a few questions on the phone concerning the workforce in Finland. In return for my answers this year, I received an interesting and nifty booklet titled “Finland in Figures 2014”. The booklet contains a huge amount of figures and graphs that can be used to make fascinating observations.

Let’s assume that you work as a sales manager in a macaroni manufacturer in the food industry. In that case you might actually be interested, when your manager tells you that according to the index, the price of groceries and non-alcoholic beverages has increased 17.7 percent since 2010 (booklet p. 3). Your manager also lets you know that at the same time the average price of 400-gram macaroni package has increased 4.9 percent, from 0.41 euros to 0.43 euros (p. 4). Do you feel like you’re being managed here? Is this true leadership in action?

Of course not. The act of managing should have consequences. Either you should change your behavior or make a conscious decision to carry on your work in the same way as before. I argue that this hugely significant piece of information didn’t get you to strive for higher macaroni package prices in sales negotiations, and it most likely didn’t encourage you to actively seek new ideas to grow the sales volume of your key accounts. You shouldn’t feel bad for not taking action. You’re just acting like all of us. You’re human.

On average, people don’t change their behavior based on knowledge, because that is not the natural way for us to act. How many children will put away their toys immediately after playing with them, if you tell them that the room is messy? Not one of them.

Knowledge as such doesn’t affect our actions; the reason for behavior change lies elsewhere. C-level executives don’t change their actions just because they’ve heard the profits have decreased. The need to alter behavior is caused by the triggers related to the fact that there is a decrease in profits. For the executive, the decrease in profits could, for example, mean that:

  • the goal is running away,
  • he might lose his authority,
  • there are less resources to execute the business plan or
  • he won’t get his bonuses.

If the situation would be the other way around, the increase in profits would give the executive a feeling of gratification. The same triggers are now producing positive feelings. Few of us voluntarily seek situations, where you could hurt your own feelings.

You need knowledge to understand, which direction you should manage the behaviors. But don’t believe in the illusion that you could actually manage or lead with knowledge. You can only manage and lead people, not things. In order to influence people’s actions, you should first find out, what triggers them to change their behavior and what are the things that make them feel gratified.

We constantly work with client projects, in which we use knowledge to understand the current situation of the organization. After seeing the big picture, we advise our clients to manage and lead people by influencing their motivation factors. This can be done with or without technology.

Motivate People Through Data

Gartner’s research analyst Brian Burke tried to redefine gamification in April which yet again launched a vivid discussion among the gamification gurus about the definition of the concept. I’m not going to dwell on the details of the discussion, but the founder of Bunchball Rajat Paharia suggested a definition which I think is worth mentioning:

Gamification is about motivating people through data.

Although the definition isn’t perfect, Paharia introduces two important factors: motivation and data. Above all gamification is about how you can use game elements to affect people’s behavior. In other words, how you can motivate people to act according to the set goals. Data is needed because a) data is the only reliable source to find out what behaviors need to be changed to reach the goals and b) making data transparent is an effective way to motivate. Even the trending topics of biohacking and Quantified Self are based on the idea that you can develop your performance and increase motivation through data.

Model for Behavior Change

At Cloudriven, we’ve divided the process of gamification into five different phases as presented in the above image.

1) Collect behavior data. Without sufficient data it’s practically impossible to decide which behaviors need to be changed to reach the set goals. In the worst case scenario the planned actions can lead the whole organizations to the wrong direction if the decisions are based purely on the intuition of management.

The amount of data in organizations has multiplied during the last decade and many companies are desperately trying to figure out what to do with all the big data.  But especially in situations where the collection of data depends on people’s own effort, data quality isn’t necessarily that good. For example, sales reports are reliable only if sales people conscientiously log their activities to the CRM system. If the sales representative feels that the task is not meaningful or she doesn’t have a sufficient incentive to perform, the task won’t be done and the sales report will be inaccurate.

2) Analyze the data and make conclusions. Yetthe mere collection of data is not enough. The data needs to be analyzed so that proposals for action can be given. Often data may be derived from multiple sources and it lacks structure. In this kind of situation data needs to be modified and transformed into commensurate and understandable form before making the actual analysis.

The purpose of the analysis is to recognize the causes of your business challenges. It can for example examine why the sales performance is weak or why some units never reach their business goals. Behavior data arises from people’s actions and therefore it gives you an honest perception of the present state of your organization.

3) Design behaviors. Based on the analysis and conclusions a detailed management plan should be created. How are you planning to manage the behavior change in your organization? If the goal is, for example, to significantly increase sales activity during the next six months, management has to deconstruct the goal to weekly actions: 30 phone calls to prospects, 7 meetings, 50 e-mails, 2 deals. In addition you have to decide, how the sales actions are being monitored and what kind of encouragement and support the sales representatives need.

4) Choose the right tools. Change has to be supported with tools that encourage and lead the behaviors to the desired direction and at the same time make the monitoring easy and transparent. This is where the game elements come into play; game mechanics can be used to tap into people’s motivation factors. But you shouldn’t forget that gamification goes hand in hand with usability: it should always be clear for the user what she has to do next. In its most simplified form “gamification” can mean that the user is being guided to perform the right actions by using user interface elements and instant feedback.

5) Follow changes in behavior and collect data constantly. Change takes time and doesn’t happen in a day. Changes in behavior have to be followed constantly and adjustments should be made to the game elements and other parts of the system based on the data.

Gamification is Efficient Tool to Manage Behavior

According to a number of market analysts, consultancies and technology vendors, Gamification is a rising trend and also entering the world of business. We at Cloudriven share this view. Like with any rising trend, enthusiasm towards gamification can at times be overwhelming. But as with most trends, they have a certain strong and sustainable core – a reason that justifies the existence of the trend. At Cloudriven we believe that using gamification for behavior management is such a core.

Creating successful business strategies and goals is often seen easier than executing them. Execution is often linked to behavior. A company can strive to become more service than product oriented, combine two company cultures after a merger, lift employee satisfaction through better management of personnel, obtain more visitors to its website, or increase the effectiveness of its sales or service centre operations. All such goals require certain type of behavior. We are traditionally better at managing behavior in real-life situations. Yet, we believe that the demand for software solutions enabling behavior management is rising.

In autumn 2012, Cloudriven decided to aim at creating a software for behavior management. While writing this blog, the first pilot projects are already under way. It is therefore a good time to tell a little bit about the concept, and how it supports behavior management.

Cloudriven Behavior Management Model, CBMM

Cloudriven Behavior Management Model, CBMM

According to Professor BJ Fogg, the most important factor supporting a behavior is Trigger. When a phone rings or traffic lights turn to green, we act. If we do not have the competence or motivation to answer the phone, that should not trouble the software vendor, but through the software we can create or enforce triggers, which should result in a wanted behavior. For instance, can you honestly swear that you’ve never even considered to take a look at the Amazon “the people who bought this also bought…” offers or you’ve completely ignored all your Facebook notifications?

A behavior management system must also be able to register the events that indicate a certain behavior (Activity). I called a client, registered a purchase order, had a development discussion with my manager or employee or someone visited our website. It is easier to manage something that is visible. Making behavior visible does not have to result in yet-another-it-system and having to manually input data in it. The system must also be able integrate to existing IT systems and communication tools.

People are mostly self-guided, which is a good thing as such, but when the goal is to change behavior in a certain manner, it is a good idea to give instant feedback of behaviors. If one rewards or punishes a dog two hours after the incident, the message will not get across. People are not that sensitive to time, but if the reward of success in spring comes at the company Christmas party, the situation is not optimal. Generally speaking, the faster the feedback, the better the effect. Here one could also think of the ancestors of gamification, entertainment games. Imagine having the chance to select two versions of Angry Birds: one of the versions lets you play the next level right after completing the previous level, in the other version you have to wait for two weeks to play the next level. Which version would you choose to play?

Feedback should be given to enforce the wanted behavior. A good behavior management solution supports enforcement both individually and collectively. On the individual level it is important to know what the expectations are and how one is doing in terms of the expectations. In addition, the individual has the right to receive feedback of the performance. Collectively, networking and viral effects should support collective learning and behavior change widely in the organization, e.g. despite geographical distance. What if one of your company’s goals for social media utilisation would be behavior change?

The name of our product is Habit. Our goal is to root new behaviors to become habits. We measure the impacts of our service and calculate a ROI to the investment.

We believe that companies have the will and need to alter and manage behaviors in psychologically sound ways to help them reach their business goals. Focusing on behavior management gives a chance for both managers and employees to learn more of themselves, each others, their organisation and customers, and in general, lift personnel and customer satisfaction. We’ll tell you more of such successes later in this blog. In case you got interested, let’s be in touch!

What Is Gamification?

What is Gamification?Gamification has been a hot potato in the technology business for a couple of years. But what is gamification? In 2011 Gartner predicted that by the year 2014 70 percent of Global 2000 organizations will use game elements in their applications. Game elements in business applications can be, for example, diverse scoring systems, leaderboards and ranking lists, progress bars, badges, levels and quests. In turn, Deloitte advices companies to seriously consider, if gamification would be the solution for engaging customers and personnel.

Because gamification is a difficult concept and a tricky word, I thought I’d gather up some definitions of the concept I’ve come across in the web. Lastly, I briefly open up what we at Cloudriven consider gamification to be. We’ll elaborate on our gamification concept in the next blog post.

The word gamification was supposedly first used by British coder and inventor Nick Pelling in the year 2002. Pelling’s ideas were still far from what gamification is considered to be today. Pelling used the term gamification to describe how he thought the user-interfaces of electronic devices, such as ATMs and vending machines, should be designed more game-like. He was not that into browser-based web applications; he was more interested in physical equipment and their user interface. In the pre-history of gamification you can also find Bret Terril’s blog post about social games. He mentions gameification [sic] of the web as one interesting subject that had been elaborated in the Social Gaming Summit that year.

The biggest or at least the loudest and most influential gamification guru, American Gabe Zichermann has defined gamification as the process of using game thinking and game dynamics to engage audiences and solve problems. Almost the same definition can be found in Wikipedia with the addition that gamification specifically refers to non-game contexts. Deterding, Dixon, Khaled and Nacke elaborate on this approach in their article. From all the different definitions Zichermann’s and Wikipedia’s versions are probably the most commonly used; either as they are or slightly altered.

The word gamification was even accepted into Oxford Dictionary last year:

the application of typical elements of game playing (e.g. point scoring, competition with others, rules of play) to other areas of activity, typically as an online marketing technique to encourage engagement with a product or service: gamification is exciting because it promises to make the hard stuff in life fun

Oxford Dictionaries

As it is also mentioned in the Oxford’s definition, so far companies have utilized game elements mainly in marketing: customers have been enticed to spend more time with the company’s brand or product with the aid of gamification. A good example is Samsung’s customer loyalty program Samsung Nation where the fans of the brand can collect badges and points, review products, watch videos and see what other fans are doing. The social features found in Facebook and other social media services are important also in gamified applications.

Kai Huotari and Juho Hamari define gamification from the service marketing perspective because, as said, most of the gamified implementations aim for marketing benefits. According to them gamification refers to a process of enhancing a service with affordances for gameful experiences in order to support user’s overall value creation. The definition emphasizes the goals of gamification; previously introduced definitions are based on the idea that gamification is all about the game elements.

What gamification is not?

80 percent of current gamified applications will fail to meet business objectives primarily because of poor design.

Gartner 2012

Gartner’s report from last November bursts the gamification bubble. Gamified applications implemented in novelty and hype don’t usually meet the set business goals. The main reason for failure is poor design: too much focus is put on single features, like badges and points, instead of the user experience as a whole. With mere badges you don’t go far. In addition to extrinsic motivators (badges and points), one should take into consideration the intrinsic motivators like power, autonomy, learning and the sense of meaning (e.g. Amy Kim 2010, s. 12). It helps to get to know the different user types and some behavioral psychology.

In fact gamification is a misleading concept because in the end, gamified business applications don’t have much in common with the actual entertainment games. Like Gabe Zichermann and Christopher Cunningham remind us in their book Gamification by Design, the purpose of gamified applications is to increase long-term engagement and customer loyalty. A game in which customer’s or employee’s alter ego hunts down bogeys with an assault rifle in corporate colors is not necessarily the best way to achieve the business goals; even though it might be fun. Gamification is not about turning business into entertainment or a simple game or play. It is about engaging, motivating, training and managing your customers, partners and employees by using familiar game elements.

The predecessor of Cloudriven’s Virta was called BLARP (Business Live Action Roleplaying Game). It was the result of New Media company Satama’s and Trainers’ House’s collaboration and originally designed to bring play and creativity into workplaces. The visions were wild as you can see from the advertising video below (sadly only available in Finnish).

We were ahead of our time when we six years ago tried to bring gamification to the everyday life and management of organizations. Time wasn’t quite ready then; only a few customers took the gamified features of BLARP into full use. Now gamification is in a strong lift and customers are starting to realize its business benefits. Based on our previous experiences we have a strong lead.

The goal is to change behavior

We at Cloudriven realize that from business perspective gamification is most of all about changing the behavior of customers, partners and personnel towards the desired direction. The most important method of managing behavior is instant feedback: user must get immediate feedback of his/her actions. Gamification has so far been utilized mostly in marketing, but good examples of activating, engaging and motivating employees also exist.

Based on these ideas we are currently developing a game platform that will put your organization’s strategy into practice. With the aid of the gamification platform, management can define what activities are necessary in order to fulfill the strategy and monitor the completion of these activities. Employees, partners and customers can now achieve the set goals because they receive guidance and immediate feedback for their actions.

We believe gamification can help organizations to build up customer loyalty and share of wallet and increase significantly the employees’ feeling of inclusion as well as motivation and learning.