Research on decision-making provides insight into spurring positive behavior in employees

Written by Adam Kronk

The goal isn’t new: we’re after ethical behavior in business. Getting people to “do the right thing” is a lofty aspiration, but not a novel one. We’ve been trying to foster and generate such conduct in our organizations for a while now. If we honestly assess our approach, most of our efforts seem to rely on one major assumption: that we are deliberative, rational beings.

If only each employee would memorize our code of conduct, corporate values, and decision-making framework, we could all rest easy that (assuming we hadn’t hired any real “bad apples”) rules would be followed and principled performance would be the norm. Right?

Of course not. There’s another side to each of us that drives what we do, and it’s at least as powerful as reason. Call it intuition, gut, or emotion—regardless of the label, we each make judgments and take actions on a daily basis that aren’t the result of cold, clear deliberation.

This isn’t news either, but despite the advances made in fields such as neuroscience, behavioral economics, and social psychology, little of what we now know about what makes people tick has made its way into companies’ ethics and compliance programs.

At the Notre Dame Deloitte Center for Ethical Leadership, we are working on connecting the dots. We stay abreast of the progress being made in academia that hasn’t yet been applied to how business is being done, creating bite-sized deliverables that will be easily digestible to business practitioners.

Here’s a sampling of ideas worth considering:

It ain’t all bad (or at least, it shouldn’t be)
How many conferences do you attend where a litany of wrongdoings is the starting point for the conversation? Are your trainings mainly focused on previous missteps and what you can learn from them?

Denise Baden at Southampton Management School studied the effect of using positive and negative role models in teaching business ethics, and she found that a steady diet of the latter does two things you probably don’t want. First, it establishes a norm that people always break the rules. Second, it reduces our “self-efficacy,” which is the sense that what we do matters. The balance to strike is to convey potential pitfalls while still giving employees a sense that people can—and do—conduct themselves in an ethical manner.

Compliance is a lousy catalyst
From a psychological perspective, avoiding a behavior for fear of punishment is a much weaker motivator than striving to emulate an admirable leader or live out a compelling value. Following an ever-increasing list of rules also diminishes independence and proactive problem solving, and ends up creating more work for managers.

Especially in industries with heavy regulation, new laws certainly need to be conveyed to employees. Just make sure to complement that information with something more salient than, “You’ll get in trouble if you do this.” Ideally, tie it to something core to your business or crucial to your mission. Give your employees something to which they can aspire rather than only something to avoid and you’ll allow them an opportunity not only to comply, but to flourish.

A story is worth a thousand values statements
It’s much easier to remember an experience than a fact. Psychologist Endel Tulving distinguished between episodic and semantic memory more than 40 years ago, and yet the power of story is often overlooked in the way we disseminate important messages in our organizations.

Rather than (or at least in addition to) distributing lists of carefully crafted phrasing around what matters to management, consider finding concrete examples of someone exemplifying the value you have in mind and recounting it, asking leadership at every level to do the same. From fables to parables to oral storytelling, it turns out humans have been learning this way for thousands of years. As a bonus, it puts context around something that might otherwise remain abstract. Integrity sounds great as a general concept, but it might be hard for an employee to link that notion to a specific behavior in his or her unit. Make the connection for them.

Intuition can be taught
If you were in despair when reading my earlier comments about the power intuition has in driving what people do, take heart: It’s trainable. Robin Hogarth, an expert in behavioral decision making, wrote a book called Educating Intuition, in which he describes a relatively simple, but not necessarily easy, method. It all comes down to learning environments being “kind” instead of “wicked.”

In the first environment, timely and accurate feedback forms and reinforces ethically appropriate intuitions while diminishing and challenging inappropriate ones. Our takeaway? If feedback is the answer, relying on an annual performance review probably doesn’t suffice. Consider upping the frequency and reducing the threatening feeling of it. A major multinational tech company that recently presented at our annual forum said they took the controversial step of separating the feedback process from compensation considerations so that people would be more forthright in what they share.

Habits help
Much has been written on the power and promise of habit. From a manufacturing giant’s legendary emphasis on safety in every facet of its operations, to the United States service academies’ focus on building character throughout their ranks by regimenting behaviors large and small, we know that organizations can leverage the human phenomenon of putting behavior on autopilot whenever possible. Ask which components of your employees’ conduct require them to pause and ask a few questions about their situation, and which ones can be elicited through a “habit of mind” that can be formed and then left to operate almost automatically.

We have a steadily growing pipeline of content like this, and it’s not all thanks to the academy. A huge part of the equation is input from experienced executives about what works in their organizations. From video interviews with C-Suite leaders to links to other practical resources, the Notre Dame Deloitte Center for Ethical Leadership aims to serve as a hub where anyone interested in advancing ethical behavior can quickly access information that’s useful and actionable.

Author Biography:

Adam Kronk runs the Notre Dame Deloitte Center for Ethical Leadership, housed in the Mendoza College of Business at the University of Notre Dame. He also teaches business ethics to undergraduates and presents regularly at corporate and academic conferences on topics related to ethical leadership and effective management practices, especially focusing on what makes people tick, how leaders can affect culture, and which cutting-edge practices hold particular promise for the business world.