Manage instinctive reactions to change to embrace data-driven innovation
In his book, The Chimp Paradox, the psychologist Professor Steve Peters outlines a simplified model of the brain in terms of rational and emotional decision-making, and breaks it down into three functional areas: the chimp, the human and the computer.
These behaviours are mirrored in how organisations behave; so this model is useful when considering how businesses react to change. When presented with innovative techniques or insights, both rational and emotional decision-making kicks in.
If you are planning to transform your business to be data-driven and forward-thinking, you will need to plan to manage, calm and control these natural, emotional responses.
The Chimp Paradox – a brief overview
The Chimp is the automatic emotional response engine. It’s the bit that starts to take over when you get angry or stressed, and it has evolved to react to threats and to ensure your survival. It’s what triggers “fight or flight” mode.
The Human is the rational side of the brain. It’s the part that allows you to be you and make decisions based on your ideals and your understanding of the world. In business terms, this is what we might call our “brand values”. The Human is your civilised side that gets on in society.
Finally there is The Computer. This is your brain’s set of “stored procedures” taken from all the situations it has experienced before: from riding a bike, to meeting new people, or even tackling difficult questions in a business meeting. It’s learned behaviour and helps you to respond quickly to circumstances by using past encounters as reference. Put simply, The Computer uses its saved data to inform future behaviour.
The paradox in practice
When faced with a challenging scenario your brain will use these areas to react and manage the situation. First, your Chimp will process the scenario and decide whether or not there is a threat. If it senses danger, it will do whatever it thinks necessary to stay safe or comfortable. If the Chimp decides that there is no threat, the scenario is handed over to the Human.
The Human then assesses the situation and works out how you should behave or respond according to the values by which you live your life . Should you be friendly? Displeased? Reserved? Outgoing? It is The Human in you that reacts in a way that defines your personality or character.
Things get more complicated when you have the Chimp reacting to a perceived threat, which requires the Human to do something. Imagine, for example, that you are not a very confident public speaker; but your role at work demands it. The Chimp is telling you to run away and hide from this uncomfortable situation; your Human has to keep your chimp in check and calm it down.
Finally, the Computer – your internal reference guide or “playbook” that has been built up based on memories of past scenarios. Think of it as a ‘cheat-sheet’ to which The Chimp and The Human can both refer. If a known response is required the brain will tell The Computer to run its stored procedures and react as it knows how. Obviously the Computer’s bank of references grows over time and it will categorise different scenarios based on what type of Human characteristics you have.
I’ve just tried to summarise an entire book into a few paragraphs, so this does not do Prof. Peters’ work justice. Hopefully, though, this has given enough of an intro to now apply this theory to how business cultures respond to the “threat” of innovation and change.
Given that businesses are made up of humans (for the time being, at least, but that’s a different article!), they behave in a similar way. The organisation as a whole is also influenced by Peter’s three elements, and its staff will react accordingly, even if they don’t realise they are doing so.
That’s a particular challenge if you are looking to make changes to your business. Effecting real data-driven innovation in the face of entrenched ways of working can be extremely difficult. Prof. Peters’ model can help us to explain why.
Act. Don’t re-act.
Almost by definition, data and data-led decision-making feeds into the rational, Human part of the organisational brain. To use Peters’ metaphor, what people mean when they say “I want the business to be more data-driven” is “I want the business to become more Human and less Chimp” – fewer knee-jerk reactions and more considered actions based on gathered intelligence.
It’s the Optimisation or Insight team that face this challenge most regularly – so they are best placed to take the “corporate temperature” as part of a data-led transformation programme.
Presenting back the results of an optimisation test, or delivering new insight to a range of stakeholders, is always fascinating. Beyond the thrill to be found in the sharing such knowledge, it’s also interesting to see, first hand, the battle between the organisational Chimp and organisational Human as they are exposed to a scenario that puts some of their assumptions to the test.
Calming the organisational Chimp
Perhaps understandably, teams will often react to this kind of intelligence defensively and sometimes irrationally. Particularly if the insight is perceived to threaten a team’s status within the organisation (if it threatens their Chimp).
Have you ever sat through a presentation and thought “well, I could have done that, I don’t know why they are getting all the credit”? That can be one reaction. More commonly, however, teams will reject insights that challenge their assumptions about how customers behave. In other words, if the information conflicts with what is stored in their “Computer”.
By way of an example, I once ran an optimisation programme for a very famous, high-end brand. Their primary focus, across all channels, was to make everything look beautiful. Offline, this had worked extremely well for them. Online, although their digital channels looked amazing they had a low conversion rate, compared to industry benchmarks.
But when the optimisation programme identified that a more functional (less picturesque) page layout drove more orders and increased basket value, the organisation’s reaction was characteristically “Chimp”.
Several stakeholders decided, despite cold hard facts, that the beautiful page was still the ‘winner’. The rational, Human part of their brain appreciated the improved conversion rate – but these two sides of the company’s intellect were at odds with each other.
In the event, the decision was rapid and decisive: the beautiful, brand-led layout won. The organisation’s Chimp had decided that there was danger ahead and reacted accordingly. This instinct was so ingrained within the company (so well established in The Computer’s stored procedures), that the more functional option was not even presented to director-level. Even to present this alternative view to senior management was felt to be a career-limiting scenario for the stakeholder.
Data-driven decision making
That is a relatively simple example of immediate corporate reaction to a one-off test. But it’s a case in point. If you want to be data-driven, you have to modify these instinctive behaviours by enacting company-wide cultural change.
You must get people to use the data to inform decisions: to act based on fact, not react based on feeling.
That’s hard enough in itself – but there will often be added challenges along the way – for example, the speed with which you can get access to insight and information. Instinctive reactions, by definition, are immediate and you need to have enough intelligence to hand to counter those impulses as they unfold.
Re-programme your “Computer”
As Prof. Peters points out in his book, and as illustrated in his diagram below, The Computer is the fastest “processor” in these kind of scenarios – provided that it has a stored procedure to which to refer. It can be 4 or 5 times faster than the Chimp to react, by which time the Computer has already put things in motion to manage whatever issue has arisen. The Chimp becomes redundant.
But the Human responds a further 4 times slower than the Chimp. That’s 20 times slower than the Computer. That’s often because it’s dealing with new scenarios that it has not previously encountered.
Of course, in business you are most likely using data to inform strategy, drive innovation or encourage original analysis, and you need to make sure that you come to an informed decision. You can’t afford to let The Human take a back seat.
Since the other areas of the corporate brain can react much more quickly – particularly to negative challenges – it’s important to quiet these initial responses, or even silence them completely. This is particularly important when driving any insight-led or strategic programmes.
Fact vs. Feeling
We recently did some ground-breaking behavioural analysis for a client across their digital channels. This was insight that had not been attempted before, and so, to use our metaphor, there could be no stored procedure for it in The Computer.
The results were surprisingly stark and suggested that some areas of activity were underperforming. Our client was pleased to have this information, and even validated the findings – he had always had an open mind on the subject and so his organisational Chimp had metaphorically been switched off.
When this was presented on to other stakeholders, one of them simply couldn’t comprehend the findings. It was contrary to their pre-conceived perceptions based on previous analyses on similar, but fundamentally different, customer research.
Almost literally, the Computer said “no”!
Their Chimp had found an (incorrect) stored procedure in The Computer, which didn’t match with the scenario presented – so it panicked. It then took several lengthy conversations to explain the distinctions between the different research pieces, and eventually their Chimp calmed down. Eventually he accepted the analysis but this took a lot of time and emotional energy that could have been spent identifying, or delivering, next steps.
If you are looking to turn your business into a data-driven organisation, you will need to train your organisational Chimp. You will need, not only to calm your Chimp in relation to new research or insight, but also to update your Computer to include new stored procedures that will embrace, rather than vilify, opportunities for innovation.
In the same way that evolution ensures that an animal species, not only survives, but improves, businesses that are able to calm their inner Chimp and reprogram their Computer will be first to progress to the next level. You must adapt to advance. Only those organisations willing to make those changes and embrace a data-driven future, will be guaranteed a part in it. It’s survival of fittest, at its finest.