Episode 75 · 25 January 2024 · 41:34

What makes your team say Yes? Exploring the Psychology of Influence with Phill Agnew

Featuring Phill Agnew

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Intro — meeting Phill Agnew
intro#intro #meeting #phill-agnew
Why most of us aren't very good at persuading
interview#persuasion #leadership #psychology
The deadly arithmetic of the modern workplace
interview#workplace #arithmetic #modern-work
Tali Sharot and the neuroscience of influence
interview#neuroscience #influence #tali-sharot
Persuasion vs. manipulation — where's the line?
interview#persuasion #manipulation #ethics
Feedback, effort, and the input bias
interview#feedback #effort #input-bias
The pratfall effect — why flaws make you more likable
interview#pratfall-effect #likability #leadership
Do bonuses actually work?
interview#bonuses #behavioral-science #incentives
Loss aversion and the psychology of incentives
interview#loss-aversion #psychology #incentives
Ayelet Fishbach and the science of motivation
interview#motivation #science #ayele-fishbach
Phill's book recommendations
interview#book-recommendations #psychology #behavioral-science

Show notes

What Makes Your Team Say Yes? Exploring the Psychology of Influence — with Phill Agnew

Guest: Phill Agnew — host of the Nudge podcast, winner of the Sussex Marketing Award, and behavioural science obsessive.

Why do some messages land while others bounce straight off? And where's the line between persuasion and manipulation?

Phill joins Al and Leanne to unpack the psychology of influence — from the "deadly arithmetic" of the modern workplace to why the UK taxman uses behavioural science to get you to pay on time. They dig into the pratfall effect (why spilling coffee on yourself might make you more hireable), why old-school bonuses are built on outdated psychology, and how the "input bias" changes how your team judges your decisions.

Top 3 Takeaways

Persuasion isn't manipulation — but the line matters. Manipulation gets people to do what they don't want to do. Persuasion helps them see why they might want to. The difference is intent, transparency, and respect for autonomy.
Effort changes perception. The "input bias" means people judge outcomes differently when they can see how much effort went in. Show your team the work behind decisions — it changes how they land.
Flaws make you more human, not less. The pratfall effect shows that admitting mistakes and showing vulnerability increases likability and trust. Perfect leaders are harder to relate to than slightly messy ones.

More Psychology at Work from Truth, Lies & Work

Connect With Us

Get in touch, book a call, or find Al and Leanne on LinkedIn — all in one place: truthliesandwork.com/connect

Mental health support: findahelpline.com — UK: Samaritans 116 123 · Mind 0300 123 3393 — US: 988 — Australia: Lifeline 13 11 14

Truth, Lies & Work is part of the HubSpot Podcast Network.

Full transcript

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Phill AgnewIt's written by Zoe Chance, who runs the Yale course on behavioral science and persuasion. That's the most popular course at Yale. So I think that shows just how impactful this stuff is. And she wrote a whole book about how you can apply these things as a leader, how you can convince people using psychology, how you can be better at understanding why people make decisions.

Leanne ElliottHello and welcome to the Truth, Lies and Workplace Culture podcast, brought to you by the HubSpot Podcast Network, the audio destination for business professionals. My name is Leanne. I'm a business psychologist.

Al ElliottMy name is Al. I'm a business owner.

Leanne ElliottWe are here to help you simplify the science of people and create amazing workplace cultures.

Al ElliottYeah. Hello. Hello. Welcome back. If you're a regular listener, then welcome back. If it's your first time, don't worry, we'll be gentle. You're going to enjoy this, I think. That sounded a bit creepy, didn't it?

Leanne ElliottIgnore him. Ignore him.

Al ElliottMoving on.

Leanne ElliottI'm here.

Al ElliottThe dirty little secret is that most businesses think they know their customers. They have the data, the records, the history, but it's scattered across 3 teams and 4 systems, and in our case, about 216,000 spreadsheets, which means nobody can actually use it.

Leanne ElliottWhat you should be doing is using HubSpot, because why? HubSpot connects it all— every interaction, every support ticket, every conversation— into one platform every team can work from. So when sales talks to a customer, marketing already knows the full story. And when you know more, you grow more.

Al ElliottNice. Check out hubspot.com, the agentic customer platform for growing businesses.

Leanne ElliottMoving on. So you know how last week we were saying that we get a lot of guest requests and they're usually a bit like not very good?

Al ElliottYeah.

Leanne ElliottUm, well, I, I've got probably at least 6 or 7 since then over the last week, and I really— my hopes were high. I thought, you know, people would have listened, they would have taken on the challenge. Um, but what I learned is that they don't listen to the podcast at all. Certainly not our most recent episodes. I had one today, I, I'm not lying, somebody pitching me an expert in soft tissue damage and recovery.

Al ElliottUm, that's not what our podcast is about.

Leanne ElliottIt's not. I mean, I'm sure there's a link in there somewhere in terms of workplace health safety and that type of stuff, but I don't have the time to make those connections.

Al ElliottNow, if you, if you are, if you want to be on anyone's podcast, you want to be on ours or anyone's, or Phill, who's our Who's our guest today? Well, I've just spoiled the surprise.

Leanne ElliottSpoiler.

Al ElliottWell, I think it's in the title anyway, but if you wanna be on it, then just at least listen to the podcast. We had one guy called Will who reached out and he said, um, and he said, I loved your— he, he started up, he sent me a generic cold DM on LinkedIn, just ignored it as I do everyone. And then he sent another one, a follow-up, just saying something like, um, yeah, just listened to your podcast, your episode, um, with the Shake Shack guys on it. Really enjoyed it. How do you find your guests? Or something like that. And I was like, oof, okay, all right. Started it, got on the phone with him. He's, um, I still dunno what he's, what he, what he's pitching, if he is, but he might not be pitching anything. But he got on the phone with us because it was just real simple. He just listened to the pod. He spent 20 minutes listening to the pod. He could speak, listen to it on double speed. There you go. Little advice rant over. Yeah.

Leanne ElliottAnd as a leader, when you're sending that generic email to your staff, maybe think again. You know, personalization can go a long way. Anyway, I thought my little, yeah, guest thing, um, I'm sure what's sad is I'm sure there's brilliant people that they're pitching, But they're just doing a rubbish job of it. But speaking of great guests.

Al ElliottYes. So we have got a load of good guests coming up over the next few weeks. We've got Joe Fear from Hustle and Flowchart. He's on navigating partnerships. The week after that, we've got the Founder Series with the amazing Dani and Sophie on navigating inclusion and diversity. Then we've got the CEO of Mind, which is a UK-based charity. If you're in the UK, you know who Mind is. If you're not, you've probably heard of them. Uh, huge big deal. Then we've got the amazing Bruce Daisley from the podcast Eat Sleep Work Repeat, and also the author of that brilliant book Resilience, as well as a few others. We've got your hero, John Emichie-Lee. I did. That made the dog look over. I don't think he needs any more introduction. If you don't know who it is, then Google it because he is a dude. Then we've got the amazing Rory Sutherland from Ogilvy, and then Isabel Berrick, who's an author, a podcaster, an FT— well, that's Financial Times— journalist, We are really, really excited about this, Leanne.

Leanne ElliottYeah, it's ace. It's ace.

Al ElliottTalking of being excited, today we have one of our heroes on the pod. He is the winner of the Sussex Marketing Competition. He's got a degree in marketing and management. He's put on his LinkedIn profile A*s in GCSEs and A-levels. I'm impressed with that.

Leanne ElliottOh, is he young enough to have had A*s at A-level?

Al ElliottWell, I don't know.

Leanne ElliottOh, Phill, that makes you more annoying. How old are you?

Al ElliottI wouldn't dare put my single D I got at A-level on LinkedIn. Um, he was was awarded the High Flyer Scholarship. He spent 6 years at Brandwatch before moving on to Senior Product Marketing Manager at Hotjar and then at Buffer and is the host of the amazing Nudge podcast. Let's go meet Phill Agnew.

Phill AgnewSo I'm Phill Agnew. I, I run a podcast. I'm a podcaster, so I run Nudge, and that's probably what I'm famous for. Nudge is the, the largest marketing show in the UK. But actually, according to Google, probably the thing I'm most famous for is when I was younger, me and my mates would muck around on Wikipedia articles, and I managed to edit Barcelona's stadium's Wikipedia article, which is the Nou Camp. And I put myself as the architect. I called myself Philippe Pedro Agnew to just give myself a bit of a Spanish spin. And somehow that stuck. And I was on there for about 2 or 3 years, and I'm still on some versions of Wikipedia with that title. Although I run a podcast which is pretty successful, I think I'm still most famous for lying about being the New Camps architect.

Leanne ElliottPhill is a funny guy. He's an awesome guy. I jested that he's annoying, but it's just because he's so good. He's such an inspiration. And every time we think we're maybe starting to, to get on his level, we realise that we're still, we're still reaching. But yeah, an awesome, awesome podcast as well, Nudge, for leaders, for marketers. And what I think a lot of leaders and managers don't realise is that creating amazing workplaces, amazing amazing cultures is actually based on the same psychological principles as creating great marketing or a great campaign or a great brand.

Al ElliottAbsolutely. So I wanted to find out a bit more about what leaders could learn from the psychology of persuasion that marketers use every single day. After all, a huge part of leading effectively is persuading your teams to create great work. So here's Phill's take on it.

Phill AgnewMost of us aren't very good at persuading. And that's unfortunately not only the case with individuals, but with leaders, not only leaders in companies, but leaders of whole countries. We are really bad at persuading other people. I think one of the best examples of this comes from the psychology around arguments. If you ask anybody, including leaders, how to win an argument, they usually say it is a combination of give very clear, transparent data, tell a coherent story, share as much as you can about your point of view, Give all of your reasons as to why you are right. We think of an argument as a bit of a, I need to build my case, share my case coherently, and that will help me win an argument. And leaders do this to put forward new projects, and individuals do this to persuade their boss to give them a pay rise. But the reality is that's not how you persuade. Heaps of studies over the past 100 years have seen that to change someone's mind, You don't share your point of view. You don't bombard them with data. Instead, you ask calibrated questions to get that individual to perhaps consider their own point of view and perhaps even change their mind. So there's this incredible study with people who had completely opposing views on very controversial topics like abortion or religion. And they sat these 2 people down, and in one scenario, they would ask them just to try and convince each other. And then in other scenarios, they'd ask one to ask some calibrating questions of the other. So to say, Why is it you believe that? Is there any way that that might not be right? Is there any reason you would change your mind? These sort of questions to get the other person to open up. And the amount of times that version changed people's approach, when people were asked those questions, they were far more likely to change their point of view rather than bombarding people with data and information. One very specific example there, but actually reveals all these ways that we're persuaded. And I think this is one that leaders need to pay attention to as well. If you want to get people back to the office 5 days a week, you shouldn't just be telling them, You should be inviting them to give their own opinion on why being back in the office would be a good thing. That will work better.

Leanne ElliottPutting my personal feelings and politics aside for a second, I have to concede that Donald Trump is pretty good at persuasion, which is why an increasingly large percentage of Americans think he should be leader of the USA again. Let's not forget, he received the most votes, or the second most votes of any presidential candidate in history, beaten only by Joe Biden. Phill has a great example of how he used the idea of the deadly arithmetic of compassion to try to convince people why they shouldn't be vaccinated.

Al ElliottJust before we go to Phill, can you just remind us— I know you've mentioned this term before, the deadly arithmetic of math, of, of statistics, no, of compassion. Um, will you just tell us what that actually means?

Leanne ElliottYeah, I mean, we are faced with huge challenges as humans, especially in a world that is so connected through social media. You know, there's climate change, there's natural disasters, there's mass atrocities, there's a deadly pandemic, the list goes on. And, you know, in present times in the 20th century, that can lead to behaviors like doom scrolling. You've heard of that one, haven't you? The continuously scrolling through bad news even though it's really depressing. Or, you know, newly coined psychological disorders such as climate anxiety, or eco-anxiety it's also known as, which is basically a chronic fear of environmental disaster caused by the impacts of climate change. So over time, we've developed coping mechanisms as humans, including becoming desensitized to large-scale problems or big tragedies. And that's a psychological phenomenon called psychic numbing. A psychologist called Paul Stovic, who is an expert in risk perception, took this to another level, gave it a very modern— and let's be honest, a bit of a sexier twist than psychic numbing. And he coined the term the deadly arithmetic of compassion. So it centers on the premise that our nervous system can't count. We just can't. The more people that die, the less we care, which is brutal, but the reality of it— it leads to apathy, a lack of action, and often in situations where those large-scale humanitarian responses are needed, like vaccinations during the pandemic. Large datasets should be convincing, but they're not. That's why charities feature the story of one individual or family in their donation campaigns. When you identify a victim, you secure twice as many donations. It's why we're seeing more visual imagery in relation to the impact of climate change. I think it was just last week I saw a map that was released of what the UK will look like in 70 years with the projected rise in sea levels and the massive cities, including London, that are going to be lost. As Phill explains, one well-told story will always outperform statistics and data.

Phill AgnewSo, Tali Sharot is a world-leading neuroscientist. She is probably one of the most intelligent people I've spoken to, other than you, Al, of course. So she's very intelligent, and she knows that vaccines for her children work. She knows they are effective. Not only does she just know this because she trusts authority figures like doctors, but she knows this because she understands the medical science behind it as well. And yet when she was watching one of the primary debates between Trump and his competitors, when he was going for the election in 2016, she heard Trump talk about how these vaccines for kids were inhumane, about how they would inject them with these huge syringes fit for a horse, about how a colleague of Trump's got their own children vaccinated and ended up with fever and ended up getting all sorts of illnesses happening to them. And he said all of this, and Trump said all of this, and Tali Sharot found herself Despite being educated, despite knowing the data, despite knowing the science, actually finding herself questioning, oh my God, should I be vaccinating my kids? And she describes in her book, The Influential Mind, that this is an example of how stories and how these non-data approaches can influence us. Being extremely salient, sharing salient concrete examples, being clear with an individual's example rather than a group's is a really effective way to persuade. And Trump was leveraging all of those biases. His competitor was saying, well, no, there's all this data with hundreds of thousands of people over lots and lots of studies that show that these vaccines are effective. And Trump gave one anecdotal example of one individual, and that was very likely to persuade. That's a good example of something called the story bias, which is we've spent millennia learning, studying, and remembering stories. The more we hear stories, the more likely we are to remember them. And thus, when Trump uses a story like that, it's actually more likely to persuade than big data points because they stick in people's mind for longer.

Al ElliottSo let's just back up for a second because I think a lot of people think that persuasion and manipulation are the same thing. Now, I wanted to know what the actual difference was from Phill, who's arguably one of the world's experts on this.

Phill AgnewManipulation is, you know, it's a negative word. It's getting somebody to do what they don't want to do. And persuading isn't always put in that category, right? You can persuade someone to do something they might want to do. Al, if you persuade me to go on a run after this, That's a good thing for me. That's something I'd want to do, but it's raining outside right now, so I'm not motivated to do it. But you could persuade me to do that. I think the point I always make when I'm talking about psychology and behavioral science is some people feel that just the process of applying these psychological principles to the act of persuasion makes it manipulation, just because they're so potent and they're proven to be effective. But the fact of the matter is, people are persuading anyway. Everybody is trying to alter the decisions of other people. That's what we spend all of our careers doing. We are constantly trying to debate, discuss, get your own point of view across. All psychological principles give us is the ability to do that more effectively. So we are not doing something different by using behavioral science or psychology. We are simply applying a bit of science to it. And often this can be really good. This can make people with opposing views start to agree, like I shared earlier. Or there's another example I really like, which is from a study which is cited in a brilliant book called The Power of Moments. And it's a study with teachers and students, but it can be applied to businesses as well. I shared it in my newsletter a few weeks back. And in the study, the teacher tested giving 2 different types of feedback to his students. So half his students would receive feedback, which is something along the lines of, I'm giving you these comments so that you'll have feedback on your paper. And then in the other scenario, the professor would use a bit of anchoring. So they would say something which would elevate the individual's self-expectations. So they would say, the professor would say, I'm giving you these comments because I have high expectations of you. Now, in this study, he measured how many of the students actually went back and revised their paper. So this is like coursework where they had a chance to actually revise their paper and improve it. When he didn't use anchoring, when he just said, I'm giving you feedback, only 40% revised their paper. When he did use anchoring, when he said, I have high expectations of you, 80% revised their paper. Now, this is brilliant because the professor wins because people are— the students are actually using his feedback, which is obviously what he wants, is what he's paid for. The students win because those who revise their paper are more likely, are far more likely to get a higher mark, and that's what they want as well. And you could argue the students win in another way as well because they're actually benefiting from a higher self-esteem. They're being told, I have high expectations of you. That makes them feel better as well. Now, this, I think, is not manipulation. This is just effective persuasion. This is a great example of how you can apply psychology to get more out of your teammates, to get more out of your colleagues, to get more out of your, whoever you might be managing.

Leanne ElliottYes. This stuff is directly related to things a leader or manager does every day, like giving feedback. So instead of saying, that wasn't the outcome I was looking for, you might say, I know you put a lot of time and effort into this, and I also know that you are amazing at your job. I'm going to point out what I think wasn't done quite right, but only because I know you can do a better job of this. There's a great story on one of Phill's episodes about how perceived effort makes something more valuable. A painting that took 40 hours is going to be perceived as better than one that took 30 minutes. A single malt whiskey that's been aged for 25 years intuitively feels like it's better than the equivalent of a 10-year-old malt. This applies to being a great leader too. If you as a leader are seen as putting in a lot of effort to getting an outcome, then you will be valued more. Phill talks about a boss he once had who did exactly this.

Phill AgnewKnowing the amount of effort you put into something makes people judge things differently. I think one of the One of the best things that I've seen a leader do in my career. So I've always worked within a product marketing function, which means I'm responsible for launching products and features. And in my role at Brandwatch, I reported directly to the CMO, Chief Marketing Officer, who wasn't directly in the product marketing function. He hadn't been a product marketer before. He hadn't done this job before. And that can be a bit tricky for a leader. If you haven't done the job that you are managing someone to do, you suffer from not having this input bias. They know that you haven't put in all the hours in your career launching products. They know that you haven't been executing on the same things that your staff are executing on day in, day out. And so what this leader did, and I think this was genius, is he said, I'm gonna do a launch myself. I'm gonna do a whole launch from start to finish. I'm gonna take time out of my role as a CMO. I'm gonna work overtime to just do a launch because I want to learn what it's like to do a launch. I wanna learn what it's like to be a product marketer like you, Phill. And in doing that, he just benefited from all this input bias, from all this labor and From all these psychological sort of hacks I've been talking about, because I realized that he was taking the time to actually learn my role. And he did this not only with my role, he spent a day with the sales team answering sales calls and doing cold calls. He spent the same time doing it with the customer advocacy team answering tickets. And I think leaders who actually spend time to understand the roles of the people they're managing will perform much better. And we intuitively know this, but there is evidence that backs it up, evidence about the input bias that really shows that this works. Spending time—

Leanne ElliottYeah.

Phill AgnewTo understand what your employees go through, what they're doing, how their work functions, will increase your value as a boss and will increase how much people will be receptive to your ideas dramatically.

Al ElliottNow, what about being likable? Because great leaders and managers are inherently likable. So assuming that you're not an awful human being, how do you leverage persuasion and psychology to encourage your teams to actually like you more?

Phill AgnewThere is one thing which I love to talk about because I think it's so important that can make people more likable, more believable, more trustworthy, and more likely to get a promotion. And it's this effect called the Pratfall effect. And it was discovered back in the 1960s by a researcher called Elliot Aronson. And what he did was this genius study. He filmed an actor answering quiz questions, and the actor would get almost all of these quiz questions right, 90%. They would know the capital of obscure countries, would know the population of a continent, all these obscure things. So if you're watching this video, you assume this actor is very intelligent. And then right at the end, after he'd finished the questions, he goes to take a sip of coffee, spills it all down himself. So appears really clumsy, just spilled coffee down his white shirt. Now, Elliot Aronson had this recording and then wanted to show it to participants and ask people how likable do you think this person is? But he ran a twist in his experiment. So half the participants saw the full recording, so all of the questions and then him spilling coffee down himself. But the other half of the participants saw only the first part of the recording. So when he just answered all the questions correctly, no coffee spilled, it was cut before that. And he wanted to see if there was a difference, if there was a difference in likability. And it turns out—

Leanne ElliottThere was.

Phill AgnewThere was. People who saw the actor spill coffee down himself, they didn't know he was an actor, by the way. They thought he was a real quizmaster sort of thing. When they saw him spill coffee down himself, they ranked him as far more likable. Now, this is really interesting, right? Why should this clumsiness, this flaw, make somebody more likable? Well, Elliot Aronson assumed it was down to this pratfall effect, this idea that we don't like people to be perfect. We don't like things in general to be perfect. We prefer things with imperfections, and when they have imperfections, they'll appear more likeable.

Leanne ElliottI love it. The pratfall effect. Funny word, but clearly highly influential in how others perceive you. Last week we had the amazing Nora Burns on the podcast, and she talked about being the undercover candidate. Definitely go back to that one. But Phill explains that this pratfall effect can be used in job interviews too.

Phill AgnewSo Jo Sylvester, a researcher from Wales, she took this finding and then in 2015 applied it to a hiring context. So she got dozens of her research assistants to apply for hundreds of different jobs, and she gave them very, very strict things they could say in each of their interviews and in their CVs. So they always had to show the same level of qualification, the same skills, the same experiences, the same strength, really detailed about, they had to be really, really thorough about what they included. But then she said to the research assistants, in half of the jobs that you're applying for, I want you to only share your strengths. And then in the other half, I want you to share those same strengths, but also highlight your weaknesses. So also share how I'm very diligent, I'm a hard worker, but I want to be totally honest with you, I'm an awful speller, or I want to be totally honest with you, I'm a rubbish public speaker, or something like that. Now, Jo Sylvester, as like most people, would predict that surely the individuals who only shared strengths would be more popular. They would be more likely to get the job, more likely to go through a second stage. After all, surely the whole interview process is just trying to hire people who are going to be most effective at the job. But that's not what she found. She discovered that when these individuals also showed their flaws, if they even highlighted their flaws and brought them out there, They were more likely to get a job, to get through to the second round, to get hired than those who only shared their strengths. So she's found that this 1960s study applies today in an interview context. By showcasing a flaw, by revealing a weakness, we are more likely to get a job. Brands know this. So some of the most famous brand slogans in the world reveal a flaw. You'll either love it or hate it with Marmite. We try harder with Avis. Great examples of why revealing a flaw can make you more popular. And right back to your example, I think if you are competing against other people, there is this natural desire to be shown as the best, to make sure that your boss thinks you are perfect, you never make a mistake, that you get everything right, that you know more than your peers. But psychology reveals that that actually might not be effective. That actually by being just a bit more human, a bit more real, revealing those imperfections, spilling a bit of coffee down yourself, that will make you more likable. That'll make you more believable, which will make you more trustworthy, which will probably make you more likely to get that promotion or that job or whatever it might be. So that would be my advice. Don't hide your weaknesses. That tends not to work. And if it does work, then you're probably in a workplace culture which is worth getting out of anyway, because it's not probably a real one like these studies. So showcase your flaws.

Leanne ElliottDid you know that the UK's number one management podcast, that's us by the way, and the UK's number one marketing podcast are both on the same podcast network.

Al ElliottWe actually have a lot in common. We both use behavioral science to help people do better at work.

Leanne ElliottAnd we both had to wrangle Rory Sutherland on an episode.

Phill AgnewAnd 2 out of 3 of us are devilishly good looking.

Al ElliottAnd you're not gonna say which. Phill, host of Nudge, UK's number 1 marketing podcast. It's brought to you— we need to do this in 3s— the HubSpot Podcast Network.

Leanne ElliottThe audio destination. Authors.

Phill AgnewSeamless, seamless.

Al ElliottTell us about your latest episode, Phill.

Phill AgnewWe've just done an episode on fake fandom and how New York indie bands are paying agencies to create fake TikTok videos about how much they like their work. And we talk about the behavioral science behind fandom and how that encourages people to enjoy the music and all of that good stuff and do some big things about how this affects the world of politics, business, and brands as well.

Leanne ElliottIt is. It's such, it's such a good Of course, you'll hear all the stuff you want to hear about how to grow your business by using behavioural science in your marketing. But there's also just some really interesting episodes that'll be right up your street. Personally, I enjoyed Can Balsamic Vinegar Make Beer Taste Better?

Phill AgnewIt can.

Leanne ElliottAnd Are We All Just Status-Seeking Monkeys?

Al ElliottI am. Go and listen to Nudge wherever you get your podcasts.

Leanne ElliottBut come back.

Al ElliottYeah, come back.

Phill AgnewDefinitely come back because Nudge isn't as good as this. So come back.

Al ElliottI'll cut that out.

Phill AgnewKeep that in.

Al ElliottEven the UK taxman uses psychology to get you to pay your taxes on time.

Phill AgnewMost famously, the British government had a team within their government called the Nudge Unit, run by David Halpern, who would apply behavioral science across all of government. So famously, if you read a letter from HMRC today, I hope you don't have to, Al, but if you do, it'll have a lot of nudges in. One of the most famous is the letter you get if your self-assessed So this is basically you declaring your taxes. If that's overdue and there's an extra line in that letter, which is new from what it would've looked like 10 years ago, which says, most people in your area like you have paid their tax on time by now. And that one extra line, because of social proof, because it says that the majority of people do this, made people 15% more likely to respond and pay their tax. So great example. Again, that saved millions, literally millions and millions for the UK government.

Al ElliottNow, a lot of people we speak to have a problem around bonuses. Specifically, does giving a bonus actually work? Leanne, what's your thoughts around this?

Leanne ElliottSo, the reason bosses will introduce bonuses is to motivate performance. Makes sense. They believe that bonuses motivate performance, and that's because of the incentive theory of motivation. That's the psychology behind it, but that dates all the way back to Skinner. You remember Skinner with the bells and the dogs? It's essentially an extension of operant conditioning, which using rewards and punishments to modify behavior. Or perhaps use a word that's more businessy— can we incentivize the behavior we want to see? And bonuses are a way of incentivizing behavior. The issue is that not all incentives are created equal. The rewards that I find motivating might not be enough to inspire another person to take action. And when it comes to financial rewards, motivating performance, we know typically has a limit. Those on a salary of $50,000 a year more don't typically experience any increase in life satisfaction or happiness with further increases in financial remuneration, such as a bonus. So what we can conclude is that financial bonuses will have more of an impact on those experiencing lower levels of financial wellbeing, and they're probably experiencing lower levels of financial wellbeing because they're not either receiving a living wage or they're not able to access support that they need to improve their financial literacy. People and culture professionals will have a beef with this and a beef with bonuses because they're often thrown around to force people to stay in environments that are not conducive to their physical or mental health, their career progression, or even their own sense of identity and worth. The thing is, at best, research suggests that by and large, rewards succeed at securing one thing only, and that's temporary compliance. How many people have you spoken to that will say things like, oh, I'm staying in my job until April because that's when I get my bonus? Or as a leader, perhaps you've had a flurry of resignations once you just triggered a bonus to your team. When it comes to producing lasting change in attitudes and behaviors, rewards are alarmingly ineffective. Once the reward runs out, people revert back to their old behaviors. Old-school bonuses are based on old-school psychology, and business leaders, in my opinion, need to update their thinking by about 80 years.

Al ElliottOld-school bonuses are based on old-school psychology. That's a t-shirt right there. Now, Phill talks about a study where they turn this bonus structure completely on its head.

Phill AgnewWe hate losses. In fact, losing something feels twice as bad as gaining the same thing. would feel good. So let me give an example. If I find £10 on the floor, I'll feel happy, maybe a 7 out of 10 level of happiness or a 5 out of 10 level of happiness. If I lose £10, I'll feel really bad. I'll feel a 10 out of 10 level of unhappiness, for example. And that's a crude example, but there are studies which have shown this actually takes place in the wild. We really dislike losses. Anyway, Houssey and List, they went into this factory and they thought, well, if loss aversion is so powerful, Why don't we change the way that we incentivize people? Rather than saying, if you work and hit your targets, you will get this reward, why don't we give people their reward upfront? So give salespeople their commission, give factory workers the money that they would get if they got their reward, but then say, if you don't hit your targets, you'll lose the reward. So flipping it on its head, giving people the reward upfront, but saying, if you don't hit the target, you'll lose it. So, loss aversion. And they found that in doing so, there was a dramatically positive effect on productivity. So, productivity was higher than it was before.

Leanne ElliottWe have had plenty of guests on the podcast talking about providing benefits to their employees via EAPs or employee assistance programmes. They are typically intended to help employees deal with more personal problems that might adversely impact their work performance, their health, their wellbeing. And typically services offered can include confidential assessments, or short-term counselling. But the number one question we get asked around this is how do we get employees to actually use the benefits available to them? We asked Phill why he thought more people don't take advantage of these types of programmes.

Phill AgnewWell, it's difficult to say because, you know, what, how are they applying these, these benefits? But my question would be, what at all psychological principles are you thinking about when you're giving these, these benefits to people? Are you thinking about any ways that you could actually get them to apply them? Because there's one, there's a great study around gym membership, which is in Uri Genezzi's brilliant book, Mixed Signals, all about fantastic incentives. That's one I definitely recommend as well, Mixed Signals, to your listeners. And in this study, they offered university students incentives to go to the gym. So a little different from your example, but the students got free gym membership anyway, as being part of the university, and they gave them incentives to go. So pretty similar, right? They just— pretty similar as before. They just said, you're getting a bonus, incentives to go to the gym, just go. And in one scenario, the incentives were only achieved once the students have actually gone to the gym and signed in. And then the other scenario, they were just given the money and they weren't actually checked whether they were going in. And then they removed those incentives very quickly and they measured gym membership. And they found something really simple. And this is obvious and all of your listeners will know this. The people who actually went to the gym, were paid to go to the gym, so just literally went to the gym just to pick up their check and then left, they were far more likely to continue going to the gym after the incentives stopped than the control group who just got the money and their attendance wasn't checked. And the reason behind that is something to do with consistency. So we stay consistent with our previous actions. If I have been going to the gym for the last 5 weeks, I build a habit around it. I'm far more likely to continue doing that. It would be more effective if you said to the staff, you get this gym membership, but you'll only get it for 1 month unless you go 3 times during that month, and then you unlock yearly access. That is a direct way of applying this principle to actual behavior. It's a direct way of thinking, okay, we know that people don't action these things. They don't go out and go to the gym if we just give them a free membership. So let's try an implementation. that can actually reinforce that behavior.

Al ElliottIf you've ever sat in a large meeting and been bored shitless, or you've sat down with a group of people to work on a problem, you probably instinctively know that the way that you behave in a group is very different from the way you behave when you're alone. In fact, Phill had a guest recently who explained why large groups and organizations are actually killing creativity.

Phill AgnewAyelet Fishbach, who has written brilliant books on motivation, she's got a great book called Get It Done. And she spoke about a principle called social loafing. Really interesting principle. And the studies behind this principle have been conducted with groups of people and individuals. And she would basically— there was one brilliant study, which is just around a tug of war. So, you know, tug of war where 2 groups pulling a rope, and they measured the force of how much people are pulling in different scenarios. So in one scenario, it was just one-on-one. I'm pulling a rope against you, Al, and they measured the force that we would exert. So my force as an individual, yours will be a lot stronger than mine, but anyway, they would measure our respective forces. And then they would do the same test, but there would be 10 people on either side. So a much bigger group of people pulling. And they discovered that the collective force of a group of people is less than it should be. People are putting less effort in when they're in a group. And this is what they called social loafing, this idea that when you're in a group, you put in less effort. And they've repeated these studies in a workplace culture where they ask people to come up with creative ideas on their own and creative ideas in a group. When you come up with ideas on your own, you come up with far more than when you do if you're in a group. In fact, sometimes an individual can trump a whole group's level of creative ideas. So it's this great example of social loafing. And honestly, it's one of those things that you read about and you hear about and you just instantly think of examples yourself. And the reason I spoke about Why a Large Organization Can Kill Your Creativity, is because Ayelet Fishbach shared on her call that most of the large businesses she works with don't realize that large groups can cull the creativity and can lessen the quality of ideas and critical thinking that people might do. And what she suggests is, if you are working in a large organization, if you are working with a large team, you should find ways for people to work in smaller groups. for people to work in individual ways to creatively solve a problem, and then present those ideas back to the group. Because just like with the tug-of-war example, we exert more effort when we are on our own or in a smaller group than if we are in a large group. And it's a great example that I think most managers should try and remember. If you've got a problem you really need to solve, don't get all 10 members of your team in the same call and say, well, let's come up with ideas. Ask each of the 10 individually to come up with ideas on their own, and then get them to present them to the group. and then discuss the ideas. That will cull social loafing and should lead to a higher quality level of ideas.

Leanne ElliottThere is so much good stuff on Phill's podcast, and I'd highly, highly recommend that you check out a few episodes. But I wanted to know if there was one thing that Phill thinks all leaders should do to be more persuasive.

Phill AgnewYeah, it's that— it's probably that input bias I spoke about at the start. So learning Seeing how the staff you manage do their jobs is incredibly powerful. If you're a leader and you manage someone, spend one day shadowing them. Just spend one day trying to do the same things they do. Yes, you'll learn a lot about how the organization runs. Yes, you'll probably spot a lot of areas for optimization. But the main thing you'll do is you'll show your subordinate that you care about their job, that you want to understand how they work. that you've actually been able to execute a few of the things they do. And that will increase your level of trust, your level of influence dramatically compared to being this sort of omniscient leader and not really ever engaging with your staff. So spending that time doing a bit of input to show that you understand your subordinate's job can be really, really impactful.

Al ElliottIf you want to know more about Phill, and of course you do, of course you do, he's an amazing guy, then go search for the Nudge Podcast on your podcast app or check out his YouTube channel. There will be a link in the show notes. On our call, Phill revealed that he's about to launch a top-secret project called the Nudge Vaults.

Phill AgnewThis is basically what I've spent the last 5 years doing. So I try and read every book— I fail, but I try to read as many books as possible on behavioral science as I can, which means I now have this huge database of 300 different insights that I've seen applied in behavioral science and all of the nudges that they link to and all of the studies that they're based And this is something that I've created called the Nudge Vault. It's not available yet, but soon at some point, I'm going to make it available to people as part of a bit of a membership for my community. And if you go into there, you'll be able to search for any of the nudges I've talked about today, social proof, anchoring, whatever it might be, and see dozens and dozens of examples of how this has been applied, and the actual studies that link to those examples as well.

Leanne ElliottWell, there you have it, a crash course in persuasion from the UK's number one podcaster. I genuinely, genuinely hope that we've dispelled this myth that persuasion and manipulation are the same thing.

Al ElliottOkay, so join us next week for the amazing Jo Fear from Hustle and Flowchart podcast. If you're into marketing or business growth in any way, then you'll be blown away by the guests that Jo's had on. Robert Cialdini, we've already talked about him. Guy Kawasaki, Dan Norris, Rand Fishkin from Moz, Uh, Pat Flynn, of course everyone knows who Pat Flynn is. Dean Graziosi, Michael Gerber, you know, The E-Myth, Jay Abraham, Ryan Levesque, Ask Russell Brunson. Those are incredible guests, but what we talk about gets a little bit deep. Both Jo and I are negotiating the breakup of a long-term business partnership.

Leanne ElliottNot me.

Al ElliottNo, no, this is not Leanne.

Leanne ElliottBefore you start to go, what? It's not me.

Al ElliottNo, there's another business I have. And on the— on this episode, we, Jo and I, really get into like the nuts and bolts of it. We kind of get into the honest story behind what happened with him and his business partner, Matt Wolfe, and why they went their separate ways.

Leanne ElliottYeah, it's gonna be a really, really good one. And yeah, I won't say any more on that. But I think we're gonna, we're gonna learn some things. And I think it's gonna be what our, our friend Jim Young would call a very intimate conversation. It's gonna be a good one. So we will See you next week.

Al ElliottSee you next week. Hang on, hang on, hang on, hang on, hang on.

Leanne ElliottCome back, come back.

Al ElliottThere's more to tell you.

Leanne ElliottI mean, there is nothing better than finding a great book, a great psychology book, a great behavioural science book. It's what I live for. We had to ask Phill what books he would recommend and what he got stuck into.

Phill AgnewYeah, I really like Cialdini's Influence. I think he's got an updated one now where he has not only the 6 original Weapons of influence, as he calls them, but the 7th one, which is utility, that's really worth reading. I think one that I like for modern-day marketers is Richard Schotten's book. So he's got 2 books, The Choice Factory and The Illusion of Choice. If you're in marketing, they're really vital to read. I really like those. And then if you are a manager, if you're looking at applying behavioral science in a workplace culture, there's a really good book which I enjoyed called Behavioral Business by Richard Chatterway. And he looked at how behavioral science is applied across a whole organization. So for example, how Amazon have applied behavioral science, how Netflix have applied it, not only in their products, but also amongst their staff as well. So that's a really good book to help you understand how this can affect people. And I'll give you one more as well, which is Influence Is Your Superpower. Bit of a corny name, but it's written by Zoe Chance, who runs the Yale course.

Al ElliottYeah.

Phill Agnewon behavioral science and persuasion. That's the most popular course at Yale. So I think that shows just how impactful this stuff is. And she wrote a whole book about how you can apply these things as a leader, how you can convince people using psychology, how you can be better at understanding why people make decisions in one-to-one sort of format. So if you're a manager, that could be a really good one to read as well.

Al ElliottOkay, so that's a real goodbye this time. We are going and we'll see you next week. Bye-bye.

Leanne ElliottAnd indeed that in some situations— I don't know what I'm adding, there's nothing there to add.

Al ElliottPeople management, the whole point of leadership is to create an—

Leanne ElliottI've got an itchy nose. It's not in the nose, it's on the side of the nose.