Research on everything from investment choices to political incumbency demonstrates that people are over-attached to the status quo, what social scientists call the “endowment effect.” We tend to stick with things we know and have used for a long time. Most of us eat the same food we’ve always eaten, buy the same brands we’ve always bought and donate to the same causes we’ve always supported.
Part of the challenge is that the status quo usually isn’t that bad, or else people would have made a change. An analogy can be made to injuries. Which do you think causes more pain: breaking a finger or spraining a finger? The answer might surprise you. It turns out that milder injuries may inflict greater pain overall, because unlike serious injuries, people are less likely to take active steps, such as surgery, to speed recovery. Milder injuries thus don’t get addressed and become nagging injuries that never quite go away.
Change agents combat this phenomenon by bringing the costs of inaction to the surface, helping people to realize that sticking with the status quo isn’t as cost-free as it seems. A financial adviser I know tried everything to convince one middle-aged client that keeping large amounts of money in a low-interest savings account instead of investing it more ambitiously for retirement wouldn’t benefit him in the long term. He liked things as they were and refused to see the upside of change. Finally, she started giving him regular updates on how much he was losing monthly compared with inflation and higher-return investments. That worked.
Similarly, IT consultants often resort to encouraging employees to upgrade to new machines by saying that they will no longer support the old ones, leaving employees to fix their own problems. The technique doesn’t force people to switch, but makes it easier for them to see the cost of doing nothing.
I like things that I know work. Is there something wrong with that?
Take away my tech support and watch me get more self-sufficient. Then I’ll ask the IT department to justify its existence.
Or I’ll sneak it past them by running my favorite classic software in an emulator.
“Change agents combat this phenomenon by bringing the costs of inaction to the surface, helping people to realize that sticking with the status quo isn’t as cost-free as it seems.”
I know someone who may think this is me, and how to approach me, politically. What is actually going on is somewhat less of rival cost/benefit analyses and somewhat more of an argument over the very definition of cost and benefit, not to mention the correct identification of appropriate beneficiaries.
I also knew someone who I called a change agent as soon as I heard the term. Her thing was workplace procedural change- that was an area in which I was more persuadable, often persuaded, and occasionally contributing. Her technique was similar to what Berger is flogging, I think by natural instinct.
In the financial realm, I see where he is coming from. Opportunity cost is not a new concept. On the other hand, although his method is direct when you have the rival choices to hand, he’s not addressing the matter of risk assessment and risk management, in which, regardless of past performance, risk aversion by the client is usually driving their refusal to change.
With technology, I’ve now seen all the major changes since the 70s. I was never an early adopter even as a kid, not the kind who must have every new thing, but I did immediately get into finding what I did want and trying to get and use it.
I’ve seen things I used to do, need and want to do get easier, and I’ve seen technology open up new things to to that I like that I hadn’t conceived of before. I expect it to continue to do so.
I’ve also seen opportunities hyped to do things that I couldn’t care less about, and their creations drive out things I did. I’ve even seen new such opportunities created that nobody ultimately wanted so they eventually died or were marginalized despite initial hype.
And I’ve seen kit created and dominate a market that is a huge pain to learn to use for little incremental gain, for me, but which I ultimately have to use. So it goes.
SO I’m still persuadable, but I’d better see some epic opportunity costs in a domain that matters to me.