Using Catalyst as Framework for Moral Healthcare Chapter 4: Uncertainty

[These blog entries are my notes and takeaways from Jonah Berger’s amazing book, The Catalyst as I apply them to Universal Healthcare.]

The chapter starts with a review of Prospect Theory principles of loss or risk aversion. He develops the “uncertainty tax” concept – “When choosing between a sure thing and a risky one, the risky option has to be that much better to get chosen.” People really dislike uncertainty.

Uncertainty undermines actively making changes and can halt the decision-making process entirely. “…while uncertainty is great for the status quo, or whatever people were doing before, it’s terrible for changing minds.”

Getting People to Unpause

Trialability How easy it is to try something? In a new inexpensive consumer product like a disposable razor is easy as barriers are small to trial. New software or a new health care system? Not so easy to try.

Four key ways to reducing uncertainty are to:

1. Harness Freemium – Dropbox example. Free to try, makes a no-cost barrier to trial.

• Reduce Upfront Costs – Zappos example. Free shipping, free returns, no uncertainty about things that are normally significant barriers.

• Drive Discovery – free Acura rides at W Hotels. They created an incentive to get people into an Acura-free rides.

• Make It Reversible – trial period for pet ownership from the him shelter. Reduces uncertainty because you can take the pet back. Second example is lenient return policies boosting business. While the lenient return policy can increase returns, it also removes a barrier to sales-uncertainty.

HCR Lessons: I may be not using my imagination, but I am having a hard time figuring out how to apply freemium and reducing upfront costs to our universal healthcare system issue.

I can see how giving people guided virtual tours of other nations healthcare systems could be a way to drive discovery. Would you have to pay them to do this? Or would you force them to watch it while the free Acura ride is taking place? But I do see little potential here.

Reversible might be possible. Buying into Medicare or Medicaid or public option would qualify.

Taking Advantage of Inertia

Trials take “advantage of the endowment effect by shifting peoples’ mind-set from acquisition to retention.” Once one has taken up the trial offer, they are now shifted to an owner and therefore losing the thing on trial becomes a loss. People will keep the item on trial to avoid a loss-inertia. Also worth noting that the longer people are allowed to keep something before having to return it, the more likely they are to keep it. Once you have the Zappos shoes in your home, you have to overcome inertia to return them.

Neophobia: “fear or dislike of anything new.” Identifying the particular reasons for the neophobia can help drive the strategy to overcome. Many examples given, but going vegetarian versus meatless Mondays is good one.

How can you make whatever is on offer easier for the customer?

HCR Lessons: I certainly agree that getting people into a well-functioning system would lead to the same reaction the rest of the world has about switching to an American-style system – “Are you kidding me?”

I think this is an interesting way to think about getting people to change from whatever they have two universal healthcare system:

Think about being single versus dating one person exclusively. When you’re single, you actively search for the best partner. You go on dates with different people, compare them, and consider the relative merits of each. You look for a set of desired attributes, and the list often gets longer the longer you search. This makes it less likely that anyone will ever live up to the growing laundry list, and more likely that you’ll never settle down. When you’re dating one person exclusively, however, it’s a different set of questions being considered and decisions being made. Rather than always looking for other options or wondering whether you could do better, you’re focused on the person you’re dating. As long as they are good enough, you keep dating them.

HCR Lessons: We are all dating America’s health care system and nobody has the energy to break up and find a better mate!

The case study the end of this chapter is about how a manager used uncertainty by enabling management to experience excellent personalized customer for themselves.

HCR Lessons: there somehow might be a way to have people experience the German or French system vicariously or virtually?

Berger, Jonah. The Catalyst: How to Change Anyone’s Mind (p. 169). Simon & Schuster. Kindle Edition.