Cognitive Design

In an earlier post I highlighted American Express’s One Card, a program that lets you save while you spend.  Amex contributes 1% of whatever you spend and deposits it in a high-yield savings account. This was rather a clever way of defeating the cognition that blocks our ability to save namely, the overpowering desire to consume and the fact that we tend to under value savings we will have in the future.

Bank of America (BOA) has introduced a related product  called keep the change. The idea is when you spend whatever change is left from rounding up to the nearest dollar is automatically put into your savings account.

 BOA matches every dollar you save for the first three months and then 5% after that for a total of $250/yr.  They even provide a simple calculator to let you estimate your savings.

I heard on the radio the other day that over $1B has been saved by customers. Interestingly, BOA has filed a patent to protect this unique product idea.

This is like a 401(k) plan with a systematic withdrawal of your own money sweetened with someone else making a matching contribution. Feels more like a savings plan than the One Card which feels more like a cash back card.

No matter, both are excellent examples of taking deep cognitive biases and leveraging them to our benefit.

Just completed the 4th year of teaching a graduate course in cognitive design at Northwestern University.  It is an elective in the Masters of Learning and Organizational Change program.

I am posting the syllabus and presentation slides on fundamental principles and a draft article introducing the technique of modeling intereaction as the conversion of mental energy.  

I’ll blog on the students projects a bit later in the summer.

Services, unlike most products, are hard for customers and employees to see, touch and explain. Services are a set of activities that we can experience but they are fleeting and don’t seem to have the clearly defined and mostly static features and functions that products do. It is hard to give a demo of a service.  Further, customer don’t own services like they do products.

It is little wonder that it is challenging to explain and sell complex services.  Doing so requires solid cognitive design both of the service itself (to eliminate unneeded complexity and reward necessary complexity with a boost of mental energy) and the design of the communications about the service.

An excellent resource for tips on how to design effective communications about complex services is Joshua Porter’s book, Designing for the Social Web.  One example he presents is an explanation of Netflix’s service:

 You might complain that this is not a good example because the Netflix service is not complex. But of course that it exactly the point. It is not complex because they made it so darn easy to understand.

Although focused on the web the examples and principles can be applied to all services.  Also check out Mr. Porter’s blog.

Cognitive biases erupt when we take the reasoning processes, rules and tricks that work so well  in one domain and apply them to another where they don’t fair so well.   An interesting example is described by Robert Britt in his LiveScience article Monsters, Ghosts and Gods: Why We Believe.

A key point from the article: 

“Brian Cronk, a professor of psychology at Missouri Western State University. “The human brain is always trying to determine why things happen, and when the reason is not clear, we tend to make up some pretty bizarre explanations.”

 Although not called out as a bias, it clearly is.  Monsters are a byproduct of our cognitive need to make sense of the world.

The publishers John Wiley & Sons (For Dummies Series) and The Penguin Group (The Complete Idiot’s Guide Series)applied a little cognitive design to the publishing world and have create two enormously successful book series and brands. For example, The Dummies Series has over 125 million books in print and has extended into software and entertainment.

In the For Dummies Experience, the publishers make the how and why of this success clear. The Dummies fit a very specific psychographic profile (set of cognitive needs). Readers of the series are:

- Intelligent and know they need answers but don’t want to mess with traditional (aka boring and complex) reference materials

- Frustrated or overwhelmed with other books or materials they have tried to use to get going on a topic or solve the problem

- Intimidated or mystified by whatever topic or problem they are trying to deal with. 

To satisfy these unmet cognitive needs, the authors and publisher add a specific set of features and functions to the traditional book design including:

- must be tightly focused on a single topic or problem e.g. mortgages, dating, learning HTML, etc.

- Concise and in plain language

- use of humor and even cartoon-like images and icons on topics that are normally very serious and sober

- just enough information to handle the topic or get going on the problem but no more

- can start reading on any page and still develop a good understanding. No complex dependencies between topics and chapters.

This design has “attitude” (concise, light-hearted, plain language),  minimizes the cognitive load on the reader and helps manage some of the emotions (frustration, anxiety, boredom) of learning something new. The emphasis is on the cognition of the reader not the topic expertise of the author or even the profits of the publisher.

Could we have forecasted strong market success for dummies and complete idiots in the publishing world? I think not, that is why it is important to prototype in cognitive design.  In the publisher’s words:

“What started out as one book has grown into a dynamic, international, multimedia knowledge brand. (Now say that five times fast!) Although each For Dummies product is unique, all products offer the same promise of demystifying a confusing or intimidating topic and empowering you to succeed. Welcome to the world of For Dummies, just one brand among many in the John Wiley & Sons stable of outstanding titles!”

Although obvious, another unique feature in the design of both book series is how well they immediately signal the promise mentioned above. How could something called a complete idiots guide provide anything but an easy and amusing read?  

It is interesting to note that the first book in both series was focused on learning DOS.

In an earlier post I described how the video game industry uses a variety of tactics to dynamically adjust the difficulty of play. These tactics can be adapted to a wide variety of customer experiences including interactions with your website, voice response units, kiosks and more fundamentally as features and functions of your core offering.

 Dynamically adjusting the difficulty of an interaction is really the problem of achieving “flow” or an optimal performance state (frame of mind) that lives in the zone between boredom and anxiety.

 An excellent post on Boxes and Arrows explores the psychology the flow state (ala Mihaly Csikszentmihalyi) and offers some advice on how to design for emotion and flow.   The post includes the following figure that illustrates that flow is a dynamic balance between boredom and anxiety.

Figure 1:Anxiety, Boredom and Flow (Csikszentmihalyi, 1990) (captions added van Gorp, 2006). 

To achieve flow we need artifacts that “have a clear goal,  provide immediate feedback on attempts to reach the goal and offer a challenge that you are confident you have the skills to achieve.” 

One area this is getting some traction (pun intended) is with the new sport in the US called hypermiling. The idea is that a driver pulls out all the stops to maximize the mileage they are getting.  The GOAL is to beat the EPA mileage rating on your car. Toyota helps put drivers in the “flow state” for hypermiling by providing real-time feedback on the effects various actions (e.g. rapid acceleration or braking) have on your gas milelage.

Makes you wonder what else cognitive design can do to help relieve the boredom of driving and keep us in the flow state. I know there are at least three graduate students at Northwestern  University that working hard to answer that question!

Green Bank offers a CARES (Committed Action to Reduce and End Smoking) savings account.  Smokers qualify and they make regular deposits for six months after which time they take a urine test. The test proves if they have smoked or not. Smokers loose their deposits (to a charity of their choice) and those that did not smoke keep the money.

As the recent study, Put Your Money Where Your Butt Is, shows this approach is surprisingly effective even at sustaining the behavior change well after the initial six months.   

There is some good cognitive design going on here.  The over confidence bias and the impulse to bet/gamble will get me into the program. Initial deposits are small so I can easily overcome my aversion to loss. However, towards the end of the six months I have significant account value (approx 20% of a month’s salary) and so loss aversion now works in favor of making the behavior change.  The urine test creates a strong sense of accountability so there is little room for rationalizing or invoking beliefs that self-justify smoking behaviors. Last but not least, participants receive encouragement and feedback when they make deposits.

This is especially clever as it meets two hard behavioral challenges at once – savings and smoking.

A new brain imaging technique called diffusion spectrum imaging (DSI) tracks how water molecules move through the nerve fibers of your brain to expose for the first time large-scale pictures of axons (nerve wires).

Check out this video of the neural wiring of the human brain.

Two miltary contracts worth $11M have been awarded to develop binoculars that work directly with the brainwaves of soliders. The idea is that the brain often “sees” things before the mind can recognize them and objects “far a field” might not be recognized as threats in time.  

The goal, as reported by MSNBC is:

“Electrodes on the scalp inside a helmet will record the user’s brain activity as it processes information about high-resolution images produced by wide-angle military binoculars. Those responses will train the binoculars over time to recognize threats.”

I have argued many times in this blog that design thinking is not only an innovation method but also a powerful general purpose management method.

Jeneanne Rae in a recent post on design thinking in BusinessWeek, talks about the success P&G is having with this approach as a management model. To quote: 

In his new book, The Game-Changer: How You Can Drive Revenue and Profit Growth with Innovation, P&G CEO A.G. Lafley explains the difference between the two methods: “Business schools tend to focus on inductive thinking (based on directly observable facts) and deductive thinking (logic and analysis, typically based on past evidence),” he writes. “Design schools emphasize abductive thinking—imagining what could be possible. This new thinking approach helps us challenge assumed constraints and add to ideas, versus discouraging them.”

For the cognitive designer then the question is how do we rethink leadership programs, management processes and other aspects of organizational design to support or even inspire abductive inference?