132: Stephan Meier - Behavioral Economics at Work: Endorsing Employee Centricity

Stephan Meier is Professor of Business Strategy at Columbia Business School and author of The Employee Advantage: How Putting Workers First Helps Business Thrive. Stephan describes how behavioral economics examine social dynamics and decision-making. He describes the importance of intrinsic motivation and fairness at work and the effect on behavior of monetary and non-monetary incentives. Stephan explains how fast-evolving business conditions require trusting leadership and empowered employees. He shares insights about flexibility and relatedness as key motivators which affect hybrid/remote working models.

 

 

TAKEAWAYS

 

[02:27] Stephan was fascinated by history but studied economics to understand the world better.

 

[03:19] Traditional economic models, though predictive, lack alignment with human behavior.

 

[04:09] Stephan explores behavioral economics to study non-rational behaviors and model deviations.

 

[06:03] For his PhD, Stephan researches intrinsic motivations and non-selfish human interactions.

 

[08:08] Early management models assumed people are lazy therefore control and incentives were essential.

 

[09:01] Lack of training to support employee-centric versus control, incentive mechanisms.

 

[11:06] Stephan’s thesis emphasizes intrinsic motivations and the joy achieved by helping others.

 

[12:01] Fairness and social norms are important to foster collaboration and group motivation.

 

[13:00] How monetary incentives can undermine social relationships.

 

[14:21] The dynamics of social and intrinsic motivation compared with financial motivation.

 

[17:13] Stephan’s Federal Reserve work focused on behavioral economics and improving financial decision-making.

 

[19:31] How people revert to status quo choices when tired and lacking nourishment.

 

[22:00] Money affects work-related decisions for people who are distracted by financial stressors.

 

[23:33] How behavioral science and economic rational competition determine our behaviors which need to be balanced.

 

[24:50] We overestimate our own decision-making abilities, not conscious of influential factors.

 

[25:35] How managers, as humans, are affected by layoffs and unemployment benefits.

 

[28:32] Thinking about employees like customers and improving their experiences.

 

[29:11] Competition and transparency are two key reasons for the new employee emphasis.

 

[30:27] A third reason is having more data and tools to personalize work experiences.

 

[32:35] Employee centricity: fixing pain points and finding moments that matter along the Employee Journey.

 

[33:21] The need for constant feedback and innovation to improve employees’ experiences.

 

[35:07] What really motivates people and using technology to enhance not destroy this.

 

[35:52] At the current pace of change, the importance of trusting relationships and