This episode marks our first serious foray into understanding why people do the things they do. Our guest, Rory Sutherland, Vice Chairman of Ogilvy and founder of Ogilvy Change looks at consumer behavior, media and communications through the twin lenses of Behavioral Economics and Evolutionary Psychology.
We sought Rory out because we believe the implications of his work go well beyond how to better sell consumer products and services. His is a powerful perspective for us to incorporate into our collective work elevating the procurement function in terms of the value we create, how we create that value and how we are perceived by our stakeholders.
Rory is one of the most interesting, irreverent and generous guests I have had the pleasure of interviewing. While this episode clocks in at about one hour and thirty minutes, I was so engaged with Rory’s ideas and how he expressed them that the time just flew by. I trust you have the same experience.
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“If you had a procurement function with the power, in other words, this is all about how the procurement function is incentivized really. And there needs to be what you might call a facility for measuring the upside benefits of spending more alongside the benefit of spending less. And when it’s done well and if it were incentivized well, it could be a truly magical influence on the business.” – Rory Sutherland, Ogilvy Change
Here are just a few of the things we covered in our conversation:
- Rory’s working definition of Behavioral Economics
- Blame avoidance/minimization
- The drive towards conformity and how it undercuts our ability to create value
- What procurement is solving for and why we may want to reconsider our goals
- All value is contextual
- Reframing the Procurement Brand
- Innovation, relationships and the preservation of social capital
- Updating incentive structures
- Email us directly for a copy of the episode transcript.
Links and Resources:
- Thinking in Bets: Making Smarter Decisions When You Don’t Have All the Facts by Annie Duke
- Skin in the Game: Hidden Asymmetries in Daily Life by Nassim Nicholas Taleb
- The Elephant in the Brain: Hidden Motives in Everyday Life by Kevin Simler and Robin Hanson
- Learning to Be Loyal. A Study of the Marseille Fish Market* Alan P. Kirman and Nicolaas J. Vriend
- The Market For “Lemons”: Quality Uncertainty And The Market Mechanism by George Akerlof by George Akerlof
Writings, Talks, and Podcasts:
- The Wiki Man (blog). Rory’s regular column in The Spectator magazine
- O Behave! (Podcast) A monthly behavioral science podcast from Ogilvy Consulting
- O Behave! (blog) that brings you the latest updates from the world of behavioral science with new research, insights and applications in the field.
- Behavioural Economics Rory Sutherland explains how BE can creatively solve business problems
- Rory Sutherland: Perspective is everything (TED)
- Rory Sutherland: Life lessons from an ad man (TED)
- Rory Sutherland: Sweat the small stuff (TED)
Where to find Rory:
- Twitter: @rorysutherland
- Twitter: @OgilvyConsultUK
- Ogilvy Consulting (A strategic consulting partner who apply Behavioural Science with creativity to achieve positive change for brands, government, and society.)
Thanks for Listening!