Seeing Sludge: Towards a Dashboard to Help Organizations Recognize Impedance to End-User Decisions and Action

Research Report Series Behaviourally Informed Organizations Partnership; Behavioural Economics in Action at Rotman, September 2019

48 Pages Posted: 8 Oct 2019

See all articles by Dilip Soman

Dilip Soman

University of Toronto - Behavioural Economics in Action at Rotman (BEAR)

Daniel Cowen

University of Toronto

Niketana Kannan

affiliation not provided to SSRN

Bing Feng

University of Toronto

Date Written: September 27, 2019

Abstract

Small factors in the context - things that might seem irrelevant to decisions and action - might either facilitate or impede the end user in accomplishing their objectives. If they are designed to facilitate, these contextual variables are called nudges. On the other hand, there is a category of situations where these contextual variables actively impede activities that are in the consumers' best interest, resulting in a reduction of welfare. These are known as sludge. Because sludge (or contextual variables) works by heightening natural human behavioural tendencies like procrastination and complexity aversion, a sludge to one person might not be similarly seen as a sludge by another person. Therefore, seeing sludge is not easy.

Hence, there is a need for a tool or a dashboard that allows organizations to see sludge. Our goal was to create a tool (scorecards and a dashboard) that organizations could use to see sludge so that they could go about clearing it. Scorecards have three components – a score for the Process, Communication and Inclusivity. Our efforts represent an important first step in developing tools for helping organizations in seeing sludge. We do not claim that our scorecards are definitively the most appropriate tool for all organizations, but we believe they are appropriate for a wide range of organizations and end-user interactions. Our key points are to a) highlight the role of scorecards in seeing sludge, b) propose scorecards that might serve as a starting point for an organization to adapt, c) illustrate a process to generate scorecards and dashboards, and d) discuss several implementation issues in using these tools effectively.

Our paper also includes a TL;DR version – a standalone summary that could be used to communicate the key ideas.

Keywords: Behavioural Insights, Sludge, Context, Channel Factors, Impedance, PCI Scorecards and Dashboards, Implementation, Behaviourally Informed Organizations

JEL Classification: D03, D11, D90

Suggested Citation

Soman, Dilip and Cowen, Daniel and Kannan, Niketana and Feng, Bing, Seeing Sludge: Towards a Dashboard to Help Organizations Recognize Impedance to End-User Decisions and Action (September 27, 2019). Research Report Series Behaviourally Informed Organizations Partnership; Behavioural Economics in Action at Rotman, September 2019, Available at SSRN: https://ssrn.com/abstract=3460734 or http://dx.doi.org/10.2139/ssrn.3460734

Dilip Soman (Contact Author)

University of Toronto - Behavioural Economics in Action at Rotman (BEAR) ( email )

Daniel Cowen

University of Toronto ( email )

Toronto, Ontario M5S 3G8
Canada

Niketana Kannan

affiliation not provided to SSRN

Bing Feng

University of Toronto ( email )

Toronto, Ontario M5S 3G8
Canada

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