What ‘science’ knows, and what business does, are not the same thing!

What science knows and what business does 190516 1

Now, this might all sound a bit illogical, but there is so much high quality and, importantly, highly relevant data freely available ‘out there’ to business people, that it seems strange, to say the least, that so much of it is completely ignored by them.

This is not a new, or recent trend, but is something that

Let me give you a few, very basic examples:

  • 80% of start-up SME owners have no experience of running a business.
  • 80% of SME business owners agree they “can run the business”.
  • 80% of business owners never, and I mean never undertake any business management or leadership skills development.
  • Yet 80% of SMEs close before they reach their 5th birthday (long-term average)*.

Spot the link?

(* = the average closure rate in the last ten years is slightly higher!)

(Sources: ONS, HMRC, The Economist)

 

On a similar theme:

  • 80% of start-up SMEs who work with a professional coach/mentor will successfully reach their fifth birthday.
  • 80% of those that don’t, won’t.

(Sources: ICF, EMCC, LSE, and others)

 

When it comes to communication:

  • At least two-thirds of business readers of SME websites just want to find the phone number.
  • If your contact number is a mobile or 08- number, two-thirds of website readers will go elsewhere before they contact you.
  • It is estimated that 30%-40% of website views will be on a mobile device by the end of 2016, and this is expected to peak at 80% by the end of 2019.
  • Approximately 40% of SME websites don’t even have their phone number on their homepage, and/or do not have it visible on ‘first view’ using a mobile device.
  • Over half of SMEs agree that their websites “don’t generate enough enquiries”.

(Sources: Google, ONS, LSE, DBIS, BT)

 

When it comes to how our decisions are influenced by the options we have:

In 2009, the eminent behavioural economist Dan Ariely conducted a study of 100 MIT students by asking them to choose one of the following newspaper subscription options:

Option 1: paper only subscription $59 (16% chose this option)

Option 2: web only subscription $125 (0%)

Option 3: print and web subscription $125 (84% chose this option)

Option 3 is most popular.

 

He then took away Option 2 and asked them to choose again. This time:

68% chose Option 1

32% chose Option 3

Note how the least popular option has become the most popular, and vice versa, simply because the list of options has changed.

How could this influence how you communicate with others?

 

He (and fellow MIT colleagues) also conducted a number of studies in the fields of motivation, including this one in 2003:

Three groups were given a selection of games that involved creativity, motor skills, and concentration.

They were each offered one of three levels of performance based rewards (low, medium, high).

The result?

When the task involved just mechanical skills, the rewards worked as expected.

However, when the task involved even rudimentary cognitive skill, a larger reward led to poorer performance. Yes, really!

However, when this same exercise was repeated in a remote village in India, people offered the medium level of reward did no better than those offered the lowest level of reward.

But, and this is a big ‘but’, those that were offered the highest level of reward….did worst of all!

In 8 of the 9 tasks in these experiments, higher incentives led to worse performance!

 

So, what science knows, and what business does are not the same thing.

The point I’m making is the same as that old adage: if you do what you have always done, you will get what you have always got.

  • If people want to contact you quickly and easily, make it easy for them to pick up the phone to you (remember using email takes twice as long as using the phone (source: Harvard Business Review)).
  • If one of your USPs is that you’re a local business, then make sure your phone number is identifiable as a local (not an 0845) number.
  • If you give people too many choices, one of the options may get zero responses, but it might also serve to help the reader to make a decision that is better for them and for you.
  • Take care how you incentivise your teams – higher performance doesn’t necessarily come from higher rewards.

 

To find out more about how science can help your business, and how I can help you build a better, more resilient and more profitable business, please get in touch:

t: 01242-672440

e: click here

© Adrian Malpass 2016. All rights reserved.