Behavioral Economics 3.0

Akerlof, Selten, Milgrom & Co.: New, good equilibria take human identity and the principle of global optimization into account. Which strategy leads there?

Identity as a behavioral driver and the principle of sustainability

Each person has many identities – these can be his or her nationality, gender, or the position as manager, employee, or customer, as a family father, single person, or child.

Knowledge from behavioral economics show that each identity brings different behavioral traits with it. For example, managers usually behave differently in their companies than they do at home as a family father. This principle also applies for consumers: customers behave very differently in the identity of one enterprise than in that of another – with different pricing sensitivities, different loyalties, different recommendation behavior, and different customer satisfaction sensitivity.

Only enterprises that are aware of the identities of their customers, employees, suppliers, and competitors are systematically able to develop strategic and operative measures that both result in short-term economic success as well as in long-term, sustainable entrepreneurial development.

Complementarity as the basis for high performance strategies

In theory, every strategy is a bundle of measures that can be expected to increase an enterprise’s economic performance to a new, higher equilibrium. The greatest challenge is developing this strategy complementarily to the entrepreneurial culture, identity, and to the customer identity. Only enterprises that take these elements into account can expect success when implementing a new strategy.

We support enterprises in designing and implementing strategic initiatives on the path to a high performance culture.

Would you like to learn more?
We would like to tell you about our performance in a personal conversation.

Contact us