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The next big wave: behavioral change - EY - Global

Progressions 2012

The next big wave: behavioral change

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Behavioral change is a complex process requiring significant personal responsibility.
  Bridgewater Associates, LP
Senior Management

In just the last 200 years, humans have doubled life expectancy — a measure that had barely budged in the previous 5,000 years. This happened because of two key developments. First, better sanitation and hygiene contributed to an enormous increase in longevity. Second, the introduction of modern medicines and better nutrition, starting in the early 20th century, created the next big wave of improvements in health and life spans.

But then progress stopped. In fact, recent studies suggest that we may be the first generation in 200 years to not outlive our parents — life expectancy might actually drop. What changed? A big part of the answer is that unhealthy behaviors — such as smoking, weight gain, poor diets and stress — are exacting an increasing toll on health outcomes and human longevity.

Going forward, therefore, progress in improving health outcomes will be renewed by the understanding, application, codification and democratization of behavior science and behavior modification. Those who crack the code will not only create abnormal growth opportunities but also positively contribute to society in disproportionate ways.

At the center of this transformation are the natural and social sciences' study of the human mind and the drivers of both rational and irrational behavior. As we gain critical knowledge, it is conceivable that in the coming decades, we may also have some tools to be able to predict behavior at an individual level based on various biological and environmental markers. The hope is that if we better understand the internal triggers (hunger, fatigue, fear, sadness, etc.) and external stimuli (friends, communities, environment, etc.) that drive harmful behaviors, we can construct better incentives to steer consumers toward healthier behaviors.

Yet behavioral change is a complex process requiring significant personal responsibility and the right balance between paternalism and individual management of health and lifestyle choices. Fortunately, myriad tools are available to help with this.

These could include social networks to keep us accountable and become our cheerleaders, providers from specialists to retail clinics that engage consumers on a personal level, and technologies to capture data for patients to help enable healthy routines and decisions. New incentives, such as financial, behavioral (commitment contracts, loss aversion, etc.) and those practices borrowed from other industries that tug on the emotive nature of humans, can powerfully impact the way all of us engage with our own health.

Other industries — retail, consumer products, financial services and even airlines — have been utilizing behavioral economics for many years, even before formal studies in the field were widespread. There are scores of examples of powerful brands in the consumer and retail world that have created an emotional affinity based on quality, luxury or other elements. Meanwhile, in the pharmacy industry, major chains such as Walgreens and CVS have largely displaced the independent pharmacy model, because customers value convenient access. Another parallel with other industries is the democratizing power of technology. From retail to air travel to brokerage, industries that were once domains where experts and technocrats made decisions around what consumers should be doing have been transformed into democratic spaces where technology allows consumers to make informed decisions for themselves. To empower patients to change their behaviors, we need to do the same thing in health care, and new technologies are already making that possible.

The bottom line is that to take on the next big challenge of changing patients' behaviors, companies will need to change their own behaviors as well. More than ever, life sciences firms will need to look outside their walls for new ideas and different approaches — and behavioral economists and customer-centric models from other industries can provide a useful starting point.

This article was featured in our report Progressions 2012 - the third place: health care everywhere.

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Progressions 2012: health care everywhere
Progressions 2012: health care everywhere
Disruptive innovations and unsustainable costs are propelling life sciences companies into the behavioral change business. Learn why in our annual life sciences report.

See the bottom section of the main page for links to related columns from industry leaders.

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