Dr. Sheena S. Iyengar, a scholar at Columbia University, has conducted significant research on change management, choice, and decision theory. One experiment she describes is based on data collected at a supermarket: counting how many customers who sampled many different types of jam ended up buying the jam. The final purchase was verified using the discount coupons at the cash register. Interestingly, she found that the higher the number of jam options the customers had tasted, the less likely they were to act on that purchase. She called this phenomenon “the paradox of choice.”
Too many choices, too many options, hence analysis paralysis and unintended consequences. She identified that the bigger the number of options and combinations, the higher the costs of acquiring and sorting information and the more complex the decision.
The Neuroscience of Change
David Rock and Jeffrey Schwartz use neuroscience to explain it simply: change is painful. Decisions leading to change are processed in our working memory and activate the energy-intensive part of the brain, depleting such energy. Routine and familiar activities are stored in the basal ganglia and form habits that require less energy to activate.
David Rock and Jeffrey Schwartz explain, “When you see a new product on a supermarket shelf and rationally compare its benefits to a product you already use, your working memory takes in the new information and matches it against the old. This kind of memory activates the prefrontal cortex, an energy-intensive part of the brain.”
Embracing Agility in SMEs
Change is indeed painful. Try to read any management theory book or journal article on the subject, and you will find a recipe for to-do lists that are meant to help people and organizations adapt to changes. But change is also necessary. Embracing agility is essential for SMEs business owners who need to create a dynamic culture in their organizations in order to thrive.
Small business leaders should refrain from the status quo and embrace change to adapt to changing circumstances. During the pandemic, many small businesses, especially in the direct services industry, had to rethink their business operations to survive. The traditional tenets of how we conduct business have changed, opening new opportunities to connect to local businesses and communities in radically distributed work environments.
Those small businesses that can ride this wave of local and community innovation and adapt swiftly will have new opportunities to reach new clients where they are. Choosing to lead this change will open new horizons. It is time to choose change, whether taxing, painful or uncomfortable. It is time to decide to change because of the unknown opportunities that it brings.