Upstream versus Downstream interventions Banny Banerjee Associate Professor Stanford d.school, Stanford Design Program Director, Stanford ChangeLabs Associate Professor d. Mechanical Engineering Department Stanford University With contributions from Jason Bade Johannes Zachrisson Daae David Miller S TA N F O R D DESIGN ChangeLabs. PROGRAM Global Score Card 2030 Targets Confidence Level 50% reductions in CO2e 45-50% more FOOD 39-45% more ENERGY 40% more FRESHWATER 3-4 orders of magnitude LOW slowdown in EXTINCTION rates 0 in EXTREME POVERTY ($1.25/Day) LOW LOW LOW NIL LOW Sources: The energy challenge, Mike Hightower1 & Suzanne A. Pierce, Nature 452, 285-286 (20 March 2008). Word Bank 2013 Water report, Information brief on Water and Agriculture in the Green Economy. UNW-DPAC, 2011, Oct 9, 2013 World Bank announcement on Poverty Eradication Goals Banny Banerjee, Stanford University Banny Banerjee, Stanford University Banny Banerjee, Stanford University intervention challenge Banny Banerjee, Stanford University “What kind of interventions will change the ecosystem behavior?” Banny Banerjee, Stanford University In all it’s messiness Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES How do we make SIGNIFICANT reductions in energy usage and GHGs? Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES How do we make SIGNIFICANT reductions in energy usage and GHGs? How do we make it financially viable? Revenue positive? Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES How do we make SIGNIFICANT reductions in energy usage and GHGs? How do we make it financially viable? Revenue positive? How do we create a business ecosystem when a KWH is so cheap? Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES How How How How do we make SIGNIFICANT reductions in energy usage and GHGs? do we make it financially viable? Revenue positive? do we create a business ecosystem when a KWH is so cheap? to get the plans past our internal organizational and decision systems? Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES How How How How How do we make SIGNIFICANT reductions in energy usage and GHGs? do we make it financially viable? Revenue positive? do we create a business ecosystem when a KWH is so cheap? to get the plans past our internal organizational and decision systems? do we diffuse the enabling technologies at scale? Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES How do we make SIGNIFICANT reductions in energy usage and GHGs? How do we make it financially viable? Revenue positive? How do we create a business ecosystem when a KWH is so cheap? How to get the plans past our internal organizational and decision systems? How do we diffuse the enabling technologies at scale? Getting people to save energy is harder than getting them to floss their teeth! Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES How do we make SIGNIFICANT reductions in energy usage and GHGs? How do we make it financially viable? Revenue positive? How do we create a business ecosystem when a KWH is so cheap? How to get the plans past our internal organizational and decision systems? How do we diffuse the enabling technologies at scale? Getting people to save energy is harder than getting them to floss their teeth! Death by a thousand cuts Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES How do we make SIGNIFICANT reductions in energy usage and GHGs? How do we make it financially viable? Revenue positive? How do we create a business ecosystem when a KWH is so cheap? How to get the plans past our internal organizational and decision systems? How do we diffuse the enabling technologies at scale? Getting people to save energy is harder than getting them to floss their teeth! Death by a thousand cuts When you want a toast, you want a toast! Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES How do we make SIGNIFICANT reductions in energy usage and GHGs? How do we make it financially viable? Revenue positive? How do we create a business ecosystem when a KWH is so cheap? How to get the plans past our internal organizational and decision systems? How do we diffuse the enabling technologies at scale? Getting people to save energy is harder than getting them to floss their teeth! Death by a thousand cuts When you want a toast, you want a toast! Okay to spend $2000 on a bigger TV but not on weatherizing one’s home Banny Banerjee, Stanford University OVER-ARCHING QUESTIONS AND ISSUES How do we make SIGNIFICANT reductions in energy usage and GHGs? How do we make it financially viable? Revenue positive? How do we create a business ecosystem when a KWH is so cheap? How to get the plans past our internal organizational and decision systems? How do we diffuse the enabling technologies at scale? Getting people to save energy is harder than getting them to floss their teeth! Death by a thousand cuts When you want a toast, you want a toast! Okay to spend $2000 on a bigger TV but not on weatherizing one’s home Mental models - recycling a soda can before boarding a flight Banny Banerjee, Stanford University Banny Banerjee, Stanford University ENABLING TECHNOLOGIES Banny Banerjee, Stanford University ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST Banny Banerjee, Stanford University ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU SIN MO ESS DE L Banny Banerjee, Stanford University ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU SIN MO ESS DE L ORG BEHAVIOR & DECISION SYSTEMS Banny Banerjee, Stanford University ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU SIN MO ESS DE L ORG BEHAVIOR & DECISION SYSTEMS & Y LIC RY O P ATO TE UL IMA G CL RE Banny Banerjee, Stanford University ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU SIN MO ESS DE L ORG BEHAVIOR & DECISION SYSTEMS IN VE S TM EN T & Y LIC RY O P ATO TE UL IMA G CL RE Banny Banerjee, Stanford University ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU SIN MO ESS DE L ORG BEHAVIOR & DECISION SYSTEMS IN VE S TM EN T & Y LIC RY O P ATO TE UL IMA G CL RE GOAL Banny Banerjee, Stanford University TH CH EORI AN ES GE OF ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU SIN MO ESS DE L ORG BEHAVIOR & DECISION SYSTEMS IN VE S TM EN T & Y LIC RY O P ATO TE UL IMA G CL RE GOAL Banny Banerjee, Stanford University SIN MO ESS DE L TH CH EORI AN ES GE OF ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU G IN D AN R T RS VIO E D A UN BEH OF ORG BEHAVIOR & DECISION SYSTEMS IN VE S TM EN T & Y LIC RY O P ATO TE UL IMA G CL RE GOAL Banny Banerjee, Stanford University SIN MO ESS DE L TH CH EORI AN ES GE OF ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU G IN D AN R T RS VIO E D A UN BEH OF ORG BEHAVIOR & DECISION SYSTEMS & Y LIC RY O P ATO TE UL IMA G CL RE IN VE S TM EN T MO TIV AT IO NS GOAL Banny Banerjee, Stanford University TH CH EORI AN ES GE OF ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU SIN MO ESS DE L G IN D AN R T RS VIO E D A UN BEH OF ORG BEHAVIOR & DECISION SYSTEMS & Y LIC RY O P ATO TE UL IMA G CL RE TM VE S IO NS S IN AT RM GOAL TIV NO EN T MO Banny Banerjee, Stanford University TH CH EORI AN ES GE OF ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU SIN MO ESS DE L ORG BEHAVIOR & DECISION SYSTEMS G IN D AN R T RS VIO E D A UN BEH OF INNOVATION PROCESS & Y LIC RY O P ATO TE UL IMA G CL RE TM VE S IO NS S IN AT RM GOAL TIV NO EN T MO Banny Banerjee, Stanford University TH CH EORI AN ES GE OF ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU SIN MO ESS DE L ORG BEHAVIOR & DECISION SYSTEMS G IN D AN R T RS VIO E D A UN BEH OF INNOVATION PROCESS & Y LIC RY O P ATO TE UL IMA G CL RE TM VE S IO NS S IN AT RM GOAL TIV NO EN T MO Banny Banerjee, Stanford University TH CH EORI AN ES GE OF ENABLING TECHNOLOGIES G IN Y AL SC TEG RA ST BU SIN MO ESS DE L G IN D AN R T RS VIO E D A UN BEH OF OR ORG BEHAVIOR & DECISION SYSTEMS INNOVATION PROCESS & Y LIC RY O P ATO TE UL IMA G CL RE TM VE S IO NS S IN AT RM GOAL TIV NO EN T MO Banny Banerjee, Stanford University Behavior Banny Banerjee, Stanford University The cheapest barrel of oil is the one that we don’t use Banny Banerjee, Stanford University Banny Banerjee, Stanford University For most systems, behavior is a choke point Banny Banerjee, Stanford University For most systems, behavior is a choke point Behavior change allows demand-side interventions Banny Banerjee, Stanford University For most systems, behavior is a choke point Behavior change allows demand-side interventions Behavior change can scale faster than infrastructure Banny Banerjee, Stanford University CHALLENGES AND OPPORTUNITIES! IN AN ALTERED ECOSYSTEM! CLOUD! PV! Sensors! Feedback, ! Nudges,! Incentives! Mobile! Device! Smart ! Controls! E V Appliances! Storage! Smart Meter! ( + Smart Grid)! Changing regulations, pricing structures, markets, competitive landscape, energy futures, sensibilities! tariffs, social norms, relationship with home-owners, and information landscapes! Banny Banerjee, Stanford University Upstream Interventions Downstream Interventions BannyBanerjee, Banerjee,Stanford StanfordUniversity University Banny How do we change the energy consumption of a region? How do we get people to use a different thermostat set-point BannyBanerjee, Banerjee,Stanford StanfordUniversity University Banny US Home Energy use breakdown # )3 & *3 " *3 ,3 ' -3 (Gardner & Stern) .3 ,,3 #&$ -3 /3 03 **3 **3 *+3 Banny Banerjee, Stanford University Upstream Interventions Downstream Interventions Target Profile Contexts Banny Banerjee, Stanford University KWH CAPITA ENERGY SOURCE INFRASTRUCTURE BEHAVIOR PATTERNS KWH CAPITA PEAK KW CURRENT ECOLOGY MENTAL MODELS, FRAMES STANDARDS BUSINESS MODELS PV/ ALT-SOURCE INFRASTRUCTURE PEAK KW FUTURE ECOLOGY STANDARDS BIZ MODELS BEHAVIOR FRAMES Banny Banerjee, Stanford University KWH CAPITA ENERGY SOURCE INFRASTRUCTURE BEHAVIOR PATTERNS KWH CAPITA PV/ ALT-SOURCE PEAK KW CURRENT ECOLOGY MENTAL MODELS, FRAMES STANDARDS BUSINESS MODELS f INFRASTRUCTURE PEAK KW FUTURE ECOLOGY STANDARDS BIZ MODELS BEHAVIOR FRAMES Banny Banerjee, Stanford University Scaled Innovation KWH CAPITA ENERGY SOURCE INFRASTRUCTURE BEHAVIOR PATTERNS KWH CAPITA PEAK KW CURRENT ECOLOGY MENTAL MODELS, FRAMES STANDARDS BUSINESS MODELS PV/ ALT-SOURCE INFRASTRUCTURE PEAK KW FUTURE ECOLOGY STANDARDS BIZ MODELS BEHAVIOR FRAMES Banny Banerjee, Stanford University Scaled Innovation Behavioral, Technical & Business Determinants KWH CAPITA ENERGY SOURCE INFRASTRUCTURE BEHAVIOR PATTERNS KWH CAPITA PEAK KW CURRENT ECOLOGY MENTAL MODELS, FRAMES STANDARDS BUSINESS MODELS PV/ ALT-SOURCE INFRASTRUCTURE PEAK KW FUTURE ECOLOGY STANDARDS BIZ MODELS BEHAVIOR FRAMES Banny Banerjee, Stanford University Scaled Innovation Behavioral, Technical & Business Determinants KWH CAPITA ENERGY SOURCE INFRASTRUCTURE BEHAVIOR PATTERNS KWH CAPITA PV/ ALT-SOURCE PEAK KW CURRENT ECOLOGY MENTAL MODELS, FRAMES STANDARDS BUSINESS MODELS Strategic Framing Scaled Concepts INFRASTRUCTURE PEAK KW FUTURE ECOLOGY STANDARDS BIZ MODELS BEHAVIOR FRAMES Banny Banerjee, Stanford University Scaled Innovation Behavioral, Technical & Business Determinants KWH CAPITA ENERGY SOURCE INFRASTRUCTURE BEHAVIOR PATTERNS KWH CAPITA PV/ ALT-SOURCE PEAK KW CURRENT ECOLOGY MENTAL MODELS, FRAMES STANDARDS Strategic Framing Scaled Concepts BUSINESS MODELS INFRASTRUCTURE PEAK KW FUTURE ECOLOGY BIZ MODELS BEHAVIOR Strategic Roadmaps Implementation & Scaling STANDARDS FRAMES Banny Banerjee, Stanford University Scaled Innovation Behavioral, Technical & Business Determinants Strategic Framing Scaled Concepts Strategic Roadmaps Implementation & Scaling Banny Banerjee, Stanford University Scaled Innovation Behavioral, Technical & Business Determinants Behavioral, Technological DRIVERS Extrinsic factors: SITUATIONAL CONSTRAINTS Ecosystem Analysis: STAKEHOLDER RELATIONSHIPS Strategic Framing Scaled Concepts Strategic Roadmaps Implementation & Scaling Banny Banerjee, Stanford University Scaled Innovation Behavioral, Technical & Business Determinants Behavioral, Technological DRIVERS Extrinsic factors: SITUATIONAL CONSTRAINTS Ecosystem Analysis: STAKEHOLDER RELATIONSHIPS STRATEGIC PATHWAYS & PLATFORMS Strategic Framing Scaled Concepts Design of SOLUTIONS, SERVICES, BIZ MODELS SCALING and DIFFUSION STRATEGY Strategic Roadmaps Implementation & Scaling Banny Banerjee, Stanford University Scaled Innovation Behavioral, Technical & Business Determinants Behavioral, Technological DRIVERS Extrinsic factors: SITUATIONAL CONSTRAINTS Ecosystem Analysis: STAKEHOLDER RELATIONSHIPS STRATEGIC PATHWAYS & PLATFORMS Strategic Framing Scaled Concepts Design of SOLUTIONS, SERVICES, BIZ MODELS SCALING and DIFFUSION STRATEGY Strategic Roadmaps Implementation & Scaling Organizational & Decision Processes Strategic Partnerships Rapid Pilots and Implementation rollouts Banny Banerjee, Stanford University The innovation process is like an accordion Banny Banerjee, Stanford University Cognitive intervention Piggyback intervention Stealth intervention Banny Banerjee, Stanford University KWH Potential High Low Low High Behavior Banny Banerjee, Stanford University KWH Potential High Low Low High Behavior Banny Banerjee, Stanford University KWH Potential High Vs Low Low High Behavior High Conversion of Small Segment Low Conversion of Larger Segment Banny Banerjee, Stanford University Prospect Theory Losses are felt twice as much as equivalent gains. (Kahneman and Tversky 1974) Banny Banerjee, Stanford University Hyperbolic Discounting Banny Banerjee, Stanford University PRINCIPLES Banny Banerjee, Stanford University PRINCIPLES Understand the local cultural, behavioral and motivational frames Banny Banerjee, Stanford University PRINCIPLES Understand the local cultural, behavioral and motivational frames Parse the qualitative insights through behavioral lenses Banny Banerjee, Stanford University PRINCIPLES Understand the local cultural, behavioral and motivational frames Parse the qualitative insights through behavioral lenses Business models and organizational behavior can ultimately limit success Banny Banerjee, Stanford University PRINCIPLES Understand the local cultural, behavioral and motivational frames Parse the qualitative insights through behavioral lenses Business models and organizational behavior can ultimately limit success Consider hybrid behavioral-techno-business strategies Banny Banerjee, Stanford University PRINCIPLES Understand the local cultural, behavioral and motivational frames Parse the qualitative insights through behavioral lenses Business models and organizational behavior can ultimately limit success Consider hybrid behavioral-techno-business strategies Upstream platforms that enable multiple downstream interventions Banny Banerjee, Stanford University PRINCIPLES Understand the local cultural, behavioral and motivational frames Parse the qualitative insights through behavioral lenses Business models and organizational behavior can ultimately limit success Consider hybrid behavioral-techno-business strategies Upstream platforms that enable multiple downstream interventions When known solutions do not exist, innovate! Banny Banerjee, Stanford University PRINCIPLES Understand the local cultural, behavioral and motivational frames Parse the qualitative insights through behavioral lenses Business models and organizational behavior can ultimately limit success Consider hybrid behavioral-techno-business strategies Upstream platforms that enable multiple downstream interventions When known solutions do not exist, innovate! Allow matches between motivational frames and solution frames Banny Banerjee, Stanford University PRINCIPLES Understand the local cultural, behavioral and motivational frames Parse the qualitative insights through behavioral lenses Business models and organizational behavior can ultimately limit success Consider hybrid behavioral-techno-business strategies Upstream platforms that enable multiple downstream interventions When known solutions do not exist, innovate! Allow matches between motivational frames and solution frames If you don’t build in scale, it will be harder to build it in later Banny Banerjee, Stanford University QUESTIONS Banny Banerjee, Stanford University QUESTIONS Is the segmentation based on motivation, behaviors, and identity? Banny Banerjee, Stanford University QUESTIONS Is the segmentation based on motivation, behaviors, and identity? Is it a Pull or Push intervention? Banny Banerjee, Stanford University QUESTIONS Is the segmentation based on motivation, behaviors, and identity? Is it a Pull or Push intervention? Will it self propel or do you have to scale distribution? Banny Banerjee, Stanford University QUESTIONS Is the segmentation based on motivation, behaviors, and identity? Is it a Pull or Push intervention? Will it self propel or do you have to scale distribution? What is the driving motivation for the user? Banny Banerjee, Stanford University QUESTIONS Is the segmentation based on motivation, behaviors, and identity? Is it a Pull or Push intervention? Will it self propel or do you have to scale distribution? What is the driving motivation for the user? Is it a Cognitive, Piggyback, or Stealth intervention? Banny Banerjee, Stanford University QUESTIONS Is the segmentation based on motivation, behaviors, and identity? Is it a Pull or Push intervention? Will it self propel or do you have to scale distribution? What is the driving motivation for the user? Is it a Cognitive, Piggyback, or Stealth intervention? Is it a Downstream intervention or a Upstream Intervention? Banny Banerjee, Stanford University QUESTIONS Is the segmentation based on motivation, behaviors, and identity? Is it a Pull or Push intervention? Will it self propel or do you have to scale distribution? What is the driving motivation for the user? Is it a Cognitive, Piggyback, or Stealth intervention? Is it a Downstream intervention or a Upstream Intervention? Is it a Single Agency play or Multi-Agency requiring strategic partnerships? Banny Banerjee, Stanford University QUESTIONS Is the segmentation based on motivation, behaviors, and identity? Is it a Pull or Push intervention? Will it self propel or do you have to scale distribution? What is the driving motivation for the user? Is it a Cognitive, Piggyback, or Stealth intervention? Is it a Downstream intervention or a Upstream Intervention? Is it a Single Agency play or Multi-Agency requiring strategic partnerships? Is there a strategy for rapid diffusion of enabling technology? Banny Banerjee, Stanford University QUESTIONS Is the segmentation based on motivation, behaviors, and identity? Is it a Pull or Push intervention? Will it self propel or do you have to scale distribution? What is the driving motivation for the user? Is it a Cognitive, Piggyback, or Stealth intervention? Is it a Downstream intervention or a Upstream Intervention? Is it a Single Agency play or Multi-Agency requiring strategic partnerships? Is there a strategy for rapid diffusion of enabling technology? Does it piggyback on infrastructure that has already scaled? Banny Banerjee, Stanford University QUESTIONS Is the segmentation based on motivation, behaviors, and identity? Is it a Pull or Push intervention? Will it self propel or do you have to scale distribution? What is the driving motivation for the user? Is it a Cognitive, Piggyback, or Stealth intervention? Is it a Downstream intervention or a Upstream Intervention? Is it a Single Agency play or Multi-Agency requiring strategic partnerships? Is there a strategy for rapid diffusion of enabling technology? Does it piggyback on infrastructure that has already scaled? Does this lead to a new culture and choice architecture? Banny Banerjee, Stanford University Banny Banerjee, Stanford University Potency of Intervention Banny Banerjee, Stanford University Potency of Intervention * Scale of Implementation Banny Banerjee, Stanford University Potency of Intervention * Time to*Impact Scale of Implementation Banny Banerjee, Stanford University Potency of Intervention * Time to*Impact Degree of*Integration Scale of Implementation Banny Banerjee, Stanford University Thank you