profile

Nudge Newsletter

The rubber chicken that saved Pizza Hut | Nudge Newsletter 🧠

Published 16 days ago • 1 min read

Toy motivation.

In 1994, David Novak was promoted to Pizza Hut CEO.

He wasn’t excited. "It was a graveyard for executives," he said.

"Morale was down, business was down. It needed energy injected into the business.”

The solution? A rubber chicken.

Novak handed out a mini rubber chicken toy (and a relatively small cash bonus) to hundreds of high-performing employees.

The tiny gift had a dramatic impact.

"This took off like you wouldn't believe it helped turned around the mindset of the organization and we started working together with the franchisees and turned around the quality in three years. And the franchisees were now giving us ideas," he told CNN.

Rubber chickens were handed out on planned visits to honour exceptional employees, but they were often awarded spontaneously to staff who went above and beyond.

Yet, it wasn’t just cash and a chick, he also wrote a personal note explaining why they deserved the reward.

“You have to be very specific with what the person has tangibly done and how it is contributing to the success of the organization. It has to be purposeful."

David Novak and his team tie this seemingly small gesture to a dramatic turnaround in the company’s fortunes.

Market cap increased from $4.6 billion to $31 billion. Employee turnover dropped and staff satisfaction rose.

Walk into Novak’s office in 2016 and you would see every inch of every wall covered in pictures of those who received the rubber chicken.

He handed out 1,400 toys in his 22 year tenure and turned the company around.

The behavioural science literature can help breakdown why this small intervention was so significant.

Variable rewards: We’re more motivated by variable benefits than consistent ones (B.F. Skinner, 1938). Spontaneous toys and cash motivate more than a yearly bonus.

Reciprocity: We need to return a favour (Cialdini 1984). Staff feel indebted to a CEO who’s hung their photo on his office wall.

Input bias: We value communication more if we see the effort behind it (Chinander and Schweitzer, 2003). It’s not just a gift and some cash, it’s a handwritten note from the busy boss. The effort makes staff appreciate the gesture more.

A rubber chicken, a $100 bill and a scribbled note won’t transform your business.

But it won’t hurt.

We shouldn’t undervalue these seemingly insignificant gestures as the scientific literature suggests they dramatically outweigh the effort they take.

Cheers!

Phill

Nudge Newsletter

Phill Agnew

I spend 18 hours each week turning marketing psychology into readable newsletters.

Read more from Nudge Newsletter

Power of the crowd. Do loud football fans influence referees? Will booing or cheering change an official's decision? In 2002, three researchers decided to find out. The researchers contacted 40 qualified referees and asked them to evaluate all incidents during a Liverpool vs Leicester City match. 20 referees watched the game WITH crowd noise 20 referees watched the game WITHOUT crowd noise It turns out that those who heard the home crowd noise were influenced. They award 15% fewer fouls...

2 days ago • 1 min read

The illusion of effort. Rory Sutherland shares the story of the highly successful Chamberlen family from the 1500s. Chamberlens acquired an extremely good reputation for delivering babies during difficult births — and charged a lot to do so. Their success lay in psychology. When called, the Chamberlens would arrive with an unbelievably heavy box hauled into the birthing chamber. The pregnant woman would have a blanket which covered everything below breast height. She could listen to the...

9 days ago • 1 min read

It's not new. It's Black Friday today, and you'll undoubtedly see news articles and social posts lamenting modern-day consumers' unparalleled and insatiable demand. Yet, history suggests this isn't the case. David Grann shares what happened in Cherokee Outlet in 1893 in his book The Killers of the Flower Moon. “After the U.S. government purchased the land from the Cherokee, it announced that a settler would be able to claim one of the 42,000 parcels of land—if he or she got to the spot...

23 days ago • 1 min read