320. The IKEA Effect
The best leaders don’t build businesses alone — they hand over the IKEA instructions and empower their teams. It's time you understood The IKEA Effect
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How would you react if you were confronted by a crazy man with a big knife?
That’s the question I attempted to answer for my final project as a psychology major in college.
I know, it’s idiotic.
I can’t believe my professor accepted this premise, yet here we are.
This is what I did.
One early morning, as students were walking to class, I stood surreptitiously off the side of the sidewalk and timed how long it took the average person to walk 10 meters.
The next morning at about the same time, I went to the same sidewalk at the same part of campus and recorded people’s pace again, but this time I was holding a big hunting knife and was screaming random things to act like a crazy man.
I then compared the data to come up with my conclusions.
Sure, my college only had 1,000 students and almost everybody knew almost everybody else, which means I most likely wasn’t viewed as some rando. And, yeah, I probably didn’t make a great crazy person in my preppy clothes and clean-cut look, otherwise somebody would’ve contacted campus security and had me arrested.
In the end, my findings were pointless. It didn’t prove to be a statistically significant study as much as a statistically stupid study.
As it turns out, a couple of decades later, a group of smarter people at smarter schools did a similarly stupid study. Their findings, however, changed the world.
The IKEA effect
In what I can only imagine was the result of a drunken dare at a dive bar, A few folks from Harvard, Yale, and Duke decided to conduct a study focused on IKEA furniture.
Yup, IKEA furniture.
The result of their study is critically important to your journey towards being a great leader.
Here’s what they did.
They got a bunch of participants and, one by one, showed them a piece of IKEA furniture. They then asked each of them to guess its retail value.
It sounds kinda like a Swedish version of The Price Is Right… but, wait, there’s more.
They then got another bunch of participants and, one by one, they had them first assemble the piece of furniture, and then each one guessed its retail value.
As it so happens, the participants who assembled the furniture themselves placed a higher value on the item than those who weren’t involved in its creation.
Interesting right?
I agree.
They called it “the IKEA Effect.”
They published their findings, and the concept took off.
Here’s what the IKEA Effect means:
People place a higher value on ideas, activities, or products when they feel like they’ve been part of the creation process.
The IKEA Effect In Action
If you’ve ever worked with me as a coach or taken my courses, you have no doubt heard me blabber on about the immense importance of empowering your team.
When people feel empowered, they are more productive, more creative, and much happier in their jobs. That’s a fact.
The IKEA Effect is about empowerment.
It’s about giving people psychological ownership of their destiny.
Smart companies know how to leverage the IKEA Effect, and they use it effectively to build engagement, loyalty, and, ultimately, a higher perceived value of the importance of the brand.
Here are some examples:
Quick Service Restaurants (QSRs) like Subway, Chipotle, and Sweetgreens leverage the IKEA Effect by letting you co-create your meal.
Nike leverages the IKEA Effect by allowing you to customize your shoes. M&M’s also did it by letting you vote for the next flavor.
Tech companies like Notion and Trello create psychological ownership by letting you customize the features and dashboards.
The same concept can be found in almost every other industry.
Once you start looking for the IKEA Effect in the real world, you’ll find it everywhere.
So, how do you apply the IKEA Effect to your leadership? I’m glad you finally asked. I was starting to think we’d never get there.
The IKEA Effect In Your Leadership
If you want to learn how to inspire and empower your team to be as productive as possible, there are few things more important than embracing the IKEA Effect.
To get started on this, there are three behaviors you should start doing right now. No extra courses or webinars required.
1. Start with Questions
Your job as a leader is NOT to know all the answers. Your job is to ask the right questions. Fortunately for you, there are only four of them you need to ask:
What?
How?
Why?
When?
Everyone who has worked with me knows that, when they ask for my opinion about an issue, the first words out of my mouth are always the same:
What do you think we should do?
By teaching your team to think about solutions, you are empowering them to be leaders and take ownership. This is the essence of the IKEA Effect.
So next time somebody comes to you with an issue, listen to them carefully, make sure you understand what the problem is, and ask them what they think should be done. Then shut up and listen.
You’ll be amazed at what happens.
2. Transparently Explain The Why
Don’t tell people when a decision is already made. That’s called “informing”. You need to lean more towards “involving”.
Once you recognize a problem that needs to be addressed, be transparent with your team and give them a seat at the solutions table.
Ask them what they think should be done
Actively listen to their ideas
Consider their ideas with an open mind
When you make a decision, explain the “why”
This is empowerment. It makes all the difference in the world.
3. Let Them Own The Win
When your team accomplishes something, give them the credit. Let them own the win. Acknowledge the idea they had and the obstacles they overcame to achieve the result.
An important part of the IKEA Effect is acknowledging and celebrating the impact of ownership.
One Last Thought From The Crazy Guy With The Knife
That idiotic college experiment of mine didn’t lead to any great discoveries. But when I look back on it, I realize that something else important happened. Something that wasn’t measured. Something that wasn’t intentional.
I owned it.
I created the idea, proposed it, and tried it.
Yes, it was stupid, but it was mine - and that’s what matters most. That’s why I proudly told you the stupid story at the top of this silly article.
And that’s the exact point of the IKEA Effect. Not just that people value what they build, but that the process of building it - the simple process of feeling like they matter - is what makes people feel proud and involved.
My challenge to you is to begin empowering your team to assemble the proverbial furniture on their own. Begin today. Right now.
Because even if the screws don’t always match the holes, even if the thing they build is not exactly what you envisioned, the empowerment and ownership they feel is the single strongest motivator you can create as a leader.
Fortunately, you don’t need a hunting knife and a crazy college kid to get it done.
Want to learn how to better empower your team?
I’ll make you a master in 60 days.
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It's common sense, but not common practice, to involve team members in decision making but the leaders that do get the most out of their teams for sure. After all, don't we hire team members because they're going to be great at the job?
I didn't expect this... When you tell me Ikea effect, I think about normalization and uniformization. But great insights: it's the same as people who take more care about public transportations when they need to pay for it VS. cities where they're free.