How can we design a workplace where employees meet deadlines, embrace initiatives, and engage deeply with their work, without feeling micromanaged? Too often, managers assume that simply presenting information will lead to the right decisions. But research in behavioral economics tells us otherwise.

The key is Choice Architecture, the strategic design of decision-making environments to nudge employees toward better choices without limiting their autonomy. By structuring workplace choices intelligently, managers can guide behavior, improve engagement, and enhance productivity without the resistance that comes from direct enforcement.

As Richard Thaler, Cass Sunstein, and Balz (2010) demonstrated, small adjustments in how choices are presented whether through default options, visual emphasis, or subtle cues, can drive significant behavioral shifts. This isn’t about control; it’s about creating conditions where the best choices feel natural.

How can managers inspire employees to choose desired behaviors willingly?

The answer lies in a surprising but powerful tool: behavioral economics and the strategic use of choice architecture.

People are at the core of every organization’s success. Yet, one of the main challenges managers face is enabling employees to make better decisions and engage more deeply. One powerful, yet often underutilized tool to achieve this is behavioral economics. Specifically, the concept of choice architecture offers a way to empower line managers to drive meaningful change in their teams.

The power of choice architecture

Every day, we make countless decisions, many of them influenced by the environment around us. A foundational work in this area is the paper “Choice Architecture” by Thaler, Sunstein, and Balz (2010). It outlines how small tweaks, like shifting default options could dramatically change behavior without taking away freedom. That’s a game-changer for managers.
One example of this comes Richard Thaler and Cass Sunstein in their book Nudge where an experiment in a school cafeteria explored how to encourage students to choose healthier foods without limiting their freedom.

What solution they come up with? A clever application of choice architecture the design of environments to subtly guide decisions. Here’s what they did:

• Rearranging the Food Display: Fruits and vegetables were placed at eye level and in prominent, easy-to-reach locations, while less healthy snacks like chips and desserts were moved to less convenient spots, such as lower shelves or the back of the cafeteria.

• Default Side Dishes: In meal combos, fruits were made the default side option instead of fries. Students could still request fries, but only if they actively chose to do so.

• Descriptive Labels: Healthy options were made more appealing with enticing labels like “Crisp, Garden-Fresh Apples” instead of simply “Apples.”

The results were remarkable. Students naturally began selecting healthier options without feeling coerced. The simple act of making fruits and vegetables more visible and attractive significantly increased their consumption. By contrast, the less accessible and less emphasized unhealthy options were chosen less often. This experiment proves a simple truth: We don’t need more rules. We need smarter design. Make the better choice the easiest one, and people follow.

Choice architecture in the workplace

Managers influence decisions every day whether it’s meeting deadlines, adopting new processes, or participating in development programs. While these decisions may seem small in isolation, they collectively shape team culture, productivity, and morale. A team that consistently meets deadlines, embraces innovation, and engages in continuous learning isn’t just the result of good hiring it’s also a reflection of how their manager structures choices and expectations.

However, many managers still rely on traditional leadership approaches, assuming that simply presenting options and making expectations clear is enough to drive behavior. They believe that if a deadline is reasonable, a new system is well-explained, or a training program is valuable, employees will naturally make the right choice. But behavioral economics tells us otherwise!

In reality, humans don’t always make rational, optimal decisions even when the benefits are clear. Psychological biases, habit loops, and decision fatigue all play a role in how employees respond to choices.

Related Article: How can we escape the “experience trap” in the workplace?

Choice architecture examples

As a manager, the structure of decisions whether in workflow design, feedback delivery, or team processes can subtly guide behavior without limiting autonomy. By making small adjustments to how information is framed, prioritized, and simplified, managers can help their teams make better choices, work more efficiently, and stay engaged. Below are practical ways to apply choice architecture in a workplace setting:

Default Options – make the best choice the easiest: People tend to stick with default choices rather than actively opting in or out of an option. Managers can leverage this by structuring workflows where the most beneficial option is the default setting.

For example, instead of requiring employees to sign up for professional development workshops, set attendance as the default expectation, allowing employees to opt out if necessary. Similarly, pre-filling project templates with best practices ensures teams don’t have to start from scratch, making high-quality work the natural outcome. By designing environments where the path of least resistance leads to better decisions, managers can improve participation and efficiency without forcing change.

Simplification – reduce choice overload to drive action: Too many choices can lead to decision paralysis, making it harder for teams to take action. Managers can combat this by limiting choices and providing clearer direction. Instead of asking for open-ended input on a project, presenting two or three specific, pre-vetted options allows for faster, more confident decision-making. Similarly, in workflow processes, removing unnecessary approval steps streamlines execution. Breaking down large, overwhelming tasks into three simple next steps can also increase progress by making tasks feel more manageable. By reducing friction and choice overload, managers make it easier for teams to move forward.

Loss Aversion – frame gains as avoiding a loss: People are more motivated to avoid losses than to achieve equivalent gains. Managers can use this to encourage action by subtly shifting the way decisions are framed.

For example, instead of saying, “Join this leadership workshop,” a more compelling message would be, “Don’t miss your chance to level up your leadership skills.” Similarly, instead of encouraging employees to improve response times, managers can emphasize the risk of inaction by saying, “Delays could impact client trust and future opportunities.” By structuring messages around what employees stand to lose by not taking action, managers can increase engagement and follow-through.

Engagement through gamification

An example of applying choice architecture in the workplace is using a point system to gamify engagement. Managers can assign points to team members for attending meetings, contributing ideas, or completing milestones. A leaderboard displayed on a shared platform adds visibility, and meaningful rewards, such as early access to training opportunities or public recognition, reinforce participation.

Want a simple way to make work more engaging? Gamify it.

A Harvard Business Review study found that implementing a gamified training platform led to a 35.8% increase in sales, a 16.3% rise in the number of clients, and a 22.3% boost in new client engagements. That’s a measurable win for managers looking to enhance performance.

Managers as Behavioral Economists: A Win-Win 

Behavioral economics principles are not just tools for economists; they are practical frameworks that empower managers to build stronger, more engaged teams. Meder (2018) highlights the importance of understanding the social interactions inherent in nudging policies, emphasizing that effective choice architecture enhances trust and autonomy rather than diminishing it.

If your organization wants to move beyond managing and start architecting environments where better choices come naturally, Choice Architecture is the key. By integrating behavioral economics into management strategies, organizations can enhance both employee experiences and organizational performance without relying on rigid mandates.

As Thaler, Sunstein, and Balz (2010) remind us, designing environments that nudge employees toward better decisions creates a win-win scenario, employees feel empowered, and organizations see measurable improvements.

The best managers aren’t enforcers, they’re architects. They design workplaces where people choose to thrive, not just comply.