I recently read the book Drive: The Surprising Truth About What Motivates Us by Daniel H. Pink. This book is a review of what truly motivates people. Apparently, our society as a whole pretty much takes the wrong approach at motivating people.
The book explains that for a long time humans have been using the “carrot and stick” approach to motivation. For example, an employee’s compensation is often tied to specific metrics like hitting a targeted release date, or reaching certain sales goals. The better the metric, the better the pay. The worse the metric, the worse the pay.
However, this is apparently a recipe for underperformance. The author sites a number studies that show that, yes, tying performance to compensation does focus their attention on a task. The problem is, people focused their attention on the wrong places and creativity suffered. It turns out that, with the exception of unskilled labor tasks such as a repetitive factory work, that the greater the carrot, the worse performance actually gets.
As an example, in one of the studies the author cites, participants were given a candle, a box of tacks, and matches. They were asked to find a way to affix the candle to the wall in a way that would prevent wax from dripping on a table’s surface. Some participants were offered a cash reward for completing the problem quickly while others were simply told they were being observed to see how long it took them to solve the problem. The result was that the second group, the ones who were not offered the cash incentive, completed the problem more quickly.
Take a moment and think about how you’d solve this specific problem. Go ahead, I’ll wait.
Now that you’re back, I’ll tell you the solution. If you were to dump the box of tacks out you could then use the tacks to stick the box to the wall. You can then place the candle upright in the box and it won’t drip wax onto the table when burnt. It seems that the added incentive of extra money focused people too much in the specifics of a given problem and blinded them from thinking, quite literally, outside the box.
Ultimately, the author breaks motivation down into three things that people want out of work:
Mastery workers want to improve their skills
Autonomy workers want to control how they work
Purpose workers want to feel like they’re doing something important
Of course, when it comes down to it, everyone needs to eat and money is a rather central component of that. So we’ve got to be paid for our work to achieve some baseline.
To the tech community this may all be fairly obvious. This explains why so many programmers a “real” job, but spend their nights and weekends contributing to open source projects. Namely, the open source work gives them practice and challenges them in new and interesting ways. This is more satisfying than the dry work at the office. They also get to control how and when they work. And lastly, they feel like they’re contributing to a greater good. This really epitomizes another key concept in the book, intrinsic vs. extrinsic motivation. Intrinsic motivation drives you to do work because you want to. Extrinsic motivation drives you because you need to.
And, according to the author, apparently, all of this can be boiled down to a simple strategy that companies can apply to motivate their employees. Essentially, you need to pay them enough to take the issue of money off the table. After that, empower them to do their best work. What you’re doing is moving their focus off from the money and onto the work.
After reading this book I was left thinking about how this book applied to Alagad. Honestly, I think it has some pretty interesting and direct applications.
It’s reasonably well known that Alagad currently pays its employees hourly. I established this because, in my previous life as a salaried worker I felt like salary was theft. All of the companies I worked for previously paid a low salary and frequently demanded long hours in the office, effectively lowering what I’m being paid per hour. Additionally, Alagad has historically billed clients on a Time and Materials basis. So, if Alagad is billing for an employee who’s putting in 50 hours in a week, shouldn’t Alagad pay that employee proportionately?
Now, with the benefit of hindsight, I think that may have been a mistake. There have always been some employees who would happily work 50 or 60 hours a week on average. This was great for Alagad, which could bill for this time. However, I think there may have been unintended consequences of this policy. For example, just because a programmer worked 50 or 60 hours doesn’t mean they did quality work during that period. That’s not to say my employees ever didn’t give me quality work, but I know that part of the incentive to putting in those long hours was simply to make more money.
So, at this point, Drive has me thinking about changing our compensation system at Alagad. We’ve been seriously considering simply paying a generous salary and leaving it at that. Other aspects I think we need to consider are the matters of time off. For example, who cares how often someone’s in the office? Doesn’t it matter more that the work is well, and on-time? Isn’t PTO simply another aspect of Carrot and Stick motivation? “If you’re not in the office enough you’re fired!!” I think this bears more thought. I could go into this for quite a while and hash it out in some sort of personal stream of thought drivel, but I’ll spare you.
In the end, my recommendation on Drive is to read it. It’s an interesting read that will have you thinking about how people see the world and what motivates them on a day to day basis.
Comments on: "Alagad Business Book Reviews: Drive by Daniel H. Pink" (7)
Dan Pink writes some great books. I have met him before and not only is he smart, but you can tell that he cares.
As a former teacher, I can also tell you that we learn this in college – external motivators only last as long as they are there. We also learned that people will focus on what you focus on: if you focus on punching the clock, they will focus on the time (picture a government employee who gets ready at 4:20 pm to leave at 4:30 promptly).
If you focus on being paid by the hour, the employee focuses on maximizing (their) revenue. But if you focus on results, you get results. As you say, pay fairly for those results and give your staff the tools they need – those are the basics. After that, you can find what motivates each team member and provide that for them.
And as you have discovered through experience and reading, focusing on results is the best way to run.
I mentioned a Harvard Business Review article in this post which discusses a similar topic.
I enjoyed reading it too since it is actually an engaging read. I liked that he gave a lot of references of source material that could be looked up and other books to try on related subjects.
I don’t know that I buy into all that he was talking about, but I know that people have to be self-motivated. Carrot and stick is temporary. I need to feel like my work has some value over the fact that it puts food in my mouth.
What is needed is a list of case studies where companies actually put these ideas to the test. I don’t think there are many larger companies who are trying these methods. I would like to hear about them.
@Qasim – That was indeed a very interesting article. I think the key point is that financial incentives only work so well. Beyond that you need to let people motivate themselves.
I remember learning some of this in college. One thing my professor noted (and I agree) is that it will always be hard to convince people that money is not their main motivator. People become very sensitive when it comes to pay rates. But I remember reading a study that found employees in almost deplorable conditions (regarding office space, pay, benefits, etc.) and when interviewed about their job the employees said they were happy. And it was because of the intrinsic motivators that their employer created. That said, there will always be outliers that aren’t happy with their job because of pay and/or benefits, regardless of intrinsic motivators.
I thought your comment about PTO was interesting, I had never thought of PTO as a carrot on a stick motivator. But it makes sense. I have long agreed with your assertion that the important thing is that work is done well and on time. Unfortunately, most employers don’t believe they can trust their employees, and so we’re generally stuck with a 9-5 type schedule, even when that doesn’t make sense.
@Jake – I’ve been thinking about the PTO thing more. I’m considering moving to a flat salary situation with no formal PTO policy. What this means is that if an employee wants to take time off, great. Just be sure to get your work done as well! Thus there’s unlimited time off in a year.
The thing is, I think there are very real problems with this. Assuming the worst in human nature, there would be some people who would abuse this. Obviously, the business would need to watch for this and put a stop to it. But how do you do that if there’s not a formal policy?
Then the other side of the coin is that if nobody knows how much time they’re permitted to take off then some people will be scared to take as much as they need or any at all.
Lastly, Alagad is a Time and Materials company. Our livelihood is based on billable hours. So, if an employee decides to take a month off that would really sting.
OTOH, employees usually have to get PTO approved unless they’re sick. So, how is it really any different from the standard arrangement?
I could go around in circles on this all day long….
@Roger I think that we don’t see real case studies because motivating employees intrinsically will require managers to spend time on understanding each employee personality and factors that affect his/her motivation – and most managers won’t do that. On the other hand, typical annual reviews and follow up pay raise are simple methods.