If you’re interested in dramatically improving employee motivation and performance, then you’ll be interested in Daniel Pink’s latest book, “Drive – The Surprising Truth About What Motivates Us.” An excellent overview of its key messages can be found in this short animated video – possibly one of the most innovative and interesting videos you’ll find on YouTube.
The key discoveries that Pink highlights are the outcomes of incentivising performance, along the lines taken by many organisations in their motivation schemes. He reports that research shows for purely mechanical skills, the higher the pay the higher performance. However for tasks that require cognitive skill, the larger the reward the poorer the performance.
In one quoted study it turned out that the people offered a medium-sized bonus didn’t perform any better than those offered a small bonus. And those people receiving a super-sized bonus performed worst of all. Reporting the results for the Federal Reserve Bank of Boston, the researchers wrote, “In eight of the nine tasks examined across the three experiments, higher incentives led to worse performance.”
This study is not an isolated example. In 2009, scholars at the London School of Economics analysed 51 studies of corporate pay-for-performance plans. The economists’ conclusion: “We find that financial incentives….can result in a negative impact on performance.”
Pink suggests that this seems to defy the laws of behavioural physics. Having applied behavioural principles in business for 20 years, I disagree. There is a fundamental difference between rewarding results and reinforcing behaviour.
It has long been known that money is more of a dissatisfier, rather than a satisfier. In fact money, or financial remuneration, is of much more value for attracting and retaining talent than it is for motivating people. I’m in total agreement with Pink when he says that if you don’t pay people enough, they won’t be motivated. In which case, the best use of money is to pay people enough to take the issue of money off the table. Then they are not thinking about the money, they’re thinking about the work.
You’ll remember from my post How to Motivate People, that a recent McKinsey & Company research study found that positive leadership attention, along with praise and commendation from a person’s immediate manager, are the most effective motivators available in any organisation. This is not an isolated discovery. Research undertaken at Witchita State University two decades ago found the most effective motivator is a person’s immediate manager recognising them for good performance. More recent work from the Work and Employee Research Centre at the University of Bath has discovered much the same.
So why doesn’t rewarding results work, while reinforcing behaviour does? Let’s examine an everyday example to illustrate. Consider parents who want to encourage their secondary school age children to do well in their end of year exams. One option is to offer their children a financial reward for achieving certain grades in their exams. But as we’ve already seen, this may well have a negative impact on performance.
Simply put, there are a number of behaviours and attitudes that need to be encouraged and developed in order for children to be successful in their exams. Developing a love of learning, becoming interested in the subject matter, organising and following a study plan, and completing readings and assignments throughout the year are all necessary prerequisites for success. Yet if the only motivator is a potential financial reward at the completion of the exams it is too far off (at the end of the year) and too uncertain (the child may work hard without actually achieving the desired reward). Under these circumstances, the financial reward will create no motivation throughout the year to develop the behaviours and attitudes that enable children to become successful students.
What does create motivation is the positive attention parents pay to their children. Discussing items of interest from class over the dinner table, encouraging children to work on their assignments and recognising the effort made, passing positive comment on following the study plan, making it easy for children to put the time aside to read the assigned texts, and providing small reinforcers when they do (such as getting to watch a television programme instead of washing the dishes).
Pink’s recipe for success with children is much the same:
- Praise effort and strategy
- Make praise specific
- Offer praise only when there is a good reason for it
And so it is at work. The deliberate use of positive personal attention by Frontline Leaders is the key to dramatically improving employee motivation and performance. You hold the pivotal role in determining the motivation and engagement of your people, not the bonus system the organisation has in place.
Image by Andrew Beierle