Stick and Carrot Doesn’t Work

The excellent TED.com has served up another gem in this talk by Dan Pink. Using hard evidence from experiments around the world he makes the case that stick and carrot type incentives actually reduce performance in any task requiring a little creative thinking. As he points out that means pretty much everything businesses expect from their employees these days.

The explanation is that an attractive financial incentive actually narrows our thinking. If the solution to the task is anything other than obvious this kind of ‘motivation’ causes us to focus on the task at the expense of a better solution that might lie at the periphery.

He suggests – he would say, proves – that autonomy, mastery and purpose are what drives motivation. The desire to have control over our lives, the ambition to get better at something and the need to feel we are serving a higher order purpose that we believe in. In this short talk he only gets to prove convincingly that stick and carrot does not work. He does not get much time to explore the more enlightened approach but it makes sense.

I’d add recognition to his list. A little public acknowledgement for our efforts goes a long way towards motivating people. It also allows everyone else to see what they should be seeking to emulate.

As Dan Pink argues, business is not applying what we know to be true – what we can prove – from science. I am with him. My comment above, that public acknowledgement allows others to copy desired behaviour is also based on social science.

Facilitating copying is the most powerful way fro ideas and actions to spread. We have long known that it is not necessary to first change people’s attitudes. We need to change behaviour and attitudes follow.

Dan is optimistic that business is prepared to look at radically different ways to manage and motivate. We have the “carrot” of organizations like Google who take a more results focused approach and give a great deal of autonomy, e.g. in NPD, to its team. We have the “stick” that old models of management, oversight and incentives have so spectacularly failed in financial institutions. Maybe, but I fear the change will be a long time coming for the big business behemoths. Inertia is the most powerful force and insecure greedy people will find it very hard to believe that fear & greed are not the best motivators.

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