I want to talk a little bit about labor and work.
When we think about how work, the naive intuition we have is that people are rats in a maze — that all people care about is money, and the moment give them money, we can direct them to work way, we can direct them to work another way. This is why we bonuses to bankers and pay in all kinds of ways. we really have this incredibly simplistic view of why work, and what the labor market looks like.
At the same time, if you about it, there’s all kinds of strange behaviors in world around us. Think about something like mountaineering and mountain climbing. you read books of people who climb mountains, difficult mountains, you think that those books are full of moments of joy and happiness? No, they full of misery. In fact, it’s all about frostbite having difficulty walking, and difficulty breathing — cold, challenging circumstances. if people were just trying to be happy, the they would get to the top, they would say, “This a terrible mistake. I’ll never do it again.”
(Laughter)
“Instead, let me sit on beach somewhere drinking mojitos.” But instead, people go down, after they recover, they go up again. And if think about mountain climbing as an example, it suggests all of things. It suggests that we care about reaching end, a peak. It suggests that we care about the fight, the challenge. It suggests that there’s all kinds of other that motivate us to work or behave in all kinds ways.
And for me personally, I started thinking about this after a student came to visit me. was one of my students from a few years earlier, and he came day back to campus. And he told me the following story: said that for more than two weeks, he was on a PowerPoint presentation. He was working in a big bank, and was in preparation for a merger and acquisition. And he was very hard on this presentation — graphs, tables, information. stayed late at night every day. And the day it was due, he sent his PowerPoint presentation to his boss, his boss wrote him back and said, “Nice presentation, the merger is canceled.” And the guy was deeply depressed. Now the moment when he was working, he was actually quite happy. Every night he was enjoying his work, was staying late, he was perfecting this PowerPoint presentation. But knowing that nobody would ever it made him quite depressed.
So I started thinking about do we experiment with this idea of the fruits our labor. And to start with, we created a little experiment which we gave people Legos, and we asked them to build Legos. And for some people, we gave them Legos we said, “Hey, would you like to build this Bionicle for three dollars? We’ll pay three dollars for it.” And people said yes, and they built with these Legos. And they finished, we took it, we put it under the table, we said, “Would you like to build another one, this time for $2.70?” If they said yes, we them another one, and when they finished, we asked them, “Do you want to build one?” for $2.40, $2.10, and so on, until at some people said, “No more. It’s not worth it for me.” This was what called the meaningful condition. People built one Bionicle after another. they finished every one of them, we put them under the table. And told them that at the end of the experiment, we will all these Bionicles, we will disassemble them, we will them back in the boxes, and we will use it the next participant.
There was another condition. This other condition was inspired by David, my student. And other condition we called the Sisyphic condition. And if you remember the story about Sisyphus, was punished by the gods to push the same up a hill, and when he almost got to the end, rock would roll over, and he would have to again. And you can think about this as the essence of doing futile work. can imagine that if he pushed the rock on different hills, least he would have some sense of progress. Also, if you look prison movies, sometimes the way that the guards torture the is to get them to dig a hole, and when prisoner is finished, they ask him to fill the hole back up and dig again. There’s something about this cyclical version of doing something over and over and that seems to be particularly demotivating.
So in the second condition this experiment, that’s exactly what we did. We asked people, “Would you like to build Bionicle for three dollars?” And if they said yes, built it. Then we asked them, “Do you want to build another one $2.70?” And if they said yes, we gave them new one, and as they were building it, we took the one that they just finished. And when they that, we said, “Would you like to build another one, this time for 30 less?” And if they said yes, we gave them the that they built and we broke. So this was endless cycle of them building, and us destroying in front of their eyes.
Now what happens you compare these two conditions? The first thing that happened that people built many more Bionicles — eleven in meaningful condition, versus seven in the Sisyphus condition. And by way, we should point out that this was not meaning. People were not curing cancer or building bridges. were building Bionicles for a few cents. And not only that, everybody knew that Bionicles would be destroyed quite soon. So there was not a real opportunity for big meaning. even the small meaning made a difference.
Now we another version of this experiment. In this other version the experiment, we didn’t put people in this situation, just described to them the situation, much as I am describing you now, and we asked them to predict what the result be. What happened? People predicted the right direction but the right magnitude. People who were just given the of the experiment said that in the meaningful condition, people would probably build more Bionicle. So people understand that meaning is important, they just don’t understand the magnitude the importance, the extent to which it’s important.
There one other piece of data we looked at. If you about it, there are some people who love Legos, and people who don’t. And you would speculate that the who love Legos would build more Legos, even for less money, because after all, get more internal joy from it. And the people who love less would build less Legos because the enjoyment that they derive from is lower. And that’s actually what we found in meaningful condition. There was a very nice correlation between love of Legos and the amount of Legos people built.
What happened in the Sisyphic condition? In that condition, the was zero — there was no relationship between the love of Legos, and much people built, which suggests to me that with this manipulation breaking things in front of people’s eyes, we basically crushed any joy that they could get out this activity. We basically eliminated it.
Soon after I finished running experiment, I went to talk to a big software company Seattle. I can’t tell you who they were, but they were a big company in Seattle. was a group within the software company that was in a different building, and they asked them to innovate, create the next big product for this company. And the before I showed up, the CEO of this big company went to that group, 200 engineers, and canceled project. And I stood there in front of 200 of the depressed people I’ve ever talked to. And I described them some of these Lego experiments, and they said felt like they had just been through that experiment. And I them, I said, “How many of you now show up work later than you used to?” And everybody raised hand. I said, “How many of you now go home earlier you used to?” Everybody raised their hand. I asked them, “How many of you now add not-so-kosher things to your reports?” And they didn’t raise their hands, but they took me out to dinner and me what they could do with expense reports. And I asked them, I said, “What could the CEO have done make you not as depressed?” And they came up with all of ideas.
They said the CEO could have asked them to to the whole company about their journey over the last years and what they decided to do. He could asked them to think about which aspect of their could fit with other parts of the organization. He could have asked them to some next-generation prototypes, and see how they would work. But the thing that any one of those would require some effort and motivation. And I think the CEO did not understand the importance of meaning. If the CEO, just like our participants, thought the essence of is unimportant, then he [wouldn’t] care. And he would say, “At the moment I directed you in this way, and that I’m directing you in this way, everything will okay.” But if you understood how important meaning is, then would figure out that it’s actually important to spend some time, energy and effort in people to care more about what they’re doing.
The next experiment slightly different. We took a sheet of paper with random letters, and we asked people to find pairs letters that were identical next to each other. That was the task. People did first sheet, then we asked if they wanted to do another a little less money, the next sheet for a little less, and so on and so forth. And we had three conditions. the first condition, people wrote their name on the sheet, all the pairs of letters, gave it to the experimenter, the would look at it, scan it from top to bottom, say “Uh huh,” and put it the pile next to them. In the second condition, people not write their name on it. The experimenter looked at it, took the sheet paper, did not look at it, did not scan it, and put it on the pile of pages. So you a piece, you just put it on the side. the third condition, the experimenter got the sheet of paper, and put it directly a shredder.
(Laughter)
What happened in those three conditions?
In this plot I’m showing you at what pay rate stopped. So low numbers mean that people worked harder. They worked for much longer. the acknowledged condition, people worked all the way down to 15 cents. 15 cents per page, they basically stopped these efforts. In shredder condition, it was twice as much — 30 cents per sheet.
And this basically the result we had before. You shred people’s efforts, — you get them not to be as happy what they’re doing. But I should point out, by the way, in the shredder condition, people could have cheated. They have done not so good work, because they realized people were just shredding it. So maybe the sheet you’d do good work, but then you see nobody is really testing it, so you would do and more and more. So in fact, in the condition, people could have submitted more work and gotten more money, and put less into it. But what about the ignored condition? Would ignored condition be more like the acknowledged or more the shredder, or somewhere in the middle? It turns out was almost like the shredder.
Now there’s good news and news here. The bad news is that ignoring the performance people is almost as bad as shredding their effort in front their eyes. Ignoring gets you a whole way out there. good news is that by simply looking at something that somebody done, scanning it and saying “Uh huh,” that seems be quite sufficient to dramatically improve people’s motivations. So good news is that adding motivation doesn’t seem to so difficult. The bad news is that eliminating motivations seems to be incredibly easy, and we don’t think about it carefully, we might overdo it. So this is all in terms negative motivation, or eliminating negative motivation.
The next part want to show you is something about positive motivation. there is a store in the U.S. called IKEA. And IKEA is a store kind of okay furniture that takes a long time assemble.
(Laughter)
I don’t know about you, but every I assemble one of those, it takes me much longer, it’s more effortful, it’s much more confusing, I put things the wrong way — I can’t say I enjoy pieces. I can’t say I enjoy the process. But I finish it, I seem to like those IKEA pieces of furniture more than like other ones.
(Laughter)
And there’s an old story about cake mixes. So when started cake mixes in the ’40s, they would take this powder and they would it in a box, and they would ask housewives to pour it in, stir some water in it, mix it, put it in oven, and — voila — you had cake. But it turns they were very unpopular. People did not want them, they thought about all kinds of reasons for that. Maybe the was not good? No, the taste was great. What they out was that there was not enough effort involved. It was so easy that nobody could serve to their guests and say, “Here is my cake.” No, it was somebody else’s cake, if you bought it in the store. It didn’t really feel like your own. So what they do? They took the eggs and the milk out of the powder.
(Laughter)
Now you had break the eggs and add them, you had to measure the milk and add it, it. Now it was your cake. Now everything was fine.
(Laughter)
(Applause)
Now, think a little bit like the IKEA effect, by getting people to work harder, they got them to love what they’re doing to a higher degree.
So how do look at this question experimentally? We asked people to build some origami. gave them instructions on how to create origami, and we gave them sheet of paper. And these were all novices, and they built something that was quite ugly — nothing like a frog or a crane. then we told them, “Look, this origami really belongs to us. You worked us, but I’ll tell you what, we’ll sell it to you. How much do you want to pay it?” And we measured how much they were willing to for it. And we had two types of people: We the people who built it, and the people who not build it, and just looked at it as observers. And what we found was that the builders that these were beautiful pieces of origami —
(Laughter)
and they were willing to pay five times for them than the people who just evaluated them externally. Now you could say — if were a builder, do you think [you’d say], “Oh, I this origami, but I know that nobody else would love it?” “I love this origami, and everybody else will love it well?” Which one of those two is correct? Turns out the builders not only loved the more, they thought that everybody would see the world in view. They thought everybody else would love it more as well.
In the next version, tried to do the IKEA effect. We tried to make it more difficult. So for some people, we the same task. For some people, we made it harder by hiding instructions. At the top of the sheet, we had little diagrams of how fold origami. For some people, we just eliminated that. So now this was tougher. What happened? Well an objective way, the origami now was uglier, it was more difficult. Now when we looked at the origami, we saw the same thing — builders loved it more, evaluators loved it less. When you looked the hard instructions, the effect was larger. Why? Because now builders loved it even more.
(Laughter)
They put all extra effort into it. And evaluators? They loved it less. Because in reality, it was even uglier than first version.
(Laughter)
Of course, this tells you something about we evaluate things.
Now think about kids. Imagine I asked you, “How much you sell your kids for?” Your memories and associations and on. Most people would say for a lot, a of money.
(Laughter)
On good days.
(Laughter)
But imagine this was different. Imagine if you did not have your kids. And day you went to the park and you met kids. They were just like your kids, and you with them for a few hours, and when you were about to leave, the parents said, “Hey, by way, just before you leave, if you’re interested, they’re for sale.”
(Laughter)
How much you pay for them now? Most people say not that much. And this is because our are so valuable, not just because of who they are, but because us, because they are so connected to us, and because of the time and connection. By way, if you think IKEA instructions are not good, about the instructions that come with kids, those are tough.
(Laughter)
By the way, these are my kids, which, of course, are wonderful and so on. Which comes tell you one more thing, which is, much like our builders, when they look at creature of their creation, we don’t see that other don’t see things our way.
Let me say one comment. If you think about Adam Smith versus Karl Marx, Smith had a very important notion of efficiency. He gave example of a pin factory. He said pins have 12 different steps, and one person does all 12 steps, production is very low. But you get one person to do step one, and one person to do step two and step three so on, production can increase tremendously. And indeed, this is a great example, and the reason for Industrial Revolution and efficiency. Karl Marx, on the other hand, said that the of labor is incredibly important in how people think about the connection to what they are doing. if you do all 12 steps, you care about the pin. But you do one step every time, maybe you don’t care as much.
I think that in Industrial Revolution, Adam Smith was more correct than Karl Marx. But the reality is that we’ve switched, now we’re in the knowledge economy. You can ask yourself, happens in a knowledge economy? Is efficiency still more than meaning? I think the answer is no. I think as we move to situations in which people have to on their own about how much effort, attention, caring, how they feel to it, are they thinking about labor on the way work, and in the shower and so on, all of a sudden has more things to say to us. So when we think about labor, usually think about motivation and payment as the same thing, the reality is that we should probably add all kinds things to it — meaning, creation, challenges, ownership, identity, pride, etc.
The good news is that if we added all of components and thought about them — how do we create our meaning, pride, motivation, and how do we do it in workplace, and for the employees — I think we could get people be both more productive and happier.
Thank you very much.