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