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