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