I want to talk a little today about labor and work.
When we think about people work, the naive intuition we have is that people are like rats in a maze — all people care about is money, and the moment we give money, we can direct them to work one way, 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 same time, if you think about it, there’s all of strange behaviors in the 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 are of misery. In fact, it’s all about frostbite and having difficulty walking, and difficulty — cold, challenging circumstances. And if people were just trying to happy, the moment they would get to the top, they would say, “This was a terrible mistake. I’ll 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 you think about mountain climbing an example, it suggests all kinds of things. It that we care about reaching the end, a peak. It suggests that we care about the fight, about challenge. It suggests that there’s all kinds of other things that motivate to work or behave in all kinds of ways.
And me personally, I started thinking about this after a student came visit me. This was one of my students from a years earlier, and he came one day back to campus. And he told me the following story: said that for more than two weeks, he was working on a PowerPoint presentation. He was working a big bank, and this was in preparation for a merger and acquisition. And was working 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 boss, and his boss wrote him back and said, “Nice presentation, but the merger is canceled.” And guy was deeply depressed. Now at the moment when he was working, was actually quite happy. Every night he was enjoying work, he was staying late, he was perfecting this PowerPoint presentation. But knowing that would ever watch it made him quite depressed.
So I started thinking about how do we experiment with idea of the fruits of our labor. And to start with, we a little experiment in which we gave people Legos, and we asked them to build Legos. And for some people, we gave them Legos and we said, “Hey, would you like build this Bionicle for three dollars? We’ll pay you 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, we said, “Would you like to build another one, this time for $2.70?” If they yes, we gave them another one, and when they finished, asked them, “Do you want to build another one?” $2.40, $2.10, and so on, until at some point said, “No more. It’s not worth it for me.” was what we called the meaningful condition. People built one after another. After they finished every one of them, put them under the table. And we told them that at end of the experiment, we will take all these Bionicles, we will disassemble them, will put them back in the boxes, and we use it for the next participant.
There was another condition. This other was inspired by David, my student. And this other we called the Sisyphic condition. And if you remember the about Sisyphus, Sisyphus was punished by the gods to push the same up a hill, and when he almost got to end, the rock would roll over, and he would have to start again. And you think about this as the essence of doing futile work. You imagine that if he pushed the rock on different hills, least he would have some sense of progress. Also, if you at prison movies, sometimes the way that the guards the prisoners is to get them to dig a hole, and when the prisoner is finished, they him to fill the hole back up and then again. There’s something about this cyclical version of doing over and over and over that seems to be demotivating.
So in the second condition of this experiment, that’s what we did. We asked people, “Would you like build one Bionicle for three dollars?” And if they yes, they built it. Then we asked them, “Do you want to build one for $2.70?” And if they said yes, we them a new one, and as they were building it, we took apart the that they just finished. And when they finished that, we said, “Would like to build another one, this time for 30 less?” And if they said yes, we gave them the one that they built and we broke. this was an endless cycle of them building, and us in front of their eyes.
Now what happens when you these two conditions? The first thing that happened was that built many more Bionicles — eleven in the meaningful condition, versus seven the Sisyphus condition. And by the way, we should out that this was not big meaning. People were not curing cancer or building bridges. People were Bionicles for a few cents. And not only that, everybody knew that the would be destroyed quite soon. So there was not a real for big meaning. But even the small meaning made a difference.
Now had another version of this experiment. In 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 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 Bionicle. So people understand that meaning is important, they just don’t understand the magnitude of the importance, extent to which it’s important.
There was one other piece data we looked at. If you think about it, there are people who love Legos, and some people who don’t. And would speculate that the people who love Legos would build more Legos, for less money, because after all, they get more internal from it. And the people who love Legos less build less Legos because the enjoyment that they derive from it is lower. that’s actually what we found in the meaningful condition. was a very nice correlation between the love of Legos and the of Legos people built.
What happened in the Sisyphic condition? In condition, the correlation was zero — there was no relationship the love of Legos, and how much people built, suggests to me that with this manipulation of breaking things in front people’s eyes, we basically crushed any joy that they could out of this activity. We basically eliminated it.
Soon after I running this experiment, I went to talk to a big software company in Seattle. can’t tell you who they were, but they were a big in Seattle. This was a group within the software company that was put in different building, and they asked them to innovate, and create the next big product this company. And the week before I showed up, the CEO of this software company went to that group, 200 engineers, and canceled the project. And I there in front of 200 of the most depressed people I’ve talked to. And I described to them some of these Lego experiments, and they said felt like they had just been through that experiment. And I asked them, said, “How many of you now show up to work later than you used to?” And raised their hand. I said, “How many of you now go home earlier 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 me what could do with expense reports. And then I asked them, I said, “What the CEO have done to make you not as depressed?” they came up with all kinds of ideas.
They said CEO could have asked them to present to the whole about their journey over the last two years and they decided to do. He could have asked them think about which aspect of 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 our participants, thought the essence of meaning is unimportant, 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 be okay.” if you understood how important meaning is, then you would figure out that it’s important to spend some time, energy and effort in getting people to more about what they’re doing.
The next experiment was slightly different. We took a sheet of paper with letters, and we asked people to find pairs of letters were identical next to each other. That was the task. People did the first sheet, then we if they wanted to do another 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 their name on the sheet, found all the pairs of letters, gave it to experimenter, the experimenter would look at it, scan it top to bottom, say “Uh huh,” and put it on the pile to them. In the second condition, people did not their name on it. The experimenter looked at it, the sheet of paper, did not look at it, not scan it, and simply put it on the pile pages. So you take a piece, you just put it on the side. In the third condition, the got the sheet of paper, and put it directly a shredder.
(Laughter)
What happened in those three conditions?
In plot I’m showing you at what pay rate people stopped. low numbers mean that people worked harder. They worked for much longer. In the 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 sheet.
And this is basically the result we had before. shred people’s efforts, output — you get them not be as happy with what they’re doing. But I should out, by the way, that in the shredder condition, people have cheated. They could have done not so good work, because they realized people were just shredding it. So 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, people have submitted more work and gotten more money, and put less effort into it. But what about the condition? Would the ignored condition be more like the acknowledged or more like the shredder, or in the middle? It turns out it was almost like 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 in front of their eyes. Ignoring gets you a whole way out there. The good news is that simply looking at something that somebody has done, scanning and saying “Uh huh,” that seems to be quite to dramatically improve people’s motivations. So the good news is adding motivation doesn’t seem to be so difficult. The news 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 part I want to show you is something about positive motivation. So there is a in 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 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 in the way — I can’t say I enjoy those pieces. 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 they would put it in box, and they would ask housewives to basically pour it in, stir some in it, mix it, put it in the oven, and — — 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 not good? No, the taste was great. What they out was that there was not enough effort involved. It was so easy nobody could serve cake to their guests and say, “Here my cake.” No, it was somebody else’s cake, as you bought it in the store. It didn’t really feel like your own. what did they do? They took the eggs and the milk out of powder.
(Laughter)
Now you had to break the eggs and add them, you to measure the milk and add it, mixing it. Now it was cake. Now everything was fine.
(Laughter)
(Applause)
Now, I a little bit like the IKEA effect, by getting people to harder, they actually got them to love what they’re to a higher degree.
So how do we look at this question experimentally? We people to build some origami. We gave them instructions how to create origami, and we gave them a sheet paper. And these were all novices, and they built something that was really ugly — nothing like 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 pay for it?” And we how much they were willing to pay for it. And we had two types of people: had the people who built it, and the people who did not build it, and looked at it as external observers. And what we found was that the builders thought 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 you [you’d say], “Oh, I love this origami, but I know that else would love it?” Or “I love this origami, everybody else will love it as well?” Which one those two is correct? Turns out the builders not only loved the origami more, they that everybody would see the world in their view. They thought everybody else would love it as well.
In the next version, we tried to the IKEA effect. We tried to make it more difficult. So for people, we gave the same task. For some people, we made harder by hiding the instructions. At the top of the sheet, had little diagrams of how you fold origami. For some people, we just that. So now this was tougher. What happened? Well an objective way, the origami now was uglier, it was difficult. Now when we looked at the easy origami, we saw same thing — builders loved it more, evaluators loved it less. When looked at the hard instructions, the effect was larger. Why? Because the builders loved it even more.
(Laughter)
They put all extra effort into it. And evaluators? They loved it even less. Because in reality, was even uglier than the first version.
(Laughter)
Of course, this you something about how we evaluate things.
Now think kids. Imagine I asked you, “How much would you sell your kids for?” Your memories and associations so on. Most people would say for a lot, lot of money.
(Laughter)
On good days.
(Laughter)
But 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 you were about to leave, the parents said, “Hey, the way, just before you leave, if you’re interested, they’re for sale.”
(Laughter)
How much would pay for them now? Most people say not that much. And this is because our kids so valuable, not just because of who they are, but because of us, because they so connected to us, and because of the time and connection. By way, if you think IKEA instructions are not good, what about instructions that come with kids, those are really tough.
(Laughter)
By the way, these are my kids, which, of course, wonderful and so on. Which comes to tell you one more thing, which is, much like our builders, they look at the creature of their creation, we don’t see that other people don’t see our way.
Let me say one last comment. If you about Adam Smith versus Karl Marx, Adam Smith had a very notion of efficiency. He gave an example of a pin factory. He said pins have 12 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 for the Industrial Revolution efficiency. Karl Marx, on the other hand, said that alienation 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 think that in the Industrial Revolution, Smith was more correct than Karl Marx. But the is that we’ve switched, and now we’re in the economy. You can ask yourself, what happens in a economy? Is efficiency still more important than meaning? I think the is no. I think that as we move to situations in which have to decide on their own about how much effort, attention, caring, connected they feel to it, are they thinking about labor on the way to work, and the shower and so on, all of a sudden Marx more things to say to us. So when we about labor, we usually think about motivation and payment as same thing, but the reality is that we should probably add all kinds of things 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 we create own meaning, pride, motivation, and how do we do it our workplace, and for the employees — I think we could get people to be both more and happier.
Thank you very much.