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