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