I want to talk a little bit today labor and work.
When we think about how people work, the naive intuition we is that people are like rats in a maze — that all people care about is money, and moment we give them money, we can direct them to work one way, we can 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 the time, if you think about it, there’s all kinds of behaviors in the world around us. Think about something like mountaineering and mountain climbing. If you read books people who climb mountains, difficult mountains, do you think that those are full of moments of joy and happiness? No, they full of misery. In fact, it’s all about frostbite and having difficulty walking, and difficulty — cold, challenging circumstances. And if people were just to be happy, the moment they would get to top, they would say, “This was a terrible mistake. I’ll never do again.”
(Laughter)
“Instead, let me sit on a beach somewhere drinking mojitos.” But instead, people go down, and 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, peak. It suggests that we care about the fight, the challenge. It suggests that there’s all kinds of other things that motivate to work or behave in all kinds of ways.
And for me personally, I started thinking about after a student came to visit me. This was one my students from a few years earlier, and he came one day back to campus. And he told the following story: He said that for more than weeks, he was working on a PowerPoint presentation. He working in a big bank, and this was in preparation a merger and acquisition. And he was working very on this presentation — graphs, tables, information. He stayed at night every day. And the day before it was due, he his PowerPoint presentation to his boss, and his boss wrote back and said, “Nice presentation, but the merger is canceled.” And the guy was depressed. Now 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 nobody would ever watch it made him quite depressed.
So I started thinking how do we experiment with this idea of the of our labor. And to start with, we created a little experiment in which we people Legos, and we asked them to build with Legos. And for some people, we gave Legos and we said, “Hey, would you like to this Bionicle for three dollars? We’ll pay you three dollars for it.” And people said yes, they built with 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 they 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 so on, until at point people said, “No more. It’s not worth it for me.” This what we called the meaningful condition. People built one Bionicle after another. After they finished every one them, we put them under the table. And we told that at the end of the experiment, we will take all these Bionicles, we disassemble them, we will put them back in the boxes, and will use it for the next participant.
There was condition. This other condition was inspired by David, my student. this other condition 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 got to end, the rock would roll over, and he would have start again. And you can think about this as the of doing futile work. You can imagine that if he pushed the rock on different hills, least he would have some sense of progress. Also, you look at prison movies, sometimes the way that the torture the prisoners is to get them to dig a hole, and the prisoner is finished, they ask him to fill the hole back up then dig again. There’s something about this cyclical version of something over 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 Bionicle for three dollars?” And if they said yes, they it. Then we asked them, “Do you want to another one for $2.70?” And if they said yes, we them a new one, and as they were building it, we took 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?” if they said yes, we gave them the one that built and we broke. So this was an endless cycle of building, and us destroying in front of their eyes.
Now what happens when you compare these two conditions? first thing that happened was that people built many more — eleven in the meaningful condition, versus seven in Sisyphus condition. And by the way, we should point out this was not big meaning. People were not curing cancer or building bridges. were building Bionicles for a few cents. And not only that, everybody knew the Bionicles would be destroyed quite soon. So there was a real opportunity for big meaning. But even the small meaning a difference.
Now we had another version of this experiment. In this other of the experiment, we didn’t put people in this situation, we just described them the situation, much as I am describing to you now, and asked them to predict what the result would be. What happened? People the right direction but not the right magnitude. People who were just the description of the experiment said that in the meaningful condition, people would probably one more Bionicle. So people understand that meaning is important, just don’t understand the magnitude of 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 people love Legos, and some people who don’t. And you would speculate the people who love Legos would build more Legos, even for less money, because after all, they get internal joy from it. And the people who love Legos less would build less Legos the enjoyment that they derive from it is lower. that’s actually what 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 the love of Legos, and how much people built, which suggests to me that 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 a big software in Seattle. I can’t tell you who they were, but were a big company in Seattle. This was a within the software company that was put in a different building, and they asked them innovate, and create the next big product for this company. And the before I showed up, the CEO of this big company went to that group, 200 engineers, and canceled project. And I stood there in front of 200 of the depressed people I’ve ever talked to. And I described to them some of these experiments, and they said they felt like they had just been through that experiment. And I asked them, said, “How many of you now show up to work than you used to?” And everybody raised their hand. said, “How many of you now go home earlier than you to?” Everybody raised their hand. I asked them, “How many of now add not-so-kosher things to your expense reports?” And didn’t raise their hands, but they took me out to and showed me what they could do with expense reports. And then I asked them, said, “What could the CEO have done to make not as depressed?” And they came up with all kinds ideas.
They said the CEO could have asked them to present to the company about their journey over the last two years and what decided to do. He could have asked them to think about which aspect of their could fit with other parts of the organization. He could asked them to build some next-generation prototypes, and see how they would work. But the thing is that one of those would require some effort and motivation. And I think the CEO basically did not understand importance of meaning. If the CEO, just like our participants, thought the essence of meaning is unimportant, then [wouldn’t] care. And he would say, “At the moment I directed you 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 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 asked people to find pairs of letters that identical next to each other. That was the task. People did the first sheet, we asked if they wanted to do another for a little less money, the next for a little bit less, and so on and forth. And we had three conditions. In the first condition, people wrote their name on sheet, found all the pairs of letters, gave it to experimenter, the experimenter would look at it, scan it from to bottom, say “Uh huh,” and put it on the pile next to them. In the second condition, did not write their name on 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 put it on the side. In the condition, the experimenter got the sheet of paper, and put it directly a shredder.
(Laughter)
What happened in those three conditions?
In this plot I’m you at what pay rate people stopped. So low mean that people worked harder. They worked for much longer. In acknowledged condition, people worked all the way down to 15 cents. At 15 cents page, they basically stopped these efforts. In the shredder condition, it was twice as much — 30 cents sheet.
And this is basically the result we had before. You shred people’s efforts, output — you get them to be as happy with what they’re doing. But should point out, by the way, that in the shredder condition, people could have cheated. They have done not so good work, because they realized people just shredding 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. in fact, in the shredder condition, people could have submitted more work and gotten more money, and less effort into it. But what about the ignored condition? Would the ignored condition be more like acknowledged or more like the shredder, or somewhere in the middle? turns out it was almost like the shredder.
Now there’s good news and bad news here. The news is that ignoring the performance of people is almost as bad as shredding effort in 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, scanning it and “Uh huh,” that seems to be quite sufficient to improve people’s motivations. So the good news is that adding motivation doesn’t seem be so difficult. The bad news is that eliminating motivations seems to be easy, and if we don’t think about it carefully, we overdo it. So this is all in terms of negative motivation, eliminating negative motivation.
The next part I want to show you something about positive motivation. So there is a store in the U.S. IKEA. And IKEA is a store with kind of okay that takes a long time to assemble.
(Laughter)
I don’t know you, but every time I assemble one of those, it takes me longer, it’s much more effortful, it’s much more confusing, I put things in the way — I can’t say I enjoy those pieces. I can’t say I the process. But when I finish it, I seem to like those IKEA pieces of more than I 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 in a box, and they would ask housewives to basically pour it in, stir some in it, mix it, put it in the oven, — voila — you had cake. But it turns they were very unpopular. People did not want them, and thought about all kinds of reasons for that. Maybe the was not good? No, the taste was great. What they figured out was that there not enough effort involved. It was so easy that nobody could serve cake their guests and say, “Here is my cake.” No, was somebody else’s cake, as if you bought it the store. It didn’t really feel like your own. So what they do? They took the eggs and the milk of the 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 your cake. Now was fine.
(Laughter)
(Applause)
Now, I think a little bit like IKEA effect, by getting people to work harder, they actually got them to love what they’re doing a higher degree.
So how do we look at question experimentally? We asked people to build some origami. We gave them instructions on how create origami, and we gave them a sheet of paper. And these all novices, and they built something that was really quite — nothing like a frog or a crane. But then told them, “Look, this origami really belongs to us. You worked for us, but I’ll 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 of people: We had the people who built it, and the people did not build it, and just looked at it as external observers. And what we found was that builders thought 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. you could say — if you were a builder, you think [you’d say], “Oh, I love this origami, but know that nobody else would love it?” Or “I love this origami, everybody else will love it as well?” Which one of two is correct? Turns out the builders not only loved the more, they thought that everybody would see the world in view. They thought everybody else would love it more as well.
In the next version, tried to do the IKEA effect. We tried to make it more difficult. for some people, we gave the same task. For some people, we made it harder by hiding instructions. At the top of the sheet, we had little diagrams of how you origami. For some people, we just eliminated that. So now was tougher. What happened? Well in an objective way, the origami now uglier, it was more difficult. Now when we looked at the easy origami, we the same thing — builders loved it more, evaluators loved it less. you looked at the hard instructions, the effect was larger. Why? Because the builders loved it even more.
(Laughter)
They put this 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 tells something about how we evaluate things.
Now think about kids. Imagine I asked you, “How 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 kids. And one day you went to the park and you met some kids. They were just your 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 for sale.”
(Laughter)
How would you pay for them now? Most people say that much. And this is because our kids are so valuable, just because of who they are, but because of us, because they are connected to us, and because of the time and connection. the way, if you think IKEA instructions are not good, what about the instructions come with 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 like builders, when they look at the creature of their creation, we don’t that other people don’t see things our way.
Let me say last comment. If you think about Adam Smith versus Karl Marx, Adam Smith had a important notion of efficiency. He gave an example of pin factory. He said pins have 12 different steps, and if one person all 12 steps, production is very low. But if you get one person do step one, and one person to do step two step three and so on, production can increase tremendously. And indeed, this a great example, and the reason for the Industrial Revolution efficiency. Karl Marx, on the other hand, said that the alienation of labor incredibly important in how people think about the connection to what are doing. And if you do all 12 steps, you care about the pin. But if do one step every time, maybe you don’t care much.
I think that in the Industrial Revolution, Adam was more correct than Karl Marx. But the reality that we’ve switched, and now we’re in the knowledge economy. You can ask yourself, what happens in knowledge economy? Is efficiency still more important than meaning? think the answer is no. I think that as we move to situations which people have to decide on their own about how much effort, attention, caring, how they feel to it, are they thinking about labor the way to work, and in the shower and so on, all of a sudden has more things to say to us. So when we about labor, we usually think about motivation and payment as the thing, but the reality is that we should probably add all kinds of to it — meaning, creation, challenges, ownership, identity, pride, etc.
The good is that if we added all of those components and thought about them — how we create our own meaning, pride, motivation, and how do we do it in our workplace, and for employees — I think we could get people to be more productive and happier.
Thank you very much.