I want to talk little bit today about labor and work.
When we about how people work, the naive intuition we have is that people are like rats in maze — that all people care about is money, the moment we give them money, we can direct them work one way, we can direct them to work another way. is why we 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 looks like.
At same time, if you think about it, there’s all kinds of strange in the world around us. Think about something like mountaineering mountain climbing. If you read books of people who mountains, difficult mountains, do you think that those books are of moments of joy and happiness? No, they are full misery. In fact, it’s all about frostbite and having difficulty walking, and difficulty breathing — cold, circumstances. And if people were just trying to be happy, moment they would get to the top, they would say, “This was a terrible mistake. I’ll never do again.”
(Laughter)
“Instead, let me sit on a beach drinking mojitos.” But instead, people go down, and after recover, they go up again. And if you think mountain climbing as an example, it suggests all kinds of things. It suggests 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 motivate us to work or behave in all kinds ways.
And for me personally, I started thinking about this after a student to visit me. This was one of my students from a few years earlier, and he came one back 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 big bank, and this was in preparation for merger and acquisition. And he was working 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 his boss wrote him and said, “Nice presentation, but the merger is canceled.” And the was deeply 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 that nobody would watch it made him quite depressed.
So I started thinking about how do we experiment this idea of the fruits of our labor. And to start with, created a little experiment in which we gave people Legos, and we asked them build 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 dollars for it.” people said yes, and they built with these Legos. And when finished, we took it, we put it under the table, and said, “Would you like to build another one, this time for $2.70?” they said yes, we gave them another one, and they finished, we asked them, “Do you want to build one?” for $2.40, $2.10, and so on, until at some point people said, “No more. It’s not it for me.” This 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 the of the experiment, we will take all these Bionicles, we will disassemble them, we will put them in 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 condition called the Sisyphic condition. And if you remember the story about Sisyphus, Sisyphus was punished by the to push the same rock up a hill, and when he almost got to end, the rock would roll over, and he would have to start again. you can think about this as the essence of futile work. You can imagine that if he pushed the rock different hills, at least he would have some sense of progress. Also, if you at prison movies, sometimes the way that the guards torture the prisoners is to get them dig a hole, and when the prisoner is finished, they ask him to the hole back up and then dig again. There’s something about this cyclical version of something over and over and over that seems to be particularly demotivating.
So the second condition of this experiment, that’s exactly what we did. We asked people, “Would you to build one 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, took apart the one that they just finished. And when they finished that, said, “Would you like to build another one, this time for 30 cents less?” And if said yes, we gave them the one that they built and we broke. So this an endless cycle of them building, and us destroying in front of 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 the Sisyphus condition. by the way, we should point out that this was not big meaning. People were curing cancer or building bridges. People were building Bionicles a few cents. And not only that, everybody knew that the Bionicles be destroyed quite soon. So there was not a real opportunity big meaning. But even the small meaning made a difference.
Now we another version of this experiment. In this other version of the experiment, didn’t put people in this situation, we just described to them the situation, much as I describing to you now, and we asked them to what the result would be. What happened? People predicted right direction but not the right magnitude. People 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, just don’t understand the magnitude of the importance, the extent which it’s important.
There was one other piece of data we looked at. you think about it, there are some people who love Legos, and 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 get more internal joy it. And the people who love Legos less would build Legos because the enjoyment that they derive from it is lower. And that’s what we found in the meaningful condition. There was a very nice 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 of Legos, and how much people built, which suggests to me that with this manipulation of breaking things front of people’s eyes, we basically crushed any joy that could get out of this activity. We basically eliminated it.
Soon after I finished running 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 software company 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 software company went to group, 200 engineers, and canceled the project. And I stood there front of 200 of the most depressed people I’ve ever talked to. I described to them some of these Lego experiments, they said they felt like they had just been through experiment. And I asked them, I said, “How many you now show up to work later than you used to?” everybody raised their hand. I said, “How many of now go home earlier than 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 their hands, they took me out to dinner and showed me what they do with expense reports. And then I asked them, I said, “What could the CEO have to make you not as depressed?” And they came up all kinds of ideas.
They said the CEO could asked them to present to the whole company about their journey over the last two and what they decided to do. He could have them to think about which aspect of their technology could fit other parts of the organization. He could have asked them to some next-generation prototypes, and see how they would work. But the thing is that any of those would require some effort and motivation. And I think the CEO basically did not 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 directed in this way, and now that I’m directing you this way, everything will be okay.” But if you how important meaning is, then you would figure out that it’s actually important to spend some time, energy effort in getting people to care more about what they’re doing.
The next experiment was slightly different. We a sheet of paper with random letters, and we asked people find pairs of letters that were identical next to each other. That was the task. did the first sheet, then we asked if they wanted to do another for a little money, the next sheet for a little bit less, and so on and so forth. And had three conditions. In the first condition, people wrote name 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, “Uh huh,” and put it on the pile next to them. In second condition, people did not write their name on it. The experimenter at it, took the sheet of paper, did not look at it, did not scan it, and simply it on the pile of pages. So you take a piece, you just put it on the side. the third condition, the experimenter got the sheet of paper, and put directly into a shredder.
(Laughter)
What happened in those three conditions?
In plot I’m showing 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 as much — 30 cents per sheet.
And this is the result we had before. You shred people’s efforts, output — you get them not to as happy with what they’re doing. But I should out, by the way, that in the shredder condition, people could have cheated. They have done not so good work, because they realized people were just shredding it. So maybe the first 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 condition, people could have submitted more work and gotten more money, put less effort into it. But what about the ignored condition? Would the ignored condition more like the acknowledged or more like the shredder, 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 as bad as shredding their effort in front of eyes. Ignoring gets you a whole way out there. good news is that by simply looking at something that somebody done, scanning it and saying “Uh huh,” that seems to be quite sufficient to dramatically people’s motivations. So the good news is that adding 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 carefully, we might overdo it. So this is all terms of negative motivation, or eliminating negative motivation.
The next I want to show you is something about positive motivation. 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 every time assemble one of those, it takes me much longer, it’s much more effortful, it’s more confusing, I put things in the wrong way — can’t say I enjoy those pieces. I can’t say I enjoy the process. But when I it, I seem to like those IKEA pieces of furniture more than 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 a box, and they would ask housewives to basically pour it in, some water 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 they thought about kinds of reasons for that. Maybe the taste was good? No, the taste was great. What they figured out that there was not enough effort involved. It was so easy that nobody could serve to their guests and say, “Here is my cake.” No, it somebody else’s cake, as if you bought it in store. It didn’t really feel like your own. So 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 the and add it, mixing it. Now it was your cake. Now everything was fine.
(Laughter)
(Applause)
Now, think a little bit like the IKEA effect, by getting to work harder, they actually got them to love what they’re to a higher degree.
So how do we look this question experimentally? We asked people to build some origami. We gave them instructions how to create origami, and we gave them a sheet of paper. And 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 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 much they 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. And we found was that the builders thought that these were beautiful pieces origami —
(Laughter)
and they were willing to pay five times for them than the people who just evaluated them externally. Now you say — if you were a builder, do you [you’d say], “Oh, I love this origami, but I know that nobody would love it?” Or “I love this origami, and everybody else will love as well?” Which one of those two is correct? Turns out the not only loved the origami 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, we tried do 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, we little diagrams of how you fold origami. For some people, just eliminated that. So now this was tougher. What happened? Well an objective way, the origami now was uglier, it was more difficult. when we looked at the easy origami, we saw the same thing — builders loved it more, evaluators it less. When you looked at the hard instructions, the effect was larger. Why? Because now the loved it even more.
(Laughter)
They put all this extra effort it. And evaluators? They loved it even less. Because reality, it was even uglier than the first version.
(Laughter)
Of course, this tells something about how we evaluate things.
Now think about kids. Imagine asked you, “How much would you sell your kids for?” 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 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, and you with them for a few hours, and when you were about leave, the parents said, “Hey, by the way, just before you leave, 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 are so valuable, just because of who they are, but because of us, they are so connected to us, and because of the and connection. By the way, if you think IKEA are not good, what about the instructions that come with kids, those are really tough.
(Laughter)
By way, these are my kids, which, of course, are and so on. Which comes to tell you one thing, which is, much like our builders, when they at the creature of their creation, we don’t see other people don’t see things our way.
Let me one last comment. If you think about Adam Smith Karl Marx, Adam Smith had a very important notion efficiency. He gave an example of a pin factory. He 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 and three and so on, production can increase tremendously. And indeed, is a great example, and the reason for the Industrial and efficiency. Karl Marx, on the other hand, said that the of labor is incredibly important in how people think about connection to what they are doing. And if you all 12 steps, you care about the pin. But you do one step every time, maybe you don’t care as much.
I think in the Industrial Revolution, Adam 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 to situations in which people to decide on their own about how much effort, attention, caring, how connected feel to it, are they thinking about labor on the way to work, and in the and so on, all of a sudden Marx has more things to say to us. So when think about labor, we usually think about motivation and as the same thing, but the reality is that we should probably all kinds of things to it — meaning, creation, challenges, ownership, identity, pride, etc.
The news is that if we added all of those components and thought about — how do we create our own meaning, pride, motivation, and how do do it in our workplace, and for the employees — I think we get people to be both more productive and happier.
Thank very much.