I want to a little bit today about labor and work.
When think about how people work, the naive intuition we have is that people are like rats a 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 labor market looks like.
At the same time, if think about it, there’s all kinds of strange behaviors in the around us. Think about something like mountaineering and mountain climbing. If you read books of who climb mountains, difficult mountains, do you think that those books full of moments of joy and happiness? No, they are full misery. In fact, it’s all about frostbite and having walking, and difficulty breathing — cold, challenging circumstances. And if people were just to be happy, the 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 go up again. And you think about mountain climbing as an example, it all kinds of things. It suggests that we care about the end, a peak. It suggests that we care about the fight, about the challenge. 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 to visit me. This was one of students from a few years earlier, and he came 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. was working in a big bank, and this was preparation for a merger and acquisition. And he was working very hard this presentation — graphs, tables, information. He stayed late at every day. And the day before 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 was working, he was actually quite happy. Every night he was enjoying his work, was staying 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 fruits of our labor. And to start with, created a little experiment in which we gave people Legos, and we 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.” people said yes, and they built with these Legos. when they finished, we took it, we put it the table, and we said, “Would you like to another one, this time for $2.70?” If they said yes, we gave them one, and when they finished, we asked them, “Do want to build another one?” for $2.40, $2.10, and on, until at some point people said, “No more. It’s not it for me.” This was what we called the condition. People built one Bionicle after another. After they finished one of them, we put them under the table. And we told them that at the end the experiment, we will take all these Bionicles, we will disassemble them, we will them back in the boxes, and we will use for the next participant.
There was another condition. This other condition was by David, my student. And this other condition we called the Sisyphic condition. if you remember the story about Sisyphus, Sisyphus was punished by the gods to push the rock up a hill, and when he almost got to the end, the rock roll over, and he would have to start again. And you can about this as the essence of doing futile work. You can imagine that if he pushed rock on different hills, at least he would have some of progress. Also, if you look at prison movies, the way that the guards torture the prisoners is get them to dig a hole, and when the prisoner is finished, they ask him fill the hole back up and then dig again. There’s something this cyclical version of doing something over and over over that seems to be particularly demotivating.
So in the condition of this experiment, that’s exactly what we did. We asked people, “Would you like to one Bionicle for three dollars?” And if they said yes, they built it. Then we them, “Do you want to build another one for $2.70?” And if they said yes, we them a new one, and as they were building it, we took apart one that they just finished. And when they finished that, we said, “Would like to build another one, this time for 30 cents less?” And if they said yes, we gave the one that they built and we broke. So this was an endless cycle of them building, 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 Bionicles — eleven in the meaningful condition, seven in the Sisyphus condition. And by the way, should point out that this was not big meaning. People were not curing cancer or bridges. People were building Bionicles for a few cents. And not only that, everybody knew that Bionicles would 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 the experiment, we didn’t put people in this situation, just described to them the situation, much as I am to you now, and we asked them to predict the result would be. What happened? People predicted the right direction but the right magnitude. People who were just given the of the experiment said that in the meaningful condition, people probably build one more Bionicle. So people understand that meaning important, they just don’t understand the magnitude of the importance, the to which it’s important.
There was one other piece 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 all, they get more internal joy from it. And the who love Legos less would build less Legos because enjoyment that they derive from it is lower. And that’s actually what found in the meaningful condition. There was a very nice correlation between the of Legos and the amount of Legos people built.
What happened in the Sisyphic condition? In that condition, correlation was zero — there was no relationship between the love Legos, and how much people built, which suggests to me with this manipulation of breaking things in front of people’s eyes, we basically crushed any joy they could get out of this activity. We basically eliminated it.
Soon after I running this experiment, I went to talk to a software company 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 that was put a different building, and they asked them to innovate, and the next big product for this company. And the week before I showed up, the CEO of big 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 experiments, and they said they felt like they had just been through experiment. And I asked them, I said, “How many of you now show up to work than you used to?” And everybody raised their hand. I said, “How of you now go home earlier than you used to?” Everybody their hand. I asked them, “How many of you now add not-so-kosher things to your 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 I asked them, I said, “What could the CEO have done make you not as depressed?” And they came up with all kinds of ideas.
They the CEO could have asked them to present to the whole company about their journey over the two years and what they decided to do. He could have them to think about which aspect of their technology could fit with parts of the organization. He could have asked them build 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 basically did not understand the importance of meaning. If CEO, just like our participants, thought the essence of meaning is unimportant, then he [wouldn’t] care. he would say, “At the moment I directed you in way, and now 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 actually to spend some time, energy and effort in getting people care more about what they’re doing.
The next experiment was slightly different. We took a sheet of with random letters, and we asked people to find pairs letters that were identical next to each other. That was the task. People did first sheet, then we asked if they wanted to do another for a little less money, the next for a little bit less, and so on and so forth. And had three conditions. In the first condition, people wrote their on the sheet, found all the pairs of letters, gave it the experimenter, the experimenter would look at it, scan it from top bottom, say “Uh huh,” and put it on the pile next to them. In second condition, people did not write their name on it. experimenter looked at it, took the sheet of paper, not look at it, did not scan it, and put it on the pile of pages. So you take a piece, just put it on the side. In the third condition, the got the sheet of paper, and put it directly into 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. the acknowledged condition, people worked all the way down to 15 cents. At 15 cents per page, basically stopped these efforts. In the shredder condition, it twice as much — 30 cents per sheet.
And this is basically the we had before. You shred people’s efforts, output — you get not to be as happy with what they’re doing. I should point out, by the way, that in the condition, people 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 good work, but then you see nobody is really it, so you would do more and more and more. So in fact, in the shredder condition, people could submitted more work and gotten more money, and put less into it. But what about the ignored condition? Would ignored condition be more like the acknowledged or more like the shredder, or in the middle? It turns out it was almost the shredder.
Now there’s good news and bad news here. The bad is that ignoring the performance of people is almost as as shredding their effort in front of their eyes. gets you a whole way out there. The good news is that by simply looking at that somebody has done, scanning it and saying “Uh huh,” that seems be quite sufficient to dramatically improve people’s motivations. So the good news that adding motivation doesn’t seem to be so difficult. The bad news is eliminating motivations seems to be incredibly easy, and if we don’t think about it carefully, might overdo it. So this is all in terms of motivation, or eliminating negative motivation.
The next part I want to show you is something about motivation. So there is a store in the U.S. called IKEA. And IKEA a store with kind of okay furniture that takes a time to assemble.
(Laughter)
I don’t know about you, every time I assemble one of those, it takes me much longer, it’s much more effortful, it’s much confusing, I put things in the wrong way — I can’t I enjoy those pieces. I can’t say I enjoy the process. But when finish it, I seem to like those IKEA pieces of furniture more than I like ones.
(Laughter)
And there’s an old story about cake mixes. So when they started cake mixes in ’40s, they would take this powder and they would put it a box, and they would ask housewives to basically pour it in, stir some water in it, it, put it in the oven, and — voila — had cake. But it turns out they were very unpopular. did not want them, and they thought about all kinds of reasons that. Maybe the taste was not good? No, the taste was great. What they out was that there was not enough effort involved. was so easy that nobody could serve cake to their guests and say, “Here is cake.” No, it was somebody else’s cake, as if bought it in the store. It didn’t really feel your own. So what did they do? They took the eggs the milk out of the powder.
(Laughter)
Now you had to the eggs and add them, you had to measure the milk add it, mixing it. Now it was your cake. Now everything fine.
(Laughter)
(Applause)
Now, I think a little bit like the IKEA effect, by getting to work harder, they actually got them to love they’re doing to a higher degree.
So how do look at this question experimentally? We asked people to build some origami. We gave instructions on how to create origami, and we gave a sheet of paper. And these were all novices, and they built that was really quite ugly — nothing like a frog a crane. But then we told them, “Look, this origami really belongs us. You worked for us, but I’ll tell you what, we’ll sell it to you. How much do want to pay for it?” And we measured how much they were to pay for it. And we had two types of people: We had the people who built it, the people who did not build it, and just looked at as external observers. And what we found was that the thought that these were beautiful pieces of origami —
(Laughter)
and they were willing to pay five times more for 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 else would love it?” “I love this origami, and everybody else will love it well?” Which one of those two is correct? Turns the builders not only loved the origami more, they that everybody would see the world in their view. They thought everybody else would it more as well.
In the next version, we tried to do the IKEA effect. We tried make it more difficult. So for some people, we gave same task. For some people, we made it harder by hiding the instructions. At the of the sheet, we had little diagrams of how you origami. For some people, we just eliminated that. So this was tougher. What happened? Well in an objective way, the origami now was uglier, was more difficult. Now when we looked at the origami, we saw the same thing — builders loved more, evaluators loved it less. When you looked at the instructions, the effect was larger. Why? Because now the builders loved even more.
(Laughter)
They put all this extra effort into it. And evaluators? They loved it less. Because in reality, it was even uglier than first version.
(Laughter)
Of course, this tells you something how we evaluate things.
Now think about kids. Imagine asked you, “How much would you sell your kids for?” Your and associations and so on. Most people would say for a lot, 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 the park you met some kids. They were just like your kids, and you played with for a few hours, and when you were about to leave, parents said, “Hey, by the way, just before you leave, you’re interested, they’re for sale.”
(Laughter)
How much would you pay for now? Most people say not that much. And this is because our are so valuable, not just because of who they are, but because us, because they are so connected to us, and because of the and connection. By the way, if you think IKEA instructions are not good, what the instructions that come with kids, those are really tough.
(Laughter)
By the way, these my kids, which, of course, are wonderful 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 that people don’t see things our way.
Let me say one last comment. If you think Adam Smith versus Karl Marx, Adam Smith had a very important notion efficiency. He gave an example of a pin factory. said pins have 12 different steps, and if one person does 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 is great example, and the reason for the Industrial Revolution and efficiency. Karl Marx, on the hand, said that the alienation of labor is incredibly important in how people think the connection to what they are doing. And if you do 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 Smith more correct than Karl Marx. But the reality is that we’ve switched, and we’re in the knowledge economy. You can ask yourself, what happens in a economy? Is efficiency still more important than meaning? I think the answer is no. I think that we move to situations in which people have to on their own about how much effort, attention, caring, how they feel to it, are they thinking about labor on the way work, and in the shower and so on, all of sudden Marx has more things to say to us. So when think about labor, we usually think about motivation and payment as same thing, but the reality is that we should probably add all kinds of to it — meaning, creation, challenges, ownership, identity, pride, etc.
The good news 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 the employees — I think we could get people be both more productive and happier.
Thank you very much.