I want to talk little bit today about labor and work.
When we think how people work, the naive intuition we have is people are like rats in a maze — that all care about is money, and the moment we give them money, we can direct to work one way, we can direct them to work another way. This is why we give bonuses bankers and pay in all kinds of ways. And we really this incredibly simplistic view of why people work, and what the labor market like.
At the same time, if you think about it, there’s all kinds of strange behaviors the world around us. Think about something like mountaineering and mountain climbing. If you books of people who climb mountains, difficult mountains, do think that those books are full of moments of joy happiness? No, they are full of misery. In fact, it’s all about frostbite having difficulty walking, and difficulty breathing — cold, challenging circumstances. if people were just trying to be happy, the they would get to the top, they would say, “This was terrible mistake. I’ll never do it again.”
(Laughter)
“Instead, let me sit on a somewhere drinking mojitos.” But instead, people go down, and after recover, they go up again. And if you think about mountain climbing as example, it suggests all kinds of things. It suggests that we care about reaching 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 us to work behave in all kinds of ways.
And for me personally, I started thinking about this after a student to visit me. This was one of my students a few years earlier, and he came one day back campus. And he told me the following story: He said that for more than two weeks, was working on a PowerPoint presentation. He was working in a big bank, and was in preparation for a merger and acquisition. And was working very hard on this presentation — graphs, tables, information. He stayed late night 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 canceled.” And the guy was deeply depressed. Now at the moment he was working, he was actually quite happy. Every he was enjoying his work, he was staying late, was perfecting this PowerPoint presentation. But knowing that nobody ever watch it made him quite depressed.
So I thinking about how do we experiment with this idea of the of our labor. And to start with, we created little experiment in which we gave people Legos, and asked them to build with Legos. And for some people, we gave them Legos and said, “Hey, would you like to build this Bionicle for three dollars? We’ll pay you three dollars it.” And people said yes, and they built with Legos. And when they finished, we took it, we put it the 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, we them, “Do you want to build another one?” for $2.40, $2.10, so on, until at some point people said, “No more. It’s worth it for me.” This was what we called the meaningful condition. built one Bionicle after another. After they finished every one them, we put them under the table. And we told them that at the end the experiment, we will take all these Bionicles, we disassemble them, we will put them back in the boxes, and we will use for the next participant.
There was another condition. This other condition inspired by David, my student. And this other condition we called the Sisyphic condition. And you remember the story about Sisyphus, Sisyphus was punished by the gods push the same rock up a hill, and when he almost to the end, the rock would roll over, and he would have to start again. And you can about this as the essence of doing futile work. You imagine that if he pushed the rock on different hills, at least he would have some sense progress. Also, if you look at prison movies, sometimes the that the guards torture the prisoners is to get them to dig a hole, when the prisoner is finished, they ask him to fill the hole up and then dig again. There’s something about 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 people, “Would you like to build one Bionicle for dollars?” And if they said yes, they built it. Then we asked them, “Do you want build another one for $2.70?” And if they said yes, we gave them a new one, and as were building it, we took apart the one that they just finished. And they finished that, we said, “Would you like to build another one, this time for 30 cents less?” if they said yes, we gave them the one that they built we broke. So this was an endless cycle of them building, and us in front of their eyes.
Now what happens when you compare 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 point that this was not big meaning. People were not curing cancer or building bridges. People were building Bionicles a few cents. And not only that, everybody knew that the Bionicles would be destroyed quite soon. there was not a real opportunity for big meaning. But the small meaning made a difference.
Now we had version of this experiment. In this other version of experiment, we didn’t put people in this situation, we just to them the situation, much as I am describing you now, and we asked them to predict what the result be. What happened? People predicted the right direction but not the right magnitude. People who just given the description of the experiment said that in the condition, people would probably build one more Bionicle. So people understand that meaning is important, they don’t understand the magnitude of the importance, the extent to it’s important.
There was one other piece of data we looked at. If you think about it, there some people who love Legos, and some people who don’t. And you speculate that the people who love Legos would build more Legos, for less money, because after all, they get more internal joy from it. And the people love Legos less would build less Legos because the that they derive from it is lower. And that’s actually we found in the meaningful condition. There was a very nice correlation between the love Legos and the amount of Legos people built.
What happened in the Sisyphic condition? In condition, the correlation was zero — there was no relationship between love of Legos, and how much people built, which to me that with this manipulation of breaking things front of people’s eyes, we basically crushed any joy that they could get out this activity. We basically eliminated it.
Soon after I finished running this experiment, I went to talk 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 building, and they asked them to innovate, and create next big product for this company. And the week before I showed up, CEO of this big software company went to that group, 200 engineers, and canceled the project. I stood there in front of 200 of the depressed people I’ve ever talked to. And I described to them of these Lego experiments, and they said they felt like they had just through that experiment. And I asked them, I said, “How many of 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 their hand. I asked them, “How many of you add not-so-kosher things to your expense reports?” And they didn’t their hands, but they took me out to dinner showed me what they could do with expense reports. And I asked them, I said, “What could the CEO done to make you not as depressed?” And they up with all kinds of ideas.
They said the CEO have asked them to present to the whole company about their journey over last two years and what they decided to do. He could have asked them to think about which of their technology could fit with other parts of the organization. He could have them to build some next-generation prototypes, and see how would work. But the thing is that any one those would require some effort and motivation. And I the CEO basically did not understand the importance of meaning. the CEO, just like our participants, thought the essence of is unimportant, then he [wouldn’t] care. And he would say, “At the moment I directed you this way, and now that I’m directing you in this way, everything will be okay.” But if understood how important meaning is, then you would figure out that it’s actually important to spend some time, and effort in getting people to care more about they’re doing.
The next experiment was slightly different. We took a sheet paper with random letters, and we asked people to find pairs letters that were identical next to each other. That was task. People did the first sheet, then we asked if wanted to do another for a little less money, the next sheet for little bit less, and so on and so forth. And had three conditions. In the first condition, people wrote their name the sheet, found all the pairs of letters, gave to the experimenter, the experimenter would look at it, scan it top to bottom, say “Uh huh,” and put it the pile next to them. In the second condition, people did not write name on it. The experimenter looked at it, took sheet of paper, did not look at it, did scan it, and simply put it on the pile of pages. So you a piece, you just put it on the side. In 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 numbers mean that people worked harder. They worked for longer. In the acknowledged condition, people worked all the way to 15 cents. At 15 cents per page, they basically stopped these efforts. In the shredder condition, it twice as much — 30 cents per sheet.
And this is basically the result we had before. You people’s efforts, output — you get them not to be as happy what they’re doing. But I should point out, by the way, that in the condition, people could have cheated. They could have done not so good work, because realized people were just shredding it. So maybe the sheet you’d do good work, but then you see is really testing it, so you would do more 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 condition? Would the ignored condition be more like the or more like the shredder, or somewhere in the middle? turns out it was almost like the shredder.
Now there’s news and bad news here. The bad news is ignoring the performance of people is almost as bad shredding their effort in front of their eyes. Ignoring gets you a way out there. The good news is that by looking at something that somebody has done, scanning it and “Uh huh,” that seems to be quite sufficient to dramatically improve people’s motivations. So the good news is adding motivation doesn’t seem to be so difficult. The bad news is that motivations seems to be incredibly easy, and if we don’t think about it carefully, we overdo it. So this is all in terms of motivation, or eliminating negative motivation.
The next part I want to you is something about positive motivation. So there is a in the U.S. called IKEA. And IKEA is a store with kind of okay furniture takes a long time to assemble.
(Laughter)
I don’t know you, but every time I assemble one of those, it takes me much longer, it’s more effortful, it’s much more confusing, I put things in the wrong way — can’t say I enjoy those pieces. I can’t say I the process. But when I finish it, I seem to like those pieces of furniture more 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 would put it in a box, and they would ask housewives to basically it in, stir some water in it, mix it, put it in oven, and — voila — you had cake. But it turns they were very unpopular. People did not want them, and they thought about all kinds reasons for that. Maybe the taste was not good? No, taste was great. What they figured out was that there not enough effort involved. It was so easy that nobody serve cake to their guests and say, “Here is 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 the out of the powder.
(Laughter)
Now you had to break the eggs and add them, had 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 got them to love what they’re doing to a higher degree.
So do we look at this question experimentally? We asked people build some origami. We gave them instructions on how to create origami, and we them a sheet of paper. And these were all novices, and they built something that was quite ugly — nothing like a frog or a crane. then we told them, “Look, this origami really belongs to us. 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 they were willing to pay for it. And we had two of people: We had the people who built it, and the who did not build it, and just looked at it as external observers. And what found was that the builders thought that these were beautiful of origami —
(Laughter)
and they were willing to pay five more for them than the people who just evaluated them externally. Now you could say — you 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 love it as well?” Which one of those two is correct? Turns out the builders not loved the origami more, they thought that everybody would the world in their view. They thought everybody else would love it as well.
In the next version, we tried to do IKEA effect. We tried to make it more difficult. So for people, we gave the same task. For some people, we it harder by hiding the instructions. At the top of the sheet, we had little diagrams of you fold origami. For 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 easy origami, saw the same thing — builders loved it more, evaluators loved it less. When looked at the hard instructions, the effect was larger. Why? Because now the builders loved 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, tells you something about how we evaluate things.
Now about kids. Imagine I asked you, “How much would you sell your kids for?” Your memories 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. if you did not have your kids. And one day you to the park and you met some kids. They were just like kids, and you played with them for a few hours, and when you about to 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 kids are so valuable, not just because of who are, but because of us, because they are so to us, and because of the time and connection. By the way, if you think IKEA instructions 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 wonderful and so on. comes to tell you one more thing, which is, much our builders, when they look at the creature of creation, we don’t see that other people don’t see things 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 an example of a pin factory. He said pins have 12 different steps, and if person does all 12 steps, production is very low. But you get one person to do step one, and one person to do step two step three and so on, production can increase tremendously. indeed, this is a great example, and the reason for the Industrial and efficiency. Karl Marx, on the other hand, said that alienation of labor is incredibly important in how people about the connection to what they are doing. And if you do all 12 steps, you care about pin. But if 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 Karl Marx. But the is that we’ve switched, and now we’re in the economy. You can ask yourself, what happens in a knowledge economy? Is still more important than meaning? I think the answer is no. I think that we move to 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 reality is that we should probably add all kinds things 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 do we create own meaning, pride, motivation, and how do we do it in our workplace, for the employees — I think we could get people to be both more productive and happier.
Thank very much.