I want talk a little bit today about labor and work.
When think about how people work, the naive intuition we have is people are like rats in a maze — that all people care is money, and the moment we give them money, we can direct them to one way, we can direct them to work another way. This why we give bonuses to bankers and pay in all of ways. And we really have this incredibly simplistic view of why people work, and the labor market looks like.
At the same time, if you think it, there’s all kinds of strange behaviors in the world around us. about something like mountaineering and mountain climbing. If you read books people who climb mountains, difficult mountains, do you think that those books are full of of joy and happiness? No, they are full of misery. In fact, it’s all about frostbite and having walking, and difficulty breathing — cold, challenging circumstances. And 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, me sit on a beach somewhere drinking mojitos.” But instead, 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. It 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 this after a student came to visit me. This one of my students from a few years earlier, he came one day back to campus. And he told me the following story: He that for more than two weeks, he was working on a PowerPoint presentation. He was working in a bank, and this was in preparation for a merger and acquisition. And he working very hard on this presentation — graphs, tables, information. stayed late at night every day. And the day before it was due, he sent his presentation to his boss, and his boss wrote him and said, “Nice presentation, but the merger is canceled.” the guy was deeply depressed. Now at the moment when he was working, he was actually happy. Every night he was enjoying his work, he staying late, he was perfecting this PowerPoint presentation. But knowing that would ever watch it made him quite depressed.
So I started thinking about how we experiment with this idea of the fruits of our labor. to start with, we created a little experiment in 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 dollars for it.” people said yes, and they built with these Legos. And when they finished, we took it, we put under the table, and we said, “Would you like to build another one, time for $2.70?” If they said yes, we gave them another one, and when they finished, asked them, “Do you want to build another one?” $2.40, $2.10, and so on, until at some point 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 every one of them, we put them under the table. And we told them at the end of the experiment, we will take these Bionicles, we will disassemble them, we will put them back in 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 we called the Sisyphic condition. And if you remember story about Sisyphus, Sisyphus was punished by the gods to push same rock up a hill, and when he almost to the end, the rock would roll over, and he have to start again. And you can think about this the essence of doing futile work. You can imagine if he pushed the rock on different hills, at least would have some sense of progress. Also, if you look prison movies, sometimes the way that the guards torture prisoners is to 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 about this cyclical version of doing something and over and over that seems to be particularly demotivating.
So in second condition of this experiment, that’s exactly what we did. We asked people, “Would you like build one Bionicle for three dollars?” And if they said yes, built 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, as they were building it, we took apart the one they just finished. And when they finished that, we said, “Would like to build another one, this time for 30 less?” And if they said yes, we gave them the one that built and we broke. So this was an endless of them building, and us destroying in front of their eyes.
Now happens when you compare these two conditions? The first that happened was that people built many more Bionicles — eleven in the meaningful condition, seven in the Sisyphus condition. And by the way, we should out that 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 soon. So there was not a real opportunity for big meaning. But even the small meaning a difference.
Now we had another version of this experiment. In this other version 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 asked to predict what the result would be. What happened? predicted the right direction but not the right magnitude. People who were just given the description of the said that in the meaningful condition, people would probably build one more Bionicle. So people understand meaning is important, they just don’t understand the magnitude the importance, the extent to which it’s important.
There one other piece of data we looked at. If you about it, there are some people who love Legos, and some people don’t. And you would speculate that the people who love Legos would more Legos, even for less money, because after all, they get more internal from it. And the people who love Legos less would build less Legos because enjoyment that they derive from it is lower. And that’s what 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? that condition, the correlation was zero — there was no relationship the love of Legos, and how much people built, which suggests me that with this manipulation of breaking things in of people’s eyes, we basically crushed any joy that they could get out of this activity. basically eliminated it.
Soon after I finished running this experiment, 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 group the software company that was put in a different building, they asked them to innovate, and create the next product for this company. And the week before I up, the CEO of this big software company went to that group, 200 engineers, canceled the project. And I stood there in front of 200 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 you used to?” everybody raised their hand. I said, “How many of you now go home earlier you used to?” Everybody raised their hand. I asked them, “How of you now add not-so-kosher things to your expense reports?” they didn’t raise their hands, but they took me out dinner and showed me what they could do with reports. And then I asked them, I said, “What could CEO have done to make you not as depressed?” And they came up with kinds of ideas.
They said the CEO could have asked them to present to the whole 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 parts of the organization. He could asked them to build some next-generation prototypes, and see how they would work. the thing is that any one of those would require effort and motivation. And I think the CEO basically did not the importance of meaning. If the CEO, just like our participants, the essence of meaning is unimportant, then he [wouldn’t] care. And would say, “At the moment I directed you in this way, and now that I’m you in this way, everything will be okay.” But if you understood how 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 of 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 wanted to do another for a little less money, the next sheet for a bit less, and so on and so forth. And we had conditions. In the first condition, people wrote their name on the sheet, found all the pairs letters, gave it to the experimenter, the experimenter would look it, scan it from top to bottom, say “Uh huh,” and put it the pile next to them. In the second condition, people did not write their on it. The experimenter looked at it, took the sheet paper, did not 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. the third condition, the experimenter got the sheet of paper, and put it directly into shredder.
(Laughter)
What happened in those three conditions?
In this plot I’m showing you at what rate people stopped. So low numbers mean that people worked harder. They worked for much longer. the acknowledged condition, people worked all the way down to 15 cents. 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 we had before. You shred people’s efforts, output — you get them not to be as happy with they’re doing. But I should point out, by the way, that in shredder condition, people could have cheated. They could have done not so good work, they realized people were just shredding it. So maybe first sheet you’d do good work, but then you see nobody really testing it, so you would do more and more and more. So in fact, in shredder condition, people could have submitted more work and gotten more money, and less effort into it. But what about the ignored condition? the ignored condition be more like the acknowledged or like the shredder, or somewhere in the middle? It turns out it was like the shredder.
Now there’s good news and bad news here. The bad is that ignoring the performance of people is almost as bad as their effort in front of their eyes. Ignoring gets you a way out there. The good news is that by simply at something that somebody has done, scanning it and saying “Uh huh,” that seems to be quite to dramatically improve people’s motivations. So the good news is that adding motivation doesn’t to be so difficult. The bad news is that eliminating motivations 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 show you is something about positive motivation. So there is a store the U.S. called IKEA. And IKEA is a store kind of okay furniture that takes a long time assemble.
(Laughter)
I don’t know about you, but every time I assemble one of those, it takes much longer, it’s much 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 like those IKEA pieces of furniture more than I like other ones.
(Laughter)
And there’s old story about cake mixes. So when they started cake mixes in the ’40s, they take this powder and they would put it in a box, and they ask housewives to basically pour it in, stir some water in it, mix it, put it in oven, and — voila — you had cake. But it turns out they were unpopular. People 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. It was easy that nobody could serve cake to their guests and say, “Here is my cake.” No, it was else’s cake, as if you bought it in the store. It didn’t really like your own. So what did they do? They took the and the milk out of the powder.
(Laughter)
Now you had to break eggs and add them, you had to measure the milk and add it, mixing it. Now was your cake. Now everything was fine.
(Laughter)
(Applause)
Now, I think a little bit the IKEA effect, by getting people to work harder, they actually them to love what they’re doing to a higher degree.
So how do we at this question experimentally? We asked people to build some origami. We them instructions on how to create origami, and we gave a sheet of paper. And these were all novices, and built something that was really quite ugly — nothing like a or a crane. But then we told them, “Look, this really belongs to us. You worked for us, but I’ll tell you what, we’ll sell it you. How much do you want to pay for it?” And measured how much they were willing to pay for it. And we two types of people: We had the people who it, and the people who did not build it, and looked at it as external observers. And what we found that the builders thought that these were beautiful pieces of origami —
(Laughter)
and were willing to pay five times more for them than the people who just them externally. Now you could say — if you were a builder, do think [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 it as well?” Which one those two is correct? Turns out the builders not only loved the origami more, they thought everybody would see the world in their view. They thought everybody would love it more as well.
In the next version, we tried to do the IKEA effect. We to make it more difficult. So for some 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 of how you fold origami. For some people, we just that. So now this was 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, loved it less. When you looked at the hard instructions, the effect was larger. Why? Because the builders 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 you something how we evaluate things.
Now think about kids. Imagine I asked you, “How much you sell your kids for?” Your memories and associations so on. Most people would say for a lot, a lot money.
(Laughter)
On good days.
(Laughter)
But imagine this was different. Imagine if you did not have your kids. And day you went to the park and you met kids. They were just like your kids, and you played with them for a few hours, and you were about to leave, the parents said, “Hey, by the way, just you leave, if you’re interested, they’re for sale.”
(Laughter)
How would you pay for them now? Most people say not that much. And this is because our kids so valuable, not just because of who they are, but because us, because they are so connected to us, and of the time and connection. By the way, if think IKEA 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, are wonderful and so on. comes to tell you one more thing, which is, much like our builders, when they look at creature of their creation, we don’t see that other people don’t see things our way.
Let say one last comment. If you think about Adam Smith versus Marx, Adam Smith had a very important notion of efficiency. He gave an example of a pin factory. said pins have 12 different steps, and if one person all 12 steps, production is very low. But if you one person to do step one, and one person do step two and step three and so on, production increase tremendously. And indeed, this is a great example, and the for the Industrial Revolution and efficiency. Karl Marx, on the hand, said that the alienation of labor is incredibly important in how people think about the connection what they are doing. And if you do all 12 steps, care about the pin. But if you do one step every time, maybe you don’t as much.
I think that in the Industrial Revolution, Adam Smith was more than Karl Marx. But the reality is that we’ve switched, now we’re in the knowledge economy. You can ask yourself, what in a knowledge economy? Is efficiency still more important meaning? I think the answer is no. I think that we move to situations in which people have to decide on their about how much effort, attention, caring, how connected they feel to it, they thinking about labor on the way to work, in the shower and so on, all of a sudden Marx has more to say to us. So when we think about labor, we usually about motivation and payment as the same thing, but the reality is that we should probably add kinds of things to it — meaning, creation, challenges, ownership, identity, pride, etc.
The news is that if we added all of those components and about them — how do we create our own meaning, pride, motivation, and how do we do it our workplace, and for the employees — I think we could get to be both more productive and happier.
Thank you much.