I want to talk a bit today about labor and work.
When we think about people work, the naive intuition we have is that people like rats in a maze — that all people about is money, and the moment we give them money, can direct them to work one way, we can direct them work another way. This is why we give bonuses to bankers and pay in all kinds ways. And we really have this incredibly simplistic view of why people work, and what labor market looks like.
At the same time, if you about it, there’s all kinds of strange behaviors in the world around us. about something like mountaineering and mountain climbing. If you books of people who climb mountains, difficult mountains, do you that those books 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 breathing — cold, challenging circumstances. And if people were just trying to be happy, the moment they would 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 they recover, they up again. And if 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 fight, about the challenge. It suggests that there’s all kinds of other that motivate us to work or behave in all of ways.
And for me personally, I started thinking about this after student came to visit me. This was one of 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 two weeks, he was working on a PowerPoint presentation. was working in a big bank, and this was in preparation for a merger and acquisition. he was working very hard on this presentation — graphs, tables, information. He stayed late at night 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 the guy deeply depressed. Now at the moment when he was working, he was quite happy. Every night he was enjoying his work, he was staying late, he was this PowerPoint presentation. But knowing that nobody would ever watch it made him quite depressed.
So started thinking about how do we experiment with this idea of fruits of our labor. And to start with, we created a experiment in which we gave people Legos, and we asked to build with Legos. And for some people, we gave them and we said, “Hey, would you like to build this for three dollars? We’ll pay you three dollars for it.” And people said yes, and they with these Legos. And when they finished, we took it, put it under the table, and we said, “Would like to build another one, this time for $2.70?” If they said yes, we gave another one, and when they finished, we asked them, “Do want to build another one?” for $2.40, $2.10, and so on, until some point people said, “No more. It’s not worth it for me.” This was what we the meaningful condition. People built one Bionicle after another. After they finished every of them, we put them under the table. And told them that at the end of the experiment, we will take all Bionicles, we will disassemble them, we will put them in the boxes, and we will use it for the next participant.
There another condition. This other condition was inspired by David, my student. And this other condition we called Sisyphic condition. And if you remember the story about Sisyphus, Sisyphus was punished by the gods push the same rock up a hill, and when he got to the end, the rock would roll over, and he would have to again. And you can think about this as the essence doing futile work. You can imagine that if he pushed rock on 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 is to get them to dig a hole, and when prisoner is finished, they ask him to fill the back up and then dig again. There’s something about this cyclical of doing something over and over and over that seems be particularly demotivating.
So in the second condition of this experiment, that’s exactly we did. We asked people, “Would you like to one Bionicle for three dollars?” And if they said yes, built it. Then we asked them, “Do you want to another one for $2.70?” And if they said yes, we gave them a one, and as they were building it, we took apart one that they just finished. And when they finished that, we said, “Would you to build another one, this time for 30 cents less?” And if they said yes, we them the one that they built and we broke. So was an endless cycle of them building, and us destroying in front of their eyes.
Now what when you compare these two conditions? The first thing that 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 curing cancer or building bridges. People were building Bionicles a few cents. And not only that, everybody knew the Bionicles would be destroyed quite soon. So there was not a real for big meaning. But even the small meaning made difference.
Now we had another version of this experiment. In this other version of the experiment, we didn’t people in this situation, we just described to them the situation, much I am describing to you now, and we asked to predict what the result would be. What happened? People predicted the right direction but not right magnitude. People who were just given the description the experiment said that in the meaningful condition, people would 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 at. If you think about it, there are some people who Legos, and some people who don’t. And you would speculate that people who love Legos would build more Legos, even for less money, because all, they get more internal joy from it. And people who love Legos less would build less Legos because the enjoyment that they derive from it lower. And 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 the Sisyphic condition? In that condition, the correlation was zero — there was relationship between 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, we basically any joy that they could get out of this activity. basically 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 they were a big company in Seattle. This a group within the software company that was put in a different building, and they them to 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 most people I’ve ever talked to. And I described to them some of Lego experiments, and they said they felt like they had just been through that experiment. I asked them, I said, “How many of you show up to work later than you used to?” And raised their hand. I said, “How many of you go home earlier than you used to?” Everybody raised their hand. asked them, “How many of you now add not-so-kosher things to your expense reports?” And didn’t raise their hands, but they took me out to dinner and me what they could do with expense reports. And then I asked them, I said, “What could CEO have done to make you not as depressed?” And they up with all kinds of ideas.
They said the CEO could have them to present to the whole company about their journey over the last two years 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 asked them build some next-generation prototypes, and see how they would work. the thing is that any one of those would require some effort and motivation. And I think CEO basically did not understand the importance of meaning. If the CEO, just like our participants, the essence of meaning is unimportant, then he [wouldn’t] care. And he would say, “At the moment I you in this way, and now that I’m directing in this way, everything will be okay.” But if you understood how important meaning is, then you figure out that it’s actually important to spend some time, energy and effort in getting to care more about what they’re doing.
The next experiment was different. We took a sheet of paper with random letters, and we people to find pairs of letters that were identical next to each other. was the task. People did the first sheet, then we asked if they to do another for a little less money, the sheet for a little bit less, and so on and so forth. we had three conditions. In the first condition, people wrote their on the sheet, found all the pairs of letters, gave to the experimenter, the experimenter would look at it, scan it from top bottom, say “Uh huh,” and put it on the next to them. In the second condition, people did not their name on it. The experimenter looked at it, took the sheet paper, did not look at it, did not scan it, and simply put it on pile of pages. So you take a piece, you put it on the side. In the third condition, the experimenter got the sheet paper, and put it directly into a shredder.
(Laughter)
What happened those three conditions?
In this 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 down to 15 cents. 15 cents per page, they basically stopped these efforts. In the shredder condition, it was as much — 30 cents per sheet.
And this is basically the result we had before. shred people’s efforts, output — you get them not to as happy with what they’re doing. But I should point out, by the way, in the shredder condition, people could have cheated. They could have not so good work, because they realized people were shredding it. So maybe the first sheet you’d do good work, but you see nobody is really testing it, so you would more and more and more. So in fact, in the shredder condition, could have submitted more work and gotten more money, and put less effort into it. But about the ignored condition? Would the ignored condition be more like the acknowledged or more like the shredder, somewhere in the middle? It turns out it was almost like the shredder.
Now there’s good news bad news here. The bad news is that ignoring the performance of people is almost bad as shredding their effort in front of their eyes. gets you a whole way out there. The good is that by simply looking at something that somebody done, scanning it and saying “Uh huh,” that seems to be quite to dramatically improve people’s motivations. So the good news that adding motivation doesn’t seem 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 might it. So this is all in terms of negative motivation, or eliminating negative motivation.
The next part I to show you is something about positive motivation. So there is store in the U.S. called IKEA. And IKEA is a store with of okay furniture that takes a long time to assemble.
(Laughter)
I don’t know about you, every time I assemble one of those, it takes much longer, it’s much more effortful, it’s much more confusing, I things in the wrong way — I can’t say I those pieces. I can’t say I enjoy the process. But I finish it, I seem to like those IKEA pieces of furniture more than like other ones.
(Laughter)
And there’s an old story cake mixes. So when they started cake mixes in the ’40s, they would take this powder and would put it in a box, and they would ask to basically pour it in, stir some water in it, it, put it in the oven, and — voila — you had cake. it turns out they were very unpopular. People did not them, and they thought about all kinds of reasons for that. Maybe the taste not 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 was somebody else’s cake, if you bought it in the store. It didn’t feel like your own. So what did they do? They took eggs and the milk out of the powder.
(Laughter)
Now had to break the eggs and add them, you had to measure the milk add it, mixing it. Now it was your cake. Now was fine.
(Laughter)
(Applause)
Now, I think a little like the 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 this question experimentally? We asked people build some origami. We gave them instructions on how to create origami, we gave them a sheet of paper. And these were all novices, they built something that was really quite ugly — nothing a frog or a crane. But then we told them, “Look, this origami really belongs to us. worked for us, but I’ll tell you what, we’ll sell it to you. much do you want to pay for it?” And we measured how much they were willing to pay it. And we had two types of people: We had the who built it, and the people who did not build it, and just looked it as external observers. And what we found was that the builders thought that were beautiful pieces of origami —
(Laughter)
and they willing to pay five times more for them than people who just evaluated them externally. Now you could say — you were a builder, do you think [you’d say], “Oh, I 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 out builders not only loved the origami more, they thought that everybody would the world in their view. They thought everybody else would it more as well.
In the next version, we tried to the IKEA effect. We tried to make it more difficult. So for some people, we gave the task. For some people, we made it harder by hiding the instructions. the top of the sheet, we had little diagrams how you fold origami. For some people, we just that. So now this was tougher. What happened? Well in objective way, the origami now was uglier, it was more difficult. Now when 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? now the builders loved it even more.
(Laughter)
They put 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 I you, “How much would you sell your kids for?” Your memories and associations so on. Most people would say for a lot, lot of money.
(Laughter)
On good days.
(Laughter)
But imagine this was slightly different. if you did not have your kids. And one day went to the park and you met some kids. were just like your kids, and you played with for a few hours, and when you were about leave, the parents said, “Hey, by the way, just before leave, if you’re interested, they’re for sale.”
(Laughter)
How much you pay for them now? Most people say not that much. And this is because our are so valuable, not just because of who they are, but of us, because they are so connected to us, and because of time and connection. By the way, if you think IKEA instructions are good, what about the instructions that come with kids, those really tough.
(Laughter)
By the way, these are my kids, which, of course, are wonderful and on. Which comes to tell you one more thing, is, much like our builders, when they look at creature of their creation, we don’t see that other people don’t see our way.
Let me say one last comment. If you about Adam Smith versus Karl Marx, Adam Smith had a very important of efficiency. He gave an example of a pin factory. He said pins 12 different steps, and if one person does all 12 steps, is very low. But if you get one person to do step one, and one person to step two and step three and so on, production can tremendously. And indeed, this is a great example, and reason for the Industrial Revolution and efficiency. Karl Marx, the other hand, said that the alienation of labor is important in how people think about the connection to what they doing. And if you do all 12 steps, you care 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 correct than Karl Marx. But the reality is that we’ve switched, and now we’re in the economy. You can ask yourself, what happens in a knowledge economy? efficiency still more important than meaning? I think the is no. I think that as we move to situations in which people have to decide on own about how much effort, attention, caring, how connected 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 more things say to us. So when we think about labor, we usually think about motivation and payment 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 thought about them — how do we create our own meaning, pride, motivation, and how do do it in our workplace, and for the employees — I think we could people to be both more productive and happier.
Thank very much.