The chasm

dollar-trap…between what science knows & what business does!

In my 3 day ‘Lean/Systems Thinking’ course, I ‘mess with the heads’ of the participants about incentives and motivation. I use material from a fabulous book called ‘Punished by Rewards’ written by Alfie Kohn (1993/1999).

Now, a number of course attendees comment back to me that “isn’t what you are saying the same as that Dan Pink guy?” * and, yes, basically it is. Pink is what I might call the modern day Kohn, the ‘in vogue’ management guru on this stuff…not that Alfie has gone anywhere!

[* Dan Pink wrote a 2009 book on the same subject area as Alfie Kohn’s earlier book. Pink’s book is called ‘Drive: the surprising truth about what motivates us’. I’ve noticed a Dan Pink RSAnimate informally making its way round]

This post is about a Dan Pink TED talk passed to me by a participant on one of my courses (thanks for sharing), in which Pink eloquently and passionately puts across his points. It is 18 mins. long and well worth watching.

The key message in the TED talk is that:

There’s a mismatch between what science knows and what business does.

‘Carrot and stick’ (as in contingent rewards) is an ideology, not a proven method to get the desired results. In fact, worse than being ineffective, it can do much harm.

Now, once you’ve watched the TED talk, you will know what the key message is about and that Dan Pink puts forward some scientific research as evidence. You might think “yeah, anyone can put forward an experiment or two, but I bet there are other experiments that ‘prove’ the opposite!”

To answer this: If you read Kohn’s book (which is a detailed and brilliantly written review of the body of research around incentives) you will find that:

  • experiments have been done on this stuff since the 1950’s, each and every decade, right up to today;
  • the results of these experiments have been replicated again and again and again; and
  • there isn’t any credible scientific evidence that contradicts the findings.

So what about service organisations?

Cast your mind back to the candle problem that Pink refers to, and whether the tacks are provided inside or outside of the box.

In service, the necessary actions are rarely a simple and obvious ‘cookie cutter’ response. Rather, the tacks might be scattered under the table, the box still a flat pack and the candle missing a wick!

Every customer service person should be thinking about the unique customer they are dealing with, their unique reality and then providing excellent service that satisfies (and hopefully exceeds) their specific needs.

You might come back at me and say “but if we standardise everything then our people don’t need to think. They just need to ‘turn the handle’ and THEN incentives work…don’t they?”

Two comments on this:

  • do you think the customer wants to be standardised?
  • do you think our people simply want to ‘turn a handle’?

I think not!

Be careful of gimmicky management fads:

Pink talks about a number of innovative techniques to get people thinking autonomously. He refers to Atlasian’s FEDEX day, Google’s 20% time and ROWE. Each makes some sense.

However, if a company simply picks up one of these ideas and ‘implements it’ BUT doesn’t change the underlying thinking, it won’t work.

It’s not about the gimmick (and you don’t need to copy theirs), it’s about the underlying thinking!

Kohn sets out a 3-step approach:

  1. abolish extrinsic motivators (incentives, competitive awards….);

(“pay people well and fairly…then put [incentives] out of their minds.”)

  1. then re-evaluate ‘evaluations’: move from formal time-batched judgement events to continual 2-way conversations divorced from the issue of compensation;
  2. then create the conditions for authentic motivation:
    • Collaboration: across the horizontal value stream
    • Work content: make it interesting
    • Choice: allow people to experiment and learn

And a reminder of that great John Seddon quote:

“with every pair of hands you get a free brain – but whether the brain is engaged depends on the design of the work.”

The difference between…

tree+bookA short and, hopefully, light hearted post for you:

For those of you who have been on an improvement course with me you will know that I start off by saying that it isn’t a training course, it is about education (with the same being true about this blog).

I use Deming’s quote of:

“We’re not here to learn skills; we’re here for education – to learn theory.”

If you are uncertain about the difference between training (learning skills) and education then I think Alfie Kohn (leading education psychologist) makes the distinction  really clear with the following:

“Would you want your kids to be provided with Sex Training or Sex Education?”

…I don’t think I need to say anymore to explain that!

Money as pay

CashThere is nothing wrong with the idea of money itself: it is simply a logical medium to enable the exchange of goods and services – it stops me trying to work out how many of my carrots to exchange for your goose.

But money as pay needs some careful thought.

We might break money for payment into three aspects to consider: as ‘hygiene’, ‘equity’, and ‘reinforcement’…and after that we’ll consider ‘joy in work’:

Hygiene: Frederick Herzberg studied the effects of financial incentives some time ago and observed that too little money can be a serious problem – we all need to cover the costs of our basic hygiene factors such as a roof over our heads, food in our bellies, clothes on our back and a feeling of security and acceptance in our society. It is highly demotivating not to have these covered. However, once these are in place, the provision of more money does not necessarily equate with more satisfaction.

Equity: The human being does not cope with injustice well! We all have a very strong inbuilt sense of fairness. So, once we’ve taken care of the hygiene aspect of pay, we must also cover equity. If you and I have a similar role but we are paid differently, then this WILL be a source of discord.

The more opaque the methodology surrounding compensation then the stronger the suspicions of inequality there will be. Note that a forward thinking American company, Menlo Innovations, takes transparency to such extremes that it posts employee salaries on its office wall! Whilst I am not saying we should go this far, if you find this idea objectionable it is worth asking yourselves why! If it is a fear of others realising how much you are paid as compared to them….then perhaps you fear you are on the positive end of an inequitable pay scheme.

Reinforcement: So, after covering hygiene and equity, we are left with the practise of contingent rewards: the offering of money (or some other perk) on a contingent basis in order to control how someone acts. Incentive/ bonus schemes sit squarely in this camp.

Alfie Kohn’s eye-opening book ‘Punished by Rewards’ explains the damaging effects of contingent rewards. He clearly sets out five major reasons as to why this is so, along with a depth of supporting research over many decades. In summary, contingent rewards:

  • Punish: those that don’t meet the criteria will not get the reward and will be demoralised – what might be seen as damage caused by the fall out , or ‘friendly fire’;
  • Rupture relationships: they interfere with the desire for collaboration and a sense of community. Competition makes others a potential obstacle to your ‘success’;
  • Ignore reasons: they are lazy – they do not require any attention to the reason for the problem in the first place, meaning that the ultimate cause will not get resolved;
  • Discourage risk taking: we do exactly what is necessary to get the reward, and no more. Research has shown that contingent rewards thwart innovation;
  • Focus people’s energies on getting the incentive, not on doing the work…which leads to lots of highly undesirable side effects!

The ‘money’ paradox:

A number of major surveys have been carried out to compare what a worker looks for in a job with what their manager (and even their peers) thinks they are looking for. What is really interesting is that:

  • the manager and peers rank ‘pay’ as being of number one importance to the worker; but
  • the worker himself ranks ‘pay’ way down the list*, putting ‘interesting work’ first.

(* 5th out of 10 ‘job factors’ in one study and 6th out of 10 in another)

So the paradox is that ‘I’ think that interesting work is most important but, conversely, ‘you’ think pay is most important to ‘me’…which would explain many a management decision based on this erroneous belief about pay.

Joy in work:

It is also interesting to consider the results of surveys about why people are unhappy with their jobs. The main reasons that arise include lack of variety or challenge, conflicts with manager or peers, and too much pressure. Salary doesn’t register as a major issue.

It would be interesting to consider why people leave an organisation and consider how many cite the primary factor as being that they weren’t being paid enough.

It is worth thinking about the following from Alfie Kohn:

“Notice how many people, regardless of how they feel about their jobs, or even how they are paid, are apt to pour their souls into tasks that they pursue in their free time: making music, fixing cars, decorating rooms, puttering in a garden, and of course, tending to their children. This work is often hard and time-consuming, and it is done with no thought of remuneration. Overall, the point is that money isn’t the point.”

He proposes that, if we want people to want to come to work on a Monday then the first thing we must do is pay people well and fairly “and then do everything in your power to help them put money out of their minds.”...then, and only then, we can work on creating the conditions for authentic motivation.

In conclusion

As Deming wrote “Pay is not a motivator”.

Now, you might respond to this with “well, I get results from offering contingent rewards“…and I would reply “sure you do…you get people chasing the rewards on offer…whatever (and in spite of) the consequences for the system”. I would add that you can’t blame them for behaving so – this is merely a product of the environment that you have provided for them.

Just imagine what your organisation, and its people, together could achieve if they were 100% focused on the actual purpose of the organisation and its primary value streams.

Two parallel tracks

railway-track-leading-into-distanceI get a number of different reactions from people when I discuss organisational ‘systems thinking’ ideas with them. These range:

  • from “wow, that’s so right…but we are completely stuck in our current ‘command-and-control’ reality and surely can’t do anything about it!” ;
  • to “we need change and I can’t wait around for your theory to come to fruition – I’m going to accept things as they are and tinker at the edges as best I can…otherwise I will go mad with frustration!”.

To quote Russell Ackoff: the later response above is basically trying to make a “wrong thing righter” or, in effect, limit the damage.

However, I am very mindful that people can’t feast on ideas alone and that the point is to improve. All the theory in the world won’t help if we can’t apply it.

I have pondered this dilemma a lot and often…and came across (what is to me) a profound answer to this dilemma, as written by Alfie Kohn:

“When something is wrong with the present system, you move on two tracks at once.

  • You do what you can within the confines of the current structure, trying to minimise its harm.
  •  You also work with others to try to change that structure, conscious that nothing dramatic may happen for a very long time.

If we move exclusively on the latter track, such as by mobilising people to dismantle [the destructive instruments of the] system, we may not be doing enough to protect [our colleagues] from the destructive effects [of these instruments] with which they are going to be controlled in the meantime.

But – and this point can be more difficult to recognise – if we simply reconcile ourselves to the status quo and spend all our time getting our [colleagues] to accommodate themselves to it and play the game, then nothing will change and they will have to do the same with their [colleagues and on and on].

As someone once said, realism corrupts; absolute realism corrupts absolutely.”

So, we need to simultaneously travel along two tracks.

We need to accept that our progress along the (truly) transformational track of changing our management system will take time….but we MUST start and sustain this journey (i.e. not see it as an impossibility) whilst also doing what we can within our current daily realities. We can only do this if you and I continue to think, collaborate and learn….which, I suggest, may be intrinsically motivating for us and give us a clearer sense of purpose.

Well done team, keep up the good work!

His+name+is+quot+condescending+wonka+quot+_f82cc1640b48cb9aa9b6dfb08f676dd5If you are a ‘leader’, how many times have you said “well done team, keep up the good work!” How do you think this is taken by those receiving it? Do you think they need to be ‘told’ to do this (the keeping up of the good work)…will they stop if you don’t?

Conversely (putting yourself in the other person’s shoes), how many times have you had some senior person who you don’t really know use the “well done…” phrase (or similar) either in an email/intranet communication or whilst doing a ‘press the flesh’ floor walk….and how does this make you feel?

How about when something major is implemented after months, if not years of hard work – is there an ever increasing level to this “well done…” message as the senior manager, then GM, then Exec. say ostensibly the same thing?…and, underneath this, do you think ‘if only they knew the half of it!’

The people who you really appreciate comment from are those who you know really understand what you (personally) have been doing/ going through, what successes you have achieved and the obstacles you have battled through to get them.

…and the comments that are most useful are the highly specific ones.

Some thoughts on praise from a chapter within Alfie Kohn’s eye-opening book ‘Punished by Reward’:

Kohn explains that the available research (of which there is plenty) has identified a number of reasons as to why ‘praise’ may fail to boost achievement and, in fact may drag it down:

  1. Low ability: praising people’s efforts may create a feeling that you are being somewhat condescending as to their abilities…along the lines of ‘didn’t you do well !’
  2. Pressure: telling someone how good they are can increase the pressure they then feel to live up to the compliment
  3. Avoidance of risk: praise may set up unrealistic expectations of continued success, which leads people to avoid difficult tasks in order not to risk the possibility of failure (and then criticism)
  4. Reduces interest in the task itself: praise can be heard as an attempt to manipulate our behaviour (as in ‘keep up the good work’ basically saying ‘I want more of the same’). A good deal of research has shown that intrinsic motivation declines as a result of praise.

So, what does Kohn say we should do? He puts forward two general principles as the standards by which all praise should be measured:

  • Self determination: Are we helping the individual feel a sense of control over their life OR are we attempting to manipulate their behaviour by getting them to think about whether they have met our criteria?
  • Intrinsic Motivation: Are our comments creating the conditions for the person being praised to become more deeply involved in what they are doing OR are they turning the task into something they have to do to win our approval?

Taking these into more specifics, Kohn offers the following practical suggestions:

  1. Don’t praise people, only what people do (“that’s a really nice story” is better than “you’re such a good writer”)
  2. Make praise as specific as possible (“the twist at the end was completely unexpected” is better than “that’s a really nice story”)
  3. Avoid phony praise (praise is objectionable when it is clearly not a spontaneous expression but a deliberate strategy)
  4. Avoid praise that sets up a competition (don’t praise by comparing to someone else.)

Now, I’m not suggesting that senior management should stop showing their appreciation. Far from it! Instead, I am noting that people believe this to be genuine when they know that the comments: comes from someone who ‘really does understand’; are specific to the receiver and what they did; and are not rationed according to some rating and ranking mechanism.

…which ties in nicely with the need for management to meaningfully ‘Gemba walk’ often.