Threshold

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Seth Godin describes 8 reasons to work:

  1. For the money
  2. To be challenged
  3. For the pleasure/calling of doing the work
  4. For the impact it makes on the world
  5. For the reputation you build in the community
  6. To solve interesting problems
  7. To be part of a group and to experience the mission
  8. To be appreciated

He then asks: “Why do we always focus on the first?”

I think it is the wrong question. We should focus on the first. The question is why do we only focus on the first?

Even the one of the most popular opponent for incentives in the way the business world usually uses them, Dan Pink, claims, in his book, Drive, that while autonomy, mastery and purpose is what really drives people, a prerequisite for that is that people are paid well. Preferably above the average pay.

I think we should think about this question as a threshold. In order to attract goof workers and demand excellence you need your pay to be reasonable. But above a certain point (which I don’t think is very high) more money does not equal better performance. To do that, you need at least one, if not more, of the rest of the items on the list.

By the way. This proposition is not mine. It belongs to the management scholar Herzberg. Here is how I described it in the past:

According to the Two-factor theory (also known as Herzberg’s motivation-hygiene theory) job satisfaction and job dissatisfaction act independently of each other. Two Factor Theory states that there are certain factors in the workplace that cause job satisfaction (Motivators, e.g. challenging work, recognition, responsibility which give positive satisfaction, arising from intrinsic conditions of the job itself, such as recognition, achievement, or personal growth), while a separate set of factors cause dissatisfaction (Hygiene factors, e.g. status, job security, salary and fringe benefits, which do not give positive satisfaction, although dissatisfaction results from their absence. These are extrinsic to the work itself, and include aspects such as company policies, supervisory practices, or wages/salary).

Hygiene factors are things you need to make sure are present to reasonable degree. Otherwise, in many cases, the motivators will have almost no effect.

So, we should focus on money (and other hygiene factors). But we need to make sure they are good enough and focus on making the motivators extraordinary. Then, we raise the chances for the emergence of excellence.

Elad

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When should a manager force employees to do things they don’t want to do?

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Dan Ariely wrote an interesting post about the Chilean pension system that mandates savings by all citizens. Not surprisingly, Ariely calls the post: “Want People to Save? Force Them”. This connects with an earlier post by Ariely (which I also wrote about) that discussed an experiment which showed  that by limiting the list of questions people could use to engage in a conversation, deeper and more meaningful conversations were brought to life.

These two posts got me thinking. In this blog I write a lot about rules in management and about how managers should let go of the mechanisms of control. I generally believe that the basic concepts Dan Pink presents in his book, Drive, of Autonomy, Mastery and Purpose are three of the most important tools managers have in their disposal.

At the same time, I do believe that sometimes, managers should force some processes on their employees. Just like people are bad at saving and need to be made to save, because in the longer-term it is better for them, there are things employees would not do and need a manager to force them. Engaging in more meaningful conversations is a great example. And if we can do that by designing the rules of the meeting differently (for example), this is an important tool that managers should use.

This is a very difficult conclusion for me as it goes against many of my personal beliefs about liberty and the importance of choice (more on this unrelated subject – see here). But I do believe that great leaders and managers know how to walk the line between allowing autonomy and forcing people to engage in some important paternalistic processes. I don’t have a complete list of these instances, but I am planning to start thinking more and more about this subject.

Any ideas? In what issues do you think managers should force employees to do things for their own long-term benefits?

Elad

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The “If – Then” bias

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One of the everlasting impressions I was left with after reading Dan Pink’s book Drive: The Surprising Truth About What Motivates Usis the importance of the difference between “If – Then” rewards and “Now-That” rewards. While the first type creates a type of agreement thus making the reward contingent on the action (and some would say the other way around), the second type is a method to reinforce a behavior that was done not out of the hope to get a reward, but out of intrinsic motivation.

I was reminded of this difference while reading Terry Goodkind’s epic fantasy novel Soul of the Fire, where he writes:

Dalton Campbell leaned back to fish something from a pocket. “This is for you.” He flipped it through the air.

Fitch caught it and stared dumbly at the silver sovereign in his palm. He expected that most rich folk didn’t even carry such a huge sum about.

“But, sir, I haven’t worked the month, yet.”

“This is not your messenger’s wage. You get your wage at the end of every month.” Dalton Campbell lifted an eyebrow. “This is to show my appreciation for the job you did last night.”

Claudine Winthrop. That was what he meant – scaring Claudine Winthrop into keeping quiet.

Fitch laid the silver coin on the desk. With a finger, he reluctantly slid the coin a few inches toward Dalton Campbell.

“Master Campbell, you owe me nothing for that. You never promised me anything for it. I did it because I wanted to help you, and to protect the future Sovereign, not for a reward. I can’t take money I’m not owed.”

I love this part of the story for two reasons:

First, it captures the idea of the difference between “If – Then” and “Now-That” rewards wonderfully. The character described by the author, Fitch, says it clearly. I did not do what I did for a reward. I did it because I wanted to. Intrinsic motivation.

Second, more than that, it actually shows that people, both those that hand out rewards and those who receive it have a bias towards “If – Then” rewards. In Drive: The Surprising Truth About What Motivates Us, Pink claims that there is an incongruity between what science knows about motivation and what business (and people in general) does about it.  Goodkind’s description of Fitch accurately deals with the paradox. Fitch does not understand. You get a reward only if you are promised beforehand. Who gives somebody a reward after the fact?

As Pink claims in his book, the science in this area is not open to debate. In the long run, “Now-That” rewards are much more effective. And I ask you this: are you, your organization or those around you suffering from the “If – Then” bias?

Elad

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Gain segregation in management

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In the last few weeks I have been studying about Daniel Kahneman and Amos Tversky famous Prospect Theory. This theory has many applications and many interpretations. One of the most important of these interpretations is that losses loom larger than gains. Meaning, all else being equal losing something will hurt us more than winning the same amount (when I say amount it is not necessarily money. It could be joy, pain or anything that has value to us). If you look at the graph that represents this theory, you would notice how the graph is steep at the beginning in both directions, but steeper in the loss area.

One of the insights of this idea is that we need to aggregate pains but segregate gains. In other words, when we talk about gains, it is better to be closer to the zero point of the axis but in the case of loses it is better be as left as possible on the graph.

Imagine going to the dentist. You need to take a four-hour operation. Your dentist offers you to do it in two sessions of two hours or in one session of four hours. Prospect Theory suggests, maybe counter-intuitively, that it is better for you to have a 4 hour operation than a two hour one.

That got me thinking about how this idea is manifested in managerial environments.

Have you ever heard the advice to celebrate small victories? Prospect Theory suggests that this is very good advice. However, in many managerial setting we are so busy dealing with current issues that we forget to celebrate small successes. We wait to the end of the period and have a huge event celebrating the last year. However, celebrating frequently turns out to be a much better way to in recognizing people’s efforts. So, instead of giving them a week off at the end of the project, give them 5 days over the duration of the project, as a reward for good work. Instead of throwing a huge party that will cost you 100,000$ dollars at the end of the project, have ten parties with a cost of 10,000 every now and then. This approach also seems to coincide with Dan Pink’s advice in Drive, that rewards should follow a “now that” pattern instead of a “if then” pattern.

I know that these examples are to literal a translation of the theory and that in real life, things work a little differently. However, I do believe that by understanding the idea of gain segregation, we can make our efforts to engage and recognize employees much more effectively and allow them, without changing our cost structure or the total sum of what they are gaining, to enjoy more of what we are already giving them.

How do you think the ideas of loses aggregation and gains segregation play out in our managerial decisions?

Elad

Shorts: Gary Hamel on Humanity in management

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Gary Hamel writes in the February 2009 issue of the Harvard business review under the title Moon Shots for Management – What great challenges must we tackle to reinvent management and make it more relevant to a volatile world:

This is a daunting challenge, but take heart. The first management pioneers had to turn freethinking, bloody-minded human being into obedient, forelock-tugging employees. They were working against the grain of human nature. We, on the other hand, are working with the grain. Our goal is to make organization more human – not less.

So true. A few weeks ago, I argued here against Daniel Pink’s claim in his book Drive that management does not emanate from nature:

Management does emanate from nature. In fact, the problem with management today as I see it is that we stopped doing what is natural and human and started using artificial methods to deal with people.

Being empathic, creating connections and socializing, talking and listening and even respecting our fellow human beings are not unnatural things.

When you start treating management as a race for productivity you get an unnatural phenomenon. When you start using carrots and sticks like people are jackasses you get an unnatural phenomenon. When you rely only on measurement of only the things you can measure to fuel management you get an unnatural phenomenon.

Elad

Are you a happiness machine?

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This is a subject I wrote about before but that I am only starting to realize its true importance. Unpredictability of rewards.

Watch the movie above. How do you feel? Putting all the cynicism aside, just seeing people this happy is contagious. Indeed positivity is contagious. And really, who doesn’t want his workplace, school or even home to be this happy? I know I do. And no, I am not advocating bringing a Coca-Cola vending machine or even giving people around you expensive gifts. I am talking about noticing people around you and doing something about it. One of the side effects of the prevalent system of Carrot and Sticks, is that people almost don’t expect anything surprising anymore. It is so easy to surprise them. And what does that have to do with management? A lot, as Tanveer Naseer writes in the original post where I first saw this ad:

So instead of having another typical team meeting, secretly plan to end it early and surprise everyone by bringing out cocktail platters and giving your employees time to just relax and enjoy their work environment. Or announce an impromptu hockey game in the office parking lot – with a request for spectators needed to cheer the game on. The point is it doesn’t have to be expensive or elaborate to plan – the only objective is to break up the routine and offer something to motivate your employees and raise team spirit.

And I will take it another step further and make it simpler. Notice and make sure the people around you know that they are noticed:

And the same happens to us when we see an employee doing good work. We assume that the fact that we saw him and know what he did means that he knows that we saw him and knows what he did. What is the solution? Taking the opposite assumption. We need to assume that our employees never know that we noticed them. Then make it a priority to let them know that we did. Let’s overcome the curse of knowledge and starting noticing people.

And also see here.

You know the saying – “I feel like you take me for granted”.

It is known because it is true – how many people around you do you take for granted every day? How many employees who are doing exactly what is expected of them are you ignoring? What will happen if you show them, in a simple way, how much you appreciate them? What will happen if you recognize their contribution? What will happen if you give them consistent feedback, all the time?

Tom Peters constantly writes about this and asks all of us: who did you take to lunch today? Every lunch is an opportunity to connect, with a costumer or an employee or in this case – recognize. How many thank-you notes have you written this week? How many people did you send flowers too?

And Dan Pink writes in his new book, Drive: The Surprising Truth About What Motivates Us, about the same thing – “if-then” rewards are bad motivators. We should move to “now that” rewards:

In other words, where “if-then” rewards are a mistake, shift to “now that” rewards – as in “Now that you’ve finished the poster and it turned out so well, I’d like to celebrate by talking you out to lunch”.

As Deci and his colleagues explain, “If tangible rewards are given unexpectedly to people after they have finished the task, the rewards are less likely to be experienced as the reason for doing the task and are thus less likely to be detrimental to intrinsic motivation”

Let’s take this idea one step further – “now that … let me surprise you! Let me make you happy! Let me do something unpredictable and unexpected”.

It is so easy to create the feeling we see above, yet it so hard. As I wrote a few months ago:

We know that predictable rewards are not as effective as unpredictable rewards, but still, most companies and managers stick to a schedule of predictable rewards. Why? Well, my guess is that it is just easier. As a manager, I don’t need to think and worry about my employees all the time. Does it really matter if I do in once every quarter for an hour or if I do it 30 times over the quarter for 2 minutes each time? But, the fact that it is easier does not mean that it is right (like most conventional wisdoms). We know nothing worth gaining is ever gained without effort.

Are you becoming a happiness machine? It is about time you become one…

Elad

The way to Mastery – the #Drive way or the Freak Factor way

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According to Dan Pink in his new book, Drive: The Surprising Truth About What Motivates Us, a big part of “Motivation 3.0”, is the concept of Mastery. The argument goes something like this:

Only engagement can produce mastery – becoming better at something that matters. And the pursuit of mastery, an important but often dormant part of our third drive, has become essential to making one’s way in the economy. Mastery begins with “flow” – optimal experiences when the challenges we face are exquisitely matched to our abilities.

While I really like the concept I feel that the argument for this part of the AMP (Autonomy, Mastery, Purpose) in the book is not compelling as the other parts. One potential drawback that I see with the way Pink approaches the issue of mastery. He takes a too narrow approach to the way success, or better yet, excellence, is actually measured in our world. In his attempt to break some of the conventional wisdoms, Pink falls prays to others.

Let me explain by quoting a short part from the mastery chapter:

Mastery – of sports, music, business – requires effort (difficult, painful, excruciating, all consuming effort) over a long time (not a week or a month, but a decade). Sociologist Daniel Chambliss has referred to this as “the mundanity of excellence.” Like Ericsson, Chambliss found – in a three-year study of Olympic swimmers – that those who did the best typically spent the most time and effort on the mundane activities that readied them for races. It’s the same reason that, in another study, the west point grit researchers found that grittiness – rather than IQ or standardized test scores – is the most accurate predictor of college grades. As they explained, whereas the importance of working harder is easily apprehended, the importance of working longer without switching objectives may be less predictable… in every field, grit may be as essential as talent to high accomplishment”.

Am I the only one who is baffled here? Predictor of college grades? I am sorry, but since when college grades is a predictor of anything? As Seth Godin says in Linchpin: Are You Indispensable?, the only thing that being good at school means is – that you are good at school (!):

You have been brainwashed by school and by the system into believing that your job is to do your job and follow instructions. It’s not, not anymore.

Following instructions with grittiness and determination might lead to successes. But it also might be exactly the kind of thinking that leads us to being cogs in the big factories of productivity. I am not sure that the success, as measured currently by society, is what we should all aspire for. I am not saying that effort or grittiness is not important. I actually believe that sometimes dying on the treadmill is all that matters. It is just that it is not the right fit for everybody. For some, mastery can be found not in grittiness, but in being impatient. Here is one example of a very successful man, from the freak factor blog:

My mantra, as well as my business plan, is ‘If you always do fun stuff, there will always be plenty of fun stuff to do.’ This works incredibly well for me, as I’m allergic to doing stuff that’s not fun. Consequently, I have the grooviest career, biz & life I can imagine as the Rock and Roll Guru.

Another significant ‘flaw’ is my attention span, or lack thereof. The strength here is that I’m working on so much cool stuff that I never get bored. There’s always another fun project to which I can turn my attention, however briefly. For example, I’m working on a series of themed Daffynitions books, including Biz, Parenting, Relationships & Self-help. Additionally, I’m writing the Rock & Roll Dictionary, which is based on the Daffynitions model.

Yes, in his own way, over a long haul of time, Joe Heuer shows grittiness. But it is not in the way Pink talks about. More importantly, Joe Heuer is a wonderful example of mastery leading to excellence.

I am not against mastery. I am all for it. I do believe in its power. We just need to remember that there are many ways to achieve mastery and that we need to be careful in the ways we measure success, as they might limit the ways we manage people. Mastery can be reached by working hard and not giving up. Mastery can also be achieved by letting go and trying many different things. And that is exactly the point. Differences should be embraced. Paths should be explored. Given the right support, people will find their way to excellence.

Elad

Does management emanate from nature?

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Finally, I have finished reading Daniel Pink’s new book Drive: The Surprising Truth About What Motivates Us. I don’t think the book needs another review (for a much better review than any I can write, see here). However, in the next few days I want to elaborate on and/or argue with some of the concepts in the book.

I want to start with this quote (an idea Dan mentions in his TED talk as well):

We forget sometimes that “management” does not emanate from nature. It’s not like a tree or a river. It’s like a television or a bicycle. It’s something that humans invented. As the strategy guru Gary Hamel has observed, management is a technology. And like motivation 2.0, it’s a technology that has grown creaky. While some companies have oiled the gears a bit, and plenty more have paid lip service to the same, at its core management hasn’t changed much in a hundred years. Its central ethics remains control; its chief tools remain extrinsic motivators…

While I agree that management hasn’t changed a lot over the last 100 years and that it is still built around misguided Taylorism based conventional wisdoms that is about time we break, I find it hard to agree with the main claim. Management does emanate from nature. In fact, the problem with management today as I see it is that we stopped doing what is natural and human and started using artificial methods to deal with people.

Being empathic, creating connections and socializing, talking and listening and even respecting our fellow human beings are not unnatural things.

When you start treating management as a race for productivity you get an unnatural phenomenon. When you start using carrots and sticks like people are jackasses you get an unnatural phenomenon. When you rely only on measurement of only the things you can measure to fuel management you get an unnatural phenomenon.

Pink claims that we should throw the word “management “onto the linguistic ash heap alongside words like “icebox” and “horseless carriage”. He claims that today we see many companies getting rid of “middle management” which leaves fewer managers with more people to manage. I think exactly the opposite.

I think what this world need is more managers. More discussions of the word and what it means to be a real manager of real people. Not more of the word that goes with every other role in every other company, but the word that describes the true role of a manager – people. more discussion about a manger who brings the best out of people. About a manager who listens to people and helps them excel. About the manager who takes out the linchpin and the artist in people. About a manager that brings out the natural human being in people.

I don’t think there is anything more natural than management. We just need to wake up, understand that we have been talking about the wrong thing and making the wrong assumptions and start being actual human beings again.

Elad

Minus two and a half cheers for sticks and carrots – my short answer to The Economist

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Let’s say you were born just a little before the car started to be a really useable means of transportation. You grew up watching everybody around you use horses. In fact, you know how people, who don’t have horses, are suffering. With a horse you can do so much more. Get to places faster. Be more productive. Hell, you stick a cart to it, and you can almost do anything with it. It sure allows you to have more time to do other stuff. And you look at this new invention, the car, and you say to yourself – “well, it has its merits, but horses work for me and they are have done so well for civilization, I think I would keep with horses”.

How would you describe this type of thinking? I know human are slow to adapt to change, but looking back from our comfortable place up history’s line, this guy just seems ridiculous to us. Well, I am not sure people in the future would not look at The Economist’s Schumpeter article from January 14th titled: Driven to distraction – Two and a half cheers for sticks and carrots the same way.

In this article, The Economist goes against what they call “… [The] Eminent management theorists [That] have been dismissing payment-by-results as simplistic and mechanical ever since Frederick Taylor tried to turn it into the cornerstone of scientific management in the early 20th century”. Their wrath is turned  especially against Daniel H. Pink new book, Drive. Their claim? The system of sticks and carrots, actually works. So please, don’t bother us with all this “new-age”  Autonomy, Mastery and Purpose propaganda:

How convincing is all this? Mr Pink insists that all he is doing is bringing the light of science to bear on management: “There’s been a mismatch between what science knows and what business does.” But this argument depends on a highly selective reading of the academic literature. Four reviews of research on the subject from the 1980s onwards have all come to the same conclusion: that pay-for-performance can increase productivity dramatically. A study of an American glass-installation company, for example, found that shifting from salaries to individual incentives increased productivity by 44%. More recent research on workers at a Chinese electronics factory also confirms that performance-related pay (especially the threat of losing income) is an excellent motivator (see article).

I had to re-read this paragraph several times to believe my eyes. The argument is: It works, thus it is good and we should reject anything else. Is it only me, or does it sound a little totalitaristic? Yes, Stalin’s rule worked, for a time, but was it a good thing? Personally, I don’t believe so. To me it sounds like this is focusing on the how and forgetting to ask why?

Carrots and sticks might work, but its underlining assumption is that people are jackasses (that is stubborn, stupid, willful, and unwilling to go where someone is driving him). Carrots and sticks might boost productivity, but they lead to a society where almost half the people are unhappy with their jobs. Carrots and sticks might is measurable, but great things come out of processes that we cannot measure.

It is not the first time I was shocked to see The Economist supporting the conventional wisdom. And while I don’t blindly buy into everything Dan Pinks says (as skillfully as he says it) and I do believe that his approach should be supplemented with other approaches, it hurts me to see such idolism of carrots and sticks and Taylorism.

The past will always to try to prevent the future. I don’t think this future could be prevented for long…

Elad