Workplace needs new employee incentives

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Let’s take a break from finance, home mortgage rates, credit scores and insurance to consider a fundamental flaw in the American business model.

I’m talking about carrots.

Not those orange scrapings atop your Cobb salad, but extrinsic rewards like annual bonuses, those coveted carrots of the carrot-and-stick (C&S) motivational model that begat the rat race in the first place.

“Not only is carrot-and-stick outdated, it can be dangerous.”

Daniel Pink says those carrots have not only outlived their usefulness; they’re clogging our creative arteries as well.

Pink thinks American workers and their employers would both benefit by a shift away from the dulling external motivators and toward a corporate culture that harnesses deeper human desires for autonomy, mastery and purpose. More about what that might look like in a moment.

Part pragmatist, part provocateur, Pink is a postmodern, PBS-pedigreed paradigm repairman out to reshape the very DNA of the workplace.

His first book, “Free Agent Nation,” was about how we work. His second, “A Whole New Mind,” was about what we do at work. His latest, “Drive: The Surprising Truth About What Motivates Us,” is about why we work.

The surprising truth? We’re not all that fond of carrots.

Veering off course

Pink cites four decades of scientific research that show that humans are not simply motivated by cash, but also by higher intellectual and emotional needs as well. In fact, in controlled studies, extrinsic rewards were shown to reduce performance and inhibit creativity.

The rat race started to veer off course back in those pre-“Mad Men” days of the 1950s.

“The whole ethic was very much this idea that human beings are automatons; ‘I’ll see your Pavlov and raise you a B.F. Skinner,'” Pink says, invoking two giants of operant conditioning, the process of changing behavior through reward and punishment.

Carrot-and-stick worked fine to motivate people to perform the simple, repetitive assembly-line tasks that built 20th century America. But since the computer automated many of those tasks, C&S has been largely ineffective in stimulating the creativity we need in the information age.

Pink says not only is carrot-and-stick outdated, it can be dangerous.

“If you have a system, particularly a financial system and a Wall Street system, that have these narrow, short-term goals with gigantic payoffs, you’re going to have some people who will take the low road there. What surprises me is that everybody doesn’t take the low road,” he says.

“We have to remember that that kind of motivation system almost brought down the entire economy. The Federal Reserve had to take unprecedented steps to save us from our excesses.”

Wall Street bonuses? So last century.

Companies catch on

Pink says what America needs is a workplace makeover that replaces the fear and uncertainty of carrot-and-stick with the freedom and (dare I say it?) playfulness that can unleash the full creative potential of its workers.

Some forward-thinking companies have already caught on. Google in Mountain View, Calif., instituted “20 percent time,” in which engineers devote one day a week to tinkering outside the box. Australian-based software company Atlassian holds “FedEx Days” in which programmers invent new products or processes in a 24-hour frenzy and deliver it overnight — hence the name.

A few companies have even gone ROWE, short for “results-only work environment,” which does away with work schedules entirely. Workers at Best Buy’s corporate office in Richfield, Minn., don’t have schedules and can show up when they want, as long as they get their work done.

To be sure, Pink’s proposition chafes under the starchy white collar of corporate America. On the positive side, there has never been a better time to abandon carrots.

“Yeah, the carrot cupboards are fairly bare,” he says. “It’s not like managers have this whole arsenal of carrots to dole out.”

Those companies that catch this wave may finally reap the full creativity of their workforce.

“It overturns a lot of orthodoxies that all of us have known in our guts weren’t quite right, that human beings have more drives besides simply chasing after the carrot and avoiding the stick,” says Pink. “Treating people more like human beings and less like horses is not only nice, it’s more effective.”

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