Monday, 4 January 2010

Incentivisation may harm performance

In this fascinating talk, Daniel Pink reminds that management is not a natural phenomenon, but was invented in the 20th century - and that therefore it may not be the right solution for the future.
He further points out that business does not do what science knows - for example:
  • contingent ("if-then") rewards often destroy productivity, particularly in work where creativity is required
  • management is great if you want compliance, but not if you want engagement
  • intrinsic self-motivation often produces better results in complex and creative environments, and relies on
    • autonomy
    • mastery, and
    • purpose
When considering this subject, though, I think it is also useful to look at pursuits into which people do pour their time, energy and money. Sports are the obvious choice that springs to mind. People engage with sports, as players or spectators, even more passionately than they engage with arts and culture, and certainly more than most people engage with their work.

I think that one of the reasons for this is that the language of winning is much more straightforward. In sports, everyone knows who the competitors are, everyone knows exactly what they need to do to score points, the causality between actions and scoring is clear, and everyone knows who is winning and losing at any point in time.

In business, I think this is less obvious. Companies keep score using arcane accounting conventions which few employees understand. Where there is a clear focus on the competition, relative performance is often less than clear. Could we make work more engaging by making it more like sports - effectively by gamifying work?

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Updated 11 April 2017.