The "true facts" about "carrots and sticks"

If creativity and productivity are going South in your organization it could be the "carrot and stick" incentives on offer.

Dan Pink, author of A Whole New Mind, shows there is a huge "mismatch between what science knows and business does" about getting the best out of people.

Business continues to use financial rewards designed for a late 19th and early 20th century workplace when higher pay, bonuses and other rewards (and punishments) improved productivity of workers engaged in routine and mechnical work, like the factory production line.



All this has changed. The old ways of rewarding people are not working any more.

A whole raft of scientific studies now show that financial and other incentives are the least effective way to reward the people in "right brain" jobs. It's all about solving wicked problems, creativity and creating new knowledge that can't be automated or sub-contracted to unskilled workers in low-cost countries.

For this kind of 21st Century work, the intrinsic motivators of "autonomy, mastery and purpose" deliver the most sensational results in postcodes like 95128 (Silicon Valley, CA) and 02139 (Cambridge, MA) and countries like Australia and India.

So knowing this, why do we still keep on paying the bankers of Wall Street and the CEOs of big companies huge bonuses to turn our financial system and our corporate sector into rubble?

Pink shows that knowledge and wisdom workers respond positively to the very human desire to exercise control over our lives, to do what we think is important, to choose our own directions. We also love to do it incredibly well and feel proud of our achievements. And do so in the service of a cause much bigger than ourselves.

It's the new way that up-and-coming software companies treat their employees. Instead of rules, time clocks and managerial control, it's ideas like "Fedex day" where all the programmers do whatever they please and create some new software fix/application overnight. And celebrate together over a beer. It's the amazing 50% of new software products coming out of Google produced during the 20% of the time they can do whatever they want. Its the amazing productivity of the millions of people who worked tirelessly to create Wikipedia, for NOTHING!

And, says Pink, it's not a socialist conspiracy. Nor a philosophy. But as Washingtonians would say, "a true fact".

Here's a workshop to deal with your productivity/creativity gap:

1. What's the mood of your organization, how does it feel about itself and what it does? Is it a party, a wake or something else?
2. List all the jobs in your organization where the staff are motivated by EXTRINSIC rewards (money, bonuses, sanctions etc.) and describe how they are rewarded.
3. List all the jobs in your organization where the staff are motivated by INTRINSIC rewards (autonomy, mastery and purpose) and describe how they are rewarded.
4. What programs (e.g. bonuses, piecework rates) does your organisation have in place to recognize and reward success at "left brain" routine work that can be automated?
5. What programs (e.g. FedEx days, celebrations) does your organisation have in place to recognize and reward success at "right brain" problem solving, decision making, improvement and creativity tasks?
6. Thinking about your "productivity/creativity crack/gap/gulf/chasm" (if any), what could you do NOW to allow your people take control of their lives, be brilliant, and serve a higher purpose?