There is a mismatch between what science knows and what business does. Science knows that the 20th century tiered financial rewards do not improve performance and can even destroy creativity.
The secret to high-performance is that unseen intrinsic drive –the drive to do things for their own sake. The drive to do things because they matter to the doer.
What science tells us from the candle problem.
Created in 1945 by a psychologist named Karl Duncker. Participants are given a candle, some thumbtacks, and some matches.“Your job is to attach the candle to the wall so the wax doesn’t drip onto the table.” You time how long it takes people to find a solution.
How do we get the quickest solutions? The standard business model is if you want people to perform better, you reward them. Right?Bonuses, commissions, etc. Incentivize them. That’s how business works. But that’s not happening here.
The group who were offered a reward for being in the top 25% actually took 3.5 minutes longer than people who were given no reason to rush. You’ve got an incentive designed to sharpen thinking and accelerate creativity, and it does just the opposite. It dulls thinking and blocks creativity.
This experiment has been replicated over and over again for nearly 40 years. Contingent motivators —if you do this, then you get that —work in some circumstances. But for a lot of tasks, they actually either don’t work at all or, often, they do harm. This is one of the most robust findings in social science, and also one of the most ignored.
If-then rewards work really well for tasks where there is a simple set of rules and a clear destination to go to. Rewards, by their very nature, narrow our focus, concentrate the mind. So, for mechanical tasks a narrow focus, where you just see the goal right there, zoom straight ahead to it, incentives work really well.
But for the candle problem, you want to be scanning wide. The solution is on the periphery. But rewards actually narrow our focus and restrict our creativity.
Modern psychology is leaning more towards intrinsic motivators –the desire to do more for personal reasons. In the business setting, it revolves around.
Autonomy. People have an urge to direct their own lives –some companies, like Google and Atlassian in Australia, let their employees use some of their company time to work on whatever projects they like, which has resulted in the creation of new products for the companies.
Mastery. People have a desire to get better at something that matters to them.
Purpose. People have a yearning to do something for the benefit of something larger than themselves.
In order to thrive in the 21st century, businesses need to repair this incentive mismatch and get beyond the traditional carrot and stick motivation, by encouraging intrinsic self-driven creativity and giving people a purpose in doing things.