I have been trying to get my head around different information which I have seen in the past months with regards of how we look at compensation and how business encourages and incentivizes the work force. Working in HR in Compensation and Benefits I cannot but stop wondering about this 2 videos/animations that talk about the matter.
They both conclude that it has been proven that if you want people to do repetitive work, then current remuneration schemes work like a charm, the more you incentivize people the better they perform; but as soon as you need them to think creatively or solve problems then this completely backfires and higher incentives lead to lower performance. Now I still do not see exactly how to link this and implement it in what I do, but for sure it leads to some interesting conversations.
It is all about: Autonomy, Mastery and Purpose; those are the 3 factors that lead to better performance and personal satisfaction.
Here are 2 of the most interesting videos I have found on the matter, leave any comments or thoughts you have on the matter:
Career analyst Dan Pink examines the puzzle of motivation, starting with a fact that social scientists know but most managers don't: Traditional rewards aren't always as effective as we think. Full bio and more links
Economists at LSE looked at 51 studies of pay-for-performance plans, inside of companies. Here's what the economists there said, "We find that financial incentives can result in a negative impact on overall performance."
And what about the Results Only Work Environment, the ROWE. In a ROWE people don't have schedules, they show up when they want, they don't have to be in the office at a certain time, or any time. They just have to get their work done.In this scenario almost across the board, productivity goes up, worker engagement goes up, worker satisfaction goes up, turnover goes down.
Conclusion: “There is a mismatch between what science knows and what business does”, but how do you apply and sell this and change business?