Thoughts on rewards as a way to boost productivity

Just some thoughts related to monetary rewards as a way to boost employee performance.

Have you ever done an activity that you truly enjoyed until someone else wanted to pay you for the work, where you suddenly stopped enjoying the activity? Have you ever got a bonus about something you did, just to see with great disappointment that the same activity didn’t lead to a bonus the next time you performed it? Has your performance dropped after it?

Companies are using rewards to increase the motivation and the performance of their employees (undermining the person’s self-interest towards an activity), only to find out with great surprise that after an initial increase the performance of the employee falls.

Rewards as established in the past can work quite good in case of algorithmic repeated tasks, for example if you pay someone by the amount of boxes he can move per hour, and reward him for every 100 boxes, its quite possible that he will perform better, at least in short term. On the other hand you can’t promise someone a reward if he paints better, because “better” in that case is highly subjective. Today most societies are leaving algorithmic repeated task to machines, while on the same time companies value more and more skills like “problem solving” and “critical thinking”.

Most of the software engineers, as most of the painters or musicians, chose their profession due to an intrinsic motivation towards learning, exploring and problem solving. Painters love drawing, musicians love playing the guitar and software engineers love solving problems. Thousands of software engineers are contributing to open source projects, not because they get paid for it but because they simply love solving problems. Companies/managers should be able to distinguish between tasks where a reward could boost productivity and tasks where a reward is not applicable, at least before the execution. On the same time they shouldn’t undermine the person’s self-interest and intrinsic motivation towards a task.

For example some years ago, in Sweden they made an experiment, they promised a small amount of money as a reward for every time someone donated blood. Donations instead of increasing, they fall dramatically. The reward turned a “social contribution to society” into “a way to get some money”. Rewards can turn something that is “fun” or “a contribution to a greater good” into a drudge. There is even a term for this phenomenon, the “Sawyer Effect”, after Tom Sawyer, who tricked his friends into painting a fence for him by convincing them it was fun.

My checklist of questions before considering any reward:

— Is the task a routine? Is it something that will need to happen quite regularly or is a one time thing?

— Does the task require critical thinking or is mostly a series of steps someone has to follow?

— If is a series of steps, can it become more interesting? (e.g. can you let the person automate it or do it in their own way)

— If is a boring task, can you associate it to a greater purpose? (e.g. we have to do this boring thing, so we will be able to release the last version of our software and make some of our customers happy)

Intrinsically motivated people 99% of the time achieve more compared to the people that seek rewards for motivation, and at the end of the day “If you need me to motivate you, probably I don’t want to hire you.”