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Employee Recognition, Life at Work

Why Money Is the Worst Way to Motivate Employees

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Robby Berman

Robby Berman is a reporter, father, and musician who creates and discovers good stuff for the Internet world.

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Optimized-iStock_000036037030_Small.jpgOne of the most tried-and-true techniques for motivating employees turns out to often have the opposite effect. Bosses have long offered workers financial bonuses for doing better work. This system of incentivizing workers worked beautifully when only mechanical skills are required, but new studies suggest it’s a whole different story when the work involves thought. It turns out we’re not as manipulatable as some bosses may think we are.

In this fascinating RSA video, author Dan H. Pink, who writes about work and business, discusses recent studies that show how different levels of financial bonuses actually do more to dispirit most workers than encourage them. When we reward top performers, it actually results in worse performance. The results we get are totally backwards from what we’d expect. And it turns out there are ways to incentivize workers when employees are just paid enough that money is taken off the table as an issue and they can just concentrate on the work.

The studies show there are three things that actually do lead to better performance:

  • Autonomy: Micromanagers may have a little trouble believing this, of course
  • Mastery: We all love to get better at things
  • Purpose: How much more exciting is it to try to achieve some that has meaning?

Pink’s a great speaker, and it’s really an enjoyable talk. With cartoons! Enjoy.



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Robby Berman

Robby Berman is a reporter, father, and musician who creates and discovers good stuff for the Internet world.

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