Why the carrot/stick approach no longer works in business

Late to the party I know, but I recently watched a TED talk by Dan Pink on motivation and couldn’t resist summarising. In essence, the presentation looked at different ways businesses attempt to motivate their staff, specifically focusing on the effects of a carrot/stick approach.

Examining what was originally dubbed the candle problem (thumb tacks in/next to a box, candle, matches and instructions to attach the candle to the wall so the wax didn’t drip), Pink’s presentation (and the scientific research it was based upon) put forward the following:

1. Where a task is simplistic and straight forward, incentive works really well. 

The logic here is that the left hemisphere of the brain is in control and the process is for the most part completely automated. As such, the greater the incentive, the faster/more likely the task will be completed.

For example, in my previous role, as a catalyst for change when it came to recycling (put your rubbish in the correct bin), this worked really well. There were clear signs about what went in each bin and the prize (platter of home made brownies) was incentive enough thanks to my reputation as a baker. Equally, dividing the teams into both floors and groups within them and offering different prizes for each category revealed that the greater prize also incentivised a greater outcome. Admittedly, to continue adherence after the month long competition ended, ongoing rewards needed to be introduced but you get the picture.

2. When the thought process requires creative or lateral thinking, incentives can actually do more harm than good

The studies that Pink discusses revealed that when incentives were offered for tasks requiring creative or lateral thinking (right brain), they either had no effect or a detrimental one (proportionate to the perceived value of the incentive). Initially, I had guessed that may be the case because of the self imposed pressure or distraction created by trying to attain the reward. However, as Pink notes, the incentive approach forces us into left brain thought processes which look for structure and automation. As such, the incentive actually acts like blinkers so that we cannot see possible solutions lying in the periphery.

As such, the carrot/stick approach only really works for tasks that can be automated. However, as we now progress into an age of not only outsourcing but automating to AI, the situations where this will successfully work are limited. In a world where we now know that the majority of jobs current school students will undertake have yet to be created and where creativity and creative thinking will be the prized assets (until AI catches up to that too), it’s no wonder why this approach isn’t likely to work too well.

So how should businesses go about motivating action and change?

3. The best motivators focus on purpose, autonomy and mastery

As this charming talk shows, human beings are far more complicated than many other animals. Successful motivations do not focus on the superficial but rather on our values and inner desires as I discussed in my piece what makes you tick.

We want to feel like we’re contributing to something bigger than ourselves and that we’re making an impact (purpose). We want to feel like we’re in control of our own career progression and possibilities (autonomy). And lastly, we want a challenge, we want to keep growing (mastery) which I discussed in detail in my post on the importance of growth in careers.

Amazingly, each and every one of us already knows these things. At our core we all want to better ourselves, to grow and contribute and find meaning. Science is simply supporting us.

So why is it that big businesses for the most part, seem to still be transfixed on bonuses and financial rewards? Why do they boast about how they promote innovation and then refuse to give employees the freedom to further themselves and in turn help the company to grow?

The answer in my mind is without a doubt fear. Fear of the unknown, fear of chaos and lack of control. That however, is a topic for another day.