Motivation and Success

Posted on June 3, 2010

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Earlier this week, Professor Don Ariely, a behavioral economist at Duke University and the author of a new book entitled “The Upside of Irrationality” was interviewed on NPR. Ariely spoke about research he has conducted on motivation in the workplace and described a couple of his findings which, while not totally surprising or unexpected, were nonetheless insightful.

One experiment was designed to test how promising someone a large bonus if they achieve a particular goal affects that person’s ability to meet the goal. According to Ariely, people will certainly want to perform and succeed, so it’s not an issue of motivation. The question is whether promising an outsized financial reward will lead to greater success. Ariely claims that the answer is no:

. . .[I]t turns out that money is kind of a two-edged sword. It’s a motivator when we get more money, we want to do better, but it’s also a stressor in the sense that the more money creates more stress.

Now, in simple task, if I told you, I’ll pay you to jump and I gave you either a dollar per jump or a thousand dollars per jump, you will jump more because you have good control over your muscles and you can just will yourself into higher effort.

But when it comes to creativity and problem solving and thinking and memory and concentration, it turns out you can’t will yourself to higher level of performance. And instead, the high bonus actually got people to be very stressed.

Robert Siegel, the interviewer, asked Ariely the obvious question – what about Wall Street? It doesn’t appear that huge bonuses make top financiers stressed – or, if huge bonuses do in fact stress out bankers, they certainly manage to overcome the stress and meet their goals. The professor didn’t have a convincing answer to this, so clearly more research remains to be done.

Posted in: Compensation