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it our motivations are unbelievably interesting I mean it I find I've been working on this for a few years I just find a topic still so amazingly engaging and interesting so I wanna tell you about that the science is really surprising the science is a little bit freaky okay if we are not as endlessly manipulatable and as predictable as you would think there's a whole set of unbelievably interesting studies I want to give you two that call into question this idea that if you reward something you get more of the behavior you want and if you punish something you get less so let's talk let's go from London to the mean streets of Cambridge Massachusetts the northeastern part of the United States let's talk about a study done at MIT Massachusetts Institute of Technology here's what they did they took a whole group of students and they gave them a set of challenges things like um memorizing strings of digits ah solving word puzzles other kinds of spatial puzzles even physical tasks like throwing a ball through a hoop okay they gave them these challenges and they said to incentivize their performance they gave him three levels of warts day so if you did pretty well and you've got a small monitor report if you did me well you gotta media monitor were and if you did really well if you are one of top performer to bet a large cash prize that we seen this movie before this is essentially a typical motivation scheme within organizations right when we were the very top performers we ignore the low performers and of the old folks come in the middle of ten in a little so what happens they detest to have these incentives here's what they found that one as long as the cost involved only mechanical scale bonuses workers they would be expected the higher the pay the better the performance it that makes sense but yours what happens but once the task offer even rudimentary cognitive skill in larger reward lead to four performance this is Frank Wright a larger reward but the forefront I cannot possibly the most interesting about this is that these folks here who did this are all economists that the two at MIT one of the universe is called oh one at Carnegie Mellon take it up here the economics profession and are reaching this conclusion that seems contrary to what a lot of us learned in economics which is which is that the higher the reward the better performance than the saying that once you get above rudimentary cognitive skill it's the other way around which seems like this kind of the idea that these words don't work that way seems vaguely left wing and social thousand it's kind of this kind of weird socialists conspiracy for those of you who have those conspiracy theories I want to point out the soap that notoriously left wing socialist to finance the research the Federal Reserve Bank today as the mainstream of the mainstream coming to a conclusion it's quite surprising seems to defy the laws of physics it was the strangest response to what they do this it looks this is this is freaky what the test that somewhere else maybe that fifty dollars to develop price isn't sufficiently motivated for an MIT right but total place were fifty dollars is actually more significant relative but so with the fake experiment in the bottom of a right India rule India where fifty dollars sixty dollars whatever the number was actually significant sum of money to be replicated experiment India roughly as follows small rewards the quick one of two weeks' salary on resource a small performance low performance to resell or a media performance about a month salary on type format but two months now so there's a real good incentive for tissue to get different results here what happened though was that the people offered the median reward didn't know better than the people offered the small room work but this time around people offer top work they did were all tired center with the worst performance with interesting about this is that it actually isn't all that anomalous this has been replicated over and over and over again by psychologists by Tom sums six and by sociologists Aachen by economists over and over and over again for simple straightforward past those kinds of incentives if you do this then you get that their rates if passed the Dar al the rhythmic set of rules we have this follow along and get a right answer if than a rewards carrots and sticks outstanding but when the task gets more complicated it would require some conceptual creative thinking those kinds of motor that are demonstrably don't work that money is a motivator at work but in a slightly strange way if you don't pay people enough they will be motivated with cherries but there's another paradox which is the best use of money is a motivator it to pay people enough to take the issue of money off the table the people enough so that they're not thinking about money that they can about the work out what to do that it turns out that three factors that the slideshows lead to better performance I'm not to mention personal satisfaction autonomy mastery and purpose autonomy is our desire to be self directed to director on lots now in many ways traditional notions of management run afoul of management is great if you want compliance but if you want engagement which is what we wanna work force today as he put in more complicated sophisticated thinks self direction is better one give you some examples of its most radical form of self direction in the workplace that lead to good results but start with this company right here at last and an Australian company the software company and they do something really cool once a quarter off on Thursday afternoon the city the developers for the next twenty four hours you can work on anything you want you can work out the way you want you to work out with whomever you want all we ask is that the show the results of the company at the end of the twenty four hours in this fun unimpeded not a star chamber session but this one meeting with the year and cake and fun and other things like that it turns out that that one day up your on diluted autonomy has led to a full re fixes for existing software awful rib ideas for new products the other ones that never were one day that this is not a gift an incentive to set up the sort of thing I would've done three years ago before I knew this reason I would've said you want people to be creative and innovative hidden African innovation bonus if you do something cool to be twenty five hundred dollars doing this at all essentially saying you probably want to do something interesting to me just about anywhere one Dale autonomy produces things that never were but the mastery master is urged to get better at stuff we'd like to get better it's tough this is why people play musical instruments on the weekend yet all these people were acting in ways that seem irrational economically the play musical instruments on weekends quiet spot to make it to me it's not to make them any money why they doing it's fun to get better at it not satisfied go back in time a little dimension I imagine this if I went to my first economics professor a woman named Mary Alice shoulder I went to her in nineteen eighty three said the social that I talk to the class for all to when I got this idea for a business model is water on it passed this I would wear you get a bunch of people around the world we're doing highly skilled work but they're willing to do it for free and fall into the top twenty sum of thirty hours he's looking somewhat skeptical I'm not done and then what they create the given away rather than sell it here the stewardess to sleep with fun I was insane they seem to find that some think what happened next powering water for corporate servers and fortune five hundred companies Apache powering up more than the majority of web servers out with the PDF what's going on why oh why are people doing what they want these people many of whom are technically sophisticated I was still people who have jobs ok they have jobs they're working in jobs for pay doing to our seats doing sophisticated subtle psychological work and that during their limited discretionary time they do equally if not more technically sophisticated work not for their employer but for someone else for Friday the strange economic behavior economists to look into it while doing this it's overwhelming weekly challenge of mastering along with making country that would be seeing more and more to rise with my call the purpose is that more and more organizations want to have some kind of transcendent purpose partly because it makes come and work better partly because that's the way to get better talent on you were saying now is in some ways when the profit motive becomes one more word from the purpose motive of bad things happen that exactly sometimes but also bad things just like not good stuff like crappy products like Lee service but uninspiring places where that when the profit motive is is is paramount or when it becomes completely on its purpose it's just people into great thing more and more organizations are our realize this and the third disturbing the categories between what profit what's with purpose and and I think that actually helps something interesting I think that the companies that organizations that are flourishing with a profit for proper somewhere in between are are are animated by this purpose but only get a couple examples here's the founder sky this is our goal to be disruptive but in the cause of making the world a better place pretty good purpose fifty jobs well enough but being in the universe alright the thing that my kitchen up in the morning every reason to go to work so I think that um that we all our purpose maximize the snuggly profit this thing to sign shows that we care about mastering very very deeply in the sign shows that we want to be self directed and I think that the big takeaway here is that if we start treating people like people and not assuming that this oblique forces second smaller smaller better smelling course I've to get past this ideology of carrots and sticks and look at the science um I think we can actually build organizations and work lives that make us better off but I also think they have the promise to make our world is a little bit better