In 2009 TED produced a video talk by Daniel Pink on “The Puzzle of Motivation.” http://www.ted.com/talks/dan_pink_on_motivation.html.  The essence of this 18-minute address is that while the work that we produce has significantly changed our “carrot and stick” reward systems have not.  Pink supports his argument with findings from several scientific studies showing that pay for performance systems are effective when the work is routine, and the goals and path for accomplishing the work are clearly laid out.  However, in a world where issues are complex and goals are unclear, pay for performance systems actually have a negative impact as they hamper the individual’s ability to be creative.*

 

If the old systems don’t work, what are we to do???

 

Again, Pink turns to science.  He points to studies of organizations that focus on their employees’ intrinsic motivators.  Organizations that allow their employees autonomy in how and when they do their work, that encourage employees to develop a level of mastery of their skills, and that help employees see how their work contributes to something bigger have higher employee satisfaction, higher employee engagement, higher productivity, and lower turnover.

 

Interestingly, Pink started this 2009 piece by suggesting that the economic downturn offered organizations an opportunity to walk away from a model that was ineffective and try something new.  Four years later, I am hard-pressed to see any significant change, and yet it’s so simple.  We already have everything that we need to begin to make this transition.

 

For those leaders looking at their 2013 review and reward budgets, and their talented staff, and wondering how they are going to keep their team with these meager funds, I offer you a challenge.  Get creative!  Reward your employees by truly engaging them.  The results may far exceed your expectation!

 

*Pink does note that salaries should be adequate and fair