At Legitimate Leadership we have come to believe that there are really only three reasons why employees will go the extra mile at work.

They believe the goals and objectives of the organisation they work for are worth going the extra mile for (Ariely’s ‘importance of meaning and purpose’).

They report to the kind of manager who kindles in them a preparedness to do, not just what is asked, but much, much more than that. Among other things this kind of manager acknowledges and demonstrates appreciation for what his people have contributed (Ariely’s gratitude).

They have such a passion for the work that they do that they want to apply all their skills and energy to doing it superbly well.

OUR SUMMARY OF THIS VIDEO: Think about Adam Smith versus Karl Marx. Adam Smith had an important notion of efficiency. He gave an example of a pin factory. He said the making of pins have 12 different steps, and if one person does all 12 steps, production is very low. But if you get one person to do step 1, and one person to do step 2 and step 3 and so on, production can increase tremendously. And indeed, this is the reason for the Industrial Revolution and efficiency.

Karl Marx, on the other hand, said that the alienation of labor is incredibly important in how people think about the connection to what they are doing. And if you do all 12 steps, you care about the pin. But if you do one step every time, maybe you don’t care as much.

In the Industrial Revolution, Adam Smith was more correct than Karl Marx. But now we’re in the knowledge economy.  Is efficiency still more important than meaning? I think not. I think that as we move to situations in which people have to decide on their own about how much effort, attention, caring they are going to put in, how connected they feel to their work … all of a sudden Marx is more applicable.

So when we think about labor, we usually think about motivation and payment as the same thing, but the reality is that we should add all kinds of things to it: meaning, creation, challenges, ownership, identity, pride, etc.

The good news is that if we added all of those components and thought about them – how do we create our own meaning, pride, motivation, and how do we do it in our workplace, and for the employees – I think we could get people to be both more productive and happier.

But we still have the naive intuition that people are like rats in a maze – that all they care about is money, and the moment we give them money, we can direct them to work one or the other way. This is an incredibly simplistic view of the labor market.
Mountain climbers don’t climb for immediate enjoyment. What they do involves a lot of suffering. But they go back again and again.

This suggests that we care about reaching the end, a peak, that we care about the fight, about the challenge. It suggests that there’s all kinds of other things that motivate us to work or behave in all kinds of ways.

In one famous set of experiments, researchers asked two groups to build characters from Lego’s Bionicles series. In both cases participants were paid decreasing amounts for each completed Bionicle – $3 for the first one, $2.70 for the next, and so on. But while the first group’s creations were stored under the table to be disassembled at the end of the experiment, the second group’s Bionicles were disassembled as soon as they had been built. They were literally destroyed in front of the builders’ eyes.

The first group made 13 on average while the second group stopped after only seven. It was clear that seeing the fruits of their labours, even for a short time, was enough to dramatically improve their performance.

In another version of this experiment, the experimenters didn’t put people in this situation, they just described to them the situation and they asked them to predict what the result would be.

People predicted the right direction but not the right magnitude. They said that in the ‘meaningful condition’, people would probably build one more Bionicle.

So people understand that meaning is important, they just don’t understand the magnitude of it.

I went to talk to a big software company in Seattle … A group within the software company  was put in a different building, and they asked them to innovate and create the next big product for this company. And the week before I showed up, the CEO of this big software company went to that group, 200 engineers, and cancelled the project. And I stood there in front of 200 of the most depressed people … and I described to them some of these Lego experiments, and they said they felt like they had just been through that experiment. And I asked them, ‘How many of you now show up to work later than you used to?’ Everybody raised their hand. I said, ‘How many of you now go home earlier than you used to?’ Everybody raised their hand.

“And I asked them, ‘What could the CEO have done to make you not as depressed?’ And they came up with all kinds of ideas. They said the CEO could have asked them to present to the whole company about their journey over the last two years and what they decided to do. He could have asked them to think about which aspect of their technology could fit with other parts of the organization. He could have asked them to build some next-generation prototypes, and see how they would work. But any one of those would require some effort and motivation. And I think the CEO did not understand the importance of meaning.

If he understood how important meaning is, then he would figure out that it’s actually important to spend some time, energy and effort in getting people to care more about what they’re doing.

The next experiment was slightly different. We took a sheet of paper with random letters, and we asked people to find pairs of letters that were identical next to each other. That was the task.

People did the first sheet, then we asked if they wanted to do another for a little less money, the next sheet for a little bit less, and so on and so forth.

We had three conditions:

People wrote their name on the sheet, found all the pairs of letters, gave it to the experimenter, the experimenter looked at it, scanned it from top to bottom, said “Uh huh,” and put it on the pile next to him.

People did not write their name on it. The experimenter took the sheet of paper, did not look at it, and simply put it on a pile of pages.

The experimenter got the sheet of paper and put it directly into a shredder.

What happened in those three conditions? In the ‘acknowledged condition,’ people worked all the way down to 15 cents, where they stopped these efforts. In the ‘shredder condition,’ it was twice as much – 30 cents per sheet.

So if you shred people’s efforts and output you get them to be less happy with what they’re doing. And in the ‘ignored condition,’ the reaction was almost like the shredder.

The bad news is that ignoring the performance of people is almost as bad as shredding their effort in front of their eyes.

The good news is that simply looking at something that somebody has done, scanning it and saying “Uh huh” seems to be quite sufficient to dramatically improve people’s motivation.

So adding motivation doesn’t seem to be so difficult, but eliminating motivation seems to be incredibly easy.

Now, something about positive motivation. There is a store in the U.S. called IKEA.  IKEA offers furniture that takes a long time to assemble.

I don’t know about you, but every time I assemble one of those, it takes me much longer, it’s much more effortful, it’s much more confusing … I can’t say I enjoy the process. But when I finish it, I seem to like those IKEA pieces of furniture more than I like other ones.

By getting people to work harder, they actually get them to love what they’re doing to a higher degree.

So how do we look at this question experimentally?

We asked people to build some origami. We gave them instructions on how to create origami, and we gave them a sheet of paper. And these were all novices, and they built something that was really quite ugly. But then we told them, ‘Look, this origami really belongs to us. You worked for us, but … we’ll sell it to you. How much do you want to pay for it?’

We measured how much they were willing to pay for it.

We had two types of people: the people who built it, and the people who did not build it, and just looked at it as external observers.

We found that the builders thought that these were beautiful pieces of origami and they were willing to pay five times more for them than the people who just evaluated them externally.

Now you could say, if you were a builder, ‘Oh, I love this origami, but I know that nobody else would love it.’ Or ‘I love this origami, and everybody else will love it as well.’ Which one of those two is correct? Turns out the builders not only loved the origami more, they thought that everybody would see the world in their view. They thought everybody else would love it more as well.

In the next version, we tried to do the IKEA effect. We tried to make it more difficult. So for some people, we gave the same task. For some people, we made it harder by hiding the instructions.

At the top of the sheet, we had little diagrams of how you fold origami. But for some people, we just eliminated that. So this was tougher. What happened?

When we looked at the easy origami, we saw the same thing – builders loved it more, evaluators loved it less.  When you looked at the hard instructions, the effect was larger because now the builders loved it even more.

And evaluators? They loved it even less. Because in reality, it was even uglier than the first version.

This tells you something about how we evaluate things.

Now think about kids. Imagine I asked you, ‘How much would you sell your kids for?’ Your memories and associations and so on. Most people would say for a lot of money.

But imagine this was slightly different. Imagine if you did not have your kids. And one day you went to the park and you met some kids. They were just like your kids, and you played with them for a few hours, and when you were about to leave, the parents said, ‘Hey, by the way, just before you leave, if you’re interested, they’re for sale.’

How much would you pay for them? Most people say not that much.

This is because our kids are so valuable not just because of who they are, but because of us, because they are so connected to us – because of the time and connection.