ATTACHING THE CARROT TO THE STICK

It seems like common sense that people work harder when there are incentives at stake, but many scholars question this premise. Alfie Kohn has long suggested that workers are "punished by rewards" and urges that organizations avoid trying rewards to performance because of the negative consequences that can result. As an alternative to rewards, some experts recommend that managers foster a positive, upbeat work environment in hopes that enthusiasm will translate into motivation.

Although rewards can be motivating, they can reduce employees' intrinsic in the tasks they are doing. Along these lines, Mark Lepper of Stanford University found that children rewarded for drawing with felt-tip pens no longer wished to use the pens at all when rewards were removed, whereas children who were not rewarded for using the pens were eager to use them. And neuroimaging researchers at Cal Tech found that when incentives reached a certain threshold, the brain's reward centrebegan to shut down and people became distracted. According to Vikram Chib, the lead researcher on the project, people begin to worry about losing the carrot when the stakes get too high, which leads to failure.

Rewards can also lead to misbehaviour by workers. Psychologist Edward Deci notes, "Once you start making people's rewards dependent on outcomes rather than behaviors, the evidence is people will take the shortest route to those outcomes". Consider factory workers paid purely based on the number of units they produce. Because only quantity is rewarded, workers may neglect quality. Executives rewarded strictly on the basis of the quarterly stock price will tend to ignore the long-termprofitability and survival of the firm; they might even engage in illegal or unethical behaviour to increase their compensation.

Some rewards may also have legal implications. An increasing number of companies are providing financial rewards to employees who meet health goals or participate in wellness programs, but such efforts raise concerns about discrimination against those unable to reach the goals. Incentives might not motivate employees to take a more active role in managing their health in any case. As David Well Health Management says, "An incentive itself doesn't necessarily buy engagement. It buys compliance." However, the majority of research cited that individual given rewards for behaviour will be more likely to engage in the rewarded behaviors.

Sources: Adapted from V.S Chib, B. DeMartino, S. Shimojo and J.P. O'Doherty. "Neutral Mechanisms Underlying Paradoxical Performance for Monetary Incentives Are Driven by Loss Aversion," Neuron 74 (2012), pp 582-594; N.Fleming, "The Bonus Myth" New Scientist 210 (2011), pp 40-43; D. Woodward, "Perking up the Workplace," Director (February 2011), pp 33-34; S. Ladika, "Are wellness Incentives Bad for Your Company's Health?" Workforce Management (February 2013), p 6; and G.G. Scoot, "How to Create a Motivating Environment," Non-profit World 28(September/October 2010), p 9.

QUESTION 1

What employee behaviors do you think might be best encouraged by offering incentive rewards?

QUESTION 2

Think about your life as a student/part=time worker and discuss what incentives have motivated or alternatively, demotivated you.