We’ve been told for years that incentivizing employees is the secret to better performance. A great talk given at the Royal Society for the encouragement of Arts, Manufactures and Commerce (RSA) questions the assumption that if you reward something you get more of the behavior you want and, the corollary, that if you punish something, you get less of the behavior. Dan Pink refers to a study at MIT which was funded by the Federal Reserve. In this study, a whole group of students were given a set of challenges – physical, cognitive, and spatial. Performance was incentivized via monetary reward in an approach typical of most workplaces. So what happened?

1. As long as the task involved purely mechanical skills, the incentives worked as expected
2. Once the task called for cognitive skill – a larger reward led to poorer performance

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