Large companies like to use rewards to increase the productivity in a workplace, instead of offering “carrot” rewards to boost performance as a quick fix, other permanent rewards to constantly keep employees happy are introduced, schemes like this are often referred to as wellness programs. The past ten years have seen an increase in organisations using wellness plans. However, welfare programs are often seen as a nice extra and not a strategic imperative. Newer evidence now tells a different story.
Berry, Mirabito & Baun (2010) produced a report which became a published document in the Harvard Business Review which states that despite employees enjoying the rewards of a wellness program, it has helped to see a recovery in businesses production.
The initial report developed research on employees of Johnson & Johnson who claims that after the introduction of the wellness program, lost days had declined by 80% which led to the right employees staying with the company. The report makes out that a wellness plan is not just throwing carrots at employees to make them work, but instead to keep the workforce morale high at a consistent level.
The Trouble with Gold Stars
Many methods have been tested to suggest that rewards such as wellness programs do not always work, Sansone (2000) investigates that we need to look beyond rewards and focus more on intrinsic motivation. Her practices have led to her conclusion that when you give a person a reward for doing a task they always did, the job is not done to the same standard.
Previous work by A Kohn (1993) complimented Sansone’s theory; he wrote “Punished by Rewards: The Trouble with Gold Stars, Incentive Plans, A’s Praise and Other Bribes,” in this report he investigates the theory behind what we might call motivating people is de-motivating people. He uses an old story which progressed from an old man who receives abuse from school children as an example for his findings. In this story the man receives abuse each day from school children, until one day he tells them that if they came back tomorrow, he would give them £1, the next day he gives them 20p, and following day 1p – until the children don’t do it anymore because there is no more incentive.
This story suggests that by firstly incentivising the process and then gradually diminishing the rewards, what the child initially called fun was taken away from them by a monetary incentive. Kohn’s theory can be portrayed in a work environment where an organisation to start no financial incentives, and the team is producing quality work based on self-motivation. Once financial incentives are introduced quality can go down the enjoyment of the task could be lost.
Kohn does a lot of investigation into “behaviourism” and the culture of asking people to do something for you to gain a reward, he suggests that a manager offering incentives is dehumanising and comments that “Those who wield rewards assume that people are like pets.”
The theories in Kohn’s work are well researched and credible, his work is agreeable in some aspects, particularly when the author researches and writes about alternative methods of incentives which develop from ideas on intrinsic motivation. This is self-motivation and how people will do the job regardless of any excuse. I feel that this is a very different view to Clark (2013) who suggests that financial incentives can increase performance by 20%. What Clark fails to write about is the quantity of workload will increase, but this may affect the quality and the overall motivation of the team.
Manipulation is how Kohn summarises what managers do when they reward staff by incentives and do not offer a work space of intrinsic motivation. This comment is arguable and subject to the work conditions of the job. More challenging places of work need to become a more motivated place, and therefore a manager would need to introduce more incentives into the workspace to increase the productivity and motivation of the workforce. Dickinson (2001) writes a different report to Kohn’s findings in the Experiential Economics journal on work team motivation; he suggests that without any incentive it gives the potential for team members to free ride and limits the team output. The paper goes on to review a carrot (positive) and stick (negative) approach to incentives in which they oversaw an experiment based in a laboratory environment where monetary prizes became a motivational tool to high performers, and monetary fines were handed out to low performers.
Penalising low performers is something that completely contradicts the work of Kohn who believes that by giving people a task they will achieve it by wanting the challenge of completion. Arguably Kohn’s work is subject to a particular kind of guy, Dickenson’s experiment review suggests that the carrot and stick effect increased efficiency levels by 10-28%. Just like Clark’s report, what the results do not show is the motivation of the employee’s during the task, the quality of work that they produced and if this was to take place in a work place environment, how would morale and turnover of staff be affected.
Can employees be more productive?
Rewarding employees is not always a negative thing. Bolch, (1997) reviews the HR policies of Nucor Corp. The report summarises that this business rewards its team with incentive plans which are transparent. Unlike most companies, even entry level staff are aware of the co workers bonus which would often imply conflict, however, the report concludes that as the business has a strong philosophy on team work, it increases the morale of the production staff.
Many people would state that Dickinson’s research is being unofficial, but by looking at further research into the motivation of employee’s. Spitzer (1995) conducted a survey on work force motivation to which his finding suggested: “50% of workers do the bare minimum to avoid employment termination while more than 80% say they could work much harder.” Introducing higher rewards and making them more transparent like Boch’s findings would create more motivation without having to add punishment.