A new/old idea: pay people more for producing more

Michael Schrage has another great post up on hbr.org this week. Titled, “Why Keeping Score is the Best Way to Get Ahead,” the post discusses how publicizing results can help workers perform better and achieve more (not only for the company, but for themselves).

This subject has come up in a couple of books I’ve read recently. “Total Engagement: Using Games and Virtual Worlds to Change the Way People Work and Businesses Compete” by Byron Reeves and J. Leighton Reid shows how players of MMORPGs are motivated by their very public stature and standing in the game. The authors state that using this kind of scorekeeping in the corporate environment can help motivate better performance among all workers.

Which sounds pretty idealistic, except that another recent book, “Profit at the Bottom of the Ladder: Improving Conditions for Your Workforce and Boosting Your Bottom Line,” by Jody Heymann and Magda Barrera, reveals in a number of case studies how certain companies use team goals and bonuses to both increase the earning power of floor workers and their value to the company.

Contrast these views with a conventional wisdom that people are motivated by mission and something greater than themselves. And “piece work” has gotten a very bad rap.

But there’s more and more evidence out there that developing and rewarding compelling, specific goals for individuals, and communicating not only the goals but how people are doing against them, is a key to enhanced performance. And perhaps now, when there’s so much pressure on plain old workers, this may be a way to navigate a channel between the pressure for constant cost reduction and the need for people to increase their wages and improve their standard of living.

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