Comments on: Pay for performance doesn’t work

By: Chris Ferdinandi

Chris Ferdinandi — Tue, 15 Sep 2009 22:49:18 +0000

@Paul – Great response! I whole-heartedly encourage any of my readers to go check it out.

I think incentives can be a powerful tool. But I do believe that finding a way to motivate people around a meaningful goal can unleash a certain potential that incentive-based management alone cannot.

Thanks again for your insights!

By: Paul Hebert

Paul Hebert — Tue, 15 Sep 2009 19:50:32 +0000

Chris – sorry to be back late to the party but I did post my response last week – and it’s more than just the “communist” plot angle. It’s the issue that we think ONE solution is what we need when we deal with people. We need multiple ways to drive motivation in the work force. To say Dan is the right way is as bad as saying only use incentives.

My response is here: http://tinyurl.com/ldchl3

By: Marguerite Granat

Marguerite Granat — Tue, 08 Sep 2009 06:10:34 +0000

I’ve heard Dan Pink speak several times. He is a creative and an exciting speaker. I agree with him on a number of issues but I’m not sure if I agree completely with what he is saying here. The pay for performance compensation may work well in certain situations and not in others. To draw a conclusion that paying a large reward can demotivate is not completely convincing to me. I do agree that once the basic needs are met (a fair compensation package), what motivates individuals the most is the opportunity to contribute to a cause greater than themselves. On this, I agree with Dan Pink. I would have to learn more about the studies he mentioned and whether the link he is making makes sense.

By: Chris Ferdinandi

Chris Ferdinandi — Mon, 31 Aug 2009 16:18:02 +0000

@Michael – I don’t remember the article, but I do remember the comment. Your absolutely right. The approach Dan’s advocating requires a cultural shift in the way an organization manages people, and that typically requires buy-in all the way at the top. And not just buy-in, but true behavioral modeling.

It looks like a lot of people are taking this as some communist scheme, where even if you suck at your work you get paid the same. That’s not what I think Dan’s saying.

I interpret it as, pay people fairly, but to really drive behavior and motivate great work, you need to inspire people from within.

By: Michael Black

Michael Black — Mon, 31 Aug 2009 16:01:34 +0000

Chris,

I think I commented on something similar to this a while back and said that I think that some people/postions/companies are just not going to be movitated in this way. If a company want’s to build a culture built on pay for performance, they better know what they are doing and stick to it. The second they go away from it, they are going to have a mess on their hands. On the flip side, if a company’s culture is not built on this, they are going to have a hard time getting buy in from the top.

Compensation is only a part of the entire “work experience” as it is only going to get you so far. The best paying gig is rarely the right gig.

Money is never going to win over passion (again, my opinion). Money will win for those who really don’t care what they are doing.

By: Chris Ferdinandi

Chris Ferdinandi — Mon, 31 Aug 2009 14:56:32 +0000

I still think compensation, and the payment for performance, is an integral part of this process.

I think Eva really, truly summed up my sentiments on this debate far better than I did. I will differ to her explanation.

By: laurie ruettimann

laurie ruettimann — Mon, 31 Aug 2009 14:51:52 +0000

I think all jobs are some form of picking up trash. ALL OF THEM.

And picking up trash isn’t rigid or limited. My garbage men have to make decisions, interact with people, and represent a corporate and employment brand. They are brand ambassadors and they know it.

So is the dude who picks up the dead deer in my neighborhood.

So is the woman who cleans my house.

Complex work happens in all sorts of amazing ways. Decisions are made. Challenges are overcome. People learn and grow. I still think compensation, and the payment for performance, is an integral part of this process.

By: Chris Ferdinandi

Chris Ferdinandi — Mon, 31 Aug 2009 14:45:18 +0000

@Eva – In 5 sentences, you managed to more clearly summarize my perspective than I was able to in a whole article. Thanks!

By: Eva

Eva — Mon, 31 Aug 2009 14:43:04 +0000

Good point on the perceived productivity.

Here is my impression on the issue. Pay for performance works for the basics. You pay me; I do job. After a certain level of compensation, higher pay loses its magic. THAT’s where all this motivation stuff comes in.

By: Chris Ferdinandi

Chris Ferdinandi — Mon, 31 Aug 2009 14:42:52 +0000

@Laurie – All of the jobs you described fit in the context of rigid, process driven tasks that Dan mentions in his talk. He specifically says that jobs of that nature are well motivated by pay-for-performance.

And I don’t think anywhere in the talk is there any implication that people only want to work for emotional gratification. We work because we get paid.

But you continue this notion that work is ONLY an exchange of labor for money, and in doing so, you’re cheating your readers out of an incredible opportunity to motivate their workforces beyond the simple chase of the paycheck.