Inside out: Motivation, Happiness and Performance

Money makes the world go round.

At least: that’s what business would have us think. A scientist would clearly offer a different explanation…but what is certain is that most businesses are judged by their financial performance – money is the metric of their success, and many businesses are driven by money. Does it necessarily follow that the people who make up the business are too?

Many have thought so, and have created financial incentives in the belief that financial performance would follow. The trouble is that science would once again offer a different perspective.

Most of the evidence from studies on human motivation by psychologists and behavioural economists show that that people perform better when they’re motivated ‘intrinsically’ than ‘extrinsically’. Intrinsic motivation is when we are driven to act by an interest or enjoyment in a task itself, rather than because we are expecting to receive external rewards, pressures or even punishments.

In terms of the world of work, this means that no promise of a performance-related bonus or perk can improve someone’s work as much as the simple fact of them actually enjoying what they’re doing. In other words people are more motivated by the internal rewards of expressing themselves, learning new things and achieving their goals than they are by the promise that if they do something well they will be well rewarded. Almost paradoxically it means that financial incentives don’t create the most financial benefits.

This is quite a challenge to the normal business model which is primarily focused on using rewards and threats as a way of producing results. Rewards and threats work to a degree, but as a system of management, are fast becoming outdated. Indeed Daniel Pink, the renowned management guru, said in his inspiring TED talk on the subject:

“Traditional management is great if you want compliance but if you want engagement – self-direction works better”.

He proposes that there are three great ‘drives’ at work in motivating us to perform: autonomy, mastery and purpose.

His ideas are similar to the work of psychologists Ed Deci and Rich Ryan whose self-determination theory proposes three inter-connected psycho-social needs: autonomy, competence and relatedness. Interestingly, one of the most widespread (and profitable) applications of Deci and Ryan’s work has been gamification, which encourages people to engage their natural desires for competition, achievement, self-expression and closure outside of normal game-playing scenarios. When people are encouraged to play, they play hard. Just look at the energy and excitement of a pub quiz or a football match. Couldn’t some of that energy go to great lengths in the work place?

Of course, people want fair pay - and they like being paid well – but its not great pay that makes someone great. So what is it? And how can businesses harness it?

These are the questions we’re asking at Happiness Works. How can businesses get the best out of their employees? What the science tells us is that the more they’re prepared and willing to give their employees, the more they’ll get in return.

If its not money that makes the world go round, what is it? Perhaps it’s things more like generosity, encouragement and openness. Or competition and play. Or pleasure in achievement.

We think there’s great value to be had in finding out. Who’s with us?

Nic MarksNic Marks is the CEO and founder of Happiness Works. Nic’s work in happiness and wellbeing research methodology is world-renowned. His love of using applied statistics to ground wellbeing and happiness in hard evidence has led to worldwide acclaim and the realization that happiness is a serious business.

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