What Makes Employees Work Harder: Punishment or Pampering?

In an article for The Atlantic, Derek Thompson examines whether “feel-good” or “feel-bad” strategies for firing up an under-motivated team are best. As it turns out, there is unfortunately a pretty valid case for both. During the 2008 financial crisis, “productivity spiked,” and evidence supports it is because the workers who were not laid off starting working harder to ensure they kept their jobs. In fact, the previously least productive workers tended to see the highest productivity gains. An unrelated study examined the effects of software that monitored employee theft and sales transactions at 392 restaurants, and while reductions in theft were “modest,” revenue at each restaurant increased by about seven percent. Basically, since people’s productivity was being more closely scrutinized, it seems they just felt an inherent need to work harder. Thompson concludes by saying that just because these “feel-bad” strategies apparently hold merit does not mean that “feel-good” strategies (like offering rewards for strong work) do not also have merits. Sometimes, if you really want to squeeze that last drop of usefulness out of people, you might want to use a little of both strategies.

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