Monday’s USA Today has a largely positive review of Drive (“fascinating . . . a powerhouse”) that bears an unfortunate headline: “Raises Make Bad Motivators.”

At the risk of sounding like a peevish author picking nits from the tangled hair of quickly forgotten reviews, let me do precisely that. Drive never says that raises aren’t worthwhile. Far from it.

Yes, raises in the form of “If-then” rewards — “If you do something great, then you’ll get a raise” — can be dangerous. But in general, I advocate (and the science affirms) paying people well.

For instance, page 79 says that if an organization doesn’t pay someone “an adequate amount, or if her pay isn’t equitable compared to others doing similar work—that person’s motivation will crater.”

Page 172 says: “Providing an employee a high level of base pay does more to boost performance and organizational commitment than an attractive bonus structure.”

The bottom line, from page 170: “The best use of money is to take the issue of money off the table . . . Effective organizations compensate people in amounts and in ways that allow individuals to mostly forget about compensation and instead focus on the work itself.”

14 Responses to “Raises *do* matter”

  1. Promise says:

    Couldn’t agree more. We are taught to believe that salary is the key trigger for recruiting and retention. Higher paid employees are not more loyal. However, each leader has to understand what is important to each key player and invest in providing that for the employee–development, flexibility, ownership, mentorship, etc.

    Pay employees well, but the larger the payroll, the less flexible the organization. We’ve learned that UAL, the car companies and so on…

  2. Rachel says:

    You have to take into consideration the mentality of the company ultimately producing that review and the headline.

    For the second year, employees will not get any pay increase, and last year “lucky” employees only lost 2 weeks of their pay due to furloughs. There have been massive layoffs and more furloughs. Even when employees were getting pay increases, the “Gannett average” for a merit pay increase was at something like 3.5-4%. That means that if you are doing above average work, that’s what you’ll get. Put that alongside the annual increase in employee contributions to their benefits, and you have to either get promoted or hope your boss puts in for and jumps through all the necessary hoops to get you more money just to keep up with inflation.

    The attitude is that the privilege of working for the company should be enough and if you don’t think so there’s a line of people who will gladly take your place. Given the economy, it’s also been “just be thankful you have a job.”

    Of course USAT would print “Raises make bad motivators,” even if you didn’t come close to saying it. The company has to be hoping its employees will buy that, and the poor fool who wrote the headline may be one of the many Gannettoids who freely drink the Kool-Aid they’re handed.

  3. Will says:

    Definitely agree, at least from a personal perspective. As I prepared for a career change I made a list of my priorities. Salary came in at #4…not at the top of the list, but still in the Top 5. Autonomy becomes a lot less important when I can’t pay my mortgage.

    Let me toss this out with regard to Dan’s quote from page 79: different people have different ideas of what’s “adequate,” so if someone else’s definition of adequate is higher than yours, how much would it matter to you if they make more money than you for doing essentially the same work (assuming you’re getting satisfaction from the opportunities for autonomy, mastery, and purpose)? I’d be interested in hearing other readers’ thoughts. Thanks!

  4. Falsely provocative headlines are annoying (especially since I always fall for them) but if this one gets more people to read the positive review (and the book!), then perhaps the ends justifies the means…

  5. C. A. Hurst says:

    Great comeback, Dan.

    USA Today could have used the tagline: ‘Drive’ author Daniel Pink: The three elements of deep motivation; Autonomy, Mastery, Purpose

    This would have taken the comments to an entirely different place and could have created a much better representation of the positive nature of “Drive”. Go figger…

  6. ryanve says:

    I bet that headline was a decent attention-grabber ;) but I like the clarification.

  7. davidburkus says:

    Overall, this is just another article misunderstanding parts of your book. I’ve noticed many people take this as an assault on all incentives. However, you’ve clearly said that for simple, repetitive tasks (or L-directed thinkers), the rules of carrots and sticks still may apply.

  8. Susan says:

    When I worked for someone else I used to always say that as long as I felt like I was being paid a fair wage (or negotiated for what I thought was a fair wage) for what I was doing, I didn’t worry that others were possibly making more. The problem at my last place of employment came when raises were being doled out and we all got exactly the same percentage when I knew that I was actually doing more (others were coming to me for help) and bringing more opportunities to the table. That’s when the raise became demotivating – It no longer felt “fair” and I felt my motivation crumbling. As Dan says in the book, if money had just been taken off the table, it would never have been an issue.
    I now work for myself and give myself a good working wage. And even though I haven’t given myself a raise in 4 years – (as the business grows more money goes into it) – I love to go to work every morning and feel completely motivated to continue to build my business.

  9. Jennifer says:

    I SO agree. Raises are wonderful, but feeling like your employers appreciate what you do on a day to day basis is more meaningful. I have been lucky enough to have both decent money and appreciation at a job EXACTLY ONCE in my career. Funny, most of the people I’ve worked for offered neither.

    I count myself incredibly fortunate that the work is meaningful even if the employer blows…since too many jobs fail to bring that all important sense of purpose above billability.

  10. Indeed, Dan. Those we speak with who insist on cash awards as the most effective are often those who have a compensation problem in that they are not properly compensating employees in the first place. Show people you will treat them fairly and consistently (especially in how you compensate them), then recognition of their stellar efforts will not ring hollow.

  11. Back in the summer of 1992, I was working in the publicity and publications office of a non-profit organization. I asked for a raise and didn’t get it. Was told that there was no money in the budget.

    Shortly after I got that news, the office grapevine brought me the news that the top management had gotten substantial raises. I seem to recall that my boss, Madame No Budget, was one of them.

    Well, that was the end of any sort of friendly relationship between me and Madame NB. I left that job in late 1994. (Yes, my bad. I should have just gotten mad and found something else to do during the summer of 1992, but live and learn.)

    In the two years that I continued to stay at that job, making myself and everyone around me miserable, I learned that my happiness (and that of others) wasn’t dependent on what some boss was paying me. Sure, the additional money would have been nice, but you know what? There are plenty of people who, shall we say, aren’t worth the lofty salaries they’re being paid.

    Enough of the early 1990s. I’ve been one of those Daniel Pink-esque Free Agents since then. Out here in Free Agent Land, you’re paid what the clients think you’re worth. In order to make a lot of money, you have to be pretty darn good at what you do. You also have to be adept at finding people who think that excellence is worth money — and are willing to pay you accordingly.

    In short, it’s a meritocracy out here. And I like that.

  12. Monica Kennedy says:

    Great food for thought, Will – “different people have different ideas of what’s ‘adequate’, so if someone else’s definition of adequate is higher than yours, how much would it matter to you if they make more money than you for doing essentially the same work (assuming you’re getting satisfaction from the opportunities for autonomy, mastery, and purpose)?

    The world of teaching is a whole other ball of wax. IMO, the amount of base teacher compensation in most states/school districts is based on an outdated mentality: Most teachers are women and can depend on their husbands to take care of them.(Let’s not get into the ‘summers off’ and other trite arguments. I generally work cumulative DAYS outside of contract hours, including breaks and summers, to grade, plan, close out and start paperwork for each school year. My average work week is Monday through Saturday, generally from 7:45 to 5:00. I do this because it makes me a better, well-prepared teacher.)

    Salary advancement and ‘bonuses’ for teachers are arbitrary, based on how many counter-productive hoops one is willing to jump through, only to be frozen or taken away when the state/district coffers are drained.

    Generally, all teachers must meet state certification requirements, complete continuing ed. hours, and maintain ‘highly qualified’ status. In addition, most districts require a certain level of proficiency on yearly evaluations. Failing to do so may result in teachers being placed on an ‘improvement’ plan, but I’ve NEVER heard of a teacher being dismissed for failure to consistently meet adequate standards of teaching.

    In 14 years of teaching in three states and four different districts, I have yet to find ANY pay incentives for educators that rate significantly higher than their ‘adequate’ peers in customer satisfaction, quarterly/yearly evaluations, and AYP (adequate yearly progress).

    This leads me to Martha’s point – “In order to make a lot of money, you have to be pretty darn good at what you do. You also have to be adept at finding people who think that excellence is worth money — and are willing to pay you accordingly.”

    Well, based on stellar evaluations from several administrators, great feedback on parent surveys, and the outstanding achievements of my students, I happen to think I’m pretty darn good at what I do… And there are thousands of other educators out there that are pretty darn good, too!

    Unfortunately, in TeacherWorld, there are few to no means in place for districts and principals to monetarily reward excellence for master teachers. Salary schedules are set; if you refuse to accept what a district offers, there’s another warm body, preferably a recent college graduate, who will take your place for less money at the expense of less professional experience (mastery), which takes years to develop. Don’t forget: Adequate teachers with the same amount of longevity tend to make the same amount as their high-performing cohorts.

    So, the only thing I’m left with is the satisfaction that the service I provide to my community and world is a valuable one.

    If I just had a dollar for every time I heard someone say, “Oh, I don’t know how you do this job! Teachers should get paid a lot more than they do.” Money comes and money goes. BUT, where does that leave us as a society?

    The ‘kick-ass’ teachers are disappearing…
    * They leave to find better pay and incentives in other professions because their greatness is not enough to pay their mortgages and maintain a certain level of income comparable to other five-year college graduates.
    * They leave because there is very little autonomy for what they do. They must endure standards that are watered down so that student achievement can be measured via an easily scored multiple-choice assessment. Thinking outside of the box, creativity, and problem-solving within a valid context are often no-no’s.
    * They leave because finally the well runs dry… The daily fight to challenge outdated methods and questionable outcomes kills the spirit.

    WE are in desperate need of peers, administrators, and other contemporaries that share the same LOVE for the art of teaching and learning.
    WE need the support of progressive thinkers and movers that are willing to commit their influence and energies to facilitate one of the biggest paradigm shifts our world has ever known.

    I’ve made mention to a couple of my friends and respected administrators about beginning a book study that utilizes Dan’s books “A Whole New Mind” and “Drive”. The support to take this on is there… I’m curious to find out how other educators will respond. I figure if I can change a few hearts and minds here and there, I might be able to shift that paradigm a millimeter or two. Wish me luck!!!!

    Thanks for letting me share my perspective!
    Mon :-)

  13. Ken Armstrong says:

    One of those things that has become de-rigeur with Managers these days is when an employee leaves they have to sit an exit interview.

    Nearly always the employee will give the line ‘I’m being offered more money elsewhere’ but I should imagine nearly always that isn’t the prime reason for them leaving that company.

    I would bet my weeks wages that most leave because of their lack of opportunity to show ‘Autonomy, Mastery, Purpose’

    Had the company been more enlightened, they might well have had a committed, productive and engaging worker and not another job to fill (at a cost in time and resources)

  14. David Haddad says:

    I’m working in the world of international development where pay-for-performance or results based financing is the new buzz word. I work on the serious issue of human resources for health (with most of my focus on Africa). We’ve seen salaries go up for health workers, but performance stinks. Any ideas?

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