You're in a room with a candle, a book of matches, a box of thumbtacks, and a corkboard hung on a wall. Your task is to fix and light the candle on the wall so that the wax doesn't drip on the floor or table below.
This is Duncker's famous candle problem, an experiment designed to measure how creative you are and how well you can solve problems. You solve the problem by removing the thumbtacks from the box and using one to tack the box to the corkboard. You then place the candle in the box and light it.
It's a hard problem because we believe the box's function is to hold the thumbtacks and nothing else. We don't consider it as the tool we need to solve our problem.
That's not the end of the story. The candle problem taught us something about motivation too. In 1962, scientist Sam Glucksberg repeated the experiment with one change: He told one group of people they'd receive some money if they completed the task. The faster they completed it, the more money they'd receive. A control group would receive no cash prizes.
Interestingly, the control group completed the task faster than the group that had been offered cash prizes. At the time, that seemed contradictory. Surely those who were offered a reward would perform better? It turns out they don't. Time and time again, science has shown that rewards for cognitive and creative tasks undermine both people's performance and motivation. The higher the reward, the worse they do.
Despite these findings, many companies still encourage their employees with compensation schemes, bonuses, and other external rewards. They would be better off without them. But if you cannot use extrinsic motivators, how should companies motivate their employees? Let's explore this question.
It's important to first acknowledge that extrinsic motivators still matter. The bottom layers of Maslow's pyramid need to be satisfied first. This means that:
When we say that companies would be better off without bonuses and compensation schemes, we don't mean companies should cut that portion of their employees' income and not replace it. Instead, they should up employees' base salary until money is no longer the primary reason they come to work. Their basic needs have to be met first.
In his 2009 book Drive: The Surprising Truth About What Motivates Us, Daniel Pink summarizes four decades of scientific research on human motivation. He writes that there are three critical factors to motivation:
Firstly, people want to be autonomous. This means we want to direct our own lives and work. We want to make our own choices. Companies with strict dress codes and tight working hours reduce this feeling of autonomy and, subsequently, our motivation too.
For X-Team, developer autonomy comes in many forms: flexible hours and asynchronous communication are only two examples. We care little when you work and where you work, as long as you do the work to the standards we require. If that's from a beach in Mexico at 7 AM, that's fine by us (we'd think it awesome).
Secondly, people crave mastery. We want to get better at something. This explains why we do things that don't make economic sense, such as writing open-source software in our free time. The feeling that we're improving our skills energizes and motivates us.
X-Team encourages mastery with the Unleash+ budget: $2,500 a year to spend on doing things you love and want to get better at. This could be anything: from new cooking gear to become a better cook to music gear that makes you a better musician.
Thirdly, people want purpose. We want to understand how we fit in the bigger picture. Work is such a big part of our lives. We want to understand how our work matters and where we fit in.
X-Team helps companies such as Coinbase, Riot Games, and Kaplan build the best software in the world. But our purpose extends far beyond that. We want to be the #1 community for developers. This means the annual X-Mas party, the Vault, Bounties, Seasons, and much more. Every X-Teamer is a vital part of that X-Team experience.
It's strange, but it's true. External rewards undermine performance and motivation at work. The carrot-and-stick model doesn't work in today's digitized economy. Instead, companies should introduce policies that give their employees more autonomy, mastery, and purpose. Only then do you have the fundamentals for a truly engaged workforce.