Compensation: determining the best approach

Reading Sway: The Irresistible Pull of Irrational Behavior by Ori Brafman and Rom Brafman afforded me many ‘ah-ha’ moments.  This book offers good insight and compelling examples to common behaviors that should probably not be so common.   This “ah ha” moment centered on how test subjects, and real life examples reacted counter to the anticipated responses.  I’ve encountered similar situations, but never thought of them in the terms that Ori and Rom described in their book.  Essentially, and this is I am sure, an over simplification, two parts of the brain can come into play when we respond to motivation:   Nucleus accumbens (NA):  this portion of the brain relates to the pleasure center or our “wild side”.  This portion of the brain shows stimulation from such experiences as a sports fan’s enthusiasm for a come from behind team victory, anticipation of a hot date, or reaction to mood altering drugs.  Maybe not surprisingly, this part of the brain also responds to financial compensation.  The more money on the line, the more strongly this portion of the brain reacts.   Posterior superior temporal sulcus (PSTS):  this section of the brain response to social interactions – developing bonds, perceiving and relating to others.      What I found surprising, is that either one or the other portions of the brain could be stimulated, but not both.  The message was that employers, companies, non-profits, etc, should carefully consider how they reward desired behavior.  A compromise of the two approaches for a job will not achieve the desired results.    Examples:   Your friend asked you to help them move to a new apartment.  Response 1:  Sure, I’m always willing to help a friend.   But, what if, they said they’d pay you $10 to help move them? Response 2:  No thanks!  My time is more valuable (yet, you would have probably done it for free)   When compensation comes into play, the cost benefit analysis takes over, and any sense of altruism flies out the window.   You’re colleague is sick, and without your help, a critical team deadline will be missed.  Your boss asks you to come in on Saturday to wrap up the project. Response 1:  OK, I’m a team player, and want to do my part.  Jane would have done it for me.   Consider, your response, if your boss had said, “I’ll pay you $XXX to come in on Saturday.”   Response 2:  “$XXX does not cut it.  I lose my Saturday.  No thanks.”     The altruistic, or PSTS side of the brain does not need nearly the level of motivation required of the pleasure center (NA) side.  Also, when the two sides come up head to head, the pleasure center side dominates.   The example given in the book was of an alternative high school where teachers received a relatively low salary.  Given the work load versus the low salary, it was obvious the teachers were not motivated by money.  However, a new law required allowed schools to operate more independently if they introduced innovative programs.  To do so the faculty tied a bonus program to reduced absenteeism, and teachers with improved attendance would receive a 12% bonus.  Note, the teachers did not ask for the bonus, nor was the existing levels of absenteeism excessive.    The result of the implemented bonus based improvement program was that completion improved, but attendance remained constant, and the GPA had dropped.  A review of the results showed that teachers had shifted their focus on attendance to secure bonuses – their pleasure centers were warring with their altruistic centers, and winning.   The teachers were fixated on the award and altered their standards, goals and behaviors to achieve the desired results.  Sound familiar? 2009-02-17T22:12:53Z

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compensation-determining-the-best-approach

2009-02-21T00:47:55Z

When rewarding for an action either financial compention or the altruistic portions of the brain can be stimulated, but not both. Employers should consider how they reward desired behavior.

Compensation: determining the best approach

2009-02-24T09:49:26Z