When Extrinsic Rewards Fail... Or Worse

It's one of the most popular exercises that psychologists like to use when it comes to testing someone's ability to solve a problem: in this case, the "candle problem." The subject is given a candle, some tacks in a box and matches (see the image). They are then asked to attach the candle to the wall in such a way that the wax doesn't drip onto the table. Most people take about five to ten minutes to find the solution. How long does it take you?

In order to solve the problem, you need to overcome your "functional fixedness". When you look at the box, at first you only see it as having the function of holding the tacks. But eventually you realize that it could also serve as a platform for the candle (see image below). So far, so good. But what happens when you offer people an extrinsic reward for solving a problem like this? According to Daniel Pink in his bestselling book Drive. The Surprising Truth About What Motivates Us one psychologist went to find out and the answer wasn't what you might expect.

He divided the participants into two groups, telling the first one that he would be timing them just to establish a norm for how long it usually takes to solve this kind of problem. But the subjects in the second group were told that they would receive 5$ if their time was among the fastest 25 percent of all participants. If they had the fastest time of all, their reward would be 20$. Not a bad incentive for a few minutes of concentrated thinking in order to solve a problem, right? Too bad it didn't work. On average, the second group took three and a half minutes longer to find the solution. Here's Pink's reasoning:

In direct contravention to the core tenets of Motivation 2.0, an incentive designed to clarify thinking and sharpen creativity ended up clouding thinking and dulling creativity. Why? Rewards, by their very nature, narrow our focus. That's helpful when there's a clear path to a solution. They help us stare ahead and race faster. But 'if-then' motivators are terrible for challenges like the candle problem. (p. 44)

Not just bad. Terrible. And the same thing has been observed among artists, who obviously have one of the most creative jobs on earth. Works that they had basically done for themselves and not been paid for were generally seen as more creative and higher in technical quality by a panel of experts who had no idea which pieces were commissioned and which ones non-commissioned. The lesson is pretty clear:

For artists, scientists, inventors, schoolchildren, and the rest of us, intrinsic motivation -- the drive to do something because it is interesting, challenging, and absorbing -- is essential for high levels of creativity. But the 'if-then' motivators that are the staple of most businesses often stifle, rather than stir, creative thinking. (p. 46)

But not only do these extrinsic motivators not work, they can actually lead to negative behavior.

The problem with making an extrinsic reward the only destination that matters is that some people will choose the quickest route there, even if it means taking the low road.
    Indeed, most of the scandals and misbehavior that have seemed endemic to modern life involve shortcuts. Executives game their quarterly earnings so they can snag a performance bonus. Secondary school counsellors doctor student transcripts so their seniors can get into college. Athletes inject themselves with steroids to post better numbers and trigger lucrative performance bonuses.
    Contrast that approach with behavior sparked by intrinsic motivation. When the reward is the activity itself -- deepening learning, delighting customers, doing one's best -- there are no shortcuts. The only route to the destination is the high road. In some sense, it's impossible to act unethically because the person who's disadvantaged isn't a competitor but yourself. (p. 51)

So here is what it comes down to: short-term thinking vs. long-term thinking. Taking shortcuts whenever possible vs. taking the high road. Getting some kind of extrinsic reward for completing a task vs. engaging in activities that are rewarding in themselves. What are you going to choose? Think about it, because it might not be so smart to concentrate on that special reward you're being offered. Even if you're not asked to attach candles to the wall...