HRMIN - Mgt 340 - Fall 1994

Duane Dove
Date of submitted: 8/23/94
Title: "So much for Incentive Pay"
Source: Press Democrat - 8/24/94

(Your articles will likely concentrate more on the content of the article and less on your reaction)

The author of the article notes the trend in recent years to implement performance based compensation systems. Such systems attempt to reward people for the quanitiy and quality of their labors rather than base compensation on the amount time worked. The writer points out that this practice has been made popular by behavioral scientists and so called modern experts in management theory.
Then he tells us that though the practice seems reasonable enough, it actually has the opposite affect from the one intended and robs people of their reason for working. The reasoning is that incentive pay concentrates on monetary rewards and people begin to feel they are working only for the money. Supposedly they lose sight of the "pure joy of work" that you and I know so well.
Actually, this theory is not new at all. It goes back to the writings of a psychologist named Deci, who was a student of "attibution theory" and began to publish his notions in the early 1970's in reaction to the behavioral theories that argued pay should be linked directly behavior (performance). The behavioral position was a direct outgrowth of the work of B.F. Skinner, one of the most important psychologist of the 20th century, who argued and demonstrated in a life time of work that behavior is caused by past rewards. The natural application to work is that incentives should be reward for desired behavior.
Attibution theory on the other hand argues that we constantly attempt to understand our behavior by attributing it to causes. In the case of incentive pay, Deci argues that incentives result in our attributing our work to the money that it produces. Without incentive pay we would attribute our hard work to intrinsic causes such as the sense of satisfaction derived from a job well done.
Is the logical extension of this theory? "Don't pay your people very well and they will inevitably believe that the reason they are working is because it is so much fun. This will create an even greater work ethic since because it is so much fun they will want to do more of it." What do you think?