Educational Info

By BARRY SCHWARTZ

Philadelphia

NEW YORK CITY has decided to offer cash rewards to some students based on their attendance records and exam performance. Diligent, high-achieving seventh graders will be able to earn up to $500 in a year. The plan is the brainchild of Roland G. Fryer, an economist who has been appointed as “chief equality officer” of the city’s Department of Education.

The assumption that underlies the project is simple: people respond to incentives. If you want people to do something, you have to make it worth their while. This assumption drives virtually all of economic theory.

Sure, there are already many rewards in learning: gaining understanding (of yourself and others), having mysterious or unfamiliar aspects of the world opened up to you, demonstrating mastery, satisfying curiosity, inhabiting imaginary worlds created by others, and so on. Learning is also the route to more prosaic rewards, like getting into good colleges and getting good jobs. But these rewards are not doing the job. If they were, children would be doing better in school.

The logic of the plan reveals a second assumption that economists make: the more motives the better. Give people two reasons to do something, the thinking goes, and they will be more likely to do it, and they’ll do it better, than if they have only one. Providing some cash won’t disturb the other rewards of learning, rewards that are intrinsic to the process itself. They will only provide a little boost. Mr. Fryer’s reward scheme is intended to add incentives to the ones that already exist.

Unfortunately, these assumptions that economists make about human motivation, though intuitive and straightforward, are false. In particular, the idea that adding motives always helps is false. There are circumstances in which adding an incentive competes with other motives and diminishes their impact. Psychologists have known this for more than 30 years.

In one experiment, nursery school children were given the opportunity to draw with special markers. After playing, some of the children were given “good player” awards and others were not. Some time later, the markers were reintroduced to the classroom. The researchers kept track of which children used the markers, and they collected the pictures that had been drawn. The youngsters given awards were less likely to draw at all, and drew worse pictures, than those who were not given the awards.

Why did this happen? Children draw because drawing is fun and because it leads to a result: a picture. The rewards of drawing are intrinsic to the activity itself. The “good player” award gives children another reason to draw: to earn a reward. And it matters — children want recognition. But the recognition undermines the fun, so that later, in the absence of a chance to earn an award, the children aren’t interested in drawing.

Similar results have been obtained with adults. When you pay them for doing things they like, they come to like these activities less and will no longer participate in them without a financial incentive. The intrinsic satisfaction of the activities gets “crowded out” by the extrinsic payoff.

An especially striking example of this was reported in a study of Swiss citizens about a decade ago. Switzerland was holding a referendum about where to put nuclear waste dumps. Researchers went door-to-door in two Swiss cantons and asked people if they would accept a dump in their communities. Though people thought such dumps might be dangerous and might decrease property values, 50 percent of those who were asked said they would accept one. People felt responsibility as Swiss citizens. The dumps had to go somewhere, after all.

But when people were asked if they would accept a nuclear waste dump if they were paid a substantial sum each year (equal to about six weeks’ pay for the average worker), a remarkable thing happened. Now, with two reasons to say yes, only about 25 percent of respondents agreed. The offer of cash undermined the motive to be a good citizen.

It is as if, when asked the question, people asked themselves whether they should respond based on considerations of self-interest or considerations of public responsibility. Half of the people in the uncompensated condition of the study thought they should focus on their responsibilities. But the offer of money, in effect, told people that they should consider only their self-interest. And as it turned out, through the lens of self-interest, even six weeks’ pay wasn’t enough.

Obviously, the intrinsic rewards of learning aren’t working in New York’s schools, at least not for a lot of children. It may be that the current state of achievement is low enough that desperate measures are called for, and it’s worth trying anything. And we don’t know whether in this case, motives will complement or compete.

But it is plausible that when students get paid to go to class and show up for tests, they will be even less interested in the work than they would be if no incentives were present. If that happens, the incentive system will make the learning problem worse in the long run, even if it improves achievement in the short run — unless we’re prepared to follow these children through life, giving them a pat on the head, or an M&M or a check every time they learn something new.

Perhaps worse, the plan will distract us from investigating a more pertinent set of questions: why don’t children get intrinsic satisfaction from learning in school, and how can this failing of education be fixed? Virtually all kindergartners are eager to learn. But by fourth grade, many students need to be bribed. What makes our schools so dystopian that they produce this powerful transformation, almost overnight?

Barry Schwartz, a professor of psychology at Swarthmore College, is the author of “The Paradox of Choice: Why More Is Less.”

credits: http://pontiacschoolsroundtable.blogspot.com/2007/07/having-fun-learning-is-reward-in-itself.html

You’re a successful senior executive with 20, 25 years of experience under your belt. You’ve made your mark and stand just 1 or 2 rungs from the position of CEO.

Now what?

As faculty chair of Harvard Business School’s Advanced Management Program (AMP), Professor Robert Simons has seen many such executives in his classroom. While they come from countries around the world and from a variety of industries, they share a common characteristic.

“They’re at a point where it’s valuable for them to stop and reflect,” says Simons, a specialist in accounting, management control, and strategy implementation. “Most are well along in their lives, with grown families. They want to make a difference and do great things, but when they step back, they see that they’ve been in a bit of a rut, running between e-mails and meetings all day. There’s a realization that they only have so much time left, and that if they want to do something, they’ve got to move.”

Launched in 1945, AMP is the longest-running executive education program in the world. And at 8 weeks, it demands a serious time commitment that may at first seem unthinkable to a busy executive who will be asked to cut off all contact with his or her organization—in other words, leave the BlackBerry at home.

But participants soon recognize the value they are receiving at a crucial time in their careers, Simons says. The program includes rigorous dives into management concepts from 3 perspectives: capital markets, customer and product markets, and geopolitical environments.

Professor William Fruhan leads the corporate finance piece of the curriculum, providing perspective on the globalization of financial markets. “Increasingly, there is more interest in private equity as a source of capital around the world,” notes Simons.

The topic of marketing, taught by Professor John Quelch, is brought up to the executive boardroom level, says Simons.

“There’s a realization that they only have so much time left.”

Professor Julio Rotemberg provides an international vantage by systematically presenting a macroeconomic view of world regions so that participants have a clear sense of how various economic and sociopolitical factors will affect their businesses.

The heart of the program, however, centers on strategy formation and implementation. Professor David Yoffie’s course on competitive positioning helps participants understand how to orient their businesses in increasingly dynamic markets and provides strategies to help them recognize and respond to threats in the marketplace.

Simons and Professor Michael Tushman share the topic of strategy implementation, focusing on the organizational, systems, and people part of the equation. Tushman, for example, asks a fundamental question: As a leader, what do you have to do to cause an organization to change?

“Over all of this, we use a number of experiential exercises so people can apply these ideas and figure out how to build action plans,” explains Simons. At a recent AMP session, Simons rolled out his research on what he calls the Executive Compass, which assigns key performance factors to each of the tool’s 8 points.

“The North Star of this is identifying your primary customer, which is not always obvious,” he says. “In the case of McDonald’s, for example, their primary customer is not the consumers who eat their food, but real estate developers. People haven’t always thought hard about this issue. The implication is that you have to put the resources in place to meet and exceed the expectations of your primary customer, while you look after your other constituents on an as-needed basis.”

In the east quadrant, Simons focuses on performance variables and the theory of value creation. “We build strategy maps and figure out how to assess what leading indicators to track and how to feel confident that strategy is being monitored on an ongoing basis,” he says.

“The caliber of our participants and the bonds they form is one of the program’s strongest drawing points.”

The southernmost point is about commitment to others. “Here we ask, to what extent are people in the organization committed to helping others achieve shared goals?” In some situations—a Wall Street trading floor or a car dealership, for example—people are paid on commission, and it doesn’t matter if they’re committed to helping others. In other organizations, commitment to the whole is enormously important. “We walk through when it makes sense to choose between these 2 extremes and how you make that happen,” says Simons.

To the west, the focus is on creative tension. “We ask how managers can create tension in the business to promote or stimulate innovation across internal units,” he explains. “We illustrate mechanisms that will encourage dialogue across internal boundaries and look at techniques such as using stretch goals to get people to think outside the box.”

Credit: http://hbswk.hbs.edu/item/5675.html