Bonuses Don’t Motivate Developers

First, let me reassure you that they don’t: 50 years of research have shown us that if anything, incentives demotivate employees. And not just developers, but any job that requires some thought beyond mechanistic, rote work like the assembly line.

This is succinctly explained in the most popular RSA Animate video so far (you can watch it below) — a speech given by Dan Pink, who literally wrote the book on motivation. In it, he explains how an experiment funded by the Federal Reserve and conducted by MIT, Carnegie Mellon and the University of Chicago showed that bonuses led to poorer performance for any tasks that required anything above “rudimentary cognitive skill”.

Increasing the bonuses didn’t just not do anything, it actually made people perform worse, and it held true for populations both in the US and in rural India. But this hugely valuable research is mostly ignored, despite being basically ancient by now:

1. Herbert Mayer wrote in a 1975 paper that

“… merit pay emphasizes the direct relationship between job performance and dollar rewards, thereby detracting from intrinsic motivation in the work itself. A system that would switch the emphasis to rewards for self-development and opportunities for greater responsibility would seem to serve both individual and organizational goals in a more effective manner.”

2. Alfie Kohn, author of another book on motivation, wrote in a Harvard Business Review article in 1993:

So the rule is that money does not motivate, with two caveats:

Joel had another article in 2006, called “Identity Management Method“, in which he described how to create intrinsic motivation:

“To be an Identity Method manager, you have to summon all the social skills you have to make your employees identify with the goals of the organization, so that they are highly motivated, then you need to give them the information they need to steer in the right direction.”

Fast forward to Dan Pink’s 2009 book and 2010 RSA Animate, and he continues the same idea, breaking it down into three factors that do increase performance:

Bonuses are related to none of those. The only reason to ever dangle bonuses in front of developers, is maybe as compensation for the rare big push requiring lots of overtime; and in that case, it’s just to prevent them from feeling exploited. Otherwise, bonuses will actually hurt productivity. And that’s a scientific fact. To get better performance out of your employees, hire smart people and let them be smart. Tell them the company story and why the job is important, then simply get out of the way and help them when they need it.

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