About a month ago I posted about a Harvard research study on the impact giving incentives before performance – and then taking them back if performance goals weren’t met.  That study was also referenced on the Compensation Café blog in a discussion on bonuses (ie:  they were talking compensation – I was talking points not dollars.)

The gut reaction most people have to “taking stuff away” if you don’t hit your goal is that it is unfair, seems harsh, and in the case of money – tough to collect if the money is spent.

All of that is true – but – as we all know – sometimes it is about getting results and ethics, fairness and morality be damned (hello – CEOs and WallStreet – are you listening?)

But the thinking in these articles is really about loss aversion and how our human brains are more “motivated” by losing stuff we think we already have then earning stuff we don’t have yet.  The concept has been proven time and again – we value stuff we have more than the stuff we don’t have and when we get it we don’t want to lose it.

Again – More Negative Incentives

I won’t use the term negative reinforcement here because A.) it doesn’t apply and B.) most people get it wrong (hint:  has nothing to do with getting a shock – it’s about not getting a shock…) but I will say this…

I’m seeing more articles about what I would call non-positive support of performance (hey – can I create a consulting gig around that? Hmmmm…)

Take this post on Bloomberg Business Week yesterday:  “The Only Earthling With a Facebook ‘Dislike’ Button.”

The article is about Chuck Rossi who is the release engineer for Facebook.  He reviews all those wonderful additions/subtractions and changes to our Facebook experience.  As you would expect he has a ton of engineers writing code and submitting it for review and testing before it goes life.  Keeping track of all that stuff is tough.  But here’s how they manage it at Facebook:

Rossi can pull up someone’s name and see what code they have submitted. “Every developer is born with four stars to their name,” he says, pointing to a ranking system on the profile page. “If we have an issue when we take someone’s code—and it blows us out of the water—then it takes them down half a star and I write what happened,” Rossi says. The system has a thumbs-down indicator, a feature many Facebook users have long sought. “I am the only guy who has a’ dislike’ button on Facebook,” he says. “A lot of people want [one], but this is the only place you will see it.”

When engineers drop down to two stars, they’re banned from making changes until they’ve completed a review and a retraining process. “People here are pretty freaked-out about losing their stars, but not in a bad way. It’s all done in good fun,” Rossi says. And if you catch an error before it goes up on the site and jump in to save the day, you can earn a half-star back. Failing that, he jokes, “you can bring booze or cupcakes.”

So… the main way Chuck manages his engineers with respect to quality of performance is… taking away stars… creating a public display of failure and creating a competitive environment?  That’s what it looks like to me.

To Each Their Own

Here’s my point of view… if it works for Facebook great.  But… don’t think it will work for you.  The culture is key here.  I’m guessing that because of the stock options and the other perks associated with being a Facebooker – this little pocket of bad incentive design is like a drop of red food coloring in an ocean of clean water.  Sure – it is there – but it has little impact.

In your company however, you probably don’t have the amount of positive vibe with respect to employee loyalty to do this – you’ll just create a bucket of red water.

Each company has a culture – some can withstand this type of program – some can’t.  I’d say that most can’t and those that can… might well be advised to start looking at alternatives as I don’t think this is a sustainable model for the long haul.

What do you think?

If this type of program works well (meaning it gets results) should it be done?

Is it something you’d consider?

 

Related articles