InspiringMotivatingIndividuals Unit4 Sytch

04.01 – 04.
12 INSPIRING AND
MOTIVATING INDIVIDUALS
Aligning Rewards and Behaviors!
Maxim Sytch, PhD!

Associate Professor of Management!
Mary Kay Hallman Fellow!
04.01 – 04.12 INSPIRING AND
Equity!
What would you prefer?
(A) $1000 bonus, but it is the (B) $2000 bonus, but it is the
largest in your team smallest in your team
Equity Theory!
Self Peers •  Inputs = effort, time,

reliability, cooperation,
etc.
INPUTS INPUTS •  Rewards = pay,
promotion, recognition,
etc.
REWARDS REWARDS •  Reward-to-effort
ratios are relative to
peers, not absolute
Source: Adams (1963)

E O of re
, t h e C e mo
2 0 1 4 m a d
In onald mes the s
McD 1,000 ti verage ny
thanry of an ae compa
sala ker at th
wor
CEO-to-Worker Compensation Ratio!

Average 2000-2012!
FOOD & ACCOMMODATION 332

RETAIL 230
INFORMATION 210
CONSTRUCTION 204
MINING 174
HEALTHCARE 170
FINANCE 156
MANUFACTURING 138
UTILITIES 58
Source: Demos (2014)
“He gave raises to people who have the least skills

Gravity Payments CEO and are the least equipped to do the job, and the
•  Set a minimum salary to be ones who were taking on the most didn’t get much of
$70,000 in three years (starting with a bump”
Financial Planner who left the company
a first raise in 2015)
•  Significantly reduced his own
“Now the people who were just clocking in and out
million-dollar pay package
were making the same as me… It shackles high
performers to less motivated team members.”
Developer who left the company after having his
salary raised from $41,000 to $50,000
Source: New York Times, July 31, 2015

Consequences of Inequity!
•  Burnout!
Self Peers
•  Stress!
•  Negative affect! INPUTS INPUTS
•  Coronary heart disease! REWARDS REWARDS
•  Absenteeism!
•  Theft at workplace!
Source: Bakker (2000); Greenberg (1990); Siegrist (1988, 2002)

Applying Equity Principles!

•  Attain congruence in perceptions of inputs!
•  Make sure inputs are relevant and important for the
organization!
•  Recognize the rewards people value !
•  Communicate!
Self Peers
•  Strive for equity in the long-term!
INPUTS INPUTS
REWARDS REWARDS
Folly of rewarding A while Hoping for B!
Maxim Sytch, PhD!

What are You Really Rewarding?!

EXPECTING: REWARDING:
•  Long-term growth •  Quarterly earnings
•  Teamwork •  Individual effort
•  Stretch goals •  “Making the numbers”
•  Total quality •  “Don’t stop the line”
•  Innovative thinking •  Proven methods and
and risk taking minimizing mistakes
•  Candor; surfacing bad •  Reporting good news;
news early Agreeing with the boss
Source: Kerr (1995)
Expect risk taking… but reward conformity:
“ A single mistake for which you are blamed

can offset many successes and result in your
being labeled and limited in future
assignments and promotions”
Scenario!
One technology company
struggled to drive radical,
breakthrough innovation. Its
management decided to
implement an incentive system,
wherein engineers would
receive a bonus based on the
number of submitted patent
applications!
Do you find this approach
effective? !
Addressing Folly A/B
q Understand what behaviors you are rewarding!

q Reward systems should reinforce desired behaviors!
q Alter the reward system!
Discussion Forum
•  Identify a Folly A/B issue; it could be your current or

past teams/organizations!
•  Propose a concrete, actionable solution to address the
issue, which would include both metrics and rewards!
•  Go to the discussion forum (Folly A/B thread) and share
your ideas!
Types of Reinforcement!
Maxim Sytch, PhD!

Ivan Pavlov (1849-1936) B.F. Skinner (1904-1990)

Positive Reinforcement
Desired Behavior Present Attractive Desired Behavior
Emitted Consequences Increases
Negative Reinforcement
Desired Behavior Remove Aversive Desired Behavior
Emitted Condition Increases
Punishment
Undesired Behavior Present Aversive Undesired Behavior

Emitted Consequences Decreases
“Our game does not really

punish players.”
Mikael Hed
former CEO of Rovio
Source: Wall Street Journal, 2010

•  Emphasize positive
reinforcement
- Generally the most
effective way to motivate
employees
•  Be discretionary and careful

when using punishment
- Punishment can lead to low
morale, turnover, and even
sabotage
- Behavioral changes as a result of
punishment may be unsustainable
•  Punishment as a reinforcer
-  Eradicate discreet, undesired
behaviors
-  Apply soon after the undesired
behaviors and clearly
communicate the reasons for it
Schedules of Reinforcement!
Maxim Sytch, PhD!

Think About It!

Goal
Get your daughter to do her homework
Which schedule of reinforcement would most effectively motivate your child

to do her homework and keep doing her homework in the future?
A) Giving your daughter a piece her favorite candy after every 20 minutes of studying
B) Giving your daughter 3 pieces of her favorite candy after every 60 minutes of studying
C) Giving your daughter 2 pieces of candy after the first 30 minutes of studying, no candy
after the next 30 minutes of studying, and then 1 piece of candy after every15 minutes of
studying
Optimizing Schedules of Reinforcement!

Fixed Interval
•  Receiving a reward after a fixed
“No o
time interval ne w
mornin orks on Mo
•  Receiving a paycheck at the end of reinfor g beca nday
ced by u s e he is
every month a payc
Friday
aftern heck on
Fixed Ratio – B.F. oon.”
Skinne
r
•  Receiving a reward after a fixed
number of responses
•  Getting paid after every 5 cars sold
Source: Skinner (1938, 1966)

Variable Schedules of Reinforcement!
Variable Ratio Reinforcement:!

The probability of winning is
constant, but the number of
lever presses needed to win is
variable!
!
!
Variable Reinforcement Schedules!

Variable Interval
•  Receiving a reward after time
intervals of different length
•  Receiving praise only now and then,
a surprise inspection, a pop quiz
Variable Ratio
•  The number of units produced to
receive a reward varies
•  A lottery for employees,
introducing probabilistic rewards
Variable Ratio in the Workplace!

Baseline Compensation: $1.5 per hour
And then Bonuses were introduced:
Bonus in condition 1:
•  50 cents per 1 exam sheet if correctly guess a coin flip
Bonus in condition 2:
•  25 cents per one exam sheet, guaranteed (no coin flip)

50%
Increase in the number of
t=3.63, Conclusion
exams graded per day
40% p<0.01
The schedule of
30%
reinforcement matters!
44.8% 36.5%
20%
Variable-ratio
10% reinforcement schedule
can increase productivity
0% and engagement
Incentives
50 cents per 25 cents per
exam sheet if
correctly guess a exam sheet,
coin flip guaranteed Source:Yukl, Wexley, & Seymore (1972)

Program:
•  Employees with perfect attendance are entered
into a lottery system
Odds of Winning:
•  Very low
Outcome:
•  Reduced absenteeism by 21%
New York Life Insurance

Source: Romero & Kleiner (2000)
Optimizing Schedules of Reinforcement!
How many of you just

looked at your phone?
Think About It!

Goal
Get your daughter to do her homework
Which schedule of reinforcement would most effectively motivate your child

to do her homework and keep doing her homework in the future?
A) Giving your daughter a piece her favorite candy after every 20 minutes of studying
B) Giving your daughter 3 pieces of her favorite candy after every 60 minutes of studying
C) Giving your daughter 2 pieces of candy after the first 30 minutes of studying, no candy
after the next 30 minutes of studying, and then 1 piece of candy after every15 minutes of
studying
Key Takeaways!
•  Ratio schedules are typically more powerful than interval schedules
•  Fixed interval and fixed ratio schedules are the most popular in
organizations (but that doesn’t mean they’re the most effective)
•  Consider using the variable-ratio schedule of reinforcement
•  Incentives are pervasive! Think about how you can use incentives to
improve your work life and life outside of work
Functions of a Performance Appraisal!
Maxim Sytch, PhD!

Performance Appraisal!
Embed this video:

https://www.youtube.com/watch?v=gdp4sPviV74!
!
!
In-Video Poll!
Rate the level of agreement with following statement: !
!
The performance appraisal review of Matt will be effective.!
!
1 - Strongly Disagree !
2 - Disagree !
3 - Neither Agree nor Disagree !
4 - Agree !
5 - Strongly Agree !
Functions of Performance Appraisals!
Will Melanie and Matt reach agreement on the

Evaluation
evaluation of Matt’s performance?
Development Will Matt walk away with a clear development plan?
Will Matt leave the performance appraisal more

Motivation
motivated?
SEPARATE
EVALUATION
FROM
DEVELOPMENT
Challenges of Performance Appraisal!
Maxim Sytch, PhD!

Why Performance Appraisals are Difficult!
Fundamental Attribution Error
Self-fulfilling Prophecy
Illusion of Transparency
Fundamental Attribution Error!

Self Others
Due to:
Due to:
Internal and stable
Success Change, politics, or
characteristics of the
situational constraints
person
Actions
Due to:
Due to:
Internal and stable
Chance, politics or
Failure situational constraints
characteristics of the
person
Illusion of Transparency!
Group 1 Group 2
“Tappers” “Listeners”
Source: Newton (1990)
Task
o n g !
the s
Guess o n g
t h e s
u e s s e d
2.5% g correctly
Group 1 Group 2
“Tappers” “Listeners”
Source:. Newton (1990)
Count the number of times

Miranda engages in an
illusion of transparency
w ay s
Takea
t e n i n g
Count the number of times
t i v e l i s
e i n a c Miranda engages in an
!
n g a g s t i o n s illusion of transparency
•  E q u e
•  Ask ur words
s e yo
•  U
Self-Fulfilling Prophecy!
Students Labeled as Intelligent Other Students
45% difference,
20% of students p<0.05
show unusual
potential for
12.2
academic growth
8.4
GAINS IN IQ ONE YEAR LATER
Source: Rosenthal and Jacobson (1965)

Self-Fulfilling Prophecy!
Students Labeled as Intelligent Other Students
45% difference,
p<0.05
12.2
8.4
GAINS IN IQ ONE YEAR LATER
Self-fulfilling Prophecy!
•  Observer has an initial impression about the target

that he/she enacts
•  Target then behaves to conform to the observers
expectations
•  As a result, the observer’s initial impressions are
confirmed and further reinforced
Self-fulfilling Prophecy!
•  USAF Academy Preparatory School (Schrank):!
–  100 enlisted airmen grouped into 5 sections based on ability
levels (randomly assigned)!
–  Performance differences (p<0.001)!
•  Job training program (King)!
–  “High aptitude” pressers, welders, mechanics!
–  Higher objective scores; higher ratings by supervisors and peers;
lower dropout rates!
“Treat a man as he is, he will remain so.Treat a

man the way he can be and ought to be, and
he will become as he can be and should be.”
Ralph Waldo Emerson
Providing Critical Performance Feedback!
Maxim Sytch, PhD!

Providing Critical Performance Feedback!

q  Don’t wait! !
q  Focus on behaviors and not on personality!
q  Focus on a few key behaviors!
q  Be specific !
q  Do not “sandwich” or “sugarcoat”!
q  Confirm understanding!
q  Follow up with positive reinforcement when seeing desired
changes!
Seeking Performance Feedback!
Maxim Sytch, PhD!

INSERT ACCENTURE CEO VIDEO!
http://www.washingtonpost.com/blogs/on-leadership/wp/
2015/07/21/in-big-move-accenture-will-get-rid-of-annual-
performance-reviews-and-rankings/ !
Seek Performance Feedback!

Benefits of consistently seeking feedback: !
q More accurate perception of how others understand you !
q You are perceived as being more creative, open, and caring!
!
Remain open to critical feedback!
q  Seeking affirmation can backfire: it diminishes the perception of your
effectiveness !
!
! Source: De Strobbeleir et al. (2011), Ashford and Northcraft (1992) Ashford and Tsui (1991)
How to Seek Feedback!
•  “How am I doing?” !
•  “What can I do to improve?”!
•  “What can I do to improve in communicating the
status of my projects to team leaders?”!
Source: Ashford (2013)

Recap – Aligning Rewards and Behaviors!

•  Manage equity – attend to relative
ratios of inputs and outputs
•  Recognize and address Folly A/B
•  Emphasize positive reinforcement
•  Use variable schedules of reinforcement
•  Manage performance feedback
-  Fundamental attribution error
-  Self-fulfilling prophecy
-  Illusion of transparency
•  Proactively seek feedback
Assignment!
•  Identify one subordinate, one peer, and one superior (boss,

mentor, senior advisor) among your colleagues or broader
contacts. Seek feedback from them on a particular dimension of
your leadership skillset (e.g., working with teams, public speaking
skills, motivating others, etc.) !
!
•  In a 1-2 page document, summarize the feedback you have
received and outline the action plan for the identified
developmental opportunities!
Assignment!
Identify a schedule of reinforcement for
motivating your team members:
•  Which schedule would you use?

•  If you use variable ratio, what strategy will you
use? (e.g., coin flip, attendance lottery, something
else)
•  What incentive will you use with your team
members (e.g., pastries, tea/coffee, cash)
Share your answers with your classmates on the

discussion forum
Assignment!
Identify a schedule of reinforcement for
motivating your team members:
•  Which schedule would you use? Read

A b o ut
•  If you use variable ratio, what strategy will you ? How
use? (e.g., coin flip, attendance lottery, R e v
something i ews D e R ue,
a n c e y t c h &
else) e r for m l l ? ”( S 0)
i t c h P W e
m team Review , 2 0 1
•  What incentive“D will youtouse
d Theyour
owith ess
e a r n B u s i n
members (e.g.,Lpastries, arvard cash)
tea/coffee,
H
Share your answers with your classmates on the
discussion forum
Image Attributions
“McDonald’s” by Mike Mozart is licensed CC BY 2.0
“B.F. Skinner at Harvard circa 1950” by Esquilo is licensed CC BY 3.0
“Exam” by Alberto G is licensed CC BY 2.0
“Modern Communication” by LearningLark is licensed CC BY 2.0
“Tapping a Pencil” by Rennett Stowe is licensed CC BY 2.0

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04.01 – 04.

Aligning Rewards and Behaviors!

Maxim Sytch, PhD!

What would you prefer?

Self Peers • Inputs = effort, time,

Source: Adams (1963)

CEO-to-Worker Compensation Ratio!

FOOD & ACCOMMODATION 332

“He gave raises to people who have the least skills

Source: New York Times, July 31, 2015

Source: Bakker (2000); Greenberg (1990); Siegrist (1988, 2002)

Applying Equity Principles!

Folly of rewarding A while Hoping for B!

Maxim Sytch, PhD!

What are You Really Rewarding?!

Expect risk taking… but reward conformity:

“ A single mistake for which you are blamed

Addressing Folly A/B

q Understand what behaviors you are rewarding!

• Identify a Folly A/B issue; it could be your current or

Maxim Sytch, PhD!

Ivan Pavlov (1849-1936) B.F. Skinner (1904-1990)

Undesired Behavior Present Aversive Undesired Behavior

“Our game does not really

Source: Wall Street Journal, 2010

• Be discretionary and careful

Maxim Sytch, PhD!

Think About It!

Get your daughter to do her homework

Which schedule of reinforcement would most effectively motivate your child

Optimizing Schedules of Reinforcement!

Source: Skinner (1938, 1966)

Variable Schedules of Reinforcement!

Variable Ratio Reinforcement:!

Variable Reinforcement Schedules!

Variable Ratio in the Workplace!

And then Bonuses were introduced:

Variable Ratio in the Workplace!

Variable Ratio in the Workplace!

New York Life Insurance

Optimizing Schedules of Reinforcement!

How many of you just

Think About It!

Get your daughter to do her homework

Which schedule of reinforcement would most effectively motivate your child

Functions of a Performance Appraisal!

Maxim Sytch, PhD!

Embed this video:

Functions of Performance Appraisals!

Will Melanie and Matt reach agreement on the

Development Will Matt walk away with a clear development plan?

Will Matt leave the performance appraisal more

Challenges of Performance Appraisal!

Maxim Sytch, PhD!

Why Performance Appraisals are Difficult!

Fundamental Attribution Error

Fundamental Attribution Error!

Count the number of times

Students Labeled as Intelligent Other Students

Source: Rosenthal and Jacobson (1965)

Students Labeled as Intelligent Other Students

• Observer has an initial impression about the target

“Treat a man as he is, he will remain so.Treat a

Providing Critical Performance Feedback!

Self Peers •  Inputs = effort, time,

q Understand what behaviors you are rewarding!

•  Identify a Folly A/B issue; it could be your current or

•  Be discretionary and careful

•  Observer has an initial impression about the target

•  Identify one subordinate, one peer, and one superior (boss,

•  Which schedule would you use?

•  Which schedule would you use? Read