Cash bonuses may not be the best way to get the most out of your employees. In fact, it may be the worst. Instead, the secret to boosted workplace performance comes with cheese, tomato paste and crispy dough.
Extra cash, it seems, is worse than no bonus at all.
Psychologist Dan Ariely has tackled the elusive question of productivity in his new book Pay-off: The Hidden Logic That Shapes our Motivations.
He cites one study as being particularly revealing, reports news.com.au.
Ariely divided the workforce of an Intel semiconductor chip assembly factory into four groups.
One group was promised about $40 as a cash bonus if they exceeded their daily quota.
Another was offered personal SMS messages of praise from the boss.
The third would be rewarded with free pizza.
And the fourth was left as-is, as a control group to balance the other three against.
Perhaps it was the warm, cheesy smell.
Or the anticipation of biting into a crisp crust.
But the pizza group surged to an early lead.
On the first day, its chip production was up 6.7 per cent.
Surprisingly, though, the runner-up came in with a 6.6 per cent productivity increase.
It seems a little praise goes a long way.
The cash group? Well, their first-day performance was boosted 4.9 per cent.
By the end of week, the situation had changed somewhat.
Both pizza and praise had kept their work teams above the productivity average, though praise eventually edged pizza out.
Those with the carrot of extra cash dangled in front of them recorded an eventual productivity fall of 6.5 per cent (it actually plunged to 13.2 per cent worse than the control group on day two).
Ariely, however, feels his pizza team had been undercooked.
He had wanted the pizzas to be delivered to the workers' homes. Instead, they'd been doled out at the office.
"This way … we not only would give them a gift, but we would also make them heroes in the eyes of their families," he writes.
Employers need to realise that pay — while vital — isn't the only motivator, he adds.
That's easy to forget.
And different motivations kick in at different times.
Before a task is undertaken, people focus on external rewards — such as pay — to get them going.
While they're actually doing the task, people focus on intrinsic motivators — such as positive experiences and a sense of achievement.
This could explain why money so quickly lost its appeal, while pizza conveyed a sense of appreciation in their efforts.