1998
n
A rock or a soft place?
Loyalty, trust, extraordinary effort, etc. are reciprocal things; we
give them to those from whom we receive similar. And organiza-
tions and employees are no different.
Human nature: self-interested bastard or
community-builder?
It goes to the very nature of organizations, and of individuals. It
pertains to why we co-operate in rms, and what motivates us as
human beings. And I am not sure that in the world of business
we have quite gured it out: how to align the fundamental
aspects of human nature with work and motivation.
Allow me to elaborate: whenever I ask executives how they should
make an organization more entrepreneurial, more customer-
focused or simply more protable they virtually always come
back with: “incentivize people”. Reward
people for their ideas, their efforts and initia-
tives, and they will deliver.
But always, when I ask them, if you were on
a xed salary, would you still do your best
to come up with new ideas, be entrepreneurial, and deliver the
best value you can for your customers? And then the answer is,
invariably, “Yes I would, because I don’t do it for the money.”
Then people say they like being good at what they do, initiating
new things, and delivering customers the best they possibly
can.
But why do we always assume that other people (but not us) are
motivated – and motivated solely – by money, and the only way
to get them to do stuff is by nancially incentivizing them? No,
we do things out of intrinsic motivation, because we want to
do the best we can and contribute to the success of our rm. Is
everybody really so different from us?
If you hadn’t noticed; that was a rhetorical question.
So why do we assume other people are only motivated by money?
My guess is it goes back to why we organize our rms the way we
‘‘
We evolved
as being part of a
tribe
’’
Business Exposed200
do. How we, in our society, organize our companies is basically
based on two sources: (1) the Roman army (i.e., a hierarchy with
unity of command), and (2) economics.
Economics has had a huge inuence on how we govern our
rms. For example, the use of stock options to incentivize and
reward top managers comes straight out of “agency theory”,
and the spread of this practice has been linked to the spread of
“agency theorists” across business schools in the US after which,
gradually, the phenomenon started to diffuse. And there are
other examples.
Yet, economics – including agency theory – works on the
assumption that people are rational and self-interested. They will
work if they are rewarded for it, but if they don’t receive a direct
reward or nobody can really observe their efforts, they will shirk
and be lazy. Under this logic, indeed, you have to incentivize
people; otherwise they won’t do a thing.
And I guess to some extent, we are indeed rational and self-inter-
ested, and hence motivated by money. However, there is another
fundamental aspect to our nature, one which through millions
of years of evolution has made us the way we are: we like being
part of a community and enjoy contributing to the well-being of
that group.
Because we evolved as being part of a tribe. And people who
were purely self-interested, shirking, and lazy would be kicked
out of the tribe and clubbed to death, if not consumed for
dinner. So our gene base evolved into making us slightly self-
interested but also community-lovers. We all like doing things
not only for our direct individual reward but also because
it contributes to the community that we are part of. This
community used to be our tribe. Nowadays, it is often our
organization.
And if you, as a manager (i.e., headman) manage to tap into that
deep fundamental need among your employees, you can build
a powerful rm indeed. People love to do stuff that strengthens
their rm, fullls them with pride, and makes us feel stronger as
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