Showing posts with label motivation. Show all posts
Showing posts with label motivation. Show all posts
Wednesday, 8 November 2023
Saturday, 5 August 2023
Monday, 16 October 2017
Bonuses are the enemy of progress
Andrew Hill in The Financial Times
When my children were still in primary school, I once let my English stiff upper lip slacken and asked them whether I had ever said how much I loved them. “Yes,” responded my truculent son, “but not with money.”
When my children were still in primary school, I once let my English stiff upper lip slacken and asked them whether I had ever said how much I loved them. “Yes,” responded my truculent son, “but not with money.”
I am reminded of his precocious attempt to persuade me to apply hard cash to a soft problem every time I hear about efforts to use monetary bonuses to encourage executives to hit non-financial goals.
Reduced emissions, safer factories, better gender balance: companies everywhere are enshrining such creditable objectives as “key performance indicators”, putting a price on the target, and letting greed take care of the rest.
“I think we’ve got to do more to tie the outcomes to compensation, so that it’s meaningful and it’s real,” declared Alexis Herman, a former US labour secretary and Coca-Cola board member, at the recent Women’s Forum for the Economy & Society in Paris, discussing how businesses can become more “human”.
More than once I heard delegates suggest similar solutions in similar terms. The argument went like this: make bonuses dependent on progress, particularly on diversity, because bonuses are “the only language executives understand”.
In that case, it is about time executives learnt another language, because at the highest level, bonus-based pay packages are a mess.
Indeed, there is something perverse about suggesting that companies should hammer away at the vital, sensitive question of how to improve their environmental, social and governance performance using a blunt instrument — the cash bonus — that has helped deepen mistrust of business, and widen inequality.
When misused, monetary bonuses foster selfishness, backbiting, even cheating among employees. Staff who start taking bonuses for granted become resentful if the cash is withdrawn, as banks that have tried to rein in such rewards since the financial crisis have discovered. When bonus packages are too complex, evidence suggests that managers simply ignore the targets altogether.
Adding non-financial goals undeniably complicates what is already a baffling array of executive incentives. Measuring how managers have performed against softer targets is also notoriously hard. That is one reason why, at board level, directors seem to have wide discretion to adjust chief executives’ bonuses for non-financial performance.
Coca-Cola, for example, assessed the 2016 performance of its then chief executive, Muhtar Kent, on no fewer than six strategic initiatives — “People, Planet, Productivity, Partners, Portfolio and Profit”. To decide his bonus, the compensation committee took account not only of his efforts to refranchise US bottling operations, but also to replenish water, reduce sugar and accelerate diversity.
I would question whether Mr Kent pondered for long the impact on his pay of the many non-financial decisions he took. Most of his eventual bonus of $4.1m (out of a total package of $16m), was the outcome of a formula based on financial results rather than other worthy actions.
Leaders should do their best to encourage and harness workers’ love of the job. But cash bonuses can get in the way of this intrinsic motivation to do the right thing.
Ioannis Ioannou, Shelley Xin Li and George Serafeim have studied attempts to meet demanding carbon emission targets.They found using stretch goals alone was quite effective. But adding monetary incentives seemed to undermine companies’ ability to hit the ambitious targets.
Not to say that incentives are worthless. BHP Billiton, the miner, is making progress towards its demanding goal of achieving gender balance by 2025, helped by the fact that bonuses for senior staff are tied to advances towards the objective. Prof Ioannou of London Business School says bonuses spurred on managers whose job description already included cleaning up emissions.
Still, I am queasy about offering cash rewards for good intentions that should be the norm. I don’t like promising cash incentives to my children for excellent exam results, either, let alone for loading the dishwasher or vacuuming their bedrooms.
As Nobel-winning economist Richard Thaler wrote in Misbehaving, it is “overly simplistic” to assume that financial incentives to children (or their parents or teachers) will improve performance. Likewise for many subtler corporate objectives.
In fact, I fear the main effect of focusing executives’ attention on cash bonuses for being cleaner, safer or more inclusive will be to remind them that the most “meaningful and real” rewards are available for the headlong pursuit of pure profit.
Friday, 1 July 2016
No grades, no timetable: Berlin school turns teaching upside down
Philip Olterman in The Guardian
Anton Oberländer is a persuasive speaker. Last year, when he and a group of friends were short of cash for a camping trip to Cornwall, he managed to talk Germany’s national rail operator into handing them some free tickets. So impressed was the management with his chutzpah that they invited him back to give a motivational speech to 200 of their employees.
Anton, it should be pointed out, is 14 years old.
The Berlin teenager’s self-confidence is largely the product of a unique educational institution that has turned the conventions of traditional teaching radically upside down. At Oberländer’s school, there are no grades until students turn 15, no timetables, no lecture-style instructions. The pupils themselves decide which subjects they want to study for each lesson and when they want to take an exam.
The school’s syllabus reads like any helicopter parents’ nightmare. Set subjects are limited to maths, German, English and social studies, supplemented by more abstract courses such as “responsibility” or “challenge”. For “challenge”, students aged 12 to 14 are each given €150 (£115) and sent on an adventure they have to plan entirely by themselves. Some go kayaking, others work on a farm. Anton went trekking along England’s south coast.
The philosophy behind these innovations is simple: as the requirements of the labour market are changing, and smartphones and the internet are transforming the ways in which young people process information, headteacher Margret Rasfeld argues, the most important skill a school can pass down to its students is the ability to motivate themselves.
“Look at three or four year olds – they are all full of self-confidence,” Rasfeld says. “Often children can’t wait to start school. But frustratingly, most schools then somehow manage to untrain that confidence.”
The Evangelical School Berlin Centre (ESBC) is trying to do nothing less than “reinvent what a school is”, she says. “The mission of a progressive school should be to prepare young people to cope with change, or better still, to make them look forward to change. In the 21st century schools should see it as their job to develop strong personalities.”
Making students listen to a teacher for 45 minutes and punish them for collaborating on an exercise, Rasfeld says, was not only out of sync with the requirements of the modern world of work but also counterproductive. “Nothing motivates students more than when they discover the meaning behind a subject of their own accord.”
Students at her school are encouraged to think up other ways to prove their acquired skills, such as coding a computer game instead of sitting a maths exam. Oberländer, who had never been away from home for three weeks until he embarked on his challenge in Cornwall, said he learned more English on his trip than he had in several years of learning the language at school.
Reinventing education: pupils at the ESBC, which is gaining a reputation as Germany’s most exciting school. Photograph: Handout
Germany’s federalised education structure, in which each of the 16 states plans its own education system, has traditionally allowed “free learning” models to flourish. Yet unlike Sudbury, Montessori or Steiner schools, Rasfeld’s institution tries to embed student self-determination within a relatively strict system of rules. Students who dawdle during lessons have to come into school on Saturday morning to catch up, a punishment known as “silentium”. “The more freedom you have, the more structure you need,” says Rasfeld.
The main reason why the ESBC is gaining a reputation as Germany’s most exciting school is that its experimental philosophy has also managed to deliver impressive results. Year after year Rasfeld’s institution ends up with the best grades among Berlin’s gesamtschulen, or comprehensive schools, which combine all three school forms of Germany’s tertiary system. Last year’s school leavers achieved an average grade of 2.0, the equivalent of a straight B – even though 40% of the year had been advised not to continue to Abitur, the German equivalent of A-levels, before they joined the school. Having opened in 2007 with just 16 students, the school now operates at full capacity, with 500 pupils and long waiting lists for new applicants.
Given its word-of-mouth success, it is little wonder there have been calls for Rasfeld’s approach to go nationwide. Yet some educational experts question whether the school’s methods can easily be exported: in Berlin, they say, the school can draw the most promising applicants from well-off and progressive families. Rasfeld rejects such criticisms, insisting the school aims for a heterogenous mix of students from different backgrounds. While a cross adorns the assembly hall and each school day starts with worship, only a third of current pupils are baptised. Thirty per cent of students have a migrant background, and 7% are from households where no German is spoken at all.
Even though the ESBC is one of Germany’s 5,000 private schools, fees are means tested and relatively low compared with those common in Britain, ranging between €720 and €6,636 a year. About 5% of students are exempt from fees.
Yet even Rasfeld admits that finding teachers able to adjust to the school’s learning methods can be harder than getting students to do the same.
Aged 65 and due to retire in July, Rasfeld still has ambitious plans. A four-person “education innovation lab” based at the school has been developing teaching materials for schools that want to follow the ESBC’s lead. About 40 schools inGermany are in the process of adopting some or all of Rasfeld’s methods. One in Berlin’s Weissensee district recently let a student trek across the Alps for a challenge project. “Things are only getting started,” says Rasfeld.
“In education, you can only create change from the bottom – if the orders come from the top, schools will resist. Ministries are like giant oil tankers: it takes a long time to turn them around. What we need is lots of little speedboats to show you can do things differently.”
Anton Oberländer is a persuasive speaker. Last year, when he and a group of friends were short of cash for a camping trip to Cornwall, he managed to talk Germany’s national rail operator into handing them some free tickets. So impressed was the management with his chutzpah that they invited him back to give a motivational speech to 200 of their employees.
Anton, it should be pointed out, is 14 years old.
The Berlin teenager’s self-confidence is largely the product of a unique educational institution that has turned the conventions of traditional teaching radically upside down. At Oberländer’s school, there are no grades until students turn 15, no timetables, no lecture-style instructions. The pupils themselves decide which subjects they want to study for each lesson and when they want to take an exam.
The school’s syllabus reads like any helicopter parents’ nightmare. Set subjects are limited to maths, German, English and social studies, supplemented by more abstract courses such as “responsibility” or “challenge”. For “challenge”, students aged 12 to 14 are each given €150 (£115) and sent on an adventure they have to plan entirely by themselves. Some go kayaking, others work on a farm. Anton went trekking along England’s south coast.
The philosophy behind these innovations is simple: as the requirements of the labour market are changing, and smartphones and the internet are transforming the ways in which young people process information, headteacher Margret Rasfeld argues, the most important skill a school can pass down to its students is the ability to motivate themselves.
“Look at three or four year olds – they are all full of self-confidence,” Rasfeld says. “Often children can’t wait to start school. But frustratingly, most schools then somehow manage to untrain that confidence.”
The Evangelical School Berlin Centre (ESBC) is trying to do nothing less than “reinvent what a school is”, she says. “The mission of a progressive school should be to prepare young people to cope with change, or better still, to make them look forward to change. In the 21st century schools should see it as their job to develop strong personalities.”
Making students listen to a teacher for 45 minutes and punish them for collaborating on an exercise, Rasfeld says, was not only out of sync with the requirements of the modern world of work but also counterproductive. “Nothing motivates students more than when they discover the meaning behind a subject of their own accord.”
Students at her school are encouraged to think up other ways to prove their acquired skills, such as coding a computer game instead of sitting a maths exam. Oberländer, who had never been away from home for three weeks until he embarked on his challenge in Cornwall, said he learned more English on his trip than he had in several years of learning the language at school.
Reinventing education: pupils at the ESBC, which is gaining a reputation as Germany’s most exciting school. Photograph: Handout
Germany’s federalised education structure, in which each of the 16 states plans its own education system, has traditionally allowed “free learning” models to flourish. Yet unlike Sudbury, Montessori or Steiner schools, Rasfeld’s institution tries to embed student self-determination within a relatively strict system of rules. Students who dawdle during lessons have to come into school on Saturday morning to catch up, a punishment known as “silentium”. “The more freedom you have, the more structure you need,” says Rasfeld.
The main reason why the ESBC is gaining a reputation as Germany’s most exciting school is that its experimental philosophy has also managed to deliver impressive results. Year after year Rasfeld’s institution ends up with the best grades among Berlin’s gesamtschulen, or comprehensive schools, which combine all three school forms of Germany’s tertiary system. Last year’s school leavers achieved an average grade of 2.0, the equivalent of a straight B – even though 40% of the year had been advised not to continue to Abitur, the German equivalent of A-levels, before they joined the school. Having opened in 2007 with just 16 students, the school now operates at full capacity, with 500 pupils and long waiting lists for new applicants.
Given its word-of-mouth success, it is little wonder there have been calls for Rasfeld’s approach to go nationwide. Yet some educational experts question whether the school’s methods can easily be exported: in Berlin, they say, the school can draw the most promising applicants from well-off and progressive families. Rasfeld rejects such criticisms, insisting the school aims for a heterogenous mix of students from different backgrounds. While a cross adorns the assembly hall and each school day starts with worship, only a third of current pupils are baptised. Thirty per cent of students have a migrant background, and 7% are from households where no German is spoken at all.
Even though the ESBC is one of Germany’s 5,000 private schools, fees are means tested and relatively low compared with those common in Britain, ranging between €720 and €6,636 a year. About 5% of students are exempt from fees.
Yet even Rasfeld admits that finding teachers able to adjust to the school’s learning methods can be harder than getting students to do the same.
Aged 65 and due to retire in July, Rasfeld still has ambitious plans. A four-person “education innovation lab” based at the school has been developing teaching materials for schools that want to follow the ESBC’s lead. About 40 schools inGermany are in the process of adopting some or all of Rasfeld’s methods. One in Berlin’s Weissensee district recently let a student trek across the Alps for a challenge project. “Things are only getting started,” says Rasfeld.
“In education, you can only create change from the bottom – if the orders come from the top, schools will resist. Ministries are like giant oil tankers: it takes a long time to turn them around. What we need is lots of little speedboats to show you can do things differently.”
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