The Medici Effect : Frans Johansson

Generating ideas that pay for themselves: The relationship between financial reward and creativity appears complex. But it is clear that great work is stimulated by something other than money.

My wife is rarely happier than when she is sitting at breakfast, working on a newspaper crossword. I used to feel excluded by this until, over weeks and months, she explained the constructs of a cryptic clue.

Now we do the crossword together and I notice we get the best results when we co-operate, discussing ideas and perspectives. Sometimes I suggest a race to find the first clue but the pressure of competition tends to stifle our thinking. Instead of experimenting with different propositions, the thinking seems to get stuck in a creative rut.

The same can happen when we link rewards to creativity, according to Teresa Amabile, a Harvard Business School psychologist, who researched the effects of rewarding creativity in a study involving more than 100 children.

The experiment focused on two activities. The first was to tell a story from a book that is made up of pictures with no words. The second involved a Polaroid camera. All the children were keen to take pictures with the camera but one group were told they could play with the camera only if they promised to tell the story when they had finished. They had to sign a note to this effect.

A second group of children were simply told that there were two activities available to them. They were asked if they wanted to play with the camera, then asked to tell a story from the book. There was no suggestion that one activity was dependent on a willingness to do the other.

When the stories of the first group were compared with those of the second, the efforts of the second group were rated as far more creative than those of the first.

Ms Amabile concluded that the external control implied by the reward was sufficient to impair creativity.

A similar experiment was carried out, using various materials to solve a practical problem. One group was offered financial rewards for reaching a high-quality solution in a short time. But the group that was offered no financial reward produced the best result and did it quickest.

Ms Amabile says the experiments expose a link between our intrinsic motivation and the quality of our work. If we love what we are doing, the creativity flows. But pile on some external pressure or link the activity to a reward and our creativity declines. I am not rewarded for completing a crossword but I find it rewarding in itself. It is the same satisfaction you get from a job well done.

This might appear to contradict what we know from the Skinner Box experiments carried out by Burrhus Skinner, the US psychologist, who illustrated the power of rewards by placing a rat in a box with a food dispenser and a button.

The Amabile and Skinner experiments are both discussed by Frans Johansson in a new book, The Medici Effect.* Mr Johansson, however, makes a distinction between linking rewards to clear goals such as the food in Skinner's box, and goals that are unclear or complex.

He also notes that not all rewards have a negative effect on instrinsic motivation.

"Rewards that are provided as testament to competence or as part of a learning experience can prove very effective," he writes. "This means that an innovator should receive the fruits of his or her labour. In fact if such rewards are not given, this is almost sure to stifle motivation."

The reward in this case may be nothing more or less than "credit where credit is due". But how often is the originator of an idea forgotten by those who use the idea? The history of innovation is littered with examples of inventors who see their ideas exploited by others.

Harry Beck, the draughtsman who devised the London Undergound map in 1933 was paid only five guineas for the original work. In fact, his map was rejected by the underground management at first because it was not geographically exact.

However, the map proved popular with the travelling public from its inception and has gone on to become a design icon.

But Mr Beck was unhappy that his work was never properly rewarded: the most visible recognition he received from his employers during his lifetime was a plaque at Finchley Central station in north London.

It could be argued that Mr Beck was doing the job that he, as an employee, was expected to do and that his managers gave him the time and space to be creative. This was Aki Maita's argument when she invented the Tamagotchi toy - the virtual pet that sold in its millions.

Ms Maita did not receive a share of the profits when she invented the toy. She argued that producing and selling the toy had not been her accomplishment alone, but that of a large team. Her role was that of the originator.

Even so, like Mr Beck, Ms Maita received widespread public recognition for her work.
Would either of these inventors have achieved their success had they been competing for some grand prize? We know that financial rewards can stimulate invention. The Pounds 20,000 prize offered by the British Government in the 18th century for the first foolproof way of calculating longitude proved a strong incentive for John Harrison, the clockmaker who devoted his life to the project.

But if the prize was the original stimulus, it was the project and the problem-solving that propelled Harrison's efforts. When you look at his clocks at the Greenwich Observatory, you see a monument to a life of perseverance. Harrison, like Sir Christopher Wren, the architect of St Paul's Cathedral, let his achievements speak for him.

The relationship between financial reward and creativity appears complex. But it is clear that great work is stimulated by something other than money.

Mr Johansson urges people to seek out what he calls the "intersections" between one interest or one way of working or thinking and another. This kind of search, he accepts, can involve taking risks. People may need to pack in their full-time job if they are to put themselves in the best position to innovate.

Does this mean that there is nothing in his book for employers whose workplaces rely for their smooth operation on processes, systems and rules, backed by regular rewards and bonuses?

On the contrary, there is a good deal that managers can draw from this collection of ideas. Perhaps the most valuable lesson for the workplace - something implied rather than stated by the author - is the need for employees to be allowed some discretion over their work. Whenever I have encountered great customer service it has nearly always involved someone adopting discretionary behaviour. Disappointments are usually accompanied by the explanation: "I would like to do this but the rules prevent me."
Every job needs structure and every organisation needs rules. But we cannot expect great work when the rules are perceived as handcuffs.