According to the US Labor Department, productivity fell at a 1.8 percent annual rate. That could restrain the economy’s growth as “Labour productivity remains the main driver of long-term growth”, the OECD stated in their recent report.
And so we continue the search to determine the factors that’ll propel productivity. From better chairs to napping, what other aspects could we look into?
Here are three studies that can help or complicate our strategies for productivity — that highlights on three determinants: bosses, motivation and pay.
1. Sorting bosses appropriately can increase productivity
The Study: Using data from a large service oriented company, the study examined the effects of bosses on their workers‘ productivity and compared them to individual and peer effects.
Findings:
- Replacing a boss who is in the lower 10% of boss quality with one in the upper 10% of boss quality increases a team’s total output by about the same amount as would adding one worker to the team.
- Bosses are the only “peer” that matters. Peer effects are small or zero, whereas boss effects are substantial.
- Good bosses should be sorted to the star workers because, although good bosses increase the productivity of both good and bad workers, they increase it by more for the top performers.
Read more about the study here.
2. Increased meaning improved effort and motivation
The Study: Subjects at Harvard University were asked to assemble Bionicle Lego models. In both conditions, participants were paid decreasing amounts for each subsequent Bionicle: $2 for the first one, $1.89 for the next one, and so on linearly.
But while first group’s creations were placed on the desk in front of the subject, the second group’s creation were disassembled as soon as they’d been built and after the second Bionicle, the subject was always rebuilding previously assembled pieces.
Findings:
- Despite the fact that the physical task requirements and the wage schedule were identical in the two conditions, the first group built an average of 10.6 Bionicles over 7.2 Bionicles by the second group
- Also the first group earned $2.88 more, on average.
- Seeing the fruits of their labor made the first group more productive.
Read the full research here.
3. Pay discrepancies will demotivate both lower and higher paid individuals
The Study: In the first experiment, 60 future managers from Newcastle, Australia, were paid either $1 or $2 to work on an identical intrinsically motivating task.
In the second experiment, with 84 future managers in Darwin, Australia, the $1/$2 group pay difference was made more realistic, by positioning the pay either at the bottom ($1) or top ($2) rungs of a pay ladder, or embedding it within a wider pay scale ($1 at a first, and $2 at the second tertile).
Findings:
- In the first experiment, between individually paid workers, both below and above average payment were linked to low intrinsic motivation.
- In the second experiment, when pay was polarised, intrinsic motivation was higher in the higher paid compared to lower paid groups; but when pay was embedded, this comparative advantage dissipated.
- Taken together, both experiments suggest that pay diversity across groups will demotivate both lower and higher paid groups. (double demotivation)
You can download the full paper here.
Image sources: Images are free-to-use through Creative Commons Deed CC0 via Pixabay.
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