Wednesday, August 12, 2015

Management: Motivated by Profit Or Purpose?

In the video bestselling author of "Drive," Dan Pink is exploring and identifying the personal qualities and essential drives that motivate people. He distinguishes profit from purpose. But that isn't the whole story. There are more essential principles at work that we must try to understand or the consequences can be dire. 

RSA animation illustrating the difference between profit and purpose motive. Full lecture.

In above animation management and business author Dan Pink (site) discovers the difference between the profit and the purpose motive. Conclusions of research into motivation conducted by MIT indicate that even when minor cognitive skills are involved, the results no longer match the rewards. The contradiction rests on two misunderstandings: the theory of behaviorism rooted in the idea that man is no different from any other animal; and the straw man argument that man is motivated by greed. Both prepositions are untrue as we shall demonstrate. It also explains why motivational techniques developed by coaches work very well in sports, but the analogy is stopping short for people involved in mental achievement. 

While mental processes are not automatic, man can't be forced to invent the airplane or the refrigerator on demand. First of all there's the hierarchy of knowledge to be taken into consideration. Flight without the invention of the combustion engine is extremely limited and refrigeration before electricity became commercially available was limited to the ice box. A chemist may conduct experiments until he gets the desired effect, but outcome is never guaranteed. The point is, we can force ourselves to run a marathon or set ourselves to learn playing the violin, but mental achievement isn't possible by force.

As the research by MIT indicated there is a difference between physical and mental exertion. The carrot and stick method is essentially conditioning, like taming a lion, or to teach a seal to balance a ball on its nose by punishing the animal or by rewarding it with food. It doesn't require any cognitive effort on the part of the lion or the seal. This is conditioning. 

Animals have very short memory spans. That is the reason they have no self awareness as is typical for human beings. Like animals, man can be conditioned by punishment and reward to run the thousand meters hurdles or produce a thousand bottles of water a day. But he can't discover the cure for cancer on demand, even if rewarded his weight in gold. It's a process that requires mental endurance and endless trial and error. 

The notion that man is a predator who is solely motivated by greed is a straw man argument to legitimize envy of achievement. While a company must make a profit to continue to exist, the original founders are rarely motivated by profit. The legendary CEO of Apple, Steve Jobs was led by creativity and excellence alone, while Henry Ford's vision was the mass production of the horseless carriage that everyone could afford. (Source) Seldom if ever are visionaries led by financial reward. 

The caricature of the fat, evil, money grabbing industrialist is a product of the prevailing morality of altruism that demands self-sacrifice for the sake of others. As pointed out by Yaron Brook, Director of the Ayn Rand Institute in many of his lectures (source), Bill Gates as the CEO of Microsoft has done more to advance the lot of humanity than he will ever be able to do as a philanthropist. Yet he was hated as an egotistic CEO, but is now loved as an altruist for giving away his money for free. But it is Microsoft's operating system for PCs that has literally changed the course of human history in every way imaginable. 

Because the nature of the human mind is so badly understood today, the danger of drawing the wrong conclusions is very real. Dan Pink doesn't know why, but he recognizes that when the relation between effort and reward is severed, the effect is "crappy products and lame services". Or worse, for example the evils and immorality of Communism! The Marxist idea rooted in Rousseau that is currently also posited by proponents of basic income guarantee (source) -- that individual man can be severed from his economic activities -- has terrible consequences for the whole.

What is true for individual man engaged in mental abstracts does not translate one-on-one to the group or on the macro-economic level. The individual mind may be motivated by purpose, but on the macro level profit is still the bottom line because reality demands it.

The creative process on the other hand belongs to the individual because it is autonomous. A design by a group is a collection of concessions in which everyone's integrity has been compromised. "A camel is a horse designed by a committee."

In the end we are a species living in reality that dictates what we should value. A man who holds values that are counter to his survival doesn't live a long and happy life. Life on earth requires physical sustenance purchased by the excess value we create individually or as a business. Surplus value is expressed in money. Money buys us food and drinks and all the other stuff we need and create for man's survival as a human being.