The last thing Wall Street analysts and investors are thinking about is "feelings." Too bad, because all economic activity boils down to the back-and-forth exchange of rewarding feelings. The visible economy is just a surface manifestation of the emotional exchanges percolating underneath. My “hack” is to expose this subterranean economy to the light of day and repair capitalism in the process.
Human beings, I claim, are primarily emotional creatures and secondarily rational. Feelings are central to human existence because they tell us what we need to survive and the rational mind dutifully attempts to satisfy these vital needs. A simple example of the primacy of feelings in human affairs is hunger. Hunger is the body’s way of saying, “feed me.” If I’m having a hectic day, and a major report is due, I might ignore the initial pangs of hunger and continue to work, but then the hunger signal then escalates to, “FEED ME!!.” Sooner or later my rational mind is going to obey the hunger signal and find a logical path to food. This, I propose, is the fundamental dynamic behind all feelings. They are proxies for our basic survival needs and if we ignore them we are all dead, extinct.
It bothers me when managers refer to feelings and emotions as soft and irrelevant. Extreme emotions may be disruptive and harmful, but subtle, everyday, emotional incentives provide the foundation for our survival and our economy.
If you still believe that feelings are soft and irrelevant, then why don’t we figure out a way to turn them off? This is precisely what happened to 13,000 lobotomy patients between the 1930s to the 1950s. Hospitals at this time had few options for dealing with extreme emotions, so doctors experimented with a variety of surgical procedures in a desperate attempt to them turn off. Surgeons eventually discovered that they could calm frantic patients, and quiet their violent emotions, by damaging a brain area located just behind the eyeballs. These operations succeeded in calming patients’ violent emotions, but they also turned off the subtle, everyday, normal emotions that get us out of bed in the morning, motivate us to care about our friends and family, and motivate us to work hard. By turning off emotions, surgeons did not create hyper-efficient robots. Rather, they created lazy people who were content to sit in their chairs all day staring out the window.
I have studied human motivation for 30 years. I know what the human engine looks like, how many cylinders it has and how companies can tap into it. The human engine is fueled by feelings and if we turn those feelings off, as we did with the lobotomy patients, human beings come to a screeching halt. Furthermore, there are 10 flavors of feeling that motivate us—five that regulate our biologic survival and five that regulate our social survival. We are often unaware of these regulatory feelings because they are subtle and operate on the edge of our conscious awareness. Taken as a whole, human motivation is an elegantly-designed survival system that has allowed a puny primate to thrive in every ecosystem on the planet. It is pure arrogance and hubris, therefore, to make fun of this vital mechanism that makes our very existence possible.
I recommend that we completely rethink how emotions impact business success. One helpful construct is the emotional paycheck. Companies measure monetary benefits to the nearest penny but then proceed to ignore the intrinsic rewards that are every bit as motivating to human beings as money. Companies therefore have a flawed perception of employee compensation and a flawed payroll accounting system. I’ve invented a tool that captures the emotional paycheck by measuring the five pleasures that nature built into our brains to motivate productive human behavior. This tool fixes the broken accounting system and provides executives with accurate compensation data.
I call the emotional paycheck the master metric because it drives everything happening inside a business. If companies can get their emotional paycheck to go up, then every desirable financial, operational and HR metric will go up as well. The logic behind this bold statement is simple; rewarding feelings drive behavior and behavior determines organizational success. It all boils down to how rewarded people feel in their work and money is just part of that reward.
The business logic for paying attention to emotions is simple and compelling: would you rather double your employees’ monetary salaries to get them to work harder, or would you rather create an exciting workplace that boosts the emotional paycheck? In my book, Primal Management: Unraveling the Secrets of Human Nature to Drive High Performance, I explain how to improve the emotional paycheck by triggering human nature's five productive pleasures. I show where these pleasures originate in the brain, which neurotransmitters regulate them, and how managers can tap into them to create a dynamic workplace that fires on all cylinders. If you follow my advice to the letter, you can create a workplace that is so rewarding that your employee might even pay for the opportunity to play!
Working harmoniously with human nature is not that difficult and the payback is spectacular. All we need to do is to shake free of the simplistic money-and-fear approach to employee motivation. The traditional approach is coercive and only taps into 30% of the potential energy our workforces. This more-nuanced approach and will allow us to tap into the other 70% to create a company that succeeds spectacularly by getting the people-part right. This is not just a good way to motivate human beings, it’s the best way, because it aligns harmoniously with the human engine.
Many CEOs have excellent people skills, but they forget to bring them to work. They are stuck in an old-school mindset and see themselves as task masters instead of as motivators and leaders. Here is an example of a people-play; a company that succeeded spectacularly by getting the people-part right.
A former Price Waterhouse accountant was promoted from controller to CEO at the nation's largest designer and builder of hospitals and clinics. He went from managing 20 people to managing 1,000. This CEO had superb people skills, but he wasn’t going to use them. His first instinct was to fall back on his accounting training and start harping about the numbers.
I suggested a radically different path. I told the CEO, “You are not an accountant any more. You are a leader who has to capture the hearts and minds of your employees. Why don’t you tell them, “My primary job as CEO is not to improve profits or increase cash flow. My primary job as CEO is to create an exciting and rewarding workplace that you look forward to arriving at in the morning. If I take care of you, and you take care of the customer, then the numbers will more-or-less take care of themselves.” He followed my advice and I continued to coach him for the next four years.
After four years (2004 to 2008), revenue increased by 200%, profits increased by 300%, the company went from the lowest quartile in employee engagement to the top quartile, and a company that was purchased for $50 million was sold for $250 million. One of the investors, a global private equity firm, said it was the best return on investment in their 23-year history.
Someday Wall Street will wake up and realize that optimal returns occur when enlightened leaders learn how to tap into the motivational engine that drives human achievement. This is the path to a more promising future where everybody wins: employees, managers, customers and shareholders.
The best way to test my hack is to measure the horsepower of your company's motivational engine. This can be accomplished using the reward survey built into The Horsepower SystemTM (see demo at www.horsepowermetric.com/demo.php). If the motivational horsepower is negative, it means that employees find it painful coming to work and that the motivational engine is malfunctioning. If the horsepower is in the 0 to +5 range, it means that employees get intrinsic pleasure from their work that enhances motivation and productivity. If the horsepower is in the +5 to +10 range it means that employees get so much passion and purpose from their jobs that they would come to work just for the thrill of it (assuming that they were independently wealthy, of course)!