In a study that was conducted by economists at MIT, Carnegie Mellon University and the University of Chicago, it was discovered that executive compensation plans that offered financial rewards for higher performance actually had a negative impact on performance. The Federal Reserve Bank of America sponsored the study.  In a similar study led by Dr Bernd Irlenbusch of The London School of Economics also came to the conclusion that financial incentives can result in a negative impact on overall performance.  That was after they studied 51 performance based compensation plans.
On both these studies it was found however that the only time the compensation plan worked was when people had to do mechanical tasks and didn’t have to do any form of independent thinking. This seems to imply that there is mismatch between what social scientists know works and what actually is happening in the world of business.
Still on both occasions these studies found out that if you give people autonomy of their time and let them choose the direction of their work, they would choose work that they felt had meaning for them and as result productivity went up. Employees are looking for autonomy, purpose and mastery. We have work but we are more productive if we are engaged in tasks in which we believe and not tasks which we are expected to do because we have been told to do them.
This means that people should challenge themselves and their teams to search for meaning in the work they do because the more meaning and sense of connection employees have the more loyal and productive they will be. It is not really about money. Of course money has its place, but what employees are really looking for is the sense that their work matters and as a consequence of that their life matters too.
Often managers want to motivate their staff by offering financial incentives. However, financial incentives only work only when basic functions of work are involved. The minute work begins to get complicated they cease to be effective. 
Does this mean that parents and managers should stop offering financial incentives for higher performance? Not necessarily, but it simply means that they should begin to encourage to take ownership of their own motivation and work with people on the basis of intrinsic and not extrinsic motivators. Let people find meaning and attach meaning to their work. A good manager or parent therefore finds intrinsic motivators that work for each of her employees or children and then taps on to that rather than offer financial reward.
Science tells us that trying to get people to perform by offering them the juiciest or promising to whip them with the sharpest stick doesn’t work. If people have a sense of independence over their time and the work they do then inevitably productivity goes up. This also adds scientific evidence to the argument that if you do it for the money you will fail but if you do it for love the money will follow.
Which leads me to question what are you doing after 5pm today? What do you do in most days after work? A day is made up 24 hours and if we divide those 24 fours by three then you have three installments of 8 hours. We spend roughly 8 hours at work and experts tell us that we should get at 8 least hours of sleep every night. This means you are left with 8 hours discretionary time each day of the week during which you can do as you please. My question to you is what are you doing with that time?
Are you using that time productively or are you squandering it? Are you only holding yourself accountable for the hours when you are at work? Success is never about doing the things because you have to do them. It’s about doing things because you want to. That is why it is your responsibility as an individual that deserves to succeed to choose your work and to ennoble that work by giving it meaning. What would be the difference between you and the donkey that pulls a plough if you cannot ennoble work with meaning? We as human beings are different from all other life forms because we can talk about such things as purpose, independence and the desire to master ourselves through our work. Therefore whether you are dealing with employees or your children money and material things should be the last things you offer as a reward for financial performance. You want people to find meaning in what they do because when they find meaning they will inevitable hold themselves accountable to a higher standard that they believe is necessary. This self-policing doesn’t end at 5pm but also extends into the other 8 hours of discretionary time.
 
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