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This article didn't talk about incentive pay, it talked about incentive superficialities. Which are of course generally degrading. IMX, incentive pay isn't the

This article didn't talk about incentive pay, it talked about incentive superficialities. Which are of course generally degrading. IMX, incentive pay isn't the same way—provided that it's actually significant, as opposed to a largely-meaningless couple hundreds of dollars or something of the sort—because it's so useful that it's an end in itself. "Don't make your employees feel like they're jumping through hoops" is a good point, and companies would do well to remember it, but when rewards are substantial in and of themselves that problem doesn't come up that much. (Real incentives can still have a bad effect on morale, but in my experience their positives outweigh their negatives.)

timr 18y ago
What makes you think that rewarding someone with a cookie of actual, monetary value avoids the morale problems inherent in rewarding someone with a cookie made of polished lucite? You've still singled someone out as different, created jealousy and division, and alienated the team members who weren't equally rewarded. The problem Joel is describing is inherent to rewarding individuals, instead of rewarding teams. Ratcheting up the value of the award doesn't solve the underlying problem. Not incidentally, Google found this out the hard way with their Founders' Award program (http://members.forbes.com/global/2007/0702/028.html http://members.forbes.com/global/2007/0702/028.html): "Early on Page and Brin gave 'Founders' Awards' in cash to people who made significant contributions....but it backfired because those who didn't get them felt overlooked. 'It ended up pissing way more people off,' says one veteran."
- trominos 18y ago
  Right. It's vital that incentives are not made to feel like "awards," but are instead seen as part of the compensation structure. (I think that the "incentive pay" Joel's talking about really means "public awards, possibly with cash associated.") "Incentive pay" in the simple sense of "pay tied to performance" is not necessarily divisive if it's handled tactfully and can be a substantial motivational force. I mean, that's what PG's always writing about in his essays—the power of a startup is that it harnesses pay very directly to performance.
  - timr 18y ago
    If you keep it secret, then I suppose that incentive pay is less harmful. The thing is, do you really want to go that way? I think that the only way that incentives are not harmful is if they're spread evenly across teams and tied to product success in the market. Most people can grasp why the team behind a successful product is paid more. Even then, though, you risk alienating the teams that don't do quite as well for reasons that aren't in their control.
cubix 18y ago
HN's karma system is a sort of "incentive superficiality", yet it seems to work well enough. Perhaps a similar model of collective peer review could be applied to the work place. It might address some of the injustices that Joel mentioned, such as the strategic thinker whose insights weren't recognized by management, but valued by his peers. Would you be willing to "up vote" your colleagues?

timr 18y ago

What makes you think that rewarding someone with a cookie of actual, monetary value avoids the morale problems inherent in rewarding someone with a cookie made of polished lucite? You've still singled someone out as different, created jealousy and division, and alienated the team members who weren't equally rewarded. The problem Joel is describing is inherent to rewarding individuals, instead of rewarding teams. Ratcheting up the value of the award doesn't solve the underlying problem. Not incidentally, Google found this out the hard way with their Founders' Award program (http://members.forbes.com/global/2007/0702/028.html http://members.forbes.com/global/2007/0702/028.html): "Early on Page and Brin gave 'Founders' Awards' in cash to people who made significant contributions....but it backfired because those who didn't get them felt overlooked. 'It ended up pissing way more people off,' says one veteran."

trominos 18y ago
Right. It's vital that incentives are not made to feel like "awards," but are instead seen as part of the compensation structure. (I think that the "incentive pay" Joel's talking about really means "public awards, possibly with cash associated.") "Incentive pay" in the simple sense of "pay tied to performance" is not necessarily divisive if it's handled tactfully and can be a substantial motivational force. I mean, that's what PG's always writing about in his essays—the power of a startup is that it harnesses pay very directly to performance.
- timr 18y ago
  If you keep it secret, then I suppose that incentive pay is less harmful. The thing is, do you really want to go that way? I think that the only way that incentives are not harmful is if they're spread evenly across teams and tied to product success in the market. Most people can grasp why the team behind a successful product is paid more. Even then, though, you risk alienating the teams that don't do quite as well for reasons that aren't in their control.

cubix 18y ago

HN's karma system is a sort of "incentive superficiality", yet it seems to work well enough. Perhaps a similar model of collective peer review could be applied to the work place. It might address some of the injustices that Joel mentioned, such as the strategic thinker whose insights weren't recognized by management, but valued by his peers. Would you be willing to "up vote" your colleagues?