Getting the right incentives for creative thinking

One of the things I’ve been doing lately at work has been setting KPIs (key performance indicators, for those readers lucky enough not to have to keep up with corporate jargon).

Coincidentally, this TED talk appeared in my itunes podcast feed:

Basically, Pink says that if you are asking someone to do something that requires creative (as opposed to sequential) thinking, then offering a monetary reward for speed is not just useless, but counterproductive. The main KPI I have for my team (from my manager) is “insightful analysis”. That means that I want my team to come up with new and interesting insights about our business, to help the business manage better. That is unlikely to be a sequential, defined task – some of it might be, but the good stuff really requires insight and creativity. So setting that KPI, and offering a hefty bonus for it is possibly counterproductive!

That’s the structure of remuneration at my company – set a KPI, and offer a differential bonus to go with it. But I’m starting to think that my previous manager was right  – make them vague, and offer a bonus based on judgement of the overall job done at the end of the year.