Speaking at TED, Dan Pink presents interesting thoughts regarding business, incentives and the systems that businesses work within to motivate and reward people for productivity.

Taking notes from highly regarded social science, Dan highlights surprising historical facts that lead him to believe that 21st century businesses are fixated on the wrong rewards.  And he adds that there’s a vast disconnect between how our leading businesses function and the mostly ignored conventional wisdom (confirmed by quantified human behavior research) from social science.  These truths of social research point to the fact that monetary rewards might concentrate one’s focus and push you to a defined linear path, but it ultimately narrows your view of how to solve a problem.

“The assumptions of underlying protocols beneath our business practices, of how we motivate people and apply human resources around extrinsic motivators.. it’s for 20th century tasks, 20th century thinking.. not 21st century business.” [loosely quoted from Dan's TED talk]:

A few thoughts on what this means for business, marketing and digital engagement:

1. Give people an open forum to create, build or think about solutions for you.  The most interested and suited to help you achieve innovation are likely to not be incentive’s by cash reward, points, or “prize”.  If it’s a compelling problem they may simply get rewards for being able to solve the problem and working with a cast of previously unaccessable others to get the job done.  Trick is here is that currency = releasing insider info, giving recognition and providing open access.  Sound familiar? Yup it’s a lead user strategy.  For employees it means a portion of unregulated free time to be autonomous (which is essentially a “free agent” philosophy.)
2. Currency for motivation is becoming more intangible.  With social technologies, social media and social advertising , a fun/ surprising reward can be more motivating than a functional cash incentive or discount.  A competitive, peer interaction and temporal element drives motivation.  Case in point look at how  4Square drives engagement.
3. To spark creativity don’t be so organized or rules-based in how you motivate people to tackle a creative problem (or in how you provide creative direction on a marketing assignment).  Also don’t reveal all the answers that you think will lead to the solution.   Give people a healthy and wide range of ingredients to play with to solve a variety of possible problems together.  Sharing,  communal element, interaction and recognition are the reward (.. and in the case of BarCamp.. perhaps some beer.)
4. Life’s a game.. so is business.  Create business practices, marketing programs and customer interactions that use game development as problem solving mechanisim and as a structure for people to interact, prototype, etc..  take notes from Jane McGonigal’s past successes if this sounds a bit whimsical for you.

See Dan’s full TED Video after the break.

UPDATE: More about science of motivation and productivity via Guy Kawasaki:

1) How leaving people alone makes them more productive and innovative http://adjix.com/3zba

2) More on Innovation at http://innovation.alltop.com/