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The headline read “Google Gives All Employees Surprise $1,000 Cash Bonus, 10% Raise.” While I believe that companies should work to pay employees as much as possible, there is a right and wrong way to do it. From what I have read, Google is doing it wrong. To paraphrase Thomas Gilbert, author of Human Competence, money is a finely honed instrument of motivation and deserves great respect. What Google has done not only disrespects the instrument but also, in my opinion puts Google’s future in peril. CEO Eric Schmidt said that an internal email survey revealed that employees value the salary part of their compensation far more highly than bonuses. Duh! If you were to offer employees a choice between $1000 now and the possibility of $1000 a year from now what do you think they would choose? Behavioral research consistently shows that people prefer smaller, guaranteed rewards as opposed to larger, future and uncertain ones. From a behavioral perspective, I see several problems with Google’s actions:
Are there any positives?
In the face of an increasingly competitive environment in the not too distant future, Google would do better in my opinion to put all this money into performance bonuses. The same things that made Google what it is today are not the things that will keep it there. In the early days at Google generous benefits, high salaries and a lavish work environment were small positives compared with the reinforcement associated with being part of groundbreaking and popular technology. In the beginning, being an employee of Google brought admiration and awe. Now this is available at other companies as well. If Google continues to disrespect money in this way, there may be more “Facebooking” than Googleing in the future.
© Aubrey Daniels International, Inc. All rights reserved. 2022