I’ll pay you more… to hurry up!

Publicado: 15 marzo, 2011 en Uncategorized
Etiquetas:, , , ,

There has been much debate over how one should pay doctors to increase efficiency.  This debate is based on the motivational effect of financial incentives. The underlying premise that if we don’t have incentive to improve our practice/outcome we won’t, and if we are not “punished” for inefficiency we will not modify our behaviour.

Much has been said in favour of pay for performance for medical staff to make hospitals more efficient and cost-effective. But what about its managers? Can we extend this argument to the CEO and Hospital Management?

Hutton argues that we can and should:

“Hutton wants performance-based pay for public sector managers”

Hutton goes on to argue that every level of an organization should be rewarded in proportion to the value of their contribution. Sounds fair enough. But this raises a few questions. Can a sector used to a lack of transparency and unfamiliar with measuring performance-based pay, implement this?

With medical staff we have more or less come up with formulae to measure performance. What performance-based criteria would we use for managers?

However, the more important question is – do financial incentives actually work?

Dryburgh in Management today argues that it doesn’t. He uses the Candle Problem example.

In the 1930s , cognitive psychologist Karl Duncker devised the “candle problem”. With a candle, a book of matches and a box of drawing pins, you are given the objective of fixing the candle to the wall so that it will burn without dripping wax.

Duncker gave 2 groups the problem. The first group were told the experimenters just wanted to time them to establish norms for the task. The second were given a financial incentives – the fastest 25% got $5 and the fastest person that day got $20.

Results: The incentivised group took, on average, nearly three and a half minutes longer to find the solution.

Reason: Solving the problem involves a tricky cognitive manoeuvre, that of overcoming ‘functional fixedness’. You have to stop seeing the box as a container of drawing pins, and start seeing it as a candle stand. The effect of the incentive was to make people concentrate harder, narrowing their focus and making it harder to see around the edges of the problem.


So, what qualities do you want in a manager in your hospital – raw motivation or creativity, intelligence and lateral thinking?

  • You decide.
  1. lacarave dice:

    It is a very important theme in health managament. I hope to deal with it next friday
    Take a look a t this video: http://www.ted.com/talks/barry_schwartz_on_our_loss_of_wisdom.html
    Thank you

  2. Hans dice:

    Take a look at this video: http://www.ted.com/talks/dan_pink_on_motivation.html

    It’s geared toward business, but it is just as applicable to public health.


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